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Prime Cost Amounts
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Disclaimer: This information does not constitute legal, professional or commercial advice. Any views, opinions and guidance stated here are provided for information purposes only, and do not purport to be legal and/or professional advice or a definitive interpretation of any law. Anyone contemplating action in respect of matters stated here should obtain advice from a suitably qualified professional adviser based on their unique requirements.

What is a Prime Cost Amount?

Prime Cost Amounts are sometimes also referred to as PC Sums.

The JBCC defines a Prime Cost Amount as "An amount included in the contract sum for the delivered cost of material and goods obtained from a supplier as instructed by the principal agent".

 

The ASAQS Preliminaries (for use with the JBCC Edition 6.1 agreements) describe Prime Cost Amounts as: "All prime cost amounts are for materials and goods delivered to the site. The priced document shall make provision for the contractor to separately price for overheads and profit and for taking delivery, unloading, checking against invoices and/or delivery notes, getting in, unpacking, storing, hoisting and fixing of such materials and goods. The contractor shall check the quantity and condition of all materials and goods on taking delivery as any materials and goods subsequently found missing or damaged shall be replaced at the contractor’s expense".

Prime cost generally is an allowance for articles to be provided by the contractor, of which the specification is not available at the time of tender and therefore the price cannot determined at the time of tender. It refers only to the supply of materials and not to the carrying out of works and the contractor should be given the opportunity in the BOQ to price for execution of work related to such items. Examples are fixtures and finishing works like tiles, sanitary fittings, water supply fittings etc. that can be decided only at the time of execution.