The following table shows some of the variations contained in AIs issued for the contract of which particulars are given in Appendix A:
AI No. Subject of variation
8 Willingdon Light Buff Facing Bricks in lieu of Hildon Tudor Brown Facing Bricks
15 The roof slabs to the flats increased from 125 mm thick to 175 mm and the main
reinforcement increased from 12 mm to 16 mm diameter
23 Living room windows in flats to be 1800 1500 mm in lieu of 1800 1200 mm
28 Glazed screens to balconies to be glazed with toughened clear float glass with putty in lieu of clear float glass in beads
41 Window removed from existing store, opening in wall altered as necessary, provision of door and frame complete with deadlock, handles and closer 48 Omission of built-in bookcase units in living rooms Figures 7.3–7.8 show the taking-off and billing for the variations. The work was billed direct from the taking-off in the case of AIs Nos. 8 and 48. The other AIs illustrate the use of ‘estimating paper’ ruling as an alternative format.
The following is a commentary on the examples.
AI No. 8 Facing bricks
This variation was necessitated by Hildon Brickworks Ltd ceasing the manufacture of Tudor Brown Facings. The additions items were all the same as the corresponding bill items apart from the change in bricks. As the latter were comparable in type and quality with those originally specified, the rates were adjusted merely to take account of the increased prime cost of the bricks, the value of the other materials and labour being unchanged. The price of the Hildon Tudor Brown Facings used by the contractor when pricing the bills was £270.50 per 1000 including delivery. The price of the Willingdon
V
ariations and instructions
145
Contract: Shops and Flats, Thames Rd, Skinton Ref. AI no.: 41
Daywork sheet no.: 6 Week commencing 19 June 2006
Signed (Architect or Representative) S Draw Date signed: 30 June 2006 Total daywork (£) 1084.25
Brief description of work: Take out window from existing store. Alter opening as necessary to form door opening, provide and build in
Catnic lintel. Provide and fix 838 1981 door and frame, fit deadlock, handles and closer
Operatives Trade Hours Total Rate £ Plant as RICS schedule Total Rate £
M T W T F S S M T W T F S S
H Jones Bklayer 8 8 4 20 11.34 226.80 Kango 2500 4 2 6 0.90 5.40
T Prince Joiner 8 8
G Howie Labr 8 4 20 8.53 170.60
B Scott Painter 1 2 3 6
Sub-total 397.40 Sub-total 5.40
Percentage adjustment 150% 596.10 Percentage adjustment 40% 2.16
Total 993.50 Total 7.56
Materials Qnty Unit Rate £ Other plant M T W T F S S Total Rate £
Facing bricks 60 no. 300/m 18.00
Themalite blocks 450 225 100 18 no. 1.10
Mortar 0.05 m3 67.50 3.38
Catnic cavity lintel 1500 1 no. 43.60 43.60
102 damp-proof course 5 m 0.87 4.35
838 1981 Ext qual ply-faced flush dr 1 no.
Door frame set 1 no.
Undercoat paint 0.25 ltr.
Gloss paint 0.25 ltr.
Sub-total 69.33 Sub-total
Percentage adjustment 20% 13.87 Percentage adjustment
Total 83.19 Total
Light Buff Facings, delivered, was £300 per 1000 and this price had remained unchanged since before tender date. The rates for the 102 and 215 mm walls items were calculated as shown below.
£ Prime cost of Willingdon Light Buffs per 1000 300.00 Prime cost of Hildon Tudor Browns per 1000 270.50
Difference 29.50
102 mm walls
63 bricks per m2, Stretcher Bond,
@ £29.50 per 1000 1.86
15% OHP* 0.28
2.14
Bill rate, item 46A 45.52
Required rate 47.66
215 mm walls, facework one side
85 bricks per m2, Flemish Bond, @ £29.50 per 1000 2.51
15% OHP 0.38
2.89
Bill rate, item 46B 76.02
Required rate 78.91
*The contractor stated, upon request, that the tender included 15% mark-up on net cost for overheads and profit.
AI No. 15 Roof slabs
This variation is shown using the format described on p. 117 in which the dimensions, billing and pricing are on the same sheet. The calculation of the pro rata rates for the additions was made as follows.
Concrete slab
The bill rate was first analysed to find the approximate rate used for the concrete at the mixer and this was then adjusted for the reduced labour input due to the increased thickness. It was con- sidered that the increased size of reinforcing bars did not affect the placing of the concrete sufficiently to justify amendment of the labour content.
