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Question
Dear Jone Dowse

Can you tell me how to calculate the coefficient of a, b, c, d, .. for the price adjustment formula in FIDIC 1999 that is to put in the tender document. If you know any free site get sample calculation it may be more helpful.

I thank you
Tilak

Answer
Dear Galappththy,

Thank you for this question. I apologise for the delay in responding, which was caused by recent travel commitments.

Co-efficients "a", "b", "c" and "d" relate to the division of the projected tender price broadly into the four categories of (a) fixed costs; (b) labour costs; (c) equipment costs; and (d) materials costs.

To my knowledge there is no published formula; it is a matter of assessment based upon the estimated price for the works. For example a very labour intense project is likely to carry a higher co-efficient "b" for labour than a project which has a high equipment level but low labour level. The co-efficients will vary with many, diverse factors including location; time of year; political and economic stability; extent of employer supplied equipment or materials; labour availability.

What I suggest at this time is that an assessment is made of the likely elemental breakdown of the project price (labour, plant, equipment, overheads, profit, method related costs and time related costs) and that proportionate split is used as the basis for the four co-efficients.



I hope that this assists you.

Kind regards,
John Dowse

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John Dowse

Expertise

Legal; contract interpretation; quantum; delay analysis. Practitioner in arbitration, adjudication and mediation.

Experience

Thirty-three (33) years experience in building and construction, at all levels both within contracting and consulting organisations. Practising arbitrator, adjudicator, and mediator. Faculty approved trainer for the Chartered Institute of Arbitrators. Lecturer on construction contract forms and dispute resolution practices.

Organizations
Chartered Institution of Civil Engineering Surveyors Chartered Institute of Arbitrators Institute of Directors Society of Construction Arbitrators

Publications
Various UK and International construction and legal publications.

Education/Credentials
LLB (Hons), Pg Dip (Legal Practice), MCInstCES MCIArb MIOD Barrister

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