The Project Manager's Own Assessment: NEC Clause 64 Explained

By Sheldon Wright MCICES. Last reviewed October 2026. Covers NEC3 and NEC4 ECC.

The NEC compensation event procedure is designed around the Contractor's quotation. The Contractor prices the event, the Project Manager accepts it, and the Prices and dates change. Clause 64 exists for when that fails. In four situations, the Project Manager assesses the event.

Both parties to the contract can misunderstand the intent of clause 64. Project Managers can treat it as a general power to replace a quotation with a figure they prefer. Contractors can treat a clause 64 assessment as the end of the matter, or as an insult. It is neither of those. It is a duty, with a deadline, that arises only in defined circumstances and has to be carried out under the same rules as a quotation. This article covers when it applies, how to do it properly, and what a Contractor should do on receiving one.

The clause has the same number and much the same content in NEC3 and NEC4. I paraphrase it.

The four triggers

Clause 64.1 says the Project Manager assesses a compensation event in four situations.

1. The Contractor has not submitted the quotation and its details in time. The period is three weeks from the instruction, unless an extension was agreed before it expired. Note the words "and details". A figure and a number of days, with no build-up and no explanation, is arguably not a quotation with details of the assessment.

2. The Project Manager decides that the Contractor has not assessed the compensation event correctly in a quotation, and does not instruct the Contractor to submit a revised quotation. This is the contentious one, and I deal with it below.

3. The Contractor has not submitted a programme, or alterations to a programme, that the contract requires with the quotation. Clause 62.2 requires the alterations to the Accepted Programme to be included where the programme for the remaining work is altered by the event.

4. When the Contractor submits the quotation, the Project Manager has not accepted the Contractor's latest programme for one of the reasons the contract gives. The reasons are the ones listed in clause 31.3: the plans are not practicable, the programme does not show the information the contract requires, it does not represent the Contractor's plans realistically, or it does not comply with the Scope.

Triggers one, three and four arise from something the Contractor has not done. Trigger two arises from a decision of the Project Manager.

The drafting matters here. The clause says the Project Manager "assesses". It can be argued that this gives a power and not a duty, but I read it as an obligation, and the deadline in clause 64.3 and the sanction in clause 64.4 only make sense on that reading. Once a trigger has occurred, the Project Manager has to make the assessment, and within a fixed period. An assessment cannot be threatened and then left undone.

Trigger two: "not assessed correctly"

This is where most of the argument lies, so it helps to be precise about what the words allow.

When a quotation arrives, the Project Manager has three replies that matter here: accept it, instruct a revised quotation with reasons, or notify that the Project Manager will make the assessment. (NEC3's clause 62.3 lists a fourth, which applies only to quotations for proposed instructions.) The last is available where the Project Manager decides that the event has not been assessed correctly.

"Correctly" means in accordance with the contract. A quotation has not been assessed correctly if it uses tender rates without agreement, omits the saving on deleted work, includes cost that is not Defined Cost, applies the wrong fee percentage, claims delay that the programme does not show, measures delay against the wrong programme, or prices a risk that would be a compensation event in its own right. Each of these is a departure from clause 63.

I think the position is different where the quotation follows the rules and the Project Manager simply holds another view of an output, a gang size or the chance of a risk occurring. Two competent estimators will forecast the same operation differently. A forecast that falls within a reasonable range has been assessed correctly, even if the Project Manager would have chosen a lower figure. The proper response to a difference of that kind is a conversation and, if needed, an instruction to submit a revised quotation with reasons. The contract intends the Contractor's quotation to be the basis of the assessment. A Project Manager who substitutes a preferred figure whenever the two differ has turned a quotation procedure into a claims procedure.

