M3NHF Schedule of Rates: maximising the benefits and avoiding the pitfalls
The M3NHF Schedule of Rates is involved in a large part of the sector’s finances, an estimated £1.3 billion a year is managed through the housing maintenance system incorporating the Schedule of Rates so naturally people are interested in any changes to the base rates from one version to another and the implications of the ‘potential’ percentage adjustments.
We can only really comment on the former, but we can offer information guidance on the latter from recent procurements.
During this year’s workshop at the NHMF Maintenance Conference, we presented some recent tender adjustments from all corners, but we also asked for some ideas on factors that could financially influence a bid from a contractor – some are certainly beyond control, like geographic spread, but there are other factors that can play a part and make a contract more attractive. For instance, a high minimum order threshold, self-authorisation limits, responsibility for taking calls and making appointments are all aspects that can promote contractor confidence and hence influence adjustments.
Version 7 is the latest release and ‘What’s the difference?’ is a big question as an awful lot has changed since Version 6 in 2008.
Version 7 is the latest release and ‘What’s the difference?’ is a big question as an awful lot has changed since Version 6 in 2008. Importantly the ‘difference’ is not uniform – it isn’t as simple as a wholesale index related increase. The re-evaluated cost of each activity is affected differently by the changes to material costs and labour rates, innovation and methodology in undertaking the works.
Fluctuations in budget spend can also be a concern to both Client and Contractor, particularly if we can’t understand why.
There are many potential reasons where the forecast doesn’t quite match the reality. For instance, potentially due to resident expectations and specification, inaccurate budgeting base data and changes to regulations. Sometimes the reason is not immediately obvious, and an investigation can find overspend due to invalid claims for work which has been misunderstood and mistakenly included on invoices.
This then leads us on to talking about the evolution of the training we provide to non-technical staff and operatives. This was predominantly down to a request from a long-standing and very astute client of ours. On joining a new organisation, tasked with ensuring efficient spend on maintenance, our client spent the first few weeks soaking up the repair reporting and job raising atmosphere of the call centre. This confirmed his belief that some of the issues were self-inflicted through a lack of knowledge on SoR use. To counter this problem we were asked to develop a training package that could be delivered in an hour and twenty minute session to small groups of up to four at a time, to ensure the continual operation of the call centre. Quite a departure from our normal half or full day sessions.
What we developed was an explanation of the system which included many everyday examples of similar situations. For example, we incorporate composite codes and individual codes – renewing a bath includes for all the other individual activities/codes that you might expect (like silicone sealant), in the same way a full breakfast could be selected from a menu that includes the individual constituent parts. The point being that we only pay for the one item. “Okay, but why have a code for silicone sealant around a bath?” That could be the only job required – not hungry enough for the full breakfast?
We also make the distinction between a new job and a consequential job. In order to fit the bath, we might have to remove the bathroom door. This is a direct consequence of the bath renewal activity so is not a new job and could not be claimed.
Is that fair? What if, on the way to deliver our package the courier had to re-route around a diversion? Might take a bit longer, bit of a pain, still the same job – you would not expect to pay any more.
These small increases in diagnostic awareness can add up to massive savings and we’ve certainly had reports that the benefits have far outweighed the downtime and costs associated with training.