Express LIFT – the new procurement process for NHS primary care construction jobs – has experienced a rapid pruning process in the past months. At the beginning of September more than 100 construction industry chiefs attended the initial Express LIFT bidders’ day.
The latest incarnation of the Local Improvement Finance Trust scheme – to build new healthcare facilities – attracted 28 consortium bids. By the beginning of October these had been cut to a shortlist of 14. A final framework list of between six and 10 firms is expected by the end of the year.
The successful bidders will then compete for 20-year LIFT co-partnering deals with Primary Care Trusts worth a total of £1 billion.
The slowdown in the construction industry has meant that more construction firms are looking to get involved in LIFT. Express LIFT provides a timely opportunity for them to do this.
With a focus on smaller deals and portfolio development, LIFT remains a good area for contractors that have a healthy balance sheet. The new players, unless they have relevant experience, will do well to team up with firms already working in the sector.
Research by Infrastructure Journal reveals the setting up of LIFTcos has been a painful process in terms of time – from OJEU to signing can take 12 months.
When a new LIFTco is established, a pipeline of projects is supposed to come through – but for various reasons many LIFTcos have not had that work.
They may have done an initial couple of projects and then been given no new schemes. Rob Harrison, of law firm Bevan Brittan, said: “In many cases, there is no real partnering going on and even though they’re supposed to be in a partnership – it’s still an ‘us and them’ mentality.”
The Department of Health said: “For the first time ever neither the bidder nor the PCT will need to engage potentially wasted design analysis and as a result wasted bidder costs will be minimal.”
David Hudson, chief executive at property developer Guildhouse, said: “The big plus of the Express LIFT is that it is a way of getting competition into projects without going through this huge process with three teams.
“It’ll put a stop to three teams designing two or three buildings with three lots of meetings.”
Express LIFT is expected to be a quick method, with minimal set-up costs and work required by the private sector – both welcome elements in a market that seems to be slowing down.
But with the economic situation increasingly precarious, questions are being raised as to how quickly Express LIFT can move forward.
Toby Stokes, relationship manager at Norwich Union, said: “It is possible that the current market may affect how much funding an individual PCT has and in turn this may affect their timing for establishing a LIFT company.”