A real NEC4 compensation event review — CE-07, pavement specification change

The full output of a Clause 60 review, on a fictional Option A scheme: rated section by section, every finding labelled Fact or Inference, and what is missing said rather than assumed.

Illustrative example. This report reviews a fictional compensation event on a sample scheme. Clause 60 is an assistive tool — it supports a qualified reviewer's judgement and is not a substitute for it. Review before relying.

CWR-CE-07

CE-07 — Pavement specification change

MIS — Motorway Improvement Scheme · NEC4 ECC Option A

AMBER

Assessable at £75,712 — the quotation is largely sound, but two queries should be resolved before you accept it, and one bond-coat quantity could reduce Defined Cost by up to £1,500.

GREEN
Contractual basis. Valid compensation event — PMI-PV-07 is a written PM instruction changing the Scope, Clause 60.1(1) applies, and it was notified in time.
AMBER
Cost. The build-up is sound — correct Schedule of Cost Components basis, correct Fee, no working-area overhead. One query: the 25,000 m² bond-coat / tack-coat quantity — up to £1,500 of Defined Cost is unsupported until it's measured.
AMBER
Time & programme. The claimed Key Date (KD-2) movement of 6 working days is arithmetically consistent with the contractor's own XER — but the float distribution and critical-path logic should be verified in Primavera P6, and the Option X7 delay-damages exposure confirmed, before it's implemented.
TO CLOSE
Missing information. Two items complete the assessment: the bond-coat quantity basis, and the full float distribution from the native programme files.

Recommended action

Return the quotation to the Contractor with a written request for: (1) clarification and substantiation of the bond coat/tack coat quantity (25,000 m² — basis and measurement); (2) confirmation of the X7 delay damages exposure in calendar days from the contractual KD-2 date of 17 April 2025 to the impacted planned date of 24 April 2025. Separately, the PM/Employer's team should open the native XER files in Primavera P6 to verify the full float distribution and critical-path logic before implementing the time assessment. Subject to satisfactory resolution of these queries, the quotation is assessable at GBP 75,712 (subject to the bond coat quantity check, which could reduce the Defined Cost by up to GBP 1,500 if the quantity is unsupported).

Section ratings

Ref	Section	Rating	Materiality	What the review found
A	Contractual Basis	GREEN	High	CE-07 is contractually valid. PMI-PV-07 is a written PM instruction changing the Scope; Clause 60.1(1) is the correct sub-clause. Notification and quotation are within time. No Z-clause removes entitlement.
B	Cost Assessment	AMBER	High	The cost build-up is largely sound: correct SSCC basis, correct Fee, no WAOH, correct X1 treatment. One AMBER query on the bond coat/tack coat quantity (GBP 1,500 at risk). Testing rate basis unstated (low value, low risk).
C	Time / Programme	AMBER	High	The time assessment is well-structured and the KD-2 movement of 6 working days is arithmetically consistent with the XER data. Two AMBER queries: (1) 46%/39% of activities show unknown total float in the extracted data — native XER verification in P6 required; (2) the X7 exposure period (contractual KD-2 date to impacted planned date) needs calendar-day confirmation for delay damages purposes.
D	Internal Consistency	GREEN	Medium	The narrative, figures and programme are internally consistent. Rates are consistent with prior CEs. Totals are arithmetically correct. The cost-programme reconciliation on the Programme Narrative sheet is coherent.
E	Risk and Contingency	GREEN	Low	No risk or contingency allowance is included. This is an affirmatively stated nil position: the scope is defined by PMI-PV-07 and the supplier quote, and no blanket percentage has been applied. No Contractor-risk matters are being passed through.
F	Missing Information	—	—	Two items of missing information are required to complete the assessment: (1) bond coat/tack coat quantity basis and rate derivation; (2) full XER verification in P6. One further item (testing rate basis) is low priority.
G	Liability Summary	GREEN	High	Liability is established. CE-07 is a valid compensation event under Clause 60.1(1). PMI-PV-07 is a written PM instruction changing the Scope. No Z-clause removes entitlement. The quotation is in the correct form. Liability is not in dispute.

