Variations are inevitable. Managing them well is the difference between a 5% overrun and a 25% overrun.
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What this guide covers
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Why variations happen
Three main causes: (1) Hidden conditions discovered during strip-out — most common, 30-50% of variations. (2) Client change requests during build — usually scope additions or specification changes. (3) Design development — clarifications and details that emerge after construction starts. Variations as a percentage of contract value: 5-8% well-managed; 15-25% on poorly-managed projects.
Pre-emptive measures
Reduce variations through: detailed pre-mobilisation surveys (asbestos R&D, intrusive surveys of services); fully-developed specification before contract; provisional sums with clear scope; client decision-maker available for fast change-control sign-off. The single biggest reducer is investing time in scope clarity before contract.
Variation pricing
JCT contracts use either: (1) re-rate methodology — variations priced using contract bills of quantity rates; (2) star-rate methodology — new rates priced as variations occur. Star-rates typically 15-25% higher than equivalent contract rates. Quantity surveyor (QS) involvement on both client and contractor side prevents variation pricing disputes.
Documentation discipline
Every variation logged with: variation number, date issued, description, cost impact, programme impact, client sign-off date. Without this paperwork, variations become disputes at final account. Weekly variation register reviewed at progress meetings keeps both sides aligned.
Frequently Asked Questions
What variation rate is acceptable?
5-8% of contract value is normal and well-managed. Above 15% suggests scope problems.
Who prices variations?
Contractor prices, client QS reviews and agrees. Disputed pricing usually settled at final account stage.
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