Page 101 - Civil Engineering Project Management, Fourth Edition

Civil Engineering Project Management
86
considerations such as how often will it be used; its cost and expected working
life; transportability; insurance, running and maintenance costs, and whether
the resulting estimated internal hire rate gives an adequate return on capital
invested, and shows a worthwhile saving over outside hire rates.
The risks involved in using owned plant have to be taken into account also.
Breakdown repairs of some plant can cause several days’ delay to the whole
job which may be very costly; whereas if hired plant breaks down it may take
only a day or two to get a replacement from the hirer or from some other firm.
Also hire firms can often supply an experienced driver with plant, and their
hire charge will cover all maintenance, repair, breakdown and renewal costs,
which reduces the contractor’s on-site commitments and risks. Additionally
some operations, such as bulk excavation, may be let to a sub-contractor who
provides all plant and drivers required for payment of either a fixed lump
sum or more often unit rates for the measure of work done.

7.7 The contractor’s use of sub-contractors

Many civil engineering contractors now use sub-contractors