In August 1996 the Landscape Institute Practice Committee produced a fee guidance supplement with the aim of promoting the principle of quality, balanced with price, in providing the best value for money. It was revised in 2003 when fee guidance for planning supervisors was added as an appendix. The booklet is divided into three sections and has attached tables, a fee graph and examples. The document supersedes the
Other methods exist and include Ceiling Figure, Unit Price Fees, Incentive Fees and Betterment Fees but the principal methods are described in detail below.
Percentage Fees
These are fees expressed as a percentage of the total construction cost of the landscape contract or subcontract. Before fees can be calculated both client and landscape architect must establish the services to be provided, the approximate construction budget and the nature of the work, e.g. hard or soft landscape or combined, main or subcontract, phasing. Subcontract costs should include on apportionment of main contractor’s attendance, prelims, profit allowance and fluctuations.
Percentage fees are best used for straightforward landscape projects where the standard services (Stages C–L) are to be used.
Office of Fair Trading and supplements the information and guidance contained within the following Landscape Institute documents: The
Landscape Consultants Appointment, A Guide to Procedure for Comprehensive
Tenderingand Appointing a Chartered Landscape Architect: Guidelines for Best
Value.
This document is now under review again by The Office of Fair Trading (Refer to The Landscape Institute for updates on this situation).
Methods of Charging Fees and Expenses
Part 3 of the document sets out the common methods of charging fees in:
• PERCENTAGE • • TIME CHARGE • • LUMP SUM •
• RETAINER •
Available data
• Engaging a Landscape Consultant: Guidance for Clients on Fees con- tains a fee graph which shows four curves as a range of percentage fees at differing complexity ratings for works of £22 500 to £10 million. This indicates the fee costs that may be incurred by the client for land- scape consultants’ basic services expressed as percentages of the con- tract sum. Lower fee percentages may be expected with higher contract sums and vice versa. Projects below the £22 500 threshold should be agreed on a time charge or lump sum fee basis.
Time Charges
Time charge fees are when all time expended on the project by principal and technical staff is charged at previously agreed rates and revised at stated intervals.
Time charge fees are best used where the scope of work cannot reason- ably be foreseen or where services cannot be related to the amount of landscape construction costs. Preliminary, additional or varied services on an otherwise basic service such as open-ended or protracted planning negotiations are examples of where time charges are appropriate.
• Four different classifications of landscape work are identified depend- ing on degrees of complexity. The four curves on the fee graph corres- pond to these four classifications and show the nominal percentage fee curve (complexity rating 1 for soft landscape design and imple- mentation services) and three other curves (rating 2–4 for comprehen- sive hard and soft landscape design and implementation services for differing scales of complexity as set out in the document).
NB The graphs are indicative only and are intended to act as a guide. How applied
• Conventionally on the latest approved revision of the budget until the contract is let and then on the contract sum until the total construction cost is established.
Advantages
• If the budget/tender price is high the consultant will achieve a high fee. Disadvantages
• A method vulnerable to market forces and their influence on contract- ors tendering. If the tender figure is lower than estimate the consultant loses out.
• Working to an agreed figure means cost control is important. There is no flexibility and if the landscape architect budgets incorrectly he loses money.
How applied
• The rates should be calculated in advance for individuals within the office or bands of staff e.g. principals, associates, senior professionals, junior professionals, technicians.
• The charge-out rate will depend on each individual’s wage plus over- heads. Often 2.5–3.0 " salary, it should also include a method of revi- sion to reflect subsequent changes in salaries and costs. Secretarial and administration staff’s time is not usually charged for, but there are
Lump Sum Fees
Lump sum fees are when a total sum of money is agreed for a defined package of services. Lump sums are common where the scope of work can be clearly defined from the outset. It is necessary to define the param- eters of services, i.e. time, project size and cost, where applicable so that if these are varied by more than the stated amount the lump sum itself may be varied. It is unwise to agree a lump sum with no provision for vari- ation except in the case of a highly focused service to be undertaken over a very short period.
times when it should be, for example when staff are directly engaged to do semi-technical work on a specific project.
Advantages
• The landscape architect is paid for all the hours worked on the project, including work not anticipated at the outset or abortive work.
• The client pays only for the work done (as opposed to fees as a per- centage of the contract sum regardless of how much work the consult- ant is involved in).
Disadvantages
• From the client’s point of view, this method of charging may seem open ended with uncertainty regarding his total financial commitment until the job is complete.
• It also may seem that the landscape architect has no incentive to work efficiently.
• It is advisable to keep the client informed on the progress of time-charged work, and to agree a figure that is not to be exceeded without prior permission.
Lump Sum Fees How applied
• At agreed payment intervals and at agreed proportions.
• Time charges are often converted to lump sums when the project become sufficiently defined.
• Percentage fees may similarly be converted to lump sums when a firm budget or contract sum is known.
Advantages
• The limit of spend is known by both parties. Disadvantages
• A lump sum is a risk. If anything goes wrong the practice may lose money yet have no justification for revision of the sum.