JCT Contracts Meeting the Objectives of the Construction Playbook

Author: Peter Hibberd, JCT past chair

The Construction Playbook

HM Government published The Construction Playbook, Government Guidance (Guidance) on sourcing and contracting public works projects and programmes in December 2020. That guidance, although developed through a collaboration of the public and private sectors, is principally concerned with the public sector building and infrastructure programmes. Nevertheless, it also can be applied, in part, to the private sector. The public sector is defined as central government, including arm’s length bodies, which must either comply or explain any divergence from the Guidance. The wider public sector, including local authorities, are encouraged to take account of the Guidance.

The Guidance refers to 14 Key Policy areas, and key activities, within the procurement stages. It sets out reforms and actions, which it is believed, will have the greatest impact in improving how public works programmes and their projects are delivered. The Guidance contains best practice for specific topics that relate to fulfilling those policy objectives.

Not all parts of the Guidance apply equally across the construction industry as some are only relevant for clients with a publishable 3-5 years’ programme of work. Something that is relevant to areas of the public sector, to which it principally applies, but not necessarily to the private sector, which it wishes to influence. Long term programmes are often more problematic for the private sector, where plans are more difficult to determine because of economic circumstances and commercial sensitivity.

JCT supporting the objectives of the Construction Playbook

JCT recognises there is no singular approach to procurement; good practice can be inherent in various solutions for differing projects and participants.  JCT’s raison d’etre is to produce standard contracts, using standard contract terms, to meet various construction procurement routes. It also produces other documents, such as, Practice Notes on Tendering, and BIM, guidance note on Sustainability, and documents such as the Project Bank Account. All which reflects good practice that is aligned closely to the Guidance.

The collaborative work of JCT embraces all the principal sectors of construction, and consequently prepares documentation to assist a wide range of client bodies with differing requirements, which range from the traditional to the modern partnering style arrangements for construction procurement. In fulfilling those diverse procurement requirements, it seeks fairness in terms of risk apportionment for each procurement route. All of which is compatible with the Construction Playbook, and to a significant extent aligns itself with its objectives. Although not all the Construction Playbook objectives fall directly within the remit of JCT e.g., commercial pipelines, market health and capability assessments, portfolios and longer term contracting, JCT synthesises such issues in the production of its contract suite and associated documents.

Individual JCT contracts meet specific objectives of the Construction Playbook

The 14 Key Policy areas of the Construction Playbook embrace a wide range of construction activity. The underlying message is one of improving life cycle value by establishing an outcome-based approach within a framework of sustainability, fairness, and improved timescales primarily through greater use of off-site manufacturing. Its achievement depends upon many factors and, consequently, will produce different procurement routes. The common factors being the adoption of good practice and improved productivity; matters for which JCT is wholly supportive.

The Construction Playbook policy areas and activities, within JCT’s remit, shows the extent of alignment within JCT documents.

Early supply chain and a contract for such involvement

JCT variously provides for early supply chain involvement. This is achieved by utilising the Pre-Construction Services Agreement (General Contractor) and the Pre-Construction Services Agreement (Specialist), as part of a two-stage tender in conjunction with a principal building contract from the JCT suite e.g., Design and Build Contract, Major Project Construction Contract, Construction Management Contract. Alternatively, by using the Constructing Excellence Contract, which can be used throughout the tiers of the supply chain; part 4 of its Contract Particulars makes specific reference.

Outcome-based approach

The nature of a project should determine the approach to its contract documentation. Specification and quantification of a defined solution prior to tender may be appropriate but for more complex constructions an outcome-based specification upon which to tender has much to offer.  JCT provides for both approaches as it is up to the employer’s advisors to determine what is appropriate. All JCT forms of contract facilitate outcome-based specification except for the Standard Building Contract With Quantities, which is restrictive because of its detailed requirement for quantification of work prior to tender. The without quantities version can be used for outcome-based projects – it is a matter of drafting the specification accordingly.

Longer term contracting

The principal way JCT provides for longer-term contracting for new work is with the Framework Agreement. For maintenance and/or minor building works it is the Measured Term Contract. The Framework Agreement is used in conjunction with an appropriate underlying JCT contract, whereas the Measured Term Contract is stand alone.

Digital Technologies

JCT has recognised the use of digital technologies for many years. In 1998 it introduced a Supplemental Condition for Electronic Data Interchange (EDI) and then went on to develop digitised contracts. It now offers instant digital access to the JCT suite of contracts, which enables editing and collaborative working through use of ‘JCT on Demand’ and ‘JCT Construct’.  The primary digital technology referred to in JCT contracts relates to BIM; the 2019 Practice Note ‘BIM and JCT Contracts’ identifies and provides a commentary on the associated provisions. In addition, it provides a checklist of common contents of Exchange Information Requirements.

Delivery model assessment

Guidance requires that contracting authorities follow an evidence-based process to decide the most appropriate delivery model. Although there is a degree of freedom in how this might be determined, there is presumption in favour of offsite construction.

Although the nature of offsite manufacture varies, existing contractual arrangements do not preclude the use of any approach. The industry has for many years had a range of offsite production solutions which procurement has accommodated and where JCT standard form contracts have been used.

