1 september 2003 - development bureau

香港特別行政區政府 The Government of the Hong Kong Special Administrative Region

政府總部

環境運輸及工務局工務科

香港花園道美利大廈

Environment, Transport and Works Bureau

Government Secretariat Works Branch

Murray Building, Garden Road, Hong Kong

Ref : ETWB(PS) 107/3 Group : 3, 5

1 September 2003

Environment, Transport and Works Bureau

Technical Circular (Works) No. 21/2003

Contract Price Fluctuation System for Civil Engineering and Building Contracts

1. Scope This Circular updates WBTC Nos. 14/95, 15/95 and 15/95A for the use of the contract price

fluctuation system (CPFS) for civil engineering capital works contracts and term contracts, as well as building capital works contracts, following the introduction of a new series of labour and material indices.

2. Effective Date This Circular shall take effect on 2 October 2003. 3. Effect on Existing Circulars This Circular supersedes WBTC Nos. 14/95, 15/95 and 15/95A. 4. Introduction 4.1 The Schedules of Proportions promulgated in WBTC No. 14/95 for civil engineering

contracts and in WBTC Nos. 15/95 and 15/95A for building capital works contracts for contract price fluctuation are based on the “Index Numbers of the Costs of Labour and Materials used in Public Sector Construction Projects” with June 1995 as the base date (referred as the “1995-based Index Numbers”).

4.2 There have been changes in the nature of works, labour trades and construction materials

after the 1995-based Index Numbers was introduced in 1995. As a result of a recent review, Census and Statistics Department (C&SD) will compile and publish in the Government Gazette in August 2003 a new series of labour and material indices. The title

ETWB TCW No. 21/2003 1 of 9

of the new series will be “Index Numbers of the Costs of Labour and Materials used in Public Sector Construction Projects (April 2003=100)” (referred as the “2003-based Index Numbers”). The current 1995-based Index Numbers will continue to be published during the transitional period (see section 7) before being phased out.

5. Policy 5.1 All contracts with time for completion of the Works (excluding Establishment Works, if

any) or, in the case of term contracts, Contract Period of more than 21 months with the first gazette date or first publication date of tender invitation on the Internet after 2 October 2003 shall use the "Index Numbers of the Costs of Labour and Materials used in Public Sector Construction Projects (April 2003=100)", i.e. with base date at April 2003, published by C&SD in conjunction with the revised Schedule of Proportions and other provisions stipulated in this Circular for contract price fluctuation adjustment. The CPFS shall not apply to contracts with time for completion of the Works (excluding Establishment Works, if any) or Contract Period (for term contracts) of 21 months or less.

5.2 For tenders not yet closed by 2 October 2003 and where situation permits, departments

may consider to adopt the 2003-based Index Numbers by means of a tender addendum. 6. Conditions of Tender For contracts adopting the CPFS, in order to inform contractors that the index numbers are

published in the Government Gazette, the General Conditions of Tender shall include in the list of documents which are not issued to tenderers the following item:

"The ‘Index Numbers of the Costs of Labour and Materials used in Public Sector Construction Projects (April 2003=100)’ i.e. with base date at April 2003. These and subsequent index figures are published in the Government of the Hong Kong Special Administrative Region Gazette."

7. Current Contracts The Index Numbers of the Costs of Labour and Materials used in Public Sector Construction

Projects (base date June 1995), which are being used for current contracts, shall continue to be used for these contracts. The C&SD will continue to compile and publish this index series in the Government Gazette during the transition for a period of four years from the effective date of this Circular. Subject to a review after an implementation for three years, this index series would be discontinued at the expiry of the transitional period.

8. Preparation of Tender Documents 8.1 Use of Contract Price Fluctuation Clause 8.1.1 Civil Engineering and Building Capital Works Contracts

a) For capital works contracts with a time for completion of the Works (excluding Establishment Works, if any) of 21 months or less, Clause 89 of the General Conditions


of Contract for Civil Engineering Works (1999 Edition) and the General Conditions of Contract for Building Works (1999 Edition) shall be deleted and replaced by the Special Condition of Contract SCC(1) at Appendix A.

b) For capital works contracts with a time for completion of the Works (excluding

Establishment Works, if any) of more than 21 months, Clause 89 of the General Conditions of Contract for Civil Engineering Works (1999 Edition) and the General Conditions of Contract for Building Works (1999 Edition) shall be amended by the Special Condition of Contract SCC(2) at Appendix A.

c) Further to above (b), for building capital works contracts containing a nominated sub-

contract for electrical installation, the Special Condition of Contract SCC(5) at Appendix A in respect of fluctuation in the cost of labour for such a nominated sub-contract shall be used. Unless under exceptional circumstances, nominated sub-contracts other than that for electrical installation shall have no provision for contract price fluctuation adjustment. If such exceptional circumstances arise, a further SCC or an amendment of the standard SCCs will be required.

