In a tie-up with data firm Tussell, Construction News brings you quarterly data on construction contracts awarded by the public sector.
View the biggest contractors, clients, frameworks and opportunities, with analysis from Tussell.
Market Overview
The UK Government awarded 2,021 contracts relating to Construction in Q1 2024, worth a total of £6.6b. This value is up 14% on the previous quarter, due to both an increase in volume and value of contracts awarded.
This quarter, the highest value contract awarded was by Network Rail Infrastructure, £1.1b to McLaren (York Central). In contrast, last quarter – the highest value contract awarded was £575m by A2 Dominion Group to Mears. This highlights the range of contract values across quarters.
Whilst the value of contract awards within the construction sector is dynamic, the volume of construction contracts has remained fairly consistent, averaging 2195 per quarter. Due to the delay in publication of contracts, we will not see the full volume and value of Q1 until next quarter.
In Q1 2024, local government awarded the highest value and volume of Construction contracts, at a value of £2.6b across 1,194 contracts. This amounted to 39% of the total value of Construction contracts awarded by the UK public sector in this quarter.
Contracts awarded by Central Government had a total value of £1.4b, but these were at less than a fifth of the volume of Local Government.
Notably, transport had the highest average contract value 0f £275m, due to the simultaneous high value but low volume of contracts awarded in Q1.
McLaren (York Central) was the top supplier this quarter by contract award value, having won the highest value contract in Q1, worth £1.1b. This was awarded by Network Rail Infrastructure, the top buyer of this quarter, for the development of York City Centre.
The Northern Ireland Housing Executive was the second top buyer in Q1 2024. They awarded the second highest value contract worth £604m to five suppliers for various installation and maintenance works. They also awarded a contract worth £36m to P.K. Murphy Construction for installations and potential ad hoc demolition works.
Newpark Homes was the second highest supplier this quarter. All three of their contracts were awarded by the Northern Ireland housing association, Choice Housing Enterprise. Their largest contract was worth £558m for the design and build of residential accommodation.
Birmingham City Council were the third highest buyer in Q1, driven by a £603m contract they awarded to Equans and Fortem Solutions (Willmott Dixon). This contract was for responsive repairs and maintenance in all areas of Birmingham, lasting two years.
Department for Education awarded 29 contracts in Q1, worth a total £419m. The highest value of these contracts went to Kier for school construction works, worth £48.4m.
Frameworks
In Q1 2024, 278 construction contracts were called-off via a framework. With a combined value of £505m, these call-offs totalled 8% of the total award value, almost half of the previous quarter’s value proportion. Whilst three of the top ten contracts were awarded via frameworks in the previous quarter, driving up the call-off value proportion, none of the top ten contracts were awarded via a framework in Q1 2024.
This quarter, the construction works and associated services framework by CCS, which encompasses a wide range of different construction works, had the highest value of call-offs. This was driven by a contract worth £45m for the delivery of a trust capital programme by Newcastle Upon Tyne Hospitals NHS Foundation Trust to Robertson Construction Group.
The main contractor framework agreement by the Hyde Housing Association had the second highest call-off award value. This was driven by a £33m contract awarded to Bugler for a Beech Tree Place Home Construction Project lasting two and a half years.
The collaborative delivery framework by CCS had both a high value and volume of call-offs this quarter. This included a £11.6m contract awarded by Defra to Bam Nuttall for works as part of the River Roding Project, and a £6.3m contract by the Environment Agency to Volkerstevin Services for two years. This framework was developed by the Environment Agency specifically for the provision of capital investment and improvement works for flood defence assets.
Opportunities
In Q1, there were 1,862 Prior Information Notices (PINs) related to construction, with a combined value of £37.7b. This included PINs for the establishment for new construction and works frameworks, alongside major infrastructure projects. Average PIN values across 2023 are high compared to other sectors, demonstrating that construction is consistently a sector with high value opportunities. The volume of PINs have not fluctuated much across the last four quarters, averaging around 1,916, showing a consistent stream of opportunities in the market.
All the data in this report comes directly from Tussell’s online market intelligence platform. To see how Tussell can help you do more business with government, visit tussell.com.
Download all the data
All data in comes directly from Tussell’s online market intelligence platform. To see how Tussell can help you do more business with government, visit tussell.com.