Where building projects comprise largely of offsite manufacture the issues of quality control and payment for offsite materials are often purported to be specific problems. However, JCT makes provision for these and other such issues in its standard form contacts, which include JCT Constructing Excellence Contract (CE), Design and Build Contract, Management Contract, Construction Management Contract and Prime Cost Contract. Those contracts are for use in conjunction with all forms of offsite manufacture: with or without the use of the Framework Agreement.


JCT contracts are primarily concerned with performance indicators. Such indicators are derived from and can be an input into the establishment of a benchmark. A performance indicator provision is contained within all the main JCT contracts, including the Framework Agreement, for which it is particularly relevant.

Effective contracting

The Guidance requires that documentation be structured to support data exchange, drive collaboration, and improve value and manage risk. All with a view to continuous improvement, especially through frameworks and effective contract management. JCT provides a ‘Guide to selecting the appropriate JCT main contract’ and a ‘Guide to selecting the appropriate JCT sub-contract’. It also provides for frameworks and incorporates good management, both here and in its other publications, including JCT Contracts Discovery. It encourages extensive collaboration through JCT Constructing Excellence Contract and the JCT Framework Agreement, and through a specific provision on collaborative working in its other contracts. JCT also provides for ‘cost and value improvements’ and for ‘value engineering’ both of which are relevant to and impact upon continuous improvement.

Risk allocation

The way risk is dealt with by JCT enables the suite to meet diverse needs, and additionally, provides optional provisions for the appropriate allocation of risk in certain areas. The definition of prime cost in the Management Contract and Prime Cost Contract provides a different approach to risk, as does the approach in Construction Management and its use of Trade Contracts. The JCT Constructing Excellence Contract also differs in that its risk allocation is largely bespoke. It provides for a risk register and a risk allocation schedule and, consequently, diverse risk profiles. The Framework Agreement provides for the supply chain to be involved in risk assessment and risk allocation. Regardless as to whether risk is prescribed pre-tender, or as part of the tender process, there is JCT contract that can be used. 

Payment Mechanisms

JCT contracts provide for proper payment mechanisms throughout its contracts to meet different procurement routes. These provisions are fully compliant with the amended Housing Grants, Construction & Regeneration Act 1996. They also provide for fixed and variable price provisions and with optional fluctuation mechanisms for use where appropriate.


JCT provides guidance on tender practices in its Tendering Practice Note 2017, which is aimed largely at the private sector. Those operating in the public sector must observe and comply with the specific requirements of that sector as set out in governmental publications. Although specific detail may vary between the public and private sectors, JCT documentation embraces the same good practice.

Resolution Planning

Much resolution planning is outside the scope of JCT documentation except for mitigation, which JCT fully embraces. Insolvency and the mitigation of insolvency risk have detailed provisions. Similarly, termination provisions, which can facilitate project completion, exist across the suite. JCT also provides for a performance or guarantee bond, advance payment bond, retention bond and off-site materials bond and it publishes ‘Project Bank Account Documentation’.

Manage and monitor the execution of construction

Managing and monitoring the construction project are extensively covered in JCT contracts except for the project programme itself, which, other than in CE, is to be detailed in associated documents rather than the contract. JCT’s principal contracts contain a section on the control of the project/works and a provision on performance indicators and monitoring. CE’s approach is different in that it contains section on working together, and primary obligations, including detail on the project programme. The Management Contract also provides detailed provisions in Annex B to the contract.

Manage change/variations

JCT provides comprehensive detail for change and variations across its contracts except for CE. The issue of instructions, variation provisions and the supplemental provision ‘cost savings and value improvements’ provides a clear means to deal with this area. CE on the other hand relies on its working together collaborative approach and the default option of Target Cost and associated provisions.

Contract completion and transition to operation

Completion of the works is generally provided by reference in JCT contracts to practical completion, which includes reference to ‘as built drawings’ and the ‘health and safety file’. The definition of practical completion relies on case law and is not defined by setting out detailed requirements to be satisfied, except in the Major Project Construction Contract, and to a lesser extent CE which refers to ‘certifying completion’ and makes specific reference to commissioning or completion tests referred to in the documentation. Other requirements are to be specified in the other contract documentation. Similarly, maintenance (as separate from rectification), operational manuals and after care are to be specified in the contract documentation.

Project review

The primary place for project review is in the overarching agreements. Such as that contained in the Framework Agreement at clause 21. Also as provided for in section 6 of the CE and at clause 2.3 of CE Project Team Agreement. In each case, the provisions link the review to performance indicators. In other JCT contracts, such indicators provide an important means of assessing performance.

Standardise designs, components and interfaces

Although JCT contracts do not refer to standard designs etc, for which there is no compelling reason to do so, they do not in any way inhibit their use.

Other significant issues in the Construction Playbook

Other issues include collaboration, conflict avoidance, continuous improvement, incentivisation of outcomes, innovation, life cycle costs, passing principles through the supply chain, sustainability, frameworks, and transparency. All such matters are accounted for within the JCT suite.