8.1.2 Civil Engineering Term Contracts

a) For civil engineering term contracts with a Contract Period of 21 months or less, General Conditions of Contract for Term Contracts for Civil Engineering Works (2002 Edition) Clause 92 shall be deleted and replaced by the Special Condition of Contract SCC(3) at Appendix A.

b) For civil engineering term contracts with a Contract Period of more than 21 months,

General Conditions of Contract for Term Contracts for Civil Engineering Works (2002 Edition) Clause 92 shall be amended by the Special Condition of Contract SCC(4) at Appendix A.

8.2 Contingencies for Contract Price Fluctuations Provision in the Bills of Quantities (BQ) for the reimbursement of contract price fluctuations

is to be made in a separate Provisional Sum and is not to be included in an overall Contingency Sum.

8.3 Schedule of Proportions 8.3.1 Completion of Form

a) The Schedule of Proportions to be used in the calculation of the Price Fluctuation Factor (PFF) is attached at Appendices B1 and B2 for civil engineering and building contracts respectively. Columns (1) and (2) shall be completed by the project engineer/surveyor and the form shall be embodied in the tender documents. Tenderers shall be instructed by means of a Condition of Tender to submit the form with column (3) completed as part of their tenders.

b) For building contracts, the preamble to the Schedule of Proportions shall repeat the

requirement for tenderers to complete column (3) of the form, and the Bills of Quantities Preliminaries or the Specification Preliminaries shall include the clauses at Appendix C


which further explain the use of the Schedule of Proportions and provide guidance in the calculation of the Price Fluctuation Factor.

8.3.2 Limits to be Used on Schedule of Proportions

a) The limits set in columns (1) and (2) of the Schedule of Proportions at Appendices B1 and B2 are to suit the project/contract type, e.g. for a labour intensive contract the limits set for Labour will be high. It is necessary to ensure that wide gaps between minimum and maximum levels are not unintentionally provided. As a general check on the reasonableness of the range of maximum and minimum percentages to be used, it is suggested that, as a general rule, the ranges of the totals of columns (1) and (2) should be as follows:

Ranges of Totals Civil Engineering

Contracts Building Contracts

Column (1) Upper Limit 145 160 Lower Limit 135 130 Column (2) Upper Limit 70 80 Lower Limit 60 50

a) For building contracts, the limits set in columns (1) and (2) of the Schedule of

Proportions are pre-determined (by statistical analysis) in respect of five typical project types as defined at Appendix D. Except in circumstances where there is clearly no comparable building project type, the project surveyor shall adopt the Schedule of Proportions limits applicable to the project type most appropriate to the proposed contract regardless of whether or not such proposed contract is expressly included at Appendix D. In circumstances where the proposed project type differs significantly from those included at Appendix D e.g. a major site formation, piling and basement contract, the project surveyor shall set appropriate limits, derived from analysis of previous similar contracts where possible, in columns (1) and (2) of the Schedule of Proportions. In such circumstances, the general rule of the ranges of the totals of columns (1) and (2) is given in the above table.

8.3.3 Use of More than One Schedule of Proportions

a) In order to reduce the possibility of speculation by contractors, the use of more than one Schedule of Proportions should be considered, especially for contracts with two or more diverse elements where a single Schedule of Proportions may not produce an equitable method of reimbursement of price fluctuations.

Examples of civil engineering contracts:

(i) Two Schedules of Proportions may be considered in the case of site formation

works which would be followed by building works. In view of the diverse nature of the two types of work, two schedules of proportions should be considered.

(ii) Another example would be a road construction contract with extensive

earthworks and bridgeworks but where bituminous pavement works would not be carried out until the last few months of the contract period. In this case the


bituminous pavement works would be billed alone in one section of the BQ and a separate Schedule of Proportions provided.

Example of building contracts:

(iii) An example for the use of more than one Schedule would be a major hospital

contract with generally multi-storey blocks and associated work but with a substantial element of alterations and additions to existing hospital buildings to be carried out in the last few months of the contract period. In such a case, the alterations and additions to the existing buildings would be billed alone in one section of the Bills of Quantities and a separate Schedule of Proportions provided.

a) Where the use of more than one Schedule of Proportions is warranted, it will be

necessary to ensure that the Schedules apply to specified and preferably clearly separate sections of the Bills of Quantities. For civil engineering contracts, appropriate Special Conditions of Contract and Special Conditions of Tender should be provided. For building contracts, the preamble to the Schedule of Proportions and the Preliminaries/Specification clauses (Appendix C) should be appropriately amended.

8.4 Use of Adjustment Item to Bills of Quantities The sum in respect of the Adjustment Item given in the Bills of Quantities will become part

of the Effective Value. For civil engineering contracts, a clause to this effect has been included in the General Preambles to the Bills of Quantities in the Standard Method of Measurement for Civil Engineering Works (1992 Edition). For building contracts, ArchSD has prepared a Special Condition of Contract for Adjustment Item to this effect.

