We are working on a project using ECC option A (priced contract with activity schedule). At tender stage the contractor submitted its tender sum, which consisted of 20 activities based upon the tender programme.
Since being awarded the contract, we have been waiting for the contractor to submit an acceptable programme. We understand it is the contractor’s intention to submit a programme and activity schedule with more than 20 activities on it to achieve a better cash flow.
However, the programme has still not been submitted and I am envisaging a situation where the contractor will submit an application for payment and I may have to make an assessment of the price for work done to date.
In the absence of an accepted programme and no further breakdown of activities, would it be acceptable for me to make an assessment of the price for work done to date based upon the 20 activities submitted in the tender sum?
Answer
The 20 activities in the activity schedule should be based on the requirements of the works information, not the accepted programme. The summation of the activities in the activity schedule under option A constitute the lump sum price payable by employer to the contractor.
Once the contract is awarded, the contractor has no right to amend the activity schedule in the way you describe. The contractor is stuck with the 20 activities unless changed due to compensation events or because the contractor changes a method of working under clause 54.2. The contractor can, however, have more operations on the programme than activities in the activity schedule, but must provide information showing how each activity on the activity schedule relates to the operations on each programme submitted for acceptance.
If there is no accepted programme in place by the assessment date, this does not prevent an assessment being made of the amount due to the contractor. The assessment would be based upon completed activities on the activity schedule, which is the 20 activities you currently have.
