I’m looking for some practical advice on how expenses should be managed under an NEC3 PSC Option C contract. I see from previous answers on this forum that expenses, as stated in Contract Data Part 2, form part of the Total of the Prices. How are these recorded in Contract Data Part 2. Is the intention to state estimated values? Secondly, how are these handled with respect to the Contractor’s Share calculation?
The PSC does this a little bizarrely in that :
- neither the Prices or the Price for Services Done to Date (PSDD) include for expenses, so the pain /gain is not affected by how much expenses the Consultant incurs;
- expenses are added onto the PSDD to get the amount due
- to be counted as ‘expenses’ (in italics), they have to be listed in Contract Data Part 2 otherwise they are effectively included in rates.
So as a tendering Consultant, you would normally want as many costs as possible to be listed as expenses in order to minimise your Prices.