The creation of a proactive link between time and money

The majority of civil engineering projects worldwide are undertaken using competitive admeasurement contracts in which the contract price is accumulated from tendered rates in a bill of quantities. The assumption that price is proportional to quantity is outdated. Many significant costs are related to timing, method of execution, gang composition, location, productivity and temporary works or any combination of these. In addition to the failure of bills of quantities to model a contractor's costs realistically, they are further limited in their usefulness by their complexity, the number of items having proliferated. The result is that no systematic procedure exists for the evaluation of variations involving disruption and delay. There are many claims for additional payment and considerable effort is spent in their resolution. Much of this conflict could be removed if the price the contractor charges for the work was clearly modelled (or expressed) on the basis of those factors which affect cost and if a system for evaluating the indirect costs was in place. In this thesis the author proposes a method for the valuation of interim payments and contractual change that incorporates a rational alternative to the bill of quantities, the "simplified bill", develops a proactive link between the simplified bill and a rationalised programme, utilises computer software to automate and rationalise the evaluation of direct costs associated with change and proposes Influence curves for the evaluation of the indirect costs. This thesis addresses the problems associated with current practice in the valuation of interim payments and contractual change through the formation of a proactive link between time and money.