WHAT ARE PROVISIONAL SUMS?
The term ‘provisional sum’ refers to an estimate in your builder’s contract for what it’ll cost to do a particular part of your building or renovation. Provisional sums are estimates that are provided where the builder can’t give an exact figure for the work required, even after having made reasonable enquiries into what it’ll actually cost.
One example might be for excavation. In some cases, it may be difficult to know exactly what’s under the ground, and therefore difficult to pinpoint the cost and effort required. The difference in this particular example could be a matter of many thousands of dollars either way – particularly if it requires, for example, revisions to the kind of foundation slab you need to build.
In reality, provisional sums aren’t always easy to plan for, in that the actual scope of work’s often inherently unknowable.
At Style Plus we discuss with the client about the inclusion of provisional sums in their contract, and make sure that the client has a very clear picture of all of the potential costs, risks and possible outcomes associated with any provisional sums – as well as what your options are to help reduce uncertainty.