How Yorkshire drives sustainability through collaborative procurement evaluation

YORbuild is a contracting framework for construction and renovation works. It is designed to align the evaluation criteria used by public organizations in the Yorkshire and Humber region (UK). The framework’s evaluation criteria are linked to the region-wide strategic goals of increased local economic development and environmental sustainability.

Between 2009 and 2020, 820 projects were contracted through the framework to a total value of GBP 1.5 billion. The framework helped ensure that the investment resulted in more employment training, greater engagement with the local economy, and notable environmental impact.

Procuring for regional results

Aligning procurement evaluation criteria with your City’s strategic goals makes every investment count without undermining your best economic value objectives. In the Yorkshire and the Humber region, construction accounts for the largest share of local government expenditure in the region, amounting to GBP 1.2bn per year. Embedding local economic development and environmental sustainability as part of these contracts presents an enormous opportunity to increase the impact of public investment.

The challenges of aligning procurement

Alignment requires the coordination of local authorities (in this case 22), public sector bodies and third sector organizations, each with their own evaluation criteria and preferences. Introducing socio-economic and environmental evaluation criteria can also add layers of complexity to an evaluation process. Procurement professionals, for example, may have to do a case-by-case analysis of each proposal to assess whether they are aligned.

How YORbuild addresses these challenges

The YORbuild contracting framework was designed to streamline this process. It provides an efficient and collaborative vehicle through which governments can procure refurbishments or new building projects. At the center of the contracting framework are four sets of open and clearly communicated evaluation criteria, aligned with the region’s overall strategic goals.

Breakdown of evaluation criteria

The scoring of YORbuild contracts was decided according to flexible price/quality weightings based on the following evaluation criteria: 50% price, 35% general quality, 5% environment, and 10% social responsibility. This last criteria was in turn broken down into employment and local economy, as detailed below.

Environment

Evaluation included a commitment to waste reduction and recycling, as well as carbon reduction techniques and renewable energy technologies. All bidders had to present three examples of past experience in sustainable construction.

Employment

Along with the project proposal, bidders also had to quantify their commitment to the following:

• number of school/college site visits and workshops
• participation in university research
• work experience placements for 16–17 year old
• work experience plus professional qualification for people aged 18+
• apprenticeships
• development of the existing workforce

These were compared to industry benchmarks and scored accordingly, to be included in the tendering evaluation.

Local economy

The tendering evaluation procedure asked potential contractors to explain their supply chain management, efforts to integrate local SMEs, and commitment to sourcing building materials and machinery made within the region (providing examples of past experiences). Additionally, preference was given to contractors who could demonstrate a relationship with charities, community groups, or social enterprises.

As part of SME integration and supply chain management efforts, the YORbuild framework was broken down into six price bands to encourage a greater diversity of contracts and ensure equal opportunities for both large companies and SMEs. The project also included a series of ‘Meet the Buyer’ events, where the network of almost 300 regional YORbuild member SMEs could engage with buyers and learn about tender opportunities in more detail.

The cost of setting up the framework was partially covered by GBP 250,000 funding from the Regional Investment and Efficiency Partnership. Additional running costs are covered by fees charged to users of the framework, calculated in relation to the estimated cost of construction.

Results

The framework was launched in December 2009 for an initial period of 4 years before being extended for an additional two (expiring in November 2015). By July 2014, the framework had implemented 355 projects to a value of GBP 700 million. The Framework consisted of 39 contractors, 80% of which are regionally based. The standardized and regionally aligned evaluation criteria helped ensure that all awarded contracts were in line with the region’s overall strategic goals.

By October 2014, the contractual social responsibility criteria outlined above resulted in the following outcomes:

• 10,988 student site visits and workshops
• 5,641 apprenticeship weeks
• 498 work experience placements
• 613 new employees
• 85,000 tons of waste diverted away from landfill
• Over GBP 250 million contracted or subcontracted to SMEs

The standardization of procurement contracting and evaluation helped local government bodies procure more effectively.

By July 2014, benefits to public organizations from YORbuild included:

• Over GBP 57 million (7.7% of works value)
• No litigation costs — no litigation in any of the 355 schemes
• 74% of schemes delivered within original budget
• 81% of schemes delivered within agreed timescales.

The pooling of demand behind a common set of evaluation criteria sent a strong signal to providers. The region-wide standardization of these evaluation criteria created a reliable market opportunity for these deliverables. Providers could invest time, energy and money to incorporate these values into their delivery, knowing it would increase their contracting opportunities in the long term across a variety of projects.

Moreover, the standardization of the procedure and incorporation of EU legislation requirements from the start also meant the procurement process proved to be quicker, easier, and more cost effective for all parties involved (in some cases reducing it from 36 to 12 weeks). This success has resulted in the current development of a second revised follow up framework: YORbuild 2.

Takeaways

The YORbuild contracting framework highlights the value of a robust set of evaluation criteria that takes into account economic, social and environmental variables. By aligning how GBP 700 million of procurement contracts were evaluated, it helped contribute to the delivery of the regional goals of local economic development and environmental sustainability. A common contracting framework makes creating impact through procurement easier for public bodies, while also stimulating supply, scaling up demand, and creating stable market opportunities.