When assessing compensation events on an ECC3 contract, how should deleted work be valued?
Deleted work is evaluated in exactly the same way as additional works.
Deleted work is a change to the Works Information and therefore a compensation event under clause 60.1(1). You then follow the same mechanism to assess a compensation event whether it is a positive or negative change.
In this case it will be the cost of not doing this works in terms of Defined Cost. You do not use the activity schedule amount (A or C) or bill of quantities rate ( B or D) to assess the value of change UNLESS both Parties agree. It is therefore assessed from first principles using the schedule of cost components to build up the defined cost. The saving should include prelim type savings if the overall planned Completion date has come forward, and also include fee (i.e. the Contractor does not get to keep loss of profit for not doing the work).
Glenn has given a thorough answer. You should also check for any amendments and/or Z clauses in relation to the deletion of work.