9. Calculation of Contract Price Fluctuations for Interim and Final Certificates 9.1 Completion of the Schedule of Proportions After the letter of acceptance of the tender has been issued to the successful tenderer and

before the execution of the Articles of Agreement,

a) civil engineering contracts - column (4) on the Schedule of Proportions (Appendix B1) submitted by the successful tenderer (now the Contractor) shall be completed by the Engineer Designate;

b) building contracts - the Schedule of Proportions (Appendix B2) shall be completed by

the Surveyor in accordance with item 2(c) of the preamble to the Schedule of Proportions.

The completed Schedule of Proportions shall be endorsed by the Employer and the

Contractor and witnessed at the time of execution of the Articles of Agreement. 9.2 Statement of Contract Price Fluctuation The calculation of the payment to be made as part of the interim or final certificate shall be

carried out using the Statement of Contract Price Fluctuation form at Appendix E1 (for civil


engineering contracts) or Appendix E2 (for building contracts). The calculation has two parts namely:

(a) Effective Value (EV) (see paragraph 9.3) (b) Price Fluctuation Factor (PFF) (see paragraph 9.4)

The product of EV and PFF gives the amount to be added or deducted. 9.3 Calculation of Effective Value The calculation of the EV is described in respective Clauses of GCC for Civil Engineering

Works (1999 Edition), GCC for Term Contracts for Civil Engineering Works (2002 Edition) and GCC for Building Works (1999 Edition) for fluctuations in the cost of labour and materials. The calculation requires the value of work based on actual cost or current prices to be established. When administering a contract using the CPFS and when calculating the value of work based on actual cost or current prices (to be shown in Section 1 of the Statement of Contract Price Fluctuation), paragraphs 9.3.1 to 9.3.3 are to be taken into consideration.

9.3.1 Valuation of Variations

a) When the valuation of variations is based on the rates set out in the Contract or rates

derived thereon the valuation shall be included in the EV. When the valuation of variations is based on actual cost or current prices the valuation shall be excluded from the EV.

b) All valuations of variations shall carry a statement, which shall be either :

"This valuation is based on prices current on the dates on which the work was carried

out and is not subject to Contract Price Fluctuation." or "This valuation is based on prices current at the time of tender and is subject to

Contract Price Fluctuation." as appropriate.

c) Any valuation that contains more than one item may require division or annotation into

two distinct parts, one subject to CPF, the other not subject to CPF. d) It is sometimes equitable to make an on-account payment for a variation which, due to

complexity, has not been fully valued before the interim certificate is issued. If such on-account payment is based on actual costs or current prices, it should be excluded from the EV. Otherwise it shall be included in the EV.

e) Where a variation has been ordered to be carried out on a Daywork basis and a priced

Bill of Provisional Quantities of labour, materials and plant for daywork is included in the Contract then the valuation will be subject to CPF. Should there be no such priced


Bill of Provisional Quantities and the valuation has been computed using rates current at the time of carrying out the work then the valuation will not be subject to CPF.

9.3.2 Use of Prime Cost and Provisional Sum Items

Where Prime Cost or Provisional Sum items are used, the situation with regard to CPF must

be clearly stated in a manner similar to paragraph 9.3.1. Sums payable to nominated sub-contractors including profit thereon will not form part of the EV. Any sum payable for attendance on nominated subcontractors that is independent of the sums payable to the nominated subcontractor will form part of the EV.

9.3.3 Contractor's Claims

The various claims that are payable under a contract calling for reimbursement of the contractor's costs or expenses will normally be excluded from the EV as they will be the actual costs at the time they were incurred.

9.4 Calculation of Price Fluctuation Factor 9.4.1 General Calculation

a) Calculations of the Price Fluctuation Factor shall be shown in the Statement of Contract Price Fluctuation at Appendix E1 for civil engineering contracts or at Appendix E2 for building contracts.

b) Column (1) of Appendices E1 and E2 will comprise the base indices for the month

which contains the 42nd day prior to the date set for return of tenders and the calculated Proportion in column (4) should be taken from column (4) of the Schedule of Proportions. These figures will remain unaltered for all payments.

c) Column (2) (subject to paragraph 9.4.2) will be the indices for the month which contains

the 42nd day prior to the last day of the period to which the payment certificate relates. The first of the monthly periods of interim statements is to commence on the notified date for commencement of the Works1. It follows that the expiry of such monthly periods shall be computed by reference to the notified date for commencement of the Works. For example, where 15 January 200X is the notified date for the commencement of the Works, the end of the monthly periods shall be the 14th day of the next following months.

d) It should be noted that where the day for commencement of the Works is immediately

prior to the middle of a month, the varying number of days that can comprise a month may produce some lack of uniformity in the selection of the indices for column (2). Where the indices for the appropriate month for the completion of column (2) are not available, a provisional sum shall be calculated for payment as set out in section 9.5.

