Contract rates

• Introduction
• Apply contract rates to schedules

Introduction

Contract rates generally refer to the rates listed in the contract documents for prime cost sums A prime cost sum is the cost of an item that has either not been selected or the price was unknown at the time the contact was entered into. and provisional sums A provisional sum is an estimate of the cost of carrying out particular work including the cost of supplying any materials needed for the work. An estimate is required if, after making all reasonable enquiries, the builder cannot give a definite amount for the item at the time the contract is entered into.

Other contract rates include the agreement between the builder and sub-contractor to perform work outside the scope of the contract whilst signing a sub-contract agreement. By doing this the builder can estimate the cost of a task without the need to consult the sub-contractor about a requested variation. In reality this is rarely done. If there was a variation the builder would ask the sub-contractor to estimate the time and cost involved for the task.