CLC publishes COVID costs toolkit

21/07/2020
Dominic Browne

The Construction Leadership Council (CLC) COVID-19 Task Force has published a methodology for assessing and reporting the cost implications of disruption due to the pandemic.

Developed through the Professional Practice Task Group, the cost methodology report supplies four main tools to support industry as it navigates the financial uncertainty of the pandemic and its aftermath.

  • Tool 1 COVID-19 productivity measures: Simple assessment methodologies designed for use on projects on site using information that can be readily accessed from site records to enable a consistent assessment of impacts on site productivity to be prepared.
  • Tool 2 Estimates adjustment methodology: Methodology for adjustment to resource-based estimates for new projects, considering productivity changes and market adjustments.
  • Tool 3 Qualification statement for estimates: Standard qualification wording for estimates clearly setting out the extent of Covid-19 related uncertainty that is included/excluded in an estimate/cost plan.
  • Tool 4 Risk assessment framework for estimates: Standard pro-forma setting out risk allowances included within an estimate/cost plan.

The CLC warned that 'the norms and benchmarks upon which estimates are prepared no longer apply' as a result of the COVID pandemic, which has cast uncertainty over the cost estimates infrastructure relies on.

'The toolkit acts as a guide to enable better cost forecasting to assist the industry in making informed investment decisions on viability, improving robustness of pipeline and driving long term economic growth,' the CLC report states.

Simon Rawlinson, chair of the Professional Practice Task Group said: 'The Cost Assessment Toolkit will help the construction industry manage the impact of Covid-19 on existing and future contracts.

'It establishes a standard methodology to incorporate the cost impacts of the virus into estimates, provides clarity on exclusions and through the collection of industry-wide data allows clients and supply chains to compare their project costs against an aggregated data set.

'By providing the tools to measure and therefore improve productivity, the toolkit acts as a guide to ascertain and assess project risks and establish viability for the long term.'

The CLC notes that when producing a cost prediction, the tools set out in the report should be applied in accordance with the mandatory requirements of the RICS professional statement on cost prediction.

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