1 This is stipulated in GCC for Civil Engineering Contracts Clause 78(1) for civil engineering contracts and is applied

also to building contracts where the period of interim certificates is monthly. ETWB TCW No. 21/2003 7 of 9

9.4.2 Effects of Completion Dates

9.4.2.1 Completion of the Works

When the Works has been certified as completed, the PFF will be calculated relative to the date so certified and all payment certificates issued after this date shall use that PFF provided that the Works were completed on or before the due date (or extended date) for completion. Should the Works not be completed by the required date, the PFF will be calculated relative to the due date (or extended date) and the resulting PFF will be applied to all certificates issued after that date, i.e. the PFF will be frozen relative to the actual date or the due date for completion of the Works, whichever is the earlier.

9.4.2.2 Completion of Sections of the Works

Some contracts may call for one or more specified Sections of the Works to be completed by a specified date prior to the completion of the Works. In such cases, should a Section be certified completed on or before the due date (or extended date), the value of any outstanding work will be subject to the PFF calculated for the certificate in which the value of the outstanding work is included. If a Section is not completed by the due date (or extended date), the value of the uncompleted work (when the work is carried out) is to be separately identified in subsequent statements and this value will be subject to the PFF relative to the due date (or extended date) for completion of the Section. Where there is more than one Section that has not been completed by the due date (or extended date), there will be an equal number of PFFs in use in addition to the PFF in use for the Works.

In order to operate this system with the minimum of administrative effort, Departments are

encouraged, where practicable, to provide separate bills in the BQ for the work forming a Section of the Works.

9.5 Provisional Calculation of Contract Price Fluctuations

9.5.1 When the indices relating to a certificate under preparation are not available, a provisional

sum for CPF is to be calculated based on the latest available published indices, using a proforma "Provisional Calculation of Contract Price Fluctuation" (Appendices F1 and F2 for civil engineering and building contracts respectively). The calculation makes use of the EV of the certificate under preparation (section 1 of the proforma) and the PFF calculated for the previous certificate for which published indices are available (section 2 of the proforma).

9.5.2 When the appropriate indices subsequently become available, the firm sum for fluctuation in

respect of previous interim certificates shall be computed on a Statement of Contract Price Fluctuation (Appendices E1 and E2 for civil engineering and building contracts respectively) and the provisional sum is to be replaced by the firm sum in the next certificate for payment.

10. Situation with no Interim Statement received Should the Contractor fail to submit an interim statement then there will be no payment

certificate and no separate CPF calculation for the period (usually one month) for which no statement has been received.



11. Situation with Interim Certificate less than Minimum Payment Specified in Contract LWBTC No. 7/87 (Minimum Amount of an Interim Payment), paragraph 3, Certificates for

Less than the Minimum Amount, relates to the use of discretionary powers in certifying payments. If such a certificate is to be issued then CPF will apply. If no certificate is to be issued then CPF cannot apply.

( W. S. Chan )

Deputy Secretary for the Environment, Transport and Works (Works) 2

LIST OF APPENDICES APPENDIX A : Special Conditions of Contract (I) Civil Engineering and Building Capital Works Contracts

SCC(1) Deletion of Contract Price Fluctuation SCC(2) Contract Price Fluctuation

(II) Term Contracts for Civil Engineering Works

SCC(3) Deletion of Contract Price Fluctuation SCC(4) Contract Price Fluctuation

(III)Building Capital Works Contracts with Nominated Sub-contract for

Electrical Installation for SCC(5) Fluctuation in the cost of labour for Nominated Sub-

contractor for electrical installations APPENDIX B1 : Schedule of Proportions to be used in calculating the Price Fluctuation

Factor (for Civil Engineering Contracts) APPENDIX B2 : Schedule of Proportions to be used in calculating the Price Fluctuation

Factor (for Building Contracts) APPENDIX C : Preliminaries/Specification clauses (for Building Contracts) APPENDIX D : Project Types, definitions thereof and related limits for Schedules of

Proportions (for Building Contracts) APPENDIX E1 : Statement of Contract Price Fluctuation (for Civil Engineering Contracts) APPENDIX E2 : Statement of Contract Price Fluctuation (for Building Contracts) APPENDIX F1 : Provisional Calculation of Contract Price Fluctuation (for Civil

Engineering Contracts) APPENDIX F2 : Provisional Calculation of Contract Price Fluctuation (for Building

Contracts)

ETWB TCW No. 21/2003 Appendix A Page A/1

Appendix A

Special Conditions of Contract

(I) Civil Engineering and Building Capital Works Contracts SCC(1) General Conditions of Contract Clause 89 is deleted and replaced

by the following:

Deletion of CPF (Time for Completion of the Contract with 21 months or less)

"No adjustment shall be made to the Final Contract Sum on account of any contract price fluctuation".

