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Clients can generate the most construction cost savings, says Morrell

Clients must improve how they procure from the supply chain if they are to contribute what will likely be the biggest savings to be made in construction costs, the government’s chief construction adviser Paul Morrell said this week.

Speaking to NCE ahead of today’s launch of a Cabinet Office report into construction cost benchmarks on government projects, Morrell said he believed that clients were the key. By knowing how to ask for what they need, he said clients will create a great deal of efficiency that will contribute the most to the government’s plan to achieve 15% to 20% savings on government construction projects by 2014/15.

He said the provision of the document outlining benchmarks for construction costs and cost reduction trajectories – that is the speed of cost reduction – would enable them to do this by giving them more information to work from. For instance, data on school building between 2006 and 2010 shows cost variations ranging in the extreme from between around £700/m2 and £4,500/m2.

By having that information, clients would be able to see that the cost they expect to pay should be in the region of £1,500/m2 to £2,000/m2, which is a more typical cost. “Benchmarking is going to be a part of being a skilled client,” he said.

However, he said it was not simply the responsibility of clients but also the supply chain. If the suppliers know that the client is ill-informed then they should help inform them. “If you think we’re asking a dumb question, then tell us,” said Morrell. “They [suppliers] can contribute and say: ‘Here’s a better way.’”

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