CG11:05

Guidance Note
Preparation of Schedules of Rates

Introduction
The schedules of rates referred to in this guidance note relate to those schedules intended to be used for the valuation of
additional work and/or variations to existing lump sum contracts generally encountered in the building and civil engineering
industries. For the avoidance of doubt this guidance note does not relate to schedules of rates used in connection with contracts
which are re-measured as the works proceed, often encountered on power station/petro-chemical site maintenance contracts.
A schedule of rates should be specific to an individual site. Schedules should not be prepared for company wide use on every
contract, unless the type of work undertaken on separate contracts is so similar, and sites are in the same geographic area, that
prices will be almost the same on every contract.
Preferably schedules of rates should be prepared at tender stage, negotiated with the client during pre-contract discussions and
incorporated into the contract documents/orders from the outset. However, it is possible to agree them after the contract has
started particularly if the contract is unexpectedly found to be subject to an excessive number of variations.
Advantages of Schedules of Rates
The incorporation of a schedule of rates into a contract can have a number of advantages:-
• Rates for additional work are agreed from the outset.
• Disputes in connection with the valuation of additional works are avoided completely or at least significantly reduced.
• Valuation and payment of additional work is made easier and earlier thereby improving cash flow.
• Schedules can be incorporated with the order or contract documents.
• Final accounts are prepared more quickly because of fewer disputes.
• Having agreed a schedule from the outset clients are often more willing to agree additional rates to add to the schedule as
necessary.
Disadvantages of Schedules of Rates
There are some significant disadvantages:-
• Unless the schedule is structured to handle height and distance variations the rates will be an average for carrying out work
anywhere on the site.
• The introduction of additional rates to accommodate height and distance variables makes the schedule complicated.
• Separate schedules are required for each contract as the cost of carrying out additional work will vary from site to site.
• Clients are often suspicious of schedules, particularly if they perceive a significant increase over lump sum contract rates.
• Care must be taken when incorporating schedules to contract documents to ensure that pro-rata and other methods included
in standard forms for the valuation of additional work are deleted or amended to allow the use of schedules.
Requirements of Schedules of Rates
• Clear unambiguous descriptions with a clear method of measuring the work in appropriate units. If necessary attach sketches
and worked examples to explain the use of the schedule.
• Clear definition of what the rates cover – for example erect and dismantle only, erect, dismantle, and equipment hire.
• Date to which schedule is valid.
• Purpose for which schedule can be used – additional work, variations.
• Purpose for which schedule cannot be used – daywork, rework, work on other sites.

NASC 1 of 2 January 2005

Preparation of Schedules of Rates

• Use the same labour, hire, and transport rates to prepare the schedule as used in the lump sum items.

• Labour outputs may be varied from the lump sum tender to accommodate different heights and locations on the site.

• If the average outputs, and hence the final rates, do not compare with the lump sum rates, and are strikingly different, consider
introducing additional height band rates.

• Include and state the period of hire included in the rate – usually one week or one month.

• Extra hire rates should be the same as used in the lump sum prices.

• Include rates for only those items which are likely to be required. Do not produce schedules which cater for every eventuality.
It is a waste of time preparing rates which will not be required.

• Provide a full description of what the rates include. If necessary do this in a set of notes appended to the schedule.
Include:-
• Access
• Carry distances
• Attendances required
• Whether rates include internal guard rails and brickguards
• Minimum sizes of scaffolds

• Clients are naturally suspicious of schedules so do not include rates which appear excessive.

Example of Schedule of Rates

Document
Reference
Date
Weeks Hire

Labour rate if
Item Ref Specification Measure Principle Rates Extra Hire Rate
applicable
Erect and dismantle
1 lift of independent
1 scaffold 5 board M Lin of Lift
wide - frame work
only 1.8 to 2.1m lift
Erect and dismantle
1 lift of independent
2 scaffold 5 board M Lin of Lift
wide - frame work
only 1.5m lift
Extra over item 1
3 M Lin of Lift
and 2 for boarding
Moving boards to
4 M Lin of Lift
next adjacent lift
Double handrails to
5 M Lin
slab edge A frame
Double handrails to
6 slab edge clipped to M Lin
steel
Toeboards to item
7 M Lin
5 and 6

Whilst every effort has been made to provide reliable and accurate information, we would welcome any corrections to information provided by the Writer which
may not be entirely accurate, therefore and for this reason, the NASC or indeed the Writer, cannot accept responsibility for any misinformation posted.

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