£ Analysis of the bill rate
Bill rate, item 36C 109.85
15% OHP (i.e., deduct 15/115) 14.33
95.52 Labour placing, say 4.00 man/h @ £11.76* 47.04
Cost of concrete at mixer per m3 48.48 Build-up of new rate
Cost of concrete at mixer per m3 48.48
Labour placing, say 3.25 man/h @ £11.76 38.22 86.70
15% OHP 13.01
Required rate 99.71
*All-in labour rate calculated in accordance with the principles of the IOB Code of Estimating Practice.
Reinforcement
An increase in the diameter of reinforcing bars results in a lower cost per tonne of both the material and the labour content.
£ Analysis of the bill rate
Bill rate, item 30F, 12 mm bars, per tonne 864.75
15% OHP 112.79
751.96
Cost of bars 480.59
Labour, bending and fixing 271.37
Build-up of new rate
16 mm high tensile steel bars, per tonne 479.41
Labour, bending and fixing, say 251.59
731.00
15% OHP 109.65
Required rate 840.65
*The balance of cost is reasonable for the required labour, thus indicating that the analysis of the bill rate is reasonable.
Formwork
No adjustment to the formwork rates is necessary. Although that to the edge of the roof is increased in height, it is still in the same
height classification as that to the thinner slab, and the rate there- fore remains the same (see SMM7, E20).
AI No. 23 Larger windows in living rooms in flats
Only the items affected by the variation were omitted from the orig- inal dimensions, i.e., the ‘vertical’ items. It should be noted that the deduction of walling for the larger windows can be taken-off either as ‘deducts’ items in the additions, or as omissions items. In the for- mer case, as in the example, the results show negative quantities and so these items have been billed as omission items with positive quantities.
The windows item in the bills was priced at a rate of £250.00. This was analysed and a rate found for the larger windows as follows:
£
Bill rate, item 64C 250.00
15% OHP 32.60
217.40 P.C. of window, delivered 199.50 Labour, handling and fixing 17.90
The labour for the larger window was increased by 20% and added to the P.C. of the larger window, as follows:
£
P.C. window, delivered 229.50
Labour, handling and fixing 21.48 250.98
15% OHP 37.65
Required rate 288.63
The remaining rates required to price the additions items are either bill rates or those used in pricing items in AI No. 8. The latter are the brick facework items for which rates are now contained in the additions items of AI No. 8. The original bill rates for those items are, of course, no longer relevant.
AI No. 28 Glazing to balcony screens
In order to determine a rate for the toughened glazing, the bill rate was analysed and a new rate was then synthesized from the result- ing data, thus:
£ Bill rate, item 103A, per m2 27.85
15% OHP 3.63
24.22 4 mm float glass, including waste, say 21.38
Labour 2.84
The balance left for labour is reasonable, representing about 0.25 man/h (on the basis of an ‘all-in’ craftsman’s rate of £11.76/h). So again, the data from the analysis may be used for building-up a new rate, as follows:
£
4 mm toughened glass 32.10
Putty and glazing sprigs, say 0.40
Labour as before20% 3.41
35.91
15% OHP 5.39
Required rate 41.30
An alternative approach
It is not always possible for a surveyor to determine the prime cost of materials with a high degree of accuracy or to know with cer- tainty the actual percentage mark up a contractor has used to recover his profit and overheads. In such instances the surveyor may adopt a different approach to determine a fair price for a vari- ation or to check prices submitted by a contractor. Through experi- ence or reference to pricing books a surveyor should be able to assess how the costs would normally be apportioned in a bill rate with regard to labour, materials and plant, and from this simple breakdown it should be possible to build a new rate suitable for the variation. The following example shows how this alternative approach may be used for AI No. 9.
The bill rate for item 103A, 4 mm float glass is £27.85. It takes a relatively short period of time to fix a pane of glass, which means the labour cost should be a minor part of the bill rate. It would not be unreasonable to assume a material to labour split of 85–15% (i.e., material £23.67 and labour £4.18). Toughened glass is approxi- mately 40% more expensive than normal float glass, and glazing with sprigs and putty will take slightly longer than with glazing strip and beads, say an extra 20%. Therefore, a new rate would be:
4 mm toughened glass, say £23.67 plus 50% 35.51 Labour in glazing, say £4.18 plus 20% 5.02
Required rate 40.53
AI No. 41 New door to existing store
The omissions relate to the redecoration of the existing window, as provided for in the bills.
The contractor submitted Daywork Sheet No. 6, dated 30 June 2006, showing all the labour and materials expended. The surveyor decided, however, that the new joinery, ironmongery and painting were items that were properly measurable and priceable and should not therefore be valued as dayworks. The carpenter’s and painter’s time, as well as the relevant materials, have therefore been omitted from the daywork account.
