If the Project Manager implements an negative CE for the omission of works am I correct in amending Activity Schedule to suit as these activities will no longer appear on the accepted programme therefore becoming an errant activity?
Yes you can submit a revised activity schedule to reflect the omission of works. Any such omission is assessed using Defined Cost, rather than the identified figure on the activity schedule (where one exists) UNLESS both Parties agree. The Contract is fairly quiet on how specifically this is done in actually physically changing the activity schedule but as long as it adds up to the correct number there is unlikely to be too much issue in accepting the revised one.