Cost update: May 2002 | Features

Hot rates: Preliminaries
	£ per week	% of total prelims
£5m greenfield industrial building, Midlands, 26-week contract
Contract guarantee bond	200	2.2
Name board	30	0.3
Management and staff	5000	54.7
Site accommodation	350	3.8
Power, lighting and water	400	4.4
Rubbish disposal, cleaning, drying and protection	600	6.6
Additional services and facilities	300	3.3
Small plant and tools	60	0.7
Mechanical plant	360	3.9
Temporary roads and hardstandings	1350	14.8
Access scaffolding	200	2.2
Hoardings, fans, fencing	135	1.5
Additional temporary works	150	1.6
TOTAL	9135	100
Preliminaries as % of other works		5%
£500,000 refurbishment, northern England, 30-week contract
Contract guarantee bond	25	1.2
Name board	15	0.7
Management and staff	1200	57.1
Site accommodation	90	4.3
Power, lighting and water	45	2.1
Rubbish disposal, cleaning, drying out and protection	115	5.5
Additional services and facilities	25	1.2
Small plant and tools	25	1.2
Mechanical plant	35	1.7
Temporary roads and hardstandings	0	0
Access scaffolding	500	23.8
Hoardings, fans, fencing	15	0.7
TOTAL	2090	100
Preliminaries as % of other works		15%
£1m single-storey school, East Anglia, 45-week contract
Contract guarantee bond	35	2.2
Name board	10	0.6
Management and staff	800	49.8
Site accommodation	75	4.7
Power, lighting and water	70	4.4
Rubbish disposal, cleaning, drying out and protection	90	5.6
Additional services and facilities	100	6.2
Small plant and tools	25	1.6
Mechanical plant	160	10
Temporary roads and hardstandings	40	2.5
Access scaffolding	200	12.5
Hoardings, fans, fencing	0	0
Additional temporary works	0	0
TOTAL	1605	100
Preliminaries as % of other works		8%
£3.5m sports centre, London, 45-week contract
Contract guarantee bond	115	1.2
Name board	15	0.2
Management and staff	5800	58.6
Site accommodation	330	3.3
Power, lighting and water	350	3.5
Site security	570	5.8
Additional services and facilities	265	2.7
Small plant and tools	70	0.7
Mechanical plant	440	4.4
Temporary roads and hardstandings	200	2.0
Access scaffolding	1500	15.2
Hoardings, fans, fencing	235	2.4
TOTAL	9890	100
Preliminaries as % of other works		15%

Price changes
	% change since spring 2001*
Hardcore	+9%
Insitu concrete	+10%
Steel reinforcement	+3%
Common bricks	+9%
Engineering bricks	+5%
Concrete blocks	+6%
Natural stone rubble	+4%
Precast concrete lintels	+8%
Structural steel	-6%
Sawn softwood	+5%
Clay roof coverings	-2%
Concrete roof coverings	+2%
Natural slate-roof coverings	-2%
Plasterboards	-2%
MDF/Chipboard linings	+3%
Standard softwood doors and windows	+5%
Glazing	+10%
Paints	+6%
Insulation	+2%
Stone pavings	+3%
* since the publication of Spon’s 2002 Price Books

Materials prices
Key Indicators	% change over last 12 mths (April 2001-April 2002)
Retail Prices Index
Headline rate (RPI)	+1.5
All items, excluding mortgage interest payments (RPIX) – government’s target index	+2.3
All items, excluding mortgage interest payments and indirect taxes (RPIY)	+2.5
Harmonised Index of Consumer Prices (HICP)	+1.3
Industry generally
Materials and fuels purchased bymanufacturing industry	-3.6
of which materials	-3.9
fuel	-1.4
Materials and fuels purchased by manufacturing industry, excluding food, beverages, tobacco and petroleum	-4.3
Output prices of manufactured products	+0.2
Output prices of manufactured products excluding food, beverages, tobacco and petroleum	+0.2
Construction industry
Construction materials	+1.0
Housebuilding materials	+0.9
Machinery and equipment (UK manufacture)	+0.9
Electrical machinery and apparatus (UK manufacture)	+0.6
Source: Office for National Statistics (March/April 2002 figures provisional)
Notes: The ONS category “Machinery and Equipment” includes mechanical engineering items such as pumps, taps, valves, lifts, cooling and ventilation equipment. “Electrical machinery and apparatus” includes electrical engineering materials such as electricity distribution and control apparatus, wires and cables and lighting equipment.

Price adjustment formulae for construction contracts
	% change July 2001-March 2002		% change July 2001-March 2002
Softwood carcassing and structural members	+2.2	Metal: decking	-6.1
Cladding and covering: sheet and tile	+2.1	Cladding and covering: coated steel	-4.2
Cladding and covering: lead	+4.8	Cladding and covering: aluminium	-3.0
Sanitary appliances	+2.6	Cladding and covering: zinc	-4.1
Pipes and accessories: spun and cast iron	+4.9	Raised access floors	-4.0
Pipes and accessories: steel	+2.9	Finishes: rigid tiles and terrazzo work	-7.3
Pipes and accessories: plastics	+2.6	Insulation	-2.4
Pipes and accessories: aluminium	+3.3
Aside from the first three items, the remaining work categories registering price rises have a plumbing labour input. Plumbers in England and Wales received a substantial wage increase in September last year, creating a 5.7% increase in labour costs.
Almost all those shown in the table have a significant metal content. ONS statistics show that imported metal prices fell 14% between September 2000 and November 2001. Since the end of last year, metal prices have stabilised, even staging a minor recovery, though some are beginning to fall in price again.

Wage agreement summary
Operatives	Agreement body	Wage rates effective since	Details in	Date of next review
Builders and civil engineering operatives	Construction Industry Joint Council	25 June 2001	Cost update 1 June 2001 Spon’s Architects’ and Builders’ Price Book 2002	24 June 2002 (third part of three-year agreement – see above)
	Building and Allied Trades Joint Industrial Council (BATJIC)	11 June 2001	Cost update 1 June 2001 Spon’s Architects’ and Builders’ Price Book 2002	10 June 2002 (see above)
Plumbers	The Joint Industry Board for Plumbing Mechanical Engineering Services in England and Wales	3 September 2001	Cost update 31 August 2001	2 December 2002 (second part of two-year agreement)
	Scottish and Northern Ireland Joint Industry Board for the Plumbing Industry	8 April 2002	Cost update 8 March 2002	28 October 2002 (third part of four-part, two-year agreement)
Heating and ventilation operatives	Joint Conciliation Committee of the Heating, Ventilating and Domestic Engineering Industry	3 September 2001	Cost update 31 August 2001 Spon’s Mechanical and Electrical Services Price Book 2002	7 October 2002 (third part of three-year agreement)
	The Joint Industry Board for the Electrical Contracting Industry	7 January 2002	Cost update 9 Nov 2001	6 January 2003 (second part of three-year agreement)
Electricians	Scottish Joint Industry Board for the Electrical Contracting Industry	7 January 2002	Cost update 8 March 2002	6 January 2003 (second part of three-year agreement)