Project Management Series Lec-9 ( Contract Price Adjustments)

The Lecture-9 is the 9th Lecture of the Series of Lectures for the Project Procurement Management, which describes the procedure for adjustment of the contract price due to changes in the price of major inputs like labor, cement, steel bar, bitumen etc. This is applied to all projects having more than 50 Million contract cost or one year duration.

[@sajidali-hq3ds]

MashaAllah Sir,,, Stay blessed

[@pakistanaudiobooks1408]

finally found a local professor's lecture.... thank you so much sir

[@ikhlaqhussain2744]

a necessary correction is required that the price adjustment not applicable for the contract having price of million but it varies time to time as per guide line of PEC.
the contract having value over and above to the C-5 limit will qualify for price adjustment, rest will be considered as fixed contract

[@seemabasim7676]

MASHALLAH Great work and guidance for us

[@sciencetechnology1347]

Take a Project and prove that you are the right person for this responsibility

[@mfarhanmughal8702]

Sir if work is done in defect liability period is escalation permissible

[@henokbogale3406]

thanks a lot.

[@DrTariqMasood]

Masha Allah great sir and stay blessed... great work...

[@engr.prof.dr.attaullahshah233]

Jazak Allah Khair Dr.sb for your support

[@engrmakhdoomiqbal4855]

If completion period of a project is more than one year, please tell us the price adjustment is applicable to the project having cost less than 50 million.

[@engr.prof.dr.attaullahshah233]

The min amount of Rs. 50 Million (C-5 Limit) must be met for price adjustment, otherwise it will be considered as Fixed Price Contract

[@shaji223]

reference of 50M condition?

[@totakanwafaediting]

May i have your number for some advise?

[@ShabirAhmad-nd3wh]

"Normally we ask consultant to calculate actual weightages". It should be part of this lecture that how consultant do the calculation. Especially for labor, POL and fixed portion. Billing period explanation was wrong. Price adjustment applies to actual financial progress in each month that month is Billing period. If any IPC is more than one month then it needs to be segregated into months based on actual work done. A few more minor conceptual mistakes are there and the lecture is too basic

[@engr.prof.dr.attaullahshah233]

Thanks. The lecture is mainly for beginners. The basic calculation of indices is made on the basis of actual consumption of materials like cement, steel etc, based on analysis of final designs and BoQs. These indices remain more or less the same with minor changes in scope. Price adjustment applies to the work done and to be paid. As regards the splitting of the bills into monthly parts is understood, as the data for indices of inputs is available for the monthly changes through Statistical Bulletin. However, in case of the non-availability of monthly data, the average price changes can be used. If you have some better case studies, which you can share on the basis of actual calculation, it can add value to the lec. We pay price adjustment after 3-4 months, as it may not be easier to collect data in places like GB. Ideally payment it with every bill is more approrpaite.
Kind Regards
Engr. Prof. Attaullah Shah
Vice Chancellor Karakoram International University Gilgit