SCC(2) General Conditions of Contract Clause 89 is amended as follows:

Contract Price Fluctuations

(1) The " Index Numbers of the Costs of Labour and Materials used in Public Sector Construction Projects " in lines 3 and 4 of GCC Clause 89(1) shall be deleted and replaced by the "Index Numbers of the Costs of Labour and Materials used in Public Sector Construction Projects (April 2003=100)".

(Time for Completion of the Contract more than 21 months)

(II) Term Contracts for Civil Engineering Works SCC(3) General Conditions of Contract Clause 92 is deleted and replaced

by the following:

Deletion of CPF (Contract Period of 21 months or less)

“No adjustment shall be made to any final payment certificate on account of any contract price fluctuation”.

SCC(4) General Conditions of Contract Clause 92 is amended as follows:

Contract Price Fluctuations

(1) The "Index Numbers of the Costs of Labour and Materials used in Public Sector Construction Projects" in lines 3 and 4 of General Conditions of Contract Clause 92(1) shall be deleted and replaced by the "Index Numbers of the Costs of Labour and Materials used in Public Sector Construction Projects (April 2003=100)"; and

(2) “column 7” in line 3 of General Conditions of Contract

Clause 92(4) shall be deleted and replaced by "column 4".

(Contract Period more than 21 months)


Appendix A

(III) Building Capital Works Contracts with Nominated Sub-contract for Electrical Installation SCC(5) (1) Notwithstanding the provisions of Clause 89(3)(d)(i) of

the General Conditions of Contract the sum payable in any interim or final payment certificate certified by the Surveyor as being due in respect of the Nominated Sub-contractor for Electrical Installations shall include fluctuation in the cost of labour in accordance with this Clause.

Fluctuation in the cost of labour for Nominated Sub-contractor for electrical installations.

(2) For the purposes of this Clause the rates contained in the Schedule of Rates forming part of the Nominated Sub-contact are deemed to have been based upon the rates of wages ascertainable from the Index of Average Daily Wages of Workers Engaged in Public Sector Construction Projects (hereinafter called the "Wage Index") compiled by the Census and Statistics Department of the Government of Hong Kong for the month in which the date for the return of the Sub-contract Tender falls.

(3) If at any time after the commencement of the Sub-contract Works and before the certified date of completion of the Works a Wage Index shall be published and shall contain in respect of any trade which may be applicable to the Sub-contract Works a Wage Index figure which differs from the corresponding Wage Index figure for the month in which the date for the return of the Sub-contract Tender falls, then such difference in such Wage Index figure shall be dealt with as follows :

(a) If the increase or decrease represented by the difference in the Wage Index figure hereinbefore referred to shall not exceed five per cent (such percentage being calculated on the figures for the month in which the date for the return of the Sub-contract Tender falls) then no adjustment of the interim payments for the Sub-contract and final Sub-contract Sum shall be made.

(b) If the increase or decrease represented by the difference in Wage Index figure hereinbefore referred to shall exceed five per cent (calculated in the manner aforesaid) the Employer shall pay to the Contractor or the Contractor shall allow to the Employer, as the case may be, in respect of each and every workman properly and necessarily employed by the Nominated Sub-contractors on the Site or in connection with the Sub-contract Works, the sum, calculated at the rate of


twenty cents per day during the period to which the new Wage Index relates in which the workman was so employed, for each unit figure of the Wage Index by which the increase or decrease in the Wage Index figure for the trade in which the workman is employed shall exceed five per cent.

Provided that :

(i) In addition to the return of labour employed on the Site which the Contractor may be required to deliver to the office of the Architect's Representative for the purposes of Clause 32 of the General Conditions of Contract, the Contractor shall deliver to the Architect's Representative on each working day a return showing the number (and names if the Architect's Representative shall so require) and the trades of persons employed by the Nominated Sub-contractor elsewhere than on the Site in the preparation of work or materials for incorporation in the Sub-contract Works and shall furnish to the Architect's Representative satisfactory proof that such persons are properly and necessarily engaged in the preparation of such work or materials for incorporation in the Sub-contract Works. If the Contractor shall for any reason whatsoever have failed to provide such returns and proof to the Architect's Representative and if, in the opinion of the Surveyor, an allowance is due to be made by the Contractor to the Employer under this Clause, the Surveyor shall be entitled to value such allowance from such information available to him and the sum so valued may be deducted by the Employer.

(ii) No payment under this Clause shall be payable or deductible to the Contractor in respect of workmen engaged by the Nominated Sub-contractor in the transportation of materials or finished or partially finished work to or from the Site.

