NEC3 ECC: Under Option D, does the rate in the BOQ already included the Fee?

The Total of the Prices (TOTP) definition in NEC Option D did not provided that it has already included the Fee. The Gain Share mechanism computation involves the TOTP and PWDD. PWDD included the fee. Do you include the fee in the computation of the TOTP?

Yes. Contractor should include within their target Price for both options C and D risk that is theirs under the contract, plus include any allowance they think is reasonable (or they think they can get away with at tender stage!) in terms of head office costs and pure profit.

The Contractor is then paid their Price for Work Done (i.e. actual cost they are incurring) plus fee (which they included as a fixed percentage within contract data part 1). At the end of the project the intent is to have come in under the target and the savings will be shared between the Parties. Therefore, if the Contractor does not include within the target fee, they are less likely to come under the target and will be losing money on that project.