Civil Engineering Reference
In-Depth Information
London 2012 Olympic and Paralympic Programme. This was principally
because they were seen as collaborative forms promoting construction
industry best practice, while also offering a range of fl exible solutions
for contracting out various levels of risk.
The NEC3 contract encompasses and integrates a set of processes that
ensure corporate governance. For example, as a publicly funded organisa-
tion it was incumbent on the ODA to manage public funds appropriately
and transparently, when initiating contract changes during the contract
period. Variations could be managed within the compensation event
process, within the NEC3 contract. The early warning notice procedure
of the NEC3 also provided a contractual method for both parties to the
contract to mitigate risk. NEC3 contracts can be used worldwide and
are indeed used in many countries.
Although the NEC has been viewed as onerous to administer, it
encourages a collaborative and proactive approach to contract adminis-
tration and ensures a focus on time as much as on cost. It was shown
on the London 2012 programme that NEC contracts could be managed
and administered with very few disputes. In general the contracts were
well administered, although that owed as much to a change in the
organisational culture and approach of all involved as it did to the avail-
ability of experienced individuals to manage and administer the pro-
gramme appropriately.
The London 2012 construction contracts were standardised, using the
NEC3 suite of contracts to provide a consistent approach to contracts
across the programme and throughout the supply chain. This was
achieved by means of a 'cascade' approach to subcontracts, where key
clauses were embedded in the tier 2 and 3 subcontracts, including
payment terms. The NEC3 consists of a suite of contract options, A to
F, with each option to be read in conjunction with core clauses. The
options adapt the NEC3 to the works or services required. The preferred
options used were:
• Option A: Priced Contract with Activity Schedule
• Option C: Target Contract with Activity Schedule
• Option E: Cost Reimbursable Contract
• Option F: Management Contract
• NEC Term Service Contract.
These options, which are reviewed below, allowed the ODA to select
the most appropriate risk profi le, while balancing time, cost and quality.
