Looking forward to the new Procure 2020 construction framework and the new Hilary Mantel novel

A new procurement framework is imminent in the territory of NHS capital spending. It will be part of the answer to the burning question of how we are going to get those “40 new hospitals” and we will learn more at the HSJ Strategic Estates Conference next month. How fitting that the narrative will advance just as we are queuing to buy our copies of The Mirror & the Light, the third part of Hilary Mantel’s literary fiction about Tudor England. Here we speculate what the new framework might offer to an NHS estates sector eager for solutions.

ProCure 22 will be replaced by a new, central framework to be called “Procure 2020” from October 2020. The new framework will last 6 years, which is notable in itself, and longer than its predecessors. The length of the framework is consistent with the well-known intention to deliver the “40 new hospitals” by 2030.

We are told the new framework will be split into at least two lots:

  • Lot 1: for projects worth over £100m – to which Trusts are steered if in receipt of Health Infrastructure Plan money;
  • Lot 2: for projects worth between £25m to £100m.

Additionally, it seems DHSC intends to take a regional approach to procuring smaller projects including refurbishments of a value up to £25m. These are going to be split into four regional Lots: North, Midlands, London and South. This appears to denote a change of approach by DHSC and we wonder if these lots may take a little longer to be awarded?

Meanwhile the P22 Framework remains in force. Employers needing to seek a construction partner before 1 October can continue to instruct members of the ProCure 22 Framework until it expires on 30 September. Provided an appointment is made by that date and work carried out is within the scope of the original appointment, the work can continue after the expiry of P22 on 30 September. The 30 September cut-off date applies only to new appointments. This is worth bearing in mind if it turns out that an employer’s preferred contractor does not make it onto the P2020 Framework – it may be possible to engage the contractor under P22 if the employer moves quickly.

We gather the opportunity is for 6 to 10 contractors to get onto the panels for each of these lots. ProCure 22 was open to non-health organisations, but how often was it used by other public bodies? There is a market for frameworks themselves, and it is a competitive one – but contractors and employers have both been known to lament the difficulties of deciphering which framework to deploy. We look forward to learning how the regional lots in particular will take us forward in that respect.

It will be interesting to see the style of engagement with the construction industry with the move away from the approach taken by ProCure 21 and ProCure 22, and whether the contract stages and processes will be clearer and easier for employer organisations to use. We hope that the contract terms will standardise stronger protection against the financial fragility shown by parts of the construction industry in recent years. We hope it will pay closer attention to the growing likelihood that individual projects may have numerous end users and occupants, whose requirements are likely to change, requiring flexible design and construction.

In view of the speed and intensity at which the Government has tasked NHSE&I to oversee this expenditure, it is to be assumed that the contracting approach will look to favour a rapid progression from early stages through to the construction phase. Altogether, that will amount to a change in mindset compared to recent years, and one in which costs can rack up faster than the employers under these contracts are likely to find it easy to keep track of.

This new procurement route will be timely for organisations with projects that have been approved and have the funding to proceed. It will be encouraging for those with a more tenuous green light. It suggests the route by which those favoured projects can attain formal approval may soon become apparent.

These days the decisions about what to build can be refined with the active and early engagement of the contractor. The original vision for “Project Phoenix”, the initiative which the centre abandoned last year, was to create a more collaborative, partnering approach with the construction industry, focused on strategic planning. It will be interesting to see if something similar will be possible under P2020, especially in the smaller, sub £25m projects, where wider partnering with a local/regional provider, across an ICS-wide area, may be beneficial.

What if opportunities for commercial investment emerge as a part of the evolving picture – can we foresee what types of projects might go down that route and at what scale? Would they stand completely outside of the reach of the Procure 2020 framework? P21/P22 were exclusively designed for traditional, public funded construction projects and we do not expect this to change with the new framework.

We are awaiting clarity on the future role for commercial sector investment. Will any new models for partnering with the private sector appear, or permissiveness relax around any existing ones? At the HSJ Strategic Estates Conference in 2019 the Treasury line was that public money would be allocated to a project only after other reasonable options had been explored. A few days later, Project Phoenix, one of the only alternative options which existed, was cancelled. It has been a long 12 months since then before the more recent change of tone. There are investors and developers with models up their sleeves, and there are NHS organisation who are keen to engage with them, but only wondering how to do so, and who to ask, and dare they do so or should they wait?

Let’s all re-read Wolf Hall and Bring up the Bodies and remember how we got here. The Mirror & the Light promises to be a lengthy read but an exciting one: we will learn to feel how it came to pass that the monasteries were brought to sudden ruin. Many of us hope for a yet more rewarding experience in 2020: to learn how the healthcare estate can soon be renewed.

We will revisit these themes after the big launch in March….