SCHEDULE OF RATES

ESTIMATION AND SPECIFICATION

 A schedule of rates in its lesser form in a

standard contract can be a list of staff,
types of labour and plant hire rates upon
which a contractor has listed hourly rates
for the purposes of pricing work carried
out under cost reimbursable instructed
day work.

 However on a much larger scale there is a Schedule of

Rates Term Contract. Such a contract is normally used
when the nature of work is known but cannot be
quantified, or if continuity of programme cannot be
determined. In the absence of an estimate, tenderers
quote unit rates against a document that is intended to
cover all likely activities that might form part of the
works. Indicative quantities may or may not be given to
tenderers but do not form part of the contract. As the
extent of the work is unknown the unit rates include
overhead and profit. General preliminaries such as
scaffolding, temporary power, supervision and
temporary accommodation will also have its own rates.
On projects longer than say 18 months there might be
escalation provisions based on annual percentage
increases based on a stipulated indices.

ADVANTAGES
Variations are easy to estimate and normally cheaper than on fixed
price traditional contracts.
The client can stop and start work at a pace that might be determined
by cash flow or funding.
A large pool of contractors can be asked to tender as the process is
inexpensive and quick.
It is infinitely flexible in relation to scope and contractual commitment.
As a fully detailed design is not required the client can obtain tenders
at the early stages of a project and begin construction activity before
completion of the design. So to this extent it is 'fast track'.

DIS-ADVANTAGES
Additional resources are required to measure work and certifying
payments.
The client does not have a final price when committing to starting
work.
It is difficult for contractors to plan long-term resources and so
might mean changes to personnel with loss of continuity.
Contractors may be tempted to load front end costs in case later
work does not materialise.
There is no real incentive for contractors to treat such work with
any sense of urgency and its best staff will be placed on the
projects where the contractor is carrying more risk.

TENDER DOCUMENTS might have the following

headings:
General conditions, which will include clauses defining:
Methods of measurement.
Qualification of star and proportional rates.
Site preliminaries.
Treatment of overtime rates.
Codes of practice.
Inclusion of protection, waste, transportation and health and safety
compliance.
Approved list of suppliers.
What is included in rates,such as all subsistence and travel expenses.
Client direct supplies and directly employed tradesmen.
Testing and commissioning.
Curved work premium.
Definitions as used in the document.