Dear Collegues,
We are the PMC of a multi-use development project. The Client intends to go into a lump sum contract with FIDIC Red Book 99 form. The design will be 100% complete before going into tender. The Designer has prepared a BOQ and Method of Measurement along with Specs and Drawings.
I think that:
a)The tender documents should only include a Schedule of Prices, together with Specs, Drawings.. etc. (No BOQS and Method of Measurement).
b) I dont actually suggest any BOQ to be incorporated whatsoever. Nevertheless, if insisted, I may not object the Contractor (after the tender is awarded) is given the BOQ prepared by us (with or without quantities) to provide breakdowns for his lumpsum price. This BOQ will be non-contractual and for only valuation of variations.. etc.
Some others think that:
a) The BOQ and MOM will be submitted during tender phase, but it will be stated that the contract is Lump Sum. Payments will be made as per BOQ items.
I strongly believe that using a BOQ instead of a Schedule of Prices for payments has no use, especially considering that the design will be 100% complete, i.e. changes are not likely to occur. A Schedule of Prices itself is very useful for Cash Flow Calculations, Scheduling etc. as well.
I am also of the opinion that, submission of BOQ's during tender phase gives Tenderers the impression that (even clearly its purpose is stated) the BOQ is contractual, and it is hard to explain people that, they are supposed to do everything written in their contract as "lump sum" but get paid on BOQ items basis. It has, and it will, mislead people to think that their responsibilities are bound with what is stated in the BOQ.
I think that, in lump sum contracts the payments / remuneration shall ne through a "Schedule of Prices". If still a BOQ is desired for valuations, etc., it might be requested after the Tender is awarded, i.e. from the Contractor, not the Tenderers. I seriously hesitate on using "Lump Sum Contract with Bill of Quantities" even though it's widely used, especially in the Gulf region.
What do you suggest on this one? Is a Schedule of Payments alone the best solution, or can both (BOQ & SOP) be used? Can you give further recommendations as it will be a FIDIC Red Book 99 type of Contract?
I'd appreciate your prompt answer,
Kind Regards,