I hold that view as an assessor as well as when I am acting for contractors. Brian Eggleston's commentary on NEC3 reaches much the same conclusion. He treats the Project Manager's assessment as a fall-back for when the Contractor has not followed the assessment rules, and points out that the contract already gives the Project Manager a tool for disagreements about forecasts, which, where the effects are too uncertain to forecast reasonably, is to state an assumption under clause 61.6 and instruct a revised quotation. Not everyone shares the view, and the words give the Project Manager's decision real weight. There is also a practical reason for restraint. An adjudicator will test a Project Manager's assessment against clause 63, and an assessment that replaces a reasoned forecast with an unexplained lower figure tends not to survive that test.

When differences like this arise, in my experience it is always worth getting both parties to the contract to sit down together, face to face, and go through the assessment in detail: pinpoint the differences and challenge each other's views openly. In most cases, the differences can be agreed in that forum.

The programme triggers

Triggers three and four are the reason the Accepted Programme is a commercial document.

If the Contractor has not submitted the programme or alterations the contract requires, or has had its latest programme properly refused, the Project Manager assesses the event. In those cases, and wherever there is no Accepted Programme at all, clause 64.2 allows the Project Manager to use their own view of the programme for the work still to be done. The Contractor has lost its say over the time half of the event, and the cost of time-related resources follows the time.

Two qualifications protect the Contractor.

The refusal has to be for a reason the contract gives. A programme that has simply not been accepted, with no reasons given, or has been refused because the Project Manager dislikes the planned Completion it shows, does not meet trigger four. A refusal for a reason the contract does not list is itself a compensation event (clause 60.1(9)). NEC4 adds a further safeguard: if the Project Manager neither accepts a programme nor gives reasons within two weeks, the Contractor can notify the failure, and a week later the programme is treated as accepted (clause 31.3). If you are on NEC3, check whether your edition has the same provision.

The programme power is also narrower than it looks. Under NEC3 it applies where there is no Accepted Programme, or where the Contractor has not submitted a programme or alterations for acceptance as the contract requires. NEC4 adds a third case, where the Project Manager has not accepted the Contractor's latest programme for one of the reasons the contract gives. In neither edition does it give the Project Manager a general right to ignore an Accepted Programme they disagree with.

One practical point. Both editions allow a programme to be identified in the Contract Data at the start. If it is, there is always an Accepted Programme, even if every later revision is refused. Where there is none, the first programme submitted for acceptance becomes the most important document on the project, and a Contractor who is late with it starts the job exposed on every event.

The rules are the same

A clause 64 assessment is an assessment of the compensation event under clause 63, and nothing in clause 64 changes the rules. The Project Manager must therefore:

assess the effect on actual Defined Cost to the dividing date and forecast Defined Cost after it, with the Fee (NEC3 fixes the same date in clause 63.1 without naming it)
use the Schedule of Cost Components that applies. NEC3 lets the Project Manager use the Shorter Schedule in their own assessments under Options C, D and E
measure delay as the movement of planned Completion on the relevant Accepted Programme, or on the Project Manager's own assessment of the programme where clause 64.2 applies
include cost and time risk allowances for matters with a significant chance of occurring that are at the Contractor's risk
assume the Contractor reacts competently and promptly
apply any stated assumptions, and any clause 61.5 decision on early warning, if one was given at the right time.

The assessment that most often goes wrong is the one that values the work at bill or activity schedule rates, leaves out risk, and gives no time because "the contractor has not demonstrated delay". That is a valuation of the kind a traditional form would call for. NEC asks for something else, and an adjudicator will say so.

The deadline, and what happens if it is missed

Clause 64.3 requires the Project Manager to notify the assessment, with details, within the period the Contractor was allowed for its quotation. That is three weeks under the standard form, or longer if an extension was agreed. The period runs from the point at which it is clear that the Project Manager has to make the assessment. For trigger one, that is the day the quotation period expired. For trigger two, it is the date of the Project Manager's reply saying they would make the assessment.

Details are required. The Contractor is entitled to see how the figure and the delay were arrived at, in the same way that the Project Manager was entitled to see the Contractor's details.

If the Project Manager misses the period, clause 64.4 applies. The Contractor may notify the failure. If it continues for a further two weeks, the Contractor's quotation is treated as accepted. Where more than one quotation was submitted, the Contractor's notification says which one it proposes should be accepted.

