Last year, NEC Contracts released a new set of contracts specifically designed for the procurement of facilities management services. NEC worked with the Institute of Workplace and Facilities Management (IWFM) to develop the contracts, ensuring that they demonstrate and encourage best practice. Containing four contracts and supporting material the suite is suitable for “total FM” and single or multiple supplier FM contracts.
As with all NEC4 contracts, they are based on three core principles – supporting good relationships between all parties; suitable for a variety of commercial situations and locations; and are written in clear, simple terms. The contracts are accessible to the sector with recognisable terminology and processes.
As with many client/contractor industries, facilities management can suffer from contract disputes and adversarial contracting and procurement strategies. Additionally, with such a vast and diverse sector, there are varying levels of experience in procurement and management of contracts. The NEC4 Facilities Management Contract represents the first suitable, up-to-date standard form of contract.
The use of this contract offers the opportunity to simplify and streamline the procurement process which is often troubled by inefficiencies. Adopting a common form of contract will strengthen the sector’s standing and raise confidence in delivery.
There is a growing trend towards larger agreements in both the public and private sector. Given the nature of these agreements and the complexities associated with larger contracts, understanding roles and responsibilities becomes vital in promoting transparency and good management practices. Challenges can arise from the range of services required and any standard contract must be extremely flexible.
NEC is already well suited for flexibility, already being used on a wide variety of projects within the built environment. There are processes which are built into the operation of an NEC contract that facilitate flexibility during its lifespan. While these processes may not be extensively used within the FM industry currently, they are supported by comprehensive explanations in the user guides and there is further training available.
The new contracts enable the facilities management sector to offer more integrated and consistent procurement strategies, add value to the supply chain and develop more collaborative relationships. Uniquely, every NEC4 contract states that parties are required to “act in a spirit of mutual trust and co-operation”. This differentiates NEC from traditional contracts which follow an adversarial approach.
Additionally, the need for greener growth makes collaboration even more important. NEC has also recently released a new secondary Option clause which is designed to support climate change reduction aims and enable clients to engage their suppliers to drive towards net zero.
NEC, IWFM and the Social Value Portal have also issued a practice note to accompany the NEC4 Facilities Management Contracts which highlights the importance of Social Value in UK public sector contracts. Crucially, it is important to consider how facilities can create Social Value and how FM professionals have an important role to play in delivering benefits to local communities and wider sustainability objectives. The NEC FM Contracts offer clients the option to detail their Social Value requirements, measures and/or targets.
As the facilities management industry becomes more open to change and eager to adapt to new ways of working, the NEC4 Facilities Management Contracts offer an opportunity to drive efficiency and best practice in procurement. With a foundation in delivering flexibility and collaboration, the new contracts aim to improve the procurement and delivery processes.
More information about the NEC4 Facilities Management Contracts is available on the NEC website – neccontract.com/fm
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