The labour rates and materials prices used in valuing the day- work are those current at the dates when the work was done, i.e., 19–23 June 2006. The labour rates have been calculated in accord- ance with Section 3 of the Definition of Prime Cost of Dayworks carried out under a Building Contract. The respective percentage additions are those tendered by the contractor in the bills (see Appendix A, p. 385).
An addition item for which there was no directly comparable bill item was the item for the push plate. A rate was determined using fair rates and prices:
Steel push plate 75 200; Boltons ref. Bps75 9.50
Labour, say 20 min @ £11.76 3.92
The door item was priced pro rata to item 96C, which was for a simi- lar type of door but size 762 1981 mm. The rate was arrived at as follows:
£
Bill rate, item 96C 61.87
Additional prime cost of 838 mm door 3.09
Additional labour allowance 0.72
3.81
15% OHP 0.57
4.38
Required rate 66.25
The door frame item was priced pro rata to bill item 95D which was for a door frame size 762 1981 mm, taking into account also other items for frames. The items in the bills were:
£ 50 88 mm Frame for door size 762 1981 mm 66.00 50 88 mm Frame for door size 838 1981 mm 67.85 63 88 mm Frame for door size 762 1981 mm 80.00 On a size proportion basis, the rate was determined at £82.24. The remaining items were priced at bill rates.
AI No. 48 Omission of bookcase units
The omissions formed a complete section of the original taking-off and cols. 325–336 of the dimensions were marked ‘X’ at the begin- ning and end of the section for ease of reference. The items involved formed a separate group in the Furniture/Equipment section of the bills and were omitted in the variation accounts as a group together with the related decoration items.
The consequential additions items were all deduction items in the original dimensions, and, upon identification for omissions pur- poses, they were converted into additions items with positive quan- tities (see comments under AI No. 23, p. 150).
References
1. Standard Method of Measurement of Building Works, Seventh Edition
Revised 1998 (London: RICS Books, 1998), p. 11, rule 1.2.
2. Definition of Prime Cost of Daywork carried out under a Building
Contract (London: RICS Books, 1975).
3. NDEKUGRI, I.E. and RYCROFT, M.E., The JCT 98 Building Contract:
Law and Administration (Butterworth-Heinemann, 2000), p. 138.
4. RICS, Questions and Answers, Chartered Quantity Surveyor, Vol. 8, No. 8, 1986, p. 8.
5. SIMS, J., Contracts, Building, Vol. 228, No. 6, 1975, p. 83; Vol. 229, No. 49, p. 72.
6. JCT, Consolidated Main Contract Formula Rules (London: RIBA Publications, 1987).
7. Building Cost Information Service, Schedule of Basic Plant Charges (Kingston-upon-Thames: RICS, 2001).
8. KEATING, D., Law and Practice of Building Contracts (London: Sweet & Maxwell, 1978), p. 315; WALKER-SMITH, D., The Standard
forms of Building Contract (London: Charles Knight & Co. Ltd, 1971),
Introduction
Any contract, other than a prime cost contract, will be either ‘firm price’ or ‘fluctuating price’. Firm price contracts are those where reimbursement of changes in costs is limited to those relating to statutory contributions, levies and taxes. Fluctuating price con- tracts are those containing provisions for reimbursement of changes in a wide range of labour costs and materials prices in addition to statutory costs. It should be recognized that the term ‘fluctuations’ includes both increases and decreases and that they may lead to payments becoming due to the contractor from the Employer and vice versa.
The Joint Contracts Tribunal (JCT) Form contains three differ- ent provisions, any one of which may be incorporated in a con- tract by deleting the other two clause references in the Contract Particulars. These provisions are
(a) adjustment of the contract sum limited to fluctuations in statu- tory contributions, levies and taxes, as specified in clause 4.21, Fluctuations Option A;
(b) adjustment of the contract sum in respect of fluctuations in labour and materials costs and in statutory contributions, levies and taxes, as specified in clause 4.21, Fluctuations Option B; and (c) adjustment of the contract sum in respect of fluctuations as in (b) above by the use of price adjustment formulae, as specified in clause 4.21, Fluctuations Option C.
(a) and (b) above relate to what may be called the traditional method of reimbursement of the actual amount of fluctuations
8
allowed under the respective clauses of the contract, and (c) to the formula method of calculating, by use of formulae, a sum to com- pensate for loss due to fluctuations.