ETWB TCW No. 21/2003 Appendix B1 Page B1/1

(for Civil Engineering Contracts)

Schedule of Proportions to be used in Calculating the PRICE FLUCTUATION FACTOR (PFF)

Contract No. / /

Item of Labour and Selected Materials

Percentage of “Effective Value” of the Works

Calculated Proportions

applicable to this LIMITS TENDER Index Contract Max. Min. (whole number)

(*) Proportion (†) (0.0085×(3))

(Column No.) (1) (2) (3) (4) Composite labour for civil

engineering contracts

Aggregates Bitumen Diesel fuel Steel reinforcement Galvanised mild steel Portland cement (ordinary) Timber formwork All other costs not subject to

adjustment - - - 0.1500

TOTAL - - 100 1.0000 Signature: _________________________ Name of tenderer: _________________________ Company: _________________________ Date: _________________________

Date for return of tender: ____________________ (*) Column (3) to be filled in by the tenderer within the limits set in columns (1) and (2) (†) Column (4) to be completed by the Engineer Designate after receipt of tender

ETWB TCW No. 21/2003 Appendix B2 Page B2/1

(For Building Contracts)

APPENDIX *

SCHEDULE OF PROPORTIONS TO BE USED IN CALCULATING THE PRICE FLUCTUATION FACTOR

Instructions on completing the Schedule of Proportions 1. Conditions of Contract (a) The Schedule included in this Appendix is the Schedule of Proportions referred to in

Clause 89 of the General Conditions of Contract. Refer also to Bill No. 1 – Preliminaries and the relevant Special Conditions of Contract.

2. The Schedule shall be completed as specified hereunder :- (a) Pre-determined proportions Columns (1) and (2) have been pre-determined before issue of tender documents.

Under no circumstances shall these figures be changed. (b) Completed by tenderer (i) The TENDERER SHALL COMPLETE COLUMN (3) ONLY. (ii) Column (3) shall be completed in whole numbers and the total of column (3)

shall equal to 100. The percentages set against the individual items are to be assessed by the tenderer within the pre-determined limits shown in columns (1) and (2).

(c) Completion of remainder of Schedule Column (4) shall be calculated in accordance with the following and shall be

completed by the Surveyor before the execution of the Articles of Agreement. (i) Column (4) shall be the figures in column (3) multiplied by 0.0085. The total

of column (4), including the figure not subject to adjustment, shall equal 1.0000.

* Insert as appropriate

ETWB TCW No. 21/2003 Appendix B2(amended in June 2011) Page B2/2


for Building Works

Contract No. (PROGRAMME NO. )


Percentage of "Effective Value"

of the Works



(*) Proportion

(0.0085×(3)) (Column No.) (1) (2) (3) (4) Composite labour for building contracts Aggregates Portland cement (ordinary) Concrete blocks Sand Steel reinforcement Galvanised mild steel Metal formwork (1) Timber formwork Hardwood Teak Homogeneous floor tiles (1) Mosaic tiles(1) Glazed ceramic wall tiles uPVC lined GMS pipes Copper pipes uPVC pipes Glass Paint All other costs not subject to adjustment

- - - 0.1500

TOTAL - - 100 1.0000

Signature: ..................................................

(*) Column (3) to be filled in by tenderer within the limits set by

Name of tenderer: ........................................

the Surveyor in columns (1) and (2) Company: ..................................................

Date: ........................................................

Date for return of tender: ................................

(1) To be included for Type E projects only (See Appendix D).

ETWB TCW No. 21/2003 Appendix C Page C/1


CONTRACT PRICE FLUCTUATION SYSTEM

The following shall be inserted into the Preliminaries in the General Conditions of Contract section for contracts using the CPFS Clause 89 Contract Price Fluctuations

The list of labour and selected materials included in the Schedule of Proportions is pre-determined and shall not be changed during the currency of the Contract. The Price Fluctuation Factor for each payment certificate shall be calculated by the Surveyor. The following shall apply to such calculation :- (a) The figure of 0.1500 given in the column (4) of the Schedule of Proportions

represents 15% of the Effective Value that will not be subject to fluctuation adjustment. The figure of 0.1500 will therefore not be used in the calculation of the Price Fluctuation Factor.

(b) The products obtained by multiplying each of the calculated proportions by the

(index) fractions shall be to eight decimal places. Decimal places in excess of eight shall be rounded up or down to the nearest eighth decimal place.

(c) The final calculated Price Fluctuation Factor shall be to six decimal places.

Decimal places in excess of six shall be rounded up or down to the nearest sixth decimal place.

* Insert as appropriate

ETWB TCW No. 21/2003 Appendix D Page D/1


CONTRACT PRICE FLUCTUATION SYSTEM

DEFINITION OF BUILDING PROJECT TYPES

FOR SCHEDULE OF PROPORTIONS Project Type : Definition Type A: High rise with large element of repetition e.g. Offices, Quarters, Police Stations and the

like. Type B: Medium rise; up to a maximum of six storeys with a degree of repetition e.g.

