Sums at the authority's disposal and contingencies

The works amount covers the measured work and the safety charges. Everything else needed to deliver the project and not entrusted to the works contractor falls within the sums at the contracting authority's disposal.

The composition varies with the nature of the project, but a core of items recurs consistently. They are the items no cost framework can omit.

Item	Content
Professional fees	Design, works supervision, safety coordination, design verification, final verification
Taxes	Value added tax on works and services, other applicable taxes
Utility connections	Contributions and charges payable to network operators
Land or property acquisition	Expropriation, temporary occupation, compensation
Contingencies	Provision for eventualities not foreseeable at design stage
Tender costs	Advertising, evaluation panels, mandatory contributions
Provisions and incentives	Sums set aside under the rules applicable to the project
Surveys, investigations and testing	Geological and structural investigation, material testing, monitoring
Disposal to landfill	Disposal charges where not included in the measured work

The last item warrants attention because it produces the greatest number of overlaps. Disposal charges may be included in the prezzario items for demolition and excavation or excluded from them, and checking the item description avoids both double counting and omission.

Some items are omitted with regularity, and their absence does not surface at approval stage because it does not stop the cost framework balancing. The cost framework balances even without them.

Verification and final inspection services are the first. Prior verification of the design, structural sign off and technical and administrative final inspection are distinct services, entrusted to distinct parties, each carrying its own cost.

Charges for interference with networks and buried services are the second. On urban projects the diversions required by network operators follow their own timescales and tariffs, and are rarely included in the work entrusted to the contractor.

Additional investigation during construction is the third. On existing buildings, demolition reveals conditions requiring tests that cannot be programmed at design stage, and covering them from the contingency provision consumes a resource intended for something else.

Landfill disposal charges are the fourth, and the item with the highest risk of double counting: they should be checked against the description of the prezzario items for demolition and excavation before being entered as a separate line. They should be checked against the price book descriptions to avoid double counting.

The cost of establishing and running site areas outside the project boundary is the fifth, where occupying public land involves fees falling to the contracting authority. Charges for occupying public land stay with the contracting authority.

The function of the provision is to cover eventualities the design could not foresee, not gaps in the design. The distinction is conceptual and has practical consequences: a provision used to fund work omitted from the bill exhausts the resource before the real risk materialises.

The law does not fix a percentage, and the customary percentages in circulation carry no prescriptive weight. The sizing rationale can instead be reconstructed and argued, and it is worth setting out in the report rather than adopting a conventional figure.

The provision is reasonably smaller where the design is developed and stable, where the project is new build on a clear site with complete geological investigation, and where the work is standard and site conditions ordinary. In those cases eventualities remain contained.

It is reasonably larger where the project concerns an existing building, whose real conditions only emerge with demolition, where it involves below ground work or interference with existing networks that are not fully recorded, where it concerns a historic or listed building, and where the anticipated duration exposes the project to significant cost movement. Real conditions only emerge with demolition.

One statutory element ties the contingency provision to the construction stage and should be known at drafting stage. It bears directly on how the provision is sized.

To meet the additional costs arising from price revision, contracting authorities draw, up to a limit of fifty per cent, on the resources specifically set aside for contingencies in the project cost framework, save for sums already committed contractually, together with any further sums at their disposal allocated to the same project. That fifty per cent limit is what makes a token provision insufficient.

The provision is therefore a resource with a dual destination: technical eventualities on the one hand, contractual rebalancing on the other, with a fifty per cent ceiling for the latter. Sizing it while ignoring the second function exposes the project to a requirement that will find no internal cover.

The discount offered by the successful bidder frees resources, and their destination is regulated. They are not therefore available for discretionary use.

Sums arising from tender discounts are among the resources contracting authorities use to meet the additional costs of price revision, unless a different destination is prescribed. Also available are sums relating to other completed projects of the same authority for which final inspections have been carried out or certificates of satisfactory completion issued.

One reading follows that is worth bearing in mind: tender savings are not definitively released at the point of award. They remain tied to the project until it concludes, and recording them in the post tender column of the cost framework therefore serves a substantive rather than a bookkeeping purpose.

Three approaches reduce the risk of understatement, and none of them applies percentages to the total. All three start from the actual items.

Professional fees are sized from the services actually to be commissioned, listed out. A project requiring design verification, safety coordination in both design and construction, structural sign off and technical and administrative final inspection has a very different requirement from one needing only some of these.

Taxes are sized by applying the regime actually applicable to each component, which is not uniform across works, professional services and acquisitions. The regime is not uniform across works, professional services and acquisitions.

Connections are sized by asking the network operators, not by estimating. It is the item where the gap between forecast and reality is most frequent and most easily avoided.

A contingency provision omitted or token is the first, and leaves the project without internal cover either for eventualities or for price revision. The project is left without internal cover for eventualities or price revision.

Professional fees estimated as a percentage of the works total are the second, and produce a systematic shortfall on complex projects, where the services required grow more than proportionally. The shortfall is systematic on complex projects.

Overlap between disposal charges included in the measured work and a separate line in the sums at disposal is the third, and generates double counts or gaps in cover. The result is either double counting or a gap in cover.

Using the provision to fund work forgotten in the bill is the fourth. It is not a cost framework error but a bill error, and the cost framework absorbs its consequences until the resource runs out.

The logic transfers in full. A private budget built on the cost of the works alone omits professional fees, charges, connections and taxes, which in practice represent a substantial share of the operation.

The contingency provision has the same function in private work and one additional difficulty: it has to be explained. A client reading a contingency line tends to interpret it as uncertainty on the designer's part, whereas it is the opposite, namely explicit recognition of a risk that exists however accurate the design. Setting out the reasoning behind the sizing, particularly on work to an existing building, turns that line from a cause of suspicion into a mark of credibility.