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Ì end-user to provide greater input Ì
Ì if the Host National Society has an engineering department, they may have technical personnel who can contribute
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Ì technical staff from the cluster may be a source of direction.
Irrespective of which approach is used, the final design will need to be signed off by the government. If you are going for the CCC approach, the next step is to prepare tender documents for construction.
2.17 Options for contracting
There are many approaches that are available for contractor en-gagement. The preferred approach will depend on the local in-dustry and what they are comfortable with (if the tenders are limited to local companies only).
2.17.1 Traditional contract
In the traditional contract, i.e., CCC, a consultant can be identified and engaged either directly or via a tender process, which may be open or pre-qualified. From a transparency and integrity point of view, it is not advisable to award direct contracts.
The benefits of engaging in this kind of contract is that the con-sultant is:
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Ì independent of the contractor Ì
Ì engaged as site engineer Ì
Ì responsible for contract administration Ì
Ì responsible for design and associated liability.
On the downside:
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Ì long lead time is required with the tendering and ensuing evaluation of the tenders
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Ì the project will be as good as the consultant is.
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2.17.2 Turnkey/design and construct
Turnkey or D and C contracts, as they are also known, is a quicker method of getting projects underway. Since the contractor and consultant are both working together, this only requires one tender process. For D and C to be effective, it is vital that the IFRC prepare a detailed and concise requirements plan. Depending on the project, it may be necessary to engage an independent con-sultant to prepare concept plans as per requirements as well as assess the tenders. Evaluation of the contractor’s bids can require a level of knowledge that is best provided by the independent con-sultant, as items and design may differ between the bids that are submitted for the same project.
As the consultant is a part of the contractor’s team, site super-vision by Host National Society/Partner National Society/IFRC’s secretariat will be required during the construction phase. An independent consultant or a construction delegate can be tasked with site supervision.
The benefits of this type of contract are:
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Ì a quicker contract selection duration due to single tender process Ì
Ì liability rests with contractor’s team.
The downside:
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Ì There is a lack of independence on the part of the consultant since he/she requires greater supervision from the Host National Society/Partner National Society/IFRC’s secretariat.
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Ì In event of claims, the contractor and consultant can blame one another making it very difficult to resolve issues at hand.
2.17.3 Partnership set-up
In a partnership set-up, the Red Cross Red Crescent party provides funding to the government. The government then implements the programmes and executes the required contractual arrangements directly with the construction companies. In other words, the Red
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Cross Red Crescent party is a donor. Nevertheless, for accounta-bility purposes to its own donors, the IFRC will put controls in place such as providing for instalments to be made upon satisfactory completion of work at each stage. The IFRC will retain oversight of the project by approving all the designs, providing a site supervisor to monitor construction among other things.
The IFRC’s secretariat decided to adopt this model right at the onset in the Maldives to manage large-scale construction projects.
The government tendered the construction of the houses with the IFRC’s secretariat involved at each step of the way, including the evaluation and approving the final decision to award the contracts.
The contracts were signed in partnership with Maldivian govern-ment and experienced international construction companies. The government acted as the client in the relationship with the con-tractor and as such was responsible for legal liabilities arising from the contract. The IFRC’s secretariat had an agreed role in moni-toring workmanship and verifying work done before settling bills directly with the contractor.
The reasons for pursuing this arrangement in the Maldives were:
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Ì lack of a National Society in-country Ì
Ì the country has a centralized administrative set-up. The National Disaster Management Centre, brought together rep-resentatives of all relevant ministries, NGOs, civil society and international organizations, including the IFRC’s secretariat, coordinated all donors who came in after the tsunami.
The main pitfall to this approach is that there can be issues around transparency in awarding the tender and managing the contract.
The table on the next page summarizes the three modalities and presents the pros and cons of each.
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Modality Positive Negative Traditional
contract (CCC)
– Consultant is inde-pendent of contractor.
– Consultant engaged to act as site engineer and contract administration.
– Design responsibility rests with third party.
– Lengthy process – tender for consultant then tender for con-tractor.
– Quality of work is con-tingent on the com-petencies of the site supervisor.
Turnkey/D
and C – Quicker process as single tender is required for consultant and con-tract.
– Variations are unlikely as contract is based on a lump sum.
– Less independence of consultant since greater site supervision from the IFRC is required.
– Employer’s require-ments must be thor-ough and concise.
– May require hiring inde-pendent consultant to provide concept design, bid assessment and site supervision.
Partnership
set-up – Removes responsibility from IFRC for contract administration.
– Requires both donor and implementing partner to approve design and specifications.
– Variations are unlikely as contract usually lump sum.
– Not transparent.
– Less control on the final product.
– Heavily reliant on IFRC staff in the field for monitoring.
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