This document is not to be taken as a legal interpretation of the provisions governing public procurement. All parties must rely exclusively on their own skills and judgement or upon those of their advisors when making use of this document. The Government Construction Contracts Committee (GCCC), the National Public Procurement Policy Unit (NPPPU) and the Department of Public Expenditure & Reform and any other contributor to this guidance note do not assume any liability to anyone for any loss or damage caused by any error or omission, whether such error or omission is the result of negligence or any other cause. Any and all such liability is disclaimed.
3.2 Responsibilities in Relation to the Contract 161
3.2.1 The Employer’s Responsibilities 162
3.2.2 The ER’s Responsibilities 163
3.2.3 The Contractor’s Responsibilities 166
3.2.4 The Project Supervisor’s Responsibilities 174
3.2.4 The Project Supervisor’s Responsibilities 174
3.3 Managing the Works in Progress 176
3.3.1 Project Documentation 177
3.3.2 Site Management 179
3.3.3 Quality Assurance in Progress 182
3.3.4 Interim Payments 184
3.3.5 Actions on Substantial Completion of the Works 188
3.3.6 Resolving Disputes 190
3.3.7 Suspension of Works 193
3.3.8 Termination of Contract 194
3.3.8 Termination of Contract, Continued 195
3.4 Managing Risk in Progress 199
3.4.1 Responsibility for Loss and Damage 201
3.4.2 Delay and Compensation Events during the Project 203
3.4.2 Delay and Compensation Events during the Project, Continued 204
3.4.2 Delay and Compensation Events during the Project, Continued 205
3.4.3 Managing Contract Insurance 213
3.5 Calculating Price Variation (PW-CF1 to PW-CF5) 215
3.5.1 PV1: Proven Cost Method 217
3.5.2 PV2: Formula Fluctuations Method 221
Appendix A: Comparison of Minor Works Contracts and Traditional Contracts 237
Comparison Table 237
Appendix B: Pre-Tender Checklists 239
B1: Invitation to Tender Checklist – Employer’s Choices 239
B2: Consents and Licences Checklists 240
B3: Invitation to Tender Checklists 243
B4: Tender Evaluation Checklist 244
Appendix C: Price Variation Calculation under PV2 (Formula Fluctuations Method): Worked Examples
(PW-CF1 to PW-CF 4) 245
C1: Worked Examples – Overview 245
C2: Example – Hyperinflation in the price of materials within the fixed-price period 248
C3: Example – Hyperinflation in the price of fuel within the fixed-price period 249
C4: Example – Increase in the price of materials after the fixed-price period 250
C5: Example – Increase in the price of fuel after the fixed-price period 252
C6: Example – Increase in the cost of non-reusable temporary works after the fixed-price period 253
C7: Example – Increase in labour costs after the fixed-price period 254
Appendix D: Department of Finance Guidelines on Methods of Measurement 255
D1: Introduction 255
D2: Amendments required when using CESMM3 256
D3: ARM4 and Supplement 1 263
D3: ARM4 and Supplement 1, Continued 264
Purpose of this document
This document is one of a number of guidance notes aimed at facilitating the implementation of the measures in the Capital Works Management Framework (CWMF) introduced to achieve better value for money on publicly funded works projects.
The purpose of this document is restricted to giving practical advice to Employers to help them administer the construction phase of a project in accordance with the provisions in the new public works contracts. Is also intended as a strategic resource for the wider public sector.
This document only applies to the nine standard forms of contract (PW-CF1 – PW-CF9) that are developed for public works projects, the Public Works Contract for Early Collaboration (PW-CF10) and the Public Works Term Maintenance and Refurbishment Contract (PW-CF11) are intended for particular circumstances and guidance on these contracts is published separately.
The Government Construction Contracts Committee (GCCC) will review the operation of the forms of contract periodically in the light of experience. Changes to contracts, practice and guidelines will be incorporated in an updated version of this document and published at regular intervals.
This document is intended primarily for the guidance of Sponsoring Agencies embarking on capital works projects. However, the role of the Sanctioning Authorities and any external consultants appointed in relation to the capital works projects is also considered.
Terminology in this guidance note
The title Sponsoring Agency changes to Contracting Authority once a contract for technical services for a works project is awarded. And Contracting Authority changes to Employer when a Works Contract is signed. The term Client is used throughout this guidance note as a generic term to cover the Sponsoring Agency / Contracting Authority / Employer.
Terms used in this Guidance Note are as defined in the following clauses of the Contracts:
The Capital Works Management Framework (CWMF) is a structure that has been developed to deliver the Government’s objectives in relation to public sector construction procurement reform. It consists of a suite of best practice guidance, standard contracts and generic template documents. For more information on the CWMF refer to Guidance Note GN 1.0