SMEs encouraged to pitch for £1.1bn defence frameworks

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SMEs encouraged to pitch for £1.1bn defence frameworks

The Defence Infrastructure Organisation (DIO) has unveiled two previously delayed regional construction framework contracts, together worth £1.1bn.

The South West Regional Capital Works Framework contract is estimated to be valued up to £700m.

The South East Regional Capital Works Framework contract is valued up to £400m.

Contractors are now being invited to bid for places on the frameworks, which cover projects with an individual value of up to £12m, such as construction of offices, messes, accommodation, garages, workshops, hangars, medical, sports and teaching facilities, armouries and guardrooms. 

SME firms (small- and medium-sized enterprises) are being encouraged to pitch. Potential framework contractors will need to show a minimum turnover of £18m along with recent experience of managing construction projects worth more than £5m. Subcontractors who do not meet these thresholds may have an opportunity to support the potential framework contractors.

Both frameworks have been developed under DIO’s Next Generation Estate Contracts (NGEC) programme.

DIO sought initial expressions of interest in these particular contracts in 2011, along with another four UK Regional Frameworks. It was subsequently decided to await further detail on military rebasing plans emerging from the Strategic Defence and Security Review (SDSR) before proceeding further with procurement, to ensure adequate future demand for construction projects.

Matt Foley, Head of NGEC, said: “DIO’s priority is to support our Armed Forces by providing the places they need to live, work, train and deploy on operations. Capital works framework contracts offer a flexible commercial structure that allows the DIO to adapt to the ever changing requirements of the Defence frontline.

“In order to meet the high standard expected across the Defence estate and deliver value for money, we encourage a cross-section of companies, from multinationals to small and medium-sized enterprises to participate in the procurement process.

“This will help us to ensure that we can identify the best, most experienced range of contractors and subcontractors as part of this competitive process.”

Each of the South East and South West Regional Capital Works Framework contracts will include a pool of up to five pre-approved principle contractors who will participate in ‘mini-competitions’ for individual contracts allowing DIO to identify the most cost-effective provider of design and build projects.

Tender adverts have been published in the Official Journal of the European Union (OJEU). Pre-qualification questionnaires (PQQs) must be returned by 30th April 2014.

It is expected that the framework contracts will be awarded by summer 2015 with each of the framework agreements running for four years, with an option to extend up to a further three years.

DIO frameworks projects manager John Jones said: “DIO is pleased to welcome Interest from both large and small businesses in these two Regional Capital Works Framework contracts in the south of England.

“Bidders will be required to deliver a complex and diverse range of facilities for the Defence estate. In addition, the Framework contracts will also be used to procure a significant proportion of work in support of military rebasing up to 2020.”

The framework contracts will operate in parallel to the National Capital Works Framework contract for projects worth up to £50m.

DIO will host an industry day at the Tidworth Garrison Theatre in early April 2014 for potential framework contractors and subcontractors to provide an overview of UK Defence, the NGEC programme and the scope of both the South East and South West frameworks. The event will also provide opportunities for subcontractor and supplier networking. Instructions for attending this event can be found via a separate link from the OJEU advert.



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