Community Centres, Fire Stations, Ambulance Depots, Village Re-site Housing and the like.

Type C: Low rise; up to a maximum of two storeys with little repetition e.g. Swimming Pool

Complexes, Recreation Facilities and Sports Grounds, Open Spaces, Bazaars, Markets and the like.

Type D: Alterations and Renovations, Extensions and Ancillary Structures, Fitting Out and the

like. Type E: Housing Authority Projects and the like. NOTE (a) The categories of project shall be known by their "type" reference, each kind of

building project being identified under the "type" headings. (b) See also paragraph 8.3.2 of this Circular.

ETWB TCW No. 21/2003 Appendix D (amended in June 2011) Page D/2

TYPE A


for Building Works




of the Works



(*) Proportion

(0.0085×(3)) (Column No.) (1) (2) (3) (4) Composite labour for building contracts 37 26 Aggregates 3 1 Portland cement (ordinary) 20 8 Concrete blocks 2 1 Sand 3 1 Steel reinforcement 18 6 Galvanised mild steel 4 1 Timber formwork 21 14 Hardwood 2 1 Teak 4 1 Glazed ceramic wall tiles 4 1 uPVC lined GMS pipes Copper pipes 2 1 uPVC pipes 2 1 Glass 2 1 Paint 8 2 All other costs not subject to adjustment

- - - 0.1500

TOTAL - - 100 1.0000

Signature: ..................................................


Name of tenderer: ........................................


Date: ........................................................



TYPE B


for Building Works




of the Works



(*) Proportion


- - - 0.1500

TOTAL - - 100 1.0000

Signature: ..................................................


Name of tenderer: ........................................


Date: ........................................................



TYPE C


for Building Works




of the Works



(*) Proportion


- - - 0.1500

TOTAL - - 100 1.0000

Signature: ..................................................


Name of tenderer: ........................................


Date: ........................................................



TYPE D


for Building Works




of the Works



(*) Proportion


- - - 0.1500

TOTAL - - 100 1.0000

Signature: ..................................................


Name of tenderer: ........................................


Date: ........................................................



TYPE E


for Building Works




of the Works



(*) Proportion

(0.0085×(3)) (Column No.) (1) (2) (3) (4) Composite labour for building contracts 40 20 Aggregates 5 2 Portland cement (ordinary) 20 10 Concrete blocks 3 1 Sand 2 1 Steel reinforcement 23 15 Galvanised mild steel 2 1 Metal formwork 9 6 Timber formwork 4 3 Hardwood 5 3 Teak - - Homogeneous floor tiles 3 1 Mosaic tiles 3 1 Glazed ceramic wall tiles 5 3 uPVC lined GMS pipes Copper pipes 5 2 uPVC pipes 2 1 Glass 2 1 Paint 6 4 All other costs not subject to adjustment

- - - 0.1500

TOTAL - - 100 1.0000

Signature: ..................................................


Name of tenderer: ........................................


Date: ........................................................


ETWB TCW No. 21/2003 Appendix E1 Page E1/1

(For Civil Engineering Contracts)

STATEMENT OF CONTRACT PRICE FLUCTUATION For period ending of 20 Certificate No.

Contract Number and title: ......................................................................... 1. STATEMENT OF EFFECTIVE VALUE (EV)

Estimated value of work completed to end of period

$

(As on Engineer's Certificate No..........dated............) DEDUCT value of work based on actual cost/current prices $ EV of work completed to this certificate DEDUCT EV of work completed to last certificate (No. ) $ EV of work included in this certificate $

2. CALCULATION OF PRICE FLUCTUATION FACTOR Index Figures (3) (4) (5)

Base index for month of , 20 .

(1)

(2)

Index Fraction

Calculated

FACTOR

Current index for month of , 20 .

Base Current Current-Base Base

Proportion (3) × (4)

Composite labour for civil engineering contracts

Aggregates Bitumen Diesel fuel Steel reinforcement Galvanised mild steel Portland cement (ordinary) Timber formwork

PRICE FLUCTUATION FACTOR (PFF)

3. AMOUNT PAYABLE/DEDUCTIBLE FOR PRICE FLUCTUATION I certify that the amount payable pursuant to Clause +........ of the General Conditions of Contract in respect of the Engineer's Certificate No. ......... shall be increased/decreased * on account of changes in the Index Numbers for the Costs of Labour and Materials used in Public Sector Construction Projects pursuant to Clause +........ of the GCC and Clause SCC +........ of the Special Conditions of Contract by the amount of :- ...............................................** (HK Dollars.................................................... .....................................................................................................................)

(+) Insert clause number

Signature ..........................................

(*) Delete where inapplicable (**) (PFF)x(EV)

Name: .......................................... (Engineer's Representative)

ETWB TCW No. 21/2003 Appendix E2(amended in June 2011) Page E2/1


CALCULATION OF PRICE FLUCTUATION FACTOR

Surveyor's Certificate No. ......................... For period ending ..............................

