Provisional Sum | Construction Contracts

Provisional sum estimates have been used in the civil engineering industry since the 1930s, and have been accepted as reliable methods to accurately account for the cost of projects. This blog article will discuss the purpose of provisional sums, and the considerations necessary to create a successful estimate. It is important that civil engineers fully understand the process of preparing provisional sums to complete projects on time and within budget.

What is Provisional Sum

A provisional sum is an allowance included in a construction contract to cover the estimated cost of certain work. The work covered by a provisional sum is usually specified in the contract documents. Provisional sums are usually used for work that is difficult to estimate, such as earthworks or specialist services.

Creating an accurate provisional sum estimate requires a sound knowledge of the work to be carried out, as well as the prices of materials and labor. It is important to allow for a contingency sum to cover unexpected costs.

Using provisional sums correctly can save time and money on a construction project. However, if the estimates are incorrect, it can lead to cost overruns and delays. It is therefore crucial that civil engineers have a good understanding of how to prepare provisional sum estimates.

How Contractor is Paid When Provisional Sumps are there

When there are provisional sums for certain items of work, it is important to have certain procedures established for the payment to the contractor. A provisional sum is a certain amount of money allocated to complete that particular work. Let’s see what the procedure for the payment of the contractor is.

• Generally, at the beginning of the work, the contractor will be asked to prepare a detailed bill of quantity for the particular work.
• Once the contractor submits that proposal, the engineer will review it, and comments will be provided. There may be comments on the rate and the others such as materials, plats, et. used to complete the work.
• Both parties will be aggreged on the rates and work to be completed.
• Then the contractor can proceed with the work

There are some disadvantages of the provisional sums.

When there are no rates in the original bill of quantities for the items of work to be done covering the provisional sum, the contractor could play with the rates. Further, he can add the new rates for this kind of work. With that work may not be able to complete for the expected cost at the tender stage.