Budget 2016: Implications for the construction and infrastructure sectors
and the £80 million to continue the planning for Crossrail 2 that will help increase tube capacity and reduce the pressure on Victoria and Waterloo stations. Road improvements, including an upgrade to the M62, and flood defence schemes also fared well with nearly £1billion committed overall.
It is interesting to speculate about the changes to the procurement regime if the UK votes “No” on 23rd June. Although it is tempting to sweep away the provisions of the EU procurement directives which frequently add delay and complexity to projects, we expect to see a continuation of compulsory competitive tendering. For the first two years following any decision regarding the EU membership, the UK would need to negotiate the terms of a trade agreement with the Union under Article 50 of the Treaty. During those two years, the Directives will remain in place. It is possible that a regime similar to the current procurement rules will continue in existence beyond that time, as the EU is likely to seek access to public contracts for continental businesses. The EU made similar demands in recent negotiations over its free trade agreement with Canada. The EEA countries (Iceland, Norway and Liechtenstein) are also subject to procurement laws that are based on those of the EU.
Whatever the outcome of the negotiations with the UK, HM Government is likely to favour some form of competitive tendering for large infrastructure contracts as a way to encourage efficiency and innovation, preventing corruption or nepotism. Post Brexit, the UK would remain a member of the World Trade Organization (WTO) and the Organisation for Economic Co-operation and Development (OECD). Both of these organisations favour transparent and competitive tendering for public contracts.
On the flip side
Regardless of the EU referendum outcome, there is also the inevitable opportunity cost of infrastructure developments of this scale. As has been seen with both Crossrail 1 and Phase 1 of HS2, such projects, whilst designed to benefit economic and social performance, have a negative impact on property owners and occupiers adjacent to the proposed lines. In some cases such big infrastructure projects can significantly reduce the value of properties and threaten the viability of otherwise well performing enterprises. The environmental impact is not to be underestimated either.
Legal obstacles – including judicial review and the parliamentary petitioning process – can cause substantial delay and increase the sums necessary to bring forward such fundamental proposals. There will also be compensation claims arising as a result of compulsory purchase or other losses sustained.
The Government is facing a challenge to deliver these major infrastructure projects on budget, on time and with minimum environmental, economic and social damage.
The Future of Property Careers
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Steven Carey writes for Building on whether a company can provide expert services in claims for and against the same party
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InvestAfrica: Checking in or Checking out? Financing Africa’s Hotels in 2021
The discussion examined the strategies investors and financial institutions can implement to mitigate the effects of the pandemic.
Infra.law - Spring 2021
Click here to read the latest edition of our construction and infrastructure publication, Infra.Law.
Assignment, novation and construction contracts - What is your objective?
What are the terms of the contract under which the sub-contractor carries out the works for the employer?
Adjudication enforcement and exclusive jurisdiction clauses post-Brexit
Does an exclusive jurisdiction clause in favour of a foreign court preclude an English court from enforcing an adjudicator’s decision?
The UK’s post-Brexit rules for skilled workers – Key implications for the construction industry
As a result of the new Points Based Immigration System , UK companies in the construction sector will not be able to sponsor labourers.
Andrew Keeley writes for Building on the consequences of a liquidated damages clause being unenforceable
Parties often agree to predetermine the level of damages that an employer is entitled to claim in the event of late completion.
Grand designs – Who should take the design risk in an MMC project?
MMC have been touted as a way to tackle costs and inefficiencies within construction, but who takes responsibility for the design ?
David Savage quoted by Construction Law on the confusion over construction contract liabilities arising from Covid-19
An increase in construction disputes relating to time and cost impacts of Covid-19 related project impacts has been seen.
Keeping Up With Construction: Pre-procurement - Practical Pointers
Successful procurement is more than the choice of the construction contract.
Understanding Rules of Origin under the Brexit Agreement
The UK-EU TCA came into effect on 31st December 2020, what does it mean for importers and exporters? and what does Rules of Origin mean?
Haliburton v Chubb: The final say on an arbitrator’s duty of disclosure
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‘Subject to contract’ – The effect of these words in settlement negotiations
The importance of the ‘subject to contract’ label during settlement negotiations and communications.
Conditional payment clauses in the UK and Middle East
Niel Coertse writes for Practical Law Construction on how conditional payment clauses help to prevent cash flow difficulties.
Niel Coertse writes for the Practical Law Construction Blog on conditional payment clauses in the UK and Middle East
Conditional payment provisions are prohibited in the UK, but in the Middle East, 'pay when paid' provisions play a significant role.