Contract No. ...................of 20......

Base Index Month ..................... of 20......

Current Index Month................... of 20......

Index Figures Index Fraction Calculated FACTORItems Base Current (Current-Base)

Base Proportion

(*) ± (3) × (4)

Column No. (1) (2) (3) (4) (5) Composite labour for building contracts

Aggregates Portland cement (ordinary) Concrete blocks Sand Steel reinforcement Galvanised mild steel Metal formwork (1) Timber formwork Hardwood Teak Homogeneous floor tiles (1) Mosaic tiles Glazed ceramic wall tiles uPVC lined GMS pipes Copper pipes

uPVC pipes Glass Paint PRICE FLUCTUATION FACTOR (PFF)

(*) Calculated proportions from Column (4) of the "Schedule of Proportions".

(1) To be included for Type E projects only (See Appendix D).

ETWB TCW No. 21/2003 Appendix E2 Page E2/2


STATEMENT OF CONTRACT PRICE FLUCTUATION

SURVEYOR'S CERTIFICATE NO. ................ for period ending ............................

Contract No. ...............of 20............ Contractor: ....................................

Contract Title: ..............................................................................................

1. STATEMENT OF EFFECTIVE VALUE Total Estimated Value as shown on Surveyor's Certificate No............. $ DEDUCT sums included above:-

(a) In respect of Nominated Sub-contractors including profit thereon

$

(b) For items based on actual cost or current prices $ $ Total Effective Value to end of period

$

DEDUCT Total Effective Value to end of period as last payment certificate $ EFFECTIVE VALUE on this Certificate (EV) $ 2. CALCULATION OF PRICE FLUCTUATION FACTOR Price Fluctuation Factor (PFF) = (detail calculation as per attached sheet) 3. AMOUNT OF FLUCTUATION I certify that the sum payable pursuant to Clause 79(1) of the General Conditions of Contract in respect of the Surveyor's Certificate No. ......... shall be increased/decreased* on account of changes in the Index Figures pursuant to Clause 89 of the GCC and Clause SCC +...... of the Special Conditions of Contract by the amount of:- EV ......................... × PFF ......................... = $ Date:..........................

Signature: ...............................................

* Delete where inappropriate (+) Insert clause number

Name: ............................................... (Surveyor for the Contract)

ETWB TCW No. 21/2003 Appendix F1 Page F1/1

(For Civil Engineering Contracts)

PROVISIONAL CALCULATION OF CONTRACT PRICE FLUCTUATION

CERTIFICATE NO. ........................................ Contract No. ................................... Contractor: ............................................................................................ Contract Title: ......................................................................................... 1.0 EFFECTIVE VALUE OF WORKS (EV)

Estimated value of work to this certificate

$

DEDUCT value of work based on actual cost or current price

$

EFFECTIVE VALUE of work completed to this certificate

$

DEDUCT Effective values of work included to last certificate (No. )

$

Effective value of work included in this Certificate $

2.0 PROVISIONAL PRICE FLUCTUATION FACTOR (PFF)

Provisional PFF to be applied to this Certificate

3.0 PROVISIONAL SUM PAYABLE/DEDUCTIBLE

Provisional Sum Payable / deductible * on this certificate = (EV) × (PFF)

$

* Delete where inappropriate

ETWB TCW No. 21/2003 Appendix F2 Page F2/1


PROVISIONAL CALCULATION OF CONTRACT PRICE FLUCTUATION SURVEYOR'S CERTIFICATE NO................

Contract No................of 20............ Contractor:....................................

Contract Title:..............................................................................................

1. STATEMENT OF EFFECTIVE VALUE for period ending ................ Total Estimated Value as shown on Surveyor's Certificate No............. $ DEDUCT sums included above:-

(a) In respect of Nominated Sub-contractors including profit thereon

$

(b) For items based on actual cost or current prices $ $ Total Effective Value to end of period

$

DEDUCT Total Effective Value to end of period as last payment certificate $ EFFECTIVE VALUE on this Certificate (EV) $ 2. PRICE FLUCTUATION FACTOR Provisional PFF(s) to be applied to this certificate = (Note: Current Index Figures for months of ...... 20.... and ...... 20.... not available and

Provisional PFF(s) based on index Figures for month of ...... 20.... as calculated for Surveyor's Certificate No.............)

3. ADJUSTMENT FOR FLUCTUATION Amount of increase or decrease for fluctuation: (a) Provisionally calculated for the following certificates:

(+/-)

Cert. No..... EV ......... × (Prov.) PFF .............. = $ This Cert. EV ......... × (Prov.) PFF .............. = $ (b) As statements of fluctuation for certificates Nos. 1 to ........

=

$

Provisional net total adjustment for fluctuation carried to Certificate No............. Add/Deduct* $ * Delete where inapplicable