NZ Report / Proposal Template - State Services Commission

• high levels of support from parent companies in support of the contracting
arrangement (as reflected by senior representation on what is referred to as the
Principals Group).
5.43 The CWA approach is aimed at fostering a best-for-project approach through a
“no-blame-no-claim” culture where all parties have a unity of purpose to achieve a
successful outcome. Decision making in regard to the project is conducted through a
Principals Group. Decisions by the Principals Group are made on a unanimous basis;
that is, all parties have to agree.
5.44 In traditional fixed price contracts, the principal point of focus is the price that is
paid for the services. Under the CWA approach, the focus is on the efficient level of costs
because this is the amount that the client, in theory, pays for the services.
Background To CWA for Prison Construction
5.45 The CWA methodology has been used in the context of the Northland (albeit in
hybrid form) and the recently opened Auckland Women’s prison. The Northland prison
commenced as a traditional NZS 3910 contract. However, by August 2003, several
factors pointed toward the need to modify the contractual approach to construction:
• financial pressure on one critical consultant was such that it was doubtful if they
would continue;
• there was evidence of on-site “man-marking” where significant effort was being
directed toward allocating blame rather than resolving issues; and
• the construction programme was not universally agreed among the parties
involved.
5.46 In considering the options open to the Department, CWA was raised as a potential
way forward. Several points are worth noting in this regard.
• We understand that Mainzeal had for some time been considering alternative
forms of procurement including alliancing.
• Stewart Rix (of CMS) had considerable experience of CWA from previous roles in
the United Kingdom (where CWA and alliancing generally is more commonplace).
A meeting between CMS and the RPDP Project Director (John Hamilton) to
present on CWA was arranged at the instigation of the Chair of the Inmate
Employment Advisory Committee. CMS also presented to Hawkins Construction
Ltd (the main contractor on the Auckland Women’s and Otago projects).
• When difficulties with Northland emerged, the RPDP Project Director approached
CMS out of which came a suggestion to convert the contractual framework for
Northland to a CWA agreement (the Northland project had been running on-site for
approximately six months). Mainzeal were the prime contractors for the Northland
project.
5.47 At the August 2003 meeting of the RPDP Steering Group, the Project Director
provided an oral briefing on the proposal to enter into a hybrid form of CWA (the hybrid
arrangements retained an element of the former NZS 3910 contract including, in
particular, a cap on construction costs). The meeting approved in principle the change to
Methodology and Processes: Design, Costing, Procurement and Scheduling 36