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NEC3 ECC: What is a reasonable allowance for float (terminal & TRA) for the 1st programme

+1 vote
Is there a consensus of what is a minimum requirement (e.g. as a % of contract duration) on float (as a combination of TRA & Terminal Float) on a First Programme. If for example there is no TRA allowance &/or Terminal Float, could the programme be regarded as too risky to expect to complete by the Completion Date & therefore be rejected as it does not represent the contractor’s plans realistically.

I realise that this may be a bit tricky if the tender set by the client was a very tight programme period & the contractor may be between a rock & a hard place with showing provisions for float if he doesn't think there is any!
asked Nov 24, 2015 in NEC3 Time by anonymous  

1 Answer

+1 vote
I think you have broadly answered your own question here. There is no defined acceptable amount of float, either total of terminal. It will depend on the project, duration, general risk profile, value etc.

Total float is what it is. Once you fully logic link activities the resultant float is what it is. A largely linear project will be mostly critical with little float, whilst non-linear projects should have numerous activities with elements of total float.

Time risk allowances are the risk the Contractor has allowed against their own activities. A critical path with no time risk allowance at all is probably a reason to reject a programme as it is not realistic that no risk at all will occur for the Contractor.

The Contract asks you to show float and time risk allowances. I think a project with no total float at all (or very little) if it is not a linear project you would have grounds to reject. No time risk allowance, particularly on the critical path that would also be grounds to reject. Terminal float value I do not see as a reason to reject.

Terminal float is again what it is. If planned Completion is earlier than Completion Date then terminal float exists. It could exist at tender stage, but often doesn't because as you say Employer's Completion Dates are often optimistic.     

So the unhelpful answer is that there is no rules here - you have to assess each programme on its own merits and decide if there is a reason not to accept in line with clause 31.3.
answered Nov 24, 2015 by Glenn Hide (26,280 points)  
Glenn's point about a programme being realistic is critical. A realistic programme is one which takes account of risks and therefore should include Time Risk Allowances and Terminal Float. It also needs to allow for realistic output rates and durations for operations.