NEC ECC Option F ERF 2066 Duynefontein building refurbishment Bok Breedt
ECC Main Options There are six types of payment mechanism available in the main Options: Option A Priced contract with activity schedule Option B Priced contract with bill of quantities Option C Target contract with activity schedule Option D Target contract with bill of quantities Option E Cost reimbursable contract Option F Management contract. 2
Option F Management contract In a management contract, the core clauses and this clause state how the Contractor is to Provide the Works by identifying what he is to do himself and what he is to subcontract. The Contractor s responsibilities for construction work are the same as those of a Contractor working under one of the other ECC Options. The Contractor is responsible for supplying management services, including the management of the design. The Contractor may limited amount of construction work performed by himself as stated in the Contract Data. If the Contractor wishes to be perform work other than management he must state the extent of that work in the Contract Data 3
Option F Management contract All subcontracts are direct contracts with the Contractor, who acts as a Management Contractor. The subcontract prices are paid to the Contractor as part of Defined Cost. The management Option F is essentially cost reimbursable but risk allocation can be varied by choosing appropriate main Options in the subcontracts. The priced and target Options offer a choice between two types of pricing document, namely an activity schedule and a bill of quantities. 4
Management contract relationships Employer Project Manager Supervisor Management Contractor Design P & G Works Professional Trades Structural Electrical Mechanical Building Performed in house Security and Access External Works Performed in house or Subcontracted 5
Contractor s tender The Contractor tenders His Prices His Fee and His estimated total of the Prices of the subcontracts. IMPORTANT : Tenderers for an Option F management contract must state and price any work the Contractor would want to do himself in the Contract Data part two. If this is not done, the work would have to be subcontracted or its price covered by the Fee. NOTE : The Contractor will not receive separate payment for his work in dealing with compensation events and he will not receive any additional Fee for work on compensation events which does not lead to an increase in Subcontractors prices. 6
Detailed procurement procedures Minimum of three (3) competitive tenders from CIDB registered Subcontractors, Criteria on how a Subcontractor is appointed is agreed with the Project Manager, The Project Manager is involved as part of the Contractor s tender evaluation process and the acceptance of Subcontractors. The Project Manager has the right to influence the form of NEC subcontract and the selection of Subcontractors and to disallow payments for compensation events to Subcontractors where these have not been properly assessed in accordance with the terms of the subcontract. 7
Price for Work Done to Date The PWDD is Defined Cost plus the Fee. Defined Cost comprises the payments due to : Subcontractors and suppliers (actual cost) and The prices quoted in the Contract Data for work done by the Contractor. It is used to calculate the PWDD and in assessing compensation events. 8
Disallowed Cost Defined Cost excludes Disallowed Cost i.e. cost which the Project Manager decides is not justified by the accounts and records provided by the Contractor, should not have been paid to a Subcontractor or supplier in accordance with his contract, was incurred only because the Contractor did not follow an the agreed acceptance or procurement procedure or give an early warning which this contract required him to give or is a payment to a Subcontractor for work which the Contract Data states that the Contractor will do himself or the Contractor s management. 9
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