BACKGROUND

1. CONSTRUCTION COST DATAOFPAKISTAN INSTITUTE OF COST AND CONTRACTS (PICC) (www.picc.org.pk)By: Engr.M.Mazhar-Ul-Islam(CEO PICC)

2. BACKGROUND • A contract is a set of conditions at a price • Unreasonable construction cost and inadequate cash flows results poor quality delayed construction • Right cost of contract for sustainable construction • Departmental & FBS data found inadequate • Need exists for single source authentic data for all construction inputs

3. BACKGROUND • Needed organization having capacity to prepare such data • Since year 2007 MoH& W initiated such efforts • PPRA formally requested to PEC to be resource organization for such data • Working papers finalized after two years deliberations by 12 organizations • PEC amendment Bill 2011 envisages creation of subsidiary and preparation of construction cost data as PEC function

4. ESTABLISHMENT OF PICC • Approved by Governing Body on April 30th 2009 Rs. 50 million seed money for PICC as subsidiary • Commenced Operation from May 01, 2009 • Cost data was hosted on website on Sep 2009 • PC-1 for three years with an amount of Rs. 118 million approved by MoST and sent on 13.07.11 to PC for CDWP approval

5. ORGANIZATION AND MANAGMENT • Incorporated in Lahore with SECP U/s-42 of Company Ordinance as non- profit research organization • PICC members are member organizations-represented by their Natural persons • Majority members and Chairman in the PICC BoD are from PEC and other from NESPAK and APCA • Independent Board of Directors comprises of PEC and other Stakeholders. • CEO PICC to work under the PICC BoD • Recruited 35 staff including 8 Market Surveyors in major cities

6. ORGANIZATION AND MANAGMENT • National Steering Committee for controlling authenticity of cost data • Prepared and got approved comprehensive Service Manual from BoD. • PICC management committee holds meeting every week for decision making in managing the PICC affairs. • Recruitment is conducted in accordance with predetermined job description and criteria on merit. • State of the art online office environment.

7. PICC ORGANIZATION CHART

8. FUNCTIONS • Prepare, update and maintain on PICC website the cost data base for all construction inputs • Country specific schedule of rates • Country specific procurement documents • Guidelines for construction cost estimate • Standard method of measurement • Uniform classification system for specs & BOQs • Training and research on cost and contracts

9. PROGRESS • Maintaining, monthly updating and progressively uploading on the website the cost data, as per detail given below, for all the districts of Pakistan including AJK and Gilgit-Baltistan. • About 3134 basic input rates • About 1986 composite item rates for concrete, brick masonry, Stone masonry, Block masonry, steel bars, formwork, plastering, pile works, Earthwork and road works etc • Presently about 644,493 data items are being monthly updated which are to be increased progressively • Per unit rates and rates for quality control tests

10. PROGRESS • Standard methods of measurements and Model BOQ & guidelines have been developed in line with the international standards. • Comprehensive mechanism established for determining the Transportation Charges for various types of terrain. • Technical Specifications for concrete, masonry works, piles and water supply & sanitation are developed and uploaded on website whereas for various other sections are under development.

11. AUTHENTICITY OF PICC COST DATA • PICC Steering Committee of Experts approved the PICC rates in six meetings before hosting to web • National Conference on Construction Cost on 10.08.10 validate PICC Cost Data by 19 stakeholders • Compared Oct-Dec, 2010 Govt of Punjab data with PICC • Bid price of 5 different projects was compared with PICC Cost data and found within 10% • PICC rates for sand, aggregate etc is almost double in City than in quarry • PICC submitted itself for constant public review by displaying providers/ sources detail addresses

13. VIEW OF BASIC INPUT RATES

14. VIEW OF BASIC INPUT RATES

15. VIEW OF BASIC INPUT RATES

16. VIEW OF COMPOSITE ITEM RATES

17. VIEW OF COMPOSITE ITEM RATES

18. VIEW OF COMPOSITE ITEM RATES

19. BASIS FOR DETERMINATION OF TRANSPORTATION CHARGES • Truck Capacity: Monthly Hired Truck of 10 Ton Capacity • Speed:For a distance of 1 Km the Average Speed is taken 10 Km/hr. An increment of 0.5 Km/hr is considered for each Km upto a maximum average speed of 30 Km/hr • Diesel & Oil Consumption: Diesel@3Km/ Liter & Engine oil@100Km/ Liter • Labor:06 No. Laborers are considered for Loading, Unloading & Stacking within 3/ 4 Hours for each Trip • Allowances For Katcha, Hilly & Hard Hilly Areas:An allowance for Katcha & Hilly Areas is considered as 25% where as For hard Hilly area as 40% • Toll Taxes: Toll Taxes are also included

20. TRANSPORTATION CHARGES A comprehensive mechanism is developed for determining transportation charges in various types of terrain

21. PRICE FLUCTUATION TRENDS OF MAJOR MATERIALS

22. PRICE FLUCTUATION TRENDS OF MAJOR MATERIALS

23. PRICE FLUCTUATION TRENDS OF MAJOR MATERIALS

25. VIEW OF TECHNICAL SPECIFICATIONS

26. UTILITY OF PICC COST DATA • Preparation of budget cost estimates • Preparation of Engineer’s Estimates • Cost validation of PC-1 and third party cost validation • Reference data for resolution of contractual disputes • Reference data for price adjustment • Reference data for Bidders to prepare the bids

27. BENEFITS OF PICC COST DATA • Verification for accuracy of project cost • Transparency in the estimates • Minimize malpractices and corruption • Quality construction • Timely completion • Effective contract administration • Minimizing cost overrun and financial loss to the National exchequer during the currency of contracts • Facilitate Cost Plus project execution

28. RECOGNITION OF PICC DATA • PICC cost data is appreciated in Seminars/ Workshops-so far by UET and NUST. • ADB from Pakistan mission and Manila made 6 visits and has approved the reward of Technical Assistance of 149,500 U.S Dollar. • Upon invitation CEO PICC presented PICC cost data in Feb, 2011 in Donor’s club (WB, USAID, EU, DFID, ADB) in Islamabad • PICC Cost data was presented in TCDPAP/FIDIC conference in Malaysia on 25 April 2011. • WB & ADB arranged tour for presentation of PICC cost data in Kathmandu on 27 April, 2011; as model for South East Asia

29. SELF-SUSTAINABILITY PLAN • PICC yearly average budget is Rs. 25-30 M • PICC is established with Rs. 50 M seed money from PEC • Sustainability plan envisaged in PEC & PC-1: • 10% of constructors license fees (5th & 8th GB Minutes) • 0.01% from ECNEC approved projects • Donations from stakeholders & Donor agencies • Profit from training programs and Arbitration etc • Fees from users of PICC data • Advertisements

30. SELF-SUSTAINABILITY PLAN • PICC designed Self-sustainability plan in 3-5 years • Issuance of Notification is key to success • ADB approved $ 149,500 grant for non-salary component • Year 2011-2013 from PC-1 amount Rs. 118 M

31. SELF-SUSTAINABILITY PLAN • Year 2013-2015 from 3 years earning and earning up to 2015 • Self-sustainability beyond 2016 through: • Professional services on cost & contracts • Fees from users of PICC data • Advertisements on PICC website • Savings from training programs and Arbitration • Donations from stakeholders and Donor agencies • Year 2011-13 stop gap funding arrangement by PEC due to current financial crunch of GoP

32. Thank you