The two editions word this differently. NEC4 treats the quotation as accepted if the failure to assess continues, so only the assessment itself stops the two weeks. NEC3 says "does not reply" and does not say what kind of reply will do. A reply saying that the assessment will follow in due course would defeat the purpose of the clause, and I would not rely on anything short of the assessment under either edition.

The consequence is severe. A Project Manager who rejects a quotation by saying "I will assess this myself", and then does not do so, can end up with the rejected quotation accepted in full by default. Of all the ways of losing control of an event, this is the easiest to avoid. The other routes to the same result are covered in deemed acceptance under NEC.

Clause 64.4 only helps where a quotation exists. If the Contractor never submitted one, which is trigger one, there is nothing to be treated as accepted. The Contractor's remedy for a Project Manager who will not assess is then the dispute procedure.

If you are the Project Manager

Use a revised quotation first. Where the problem can be fixed by the Contractor, say what it is and instruct a revision. Keep clause 64 for quotations that do not follow the rules and for Contractors who will not engage.
Give reasons when you decide to assess, and say which of the four situations in clause 64.1 applies. The contract does not require reasons at that point, but your assessment must have details, reasons given early focus the dispute, and an assessment made outside those situations is the one most likely to be unwound.
Put the three weeks in the diary the day you notify.
Build the assessment as you would expect a quotation to be built: by cost component, with actual and forecast separated, a programme demonstration and stated risk. If you have no planner, find one.
Use the Contractor's quotation as your starting point. Mark it up. Accept what is right, correct what is wrong, and show the difference. That is quicker than starting from nothing and much easier to defend.
Check whether you made a clause 61.5 early warning statement in time. If you did not, you cannot introduce it now.

If you are the Contractor

Avoid the triggers. Submit on time, with details, with the programme alterations, on a current Accepted Programme. Three of the four triggers are within your control.
Ask for an extension before the three weeks expire if you need one. The Project Manager can agree one, and an agreed extension is far better than a late quotation.
If the Project Manager says they will assess, diarise their three weeks, and send the clause 64.4 notification if they miss it.
When you receive the assessment, check it against clause 63. Look for rates in place of Defined Cost, missing risk, delay measured against the wrong programme, hindsight, and an early warning deduction that was never notified.
Respond in writing and promptly. The assessment is implemented, and the Prices change to the Project Manager's figure. If you disagree, the route is the dispute procedure. Under Option W1 there are time limits: a dispute about an action of the Project Manager has to be raised within four weeks of becoming aware of it (with the Senior Representatives first, under NEC4), so read them on the day the assessment arrives. Under Option W2 you can refer to adjudication at any time, but delay rarely helps.
Your quotation is your case. In an adjudication, the quotation you submitted is the document that sets out your position. That is one more reason to build it properly at the outset, and how to substantiate a compensation event sets out how.

Where Clause 60 fits

Most Project Managers who miss the clause 64.3 period do so because of everything else they have to get through that week. A proper assessment can take hours, and they have three weeks and ten other compensation events to assess. Clause 60 reads the quotation and cost build-up, the contract with its Z-clauses, and the native programme — Primavera P6 or Microsoft Project — and returns a structured first-pass review in about ten minutes. Each section is RAG-rated, every finding is cited to its source and labelled Fact or Inference, and gaps are flagged. For a Project Manager, that marked-up view of the Contractor's quotation is the natural starting point for a clause 64 assessment, and it is usually enough to decide on day one whether a revised quotation would be the better route. A contractor can run the same review on its own quotation before submission, to see which of the triggers it is exposed to.

It is assistive, not advisory. The assessment is the Project Manager's, and the Project Manager signs it.

There is a full sample review at clause60.com/demo, with no sign-up needed.

This article is general guidance on the standard NEC3 and NEC4 ECC forms, written from professional experience. It is not legal advice, and it does not account for the amendments in your contract. NEC is a registered trade mark of its owner; Clause 60 Limited is not affiliated with or endorsed by NEC.