A new survey from the NBS has revealed the number of disputes reported within the construction sector remain widespread…
The National Building Specification (NBS) has released the findings of its third major survey investigating construction contracts and other legal issues. The survey, which questioned more than 20 industry bodies, encouraged organisations to share their legal and contractual experiences over a 12 month period.
The survey, which was previously conducted in 2011 and 2012, has been published at a time when construction output is at its strongest since the recession. This, The NBS said, indicated that disputes within the sector remain unchanged.
The report stated 90 per cent of respondents questioned in 2012 thought the number of disputes in the industry had increased or stayed the same. Those questioned in this year’s survey said they thought this figure also remained unchanged.
Reasons for this during the recession were thought to be due to a lack of work and low-value contracts only being made profitable through disputes. However, this latest survey suggested this is not the case and the NBS said it was likely the adversarial legal process is simply an inherent issue within the sector.
Other findings from the survey included greater cooperation in the sector, with 62 per cent reporting they had been involved in some form of collaborative working within the past 12 months. A total of 81 per cent said they believed this enabled information sharing, while 65 per cent said it reduced the number of disputes that arose.
In the introduction to the survey report, CEO Richard Waterhouse said: “Although we have issued these reports in different economic climates, the central themes remain consistent: the need for collaboration, the damaging effect of disputes and the often adversarial character of construction.
“These themes are not new: Egan and Latham clearly described them more than twenty years ago.
“What is new is the assortment of ways in which, together, we can create, aggregate and analyse construction information. We now have innovative ways to address old problems.”
The NBS also said companies needed to utilise building information modelling (BIM) more efficiently, as this is key to overcoming barriers to collaborative working.
BIM, which has become a major facet of the sector (and a significant part of public sector contracts in particular), is changing the face of the construction industry. The report noted the vital role of BIM and the importance of all organisations in embracing it.
“By 2016 all government-funded construction projects will require 3D collaborative BIM, irrespective of project size. So collaboration is at the heart of the Government’s construction strategy,” continued Waterhouse.
“BIM allows for collaboration to be well described, for it to move beyond a shared project ethos, to a clear description of who is responsible for what, when, and how that responsibility integrates with the responsibilities of others in the construction team.
“BIM can, does, and will provide increasingly better descriptions of buildings, and the responsibilities for design and construction. The NBS BIM toolkit is one way in which these descriptions can be clearly given, in a standard, sharable format.”
Currently, only 14 per cent of those who responded to the survey have integrated BIM fully into its contracts. The report said the legal framework should evolve to recognise changes BIM will bring to the sector.
He added: “The 2016 BIM mandate is just the start of the transformation of the industry. While not yet fully defined, Level 3 BIM will be next. Level 3 will mean full collaboration between all disciplines, using a single, shared project environment.
“As we have seen with Level 2 BIM, those who are early to adopt new working practices are those who see the financial benefit most quickly.
“So too with Level 3 BIM: those who move to fully digitised, collaborative working that takes place within a fit-for-purpose legal and contractual framework will be at an advantage.
“Those who maintain a non-collaborative approach, using disputes to gain additional revenue contract by contract, may find the projects of the future closed to them.”
One of the more interesting aspects to come out of the survey was the growth of bespoke contracts. This has risen from 42 per cent in 2011 to 51 in 2015. Additionally, the use of NEC Professional Contracts rose from 15 per cent to 37 during the same period.
The NBS said the move reflected the changes in the sector, with organisations increasingly using contracts that are suited to higher value, collaborative projects.
Discussing the survey, head of research, analysis and forecasting Adrian Malleson said: “The results of the survey offer a valuable insight into an industry that is open to increasingly collaborative working, yet at odds with an often combative legal process.
“The number of respondents (981), including clients, contractors and consultants offers an all-encompassing view of the industry and will allow each group to better understand the issues facing each other, in the hope each may collaborate better.”
For more details, view The National Construction Contracts and Law Survey 2015.