Commercial summary

Measure	Amount / status
Total change to the Prices claimed	GBP 75,712
Defined Cost claimed	GBP 67,600
People	GBP 16,400
Equipment	GBP 11,800
Plant and Materials (binder course)	GBP 37,200
Plant and Materials (bond/tack coat) — AMBER query on quantity	GBP 1,500
Charges (testing and coring)	GBP 700
Fee at 12%	GBP 8,112
Amount assessable / supportable (subject to AMBER queries)	GBP 75,712 (up to GBP 1,680 at risk pending bond coat quantity check — GBP 1,500 DC + GBP 180 Fee)
Principal amount in question (bond coat quantity)	Up to GBP 1,680 (GBP 1,500 DC + GBP 180 Fee)
Time claimed — KD-2 movement	6 working days (10 calendar days), 14 April 2025 to 24 April 2025
Time assessable — KD-2 movement	6 working days subject to XER verification in P6
X7 delay damages exposure (KD-2, GBP 2,500/day)	Contractual KD-2 date 17 April 2025; impacted planned date 24 April 2025; 5 working days / 7 calendar days exposure — confirm calendar-day count for X7 purposes
Planned Completion impact	Nil — unchanged at 20 May 2025 in both XER files
Option X1 (inflation) adjustment	Nil — correctly excluded; CE assessed at current prices under Clause 63.1

Actions required

#	Action	Party	Ref	Priority
1	Contractor to provide the measurement basis and substantiation for the bond coat and tack coat quantity of 25,000 m² (Sheet: Defined Cost SSCC). The quantity implies a 2.5 m-wide strip over 10,000 m of chainage, which exceeds the stated scope of chainage 800–3200 (2,400 m). If the quantity cannot be substantiated, the item should be re-measured and the Defined Cost adjusted accordingly (maximum reduction GBP 1,500 DC + GBP 180 Fee = GBP 1,680).	Contractor	B	High
2	PM / Employer's team to open the native XER files (CE07_AP05_baseline_clause32.xer and CE07_IMP01_impacted_clause62.xer) in Primavera P6 to verify the full float distribution, critical-path logic, and calendar settings for the 46% / 39% of activities showing unknown total float in the extracted data. Confirm that the KD-2 movement of 6 working days is supported by the full schedule logic.	PM	C	High
3	PM to confirm the Option X7 delay damages exposure in calendar days from the contractual KD-2 date (17 April 2025) to the impacted planned KD-2 date (24 April 2025), accounting for the bank holidays (Good Friday 18 April and Easter Monday 21 April). The exposure is 7 calendar days / 5 working days at GBP 2,500/day = GBP 12,500 if KD-2 is not met by 17 April 2025. The PM should record this exposure and monitor progress against the impacted KD-2 date.	PM	C	High
4	Contractor to confirm whether the testing and coring rate of GBP 35 per core (20 cores, GBP 700) is a forecast rate from a specialist or an internal estimate, and to provide the supporting quotation or rate derivation if available. This is a low-value item but the rate basis is unstated in the pack.	Contractor	B	Low
5	PM to implement the CE-07 Key Date adjustment (KD-2 moved by 6 working days, subject to XER verification) in the contract records and notify the Contractor of the adjusted Key Date under Clause 65.1 once the quotation is accepted. Update the X7 delay damages monitoring accordingly.	PM	G	Medium

What a review done at speed would likely miss

It would take the £75,712 and the claimed Key Date slip at face value. Clause 60 checked the time claim against the programme's own float — not the assertion — flagged the unsupported bond-coat quantity, and surfaced the Option X7 delay-damages exposure to confirm. Those are the three points that decide what you actually pay.

Read the full report — all 19 pages (contractual basis, cost, time, consistency, risk, liability)