This report is being prepared to address the challenges in the procurement contracts in the construction industry. The industry as a whole is of prime importance to any economy and supports many small and medium industries as well. The procurement contracts are more or less traditional with a lump-sum value of its scope of work, but they differ to a large extent in contracts for projects which are of national importance. This report contains a case study of a construction organisation of the public sector who has been accepting traditional as well as specific and detailed contracts. The aim of the report is to find out if there is any better procurement contract system which can be followed. The research is to find out the advantages of all kinds of contract followed by the organisation, any alternatives to the current method of contracting, and what are the assessment factors that lead the organisation to select certain types of contracts. The overall report contains the practices followed by the organisation taken in the case study which is based in the UK.
Public sector organisations (PSU) are an important part of the industry and the government which offers valuable support to important infrastructure projects. These PSU’s are however acting on behalf of the citizens who benefit from projects of importance being developed by the PSU’s. These PSU’s have an important responsibility of procuring raw materials and goods for using in their projects, and the procurement of raw materials is considered an important activity which leads to better offering of infrastructure projects. Major construction projects done by a PSU requires a long list of procurement procedures and multiple contracts with contractors to assign them their scope of work and materials purchase. This paper will study the different types of contracts that are being undertaken by a public sector organisation in the construction industry, and also discuss various factors that affect the selection of certain contractors.