CONTRACT PAYMENTS

&
VARIATIONS

Document to be referred for variation

procedure in local contract
1. Standard Bidding Document for Procurement of Works
ICTAD/SBD/01
Recommended for use on works contract between Rs. 10
million and Rs. 100 million
May be used for works of higher which are not of a complex
nature
2. Standard Bidding Document for Procurement of Works for Major
Contracts ICTAD/SBD/02
Recommended for use on works contracts over Rs. 100
million and for contracts of a lesser value which are
complex in nature
3. Standard Bidding Document for Procurement of Works for Minor
Contracts ICTAD/SBD/03
Recommended for use on works contracts up to Rs. 10
million
4. Standard Bidding Document for Procurement of Works for Design
and Build Contracts ICTAD/SBD/04
Recommended for use for works contracts where the

Who has the authority(Clause 39 of the

ICTAD)

The variations may initiated by the Engineer

at any time prior to issuing the Certificate of
As per the clause 39.4 ,ICTAD/SBD/01 each Variation
Completion of the works.
may include;
1. Changes to the quantities of any item of work
included in contract.
2. Changes to quality and other characteristics of any
item of work
3. Changes to levels, positions and dimensions of any
part of the Works
4. Omission of any work unless it is to be carried out
by others
5. Any additional work, plant, material or services
necessary for the Permanent Works.

Payments for Variations(clause 40)

The Contractor shall submit quotation for carrying out
variation within 07 Days and the Engineer shall assess
the quotation before the variation is ordered(clause
40.1 ,ICTAD/SBD/01)
The rate in the BOQ shall be used to calculate the
value of variation(refer clause 40.2 other cases,
ICTAD/SBD/01)
If the Contractor quotation is unreasonable, the
Engineer may fix the price still needs to be proceed
with works and then DAB (clause 40.3, ICTAD/SBD/01).
The Contractor shall not be entitled to additional
payments for costs that could have been avoided by
giving early warning(clause40.5 ,ICTAD/SBD/01).
The value of work executed shall include the valuation
of Variations and Compensation Events.(clause 42.5
,ICTAD/SBD/01)

Procurement Guide Lines

Reference:8.13.4
Variations to Contracts
A: Net variation within 10% of the Contract Award
Price:
Head of the Department (HD) or Project Director (PD) may
approve the variation by
revising the TCE, if required and subject to the following:
a) By obtaining explanatory note from the persons
involve;
b) By Satisfying that:
i. Change of scope could not have foreseen at the time
of award of contract;
ii. the change of scope is justifiable;
iii. The quantity variation/s are marginal or are due to
unforeseen situation/s;

Procurement Guide Lines

Reference:8.13.4
Variations to Contracts
B: Net variation exceeds 10% of the Contract Award Price:
a) HD/PD shall forward all the relevant documents

together with a statement prepared in accordance with a)

and b) above to the CAO; HD/PD shall also submit all the
documents required for the revision of TCE.
b) If the net variation is within 15% of the Contract Award
Price and CAO is satisfied with the HD/PD statement CAO
may approve it;
c) If the net variation is more than 15% of the Contract
Award Price or the net variation is below 15% and CAO is
not satisfied with the statement submitted by HD/PD, CAO
shall refer it to a the appropriate PC assisted by the TEC;
In this situation the appropriate PC shall be decide on the
basis of increased amount of the contract price and not

Conclusion
Contract Payments, Types
Authority Levels
Types of Payment
Definition of Variation Orders
Valuation procedure for VO
Procurement Guile Lines