What is the updated Construction Playbook?
The Construction Playbook will be familiar to many but by way of brief background, it sets out the Government’s expectations of how public projects should be assessed, procured and delivered. It contains 14 key policies that emphasise longer-term contracting across portfolios, encourage modern methods of construction (“MMC”), and focus on outcome-based specifications [1].
The aim of the Construction Playbook is to change how publically procured construction projects are managed and delivered, with a focus on “getting it right” from the start.
All central government departments and their Arms-Length Bodies (“ALBs”) are expected to follow the Construction Playbook on a "comply or explain" basis, although they can depart from its recommendations in certain situations.
On 5 September 2022, the Government published an update to the Construction Playbook. The original 14 key policies set out in the first edition remain the focus, however, there is some important new guidance.
The updated Construction Playbook includes an "expectation" for Government departments and ALBs to set targets for the level of use of MMC in project delivery. This reflects the progress MMC has made over the last couple of years to reduce both the cost and environmental impact of projects. It does so by utilising alternatives to traditional methods of construction, such as off-site fabrication. The Government is keen to use MMC to deliver improvements in productivity, efficiency and quality for both the construction industry and public sector.
The update also includes an endorsement of the 24 recommendations set out by Professor David Mosey in “Constructing the Gold Standard”, which was published in December 2021. Taken together, the Construction Playbook and the Mosey recommendations encourage a move towards greater collaboration and transparency at each stage of publically procured construction projects.
Whilst the Construction Playbook is part of a wider focus on construction and infrastructure to encourage economic growth, it also recognises the industry's role in achieving the UK's target of net zero greenhouse gas emissions by 2050. A new principle has been added, requiring all contracting authorities to benchmark greenhouse gas emission and social value deliverables at each stage of business case development. In addition, the updated Construction Playbook encourages the use of The Chancery Lane Project clauses, which are designed to create new market norms as to how climate change risks and issues are addressed in contracts. This increased focus on the environment is what this article will look at in more detail.
Net zero and environmental strategies in the updated guidance
Improving the sustainability of UK construction is vitally important. The Government is the UK's largest construction client and it has committed to supporting the adoption of a more sustainable business model within the UK construction sector. The UK Green Building Council estimates that the built environment in the UK (including surface transport) is currently responsible for 42% of total UK greenhouse gas emissions. Reducing built environment emissions is therefore an essential goal if the UK is to reach its legally mandated goal of achieving a 100% reduction in Carbon emissions by 2050 relative to the 1990 level [2].
The guidance [3] published with the Construction Playbook sets out that all contracting authorities should have strategies in place for achieving net zero carbon by 2050 in relation to construction and operation emissions across their estates. It states that in considering how to reduce carbon emissions, contracting authorities should take a whole life approach to mitigating carbon; ensure due consideration is given to issues such as waste and recycling, sustainable sourcing of products and materials; and the objective of developing a circular economy.
In addition, the guidance states that contracting authorities should consider how to incorporate other environmental objectives in their organisational strategies. This includes the delivery of mandatory requirements, such as biodiversity net gain (as introduced through the Environment Act 2021), but also wider environmental benefits consistent with the UN Sustainable Development Goals such as better air, water, and soil quality.
By focusing on improving environmental outcomes and shifting priorities to a more holistic view of ‘value’, the updated Construction Playbook and related guidance hopes to be able to influence the wider sector’s attitude to sustainability. The aim is to create a clear line of sight right from the start of a project for how sustainability objectives can be incorporated and delivered. How successful this will be may depend on how well and how quickly contracting authorities are able to translate strategies into practice, not to mention how well contracting authorities adapt to external influences such as the cost of living crisis and a looming recession.
Supply chain decarbonisation
The updated Construction Playbook and guidance recognises that supply chains make a significant contribution to the overall emissions of construction projects. As a result, it contains a recommendation for contracting authorities to factor this into their procurement strategies.
At the supplier selection stage, the Government has already put in place a practical measure which is likely to encourage supply chain decarbonisation. Procurement Policy Note 06/21 (“PPN 06/21”) requires suppliers who are bidding on central government contracts over £5 million p.a. to commit to achieving net zero by 2050 and to detail their organisation’s UK greenhouse gas emissions via the publication of a Carbon Reduction Plan.
The Government’s purchasing power means that measures such as PPN 06/21 will have a significant impact on construction supply chains. Contracting authorities who are not subject to the PPN are also encouraged to adopt it voluntarily. By encouraging the supply chain to change their working practices for public contracts, it is likely the new ways of working will filter into private sector projects as well.
Waste and resource efficiency
The updated guidance suggests that contracting authorities should consider the principles set out in the Environment Act 2021 prior to launching any public procurement, including:
- The integration principle, which proposes that policymakers should look for opportunities to embed environmental protection in fields of policy that have environmental effects;
- The prevention principle, which suggests that government policy should aim to prevent environmental harm and look to ensure that environmental damage, such as CO2 emissions, pollution or biodiversity loss, is avoided;
- The rectification at source principle, which states that environmental damage should, as a priority, be addressed at its origin to avoid the need to remedy its effects later;
- The polluter pays principle, which means that, where possible, the costs of pollution should be borne by those causing it, rather than the person who suffers the effects of the resulting environmental damage, or the wider community; and
- The precautionary principle, which assists the decision-making process in the face of a lack of scientific certainty.
By considering and implementing these principles, the guidance suggests contracting authorities will be better placed to facilitate outcomes that benefit the environment.
The bottom line
Sustainability is a priority under the updated Construction Playbook. The requirements for contracting authorities to have strategies in place for achieving net zero and for all supply chain members to use resources more efficiently could have a profound effect on the environmental impact of construction in the UK. How far these aims go to facilitating actual change remains to be seen but nevertheless remain a welcome step in the right direction. Public spending constraints may impact the pace of adoption.
[1] https://www.gov.uk/government/publications/the-construction-playbook
[2] https://www.ukgbc.org/climate-change-2/
[3] 20220901 Carbon Net Zero Guidance Note (publishing.service.gov.uk)