In construction contracts, Provisional Sums (PS) play a critical role in managing scope uncertainty and budgeting for future instructions. But how well do we understand their types and impact?
What are Provisional Sums?
These are allowances included in the Schedule of Quantities (SOQ) or pricing documents for works that are undefined or uncertain at the time of contract signing. They’re only executed once the Engineer or Employer gives the green light.
Types of Provisional Sums:
Defined PS: Scope is known but price or final details are pending.
Undefined PS: Scope is unclear; valued based on actual cost + overheads.
Prime Cost Sums: Specialist subcontracted work (e.g., lifts, MEP); adjusted as per supplier cost + contractor’s margin.
Contingency Sums: For unforeseen or minor adjustments not covered in the original scope.
When Does It Count?
A PS item becomes payable only when instructed. Until then, it’s just a placeholder. Once activated, it’s treated as a variation and priced accordingly.
Project Impact:
It becomes a variation and is evaluated using actual costs + agreed markups.
Contractors must provide detailed breakdowns to support Employer decision-making.
“Treat Provisional Sums with care, they may look passive on paper but can have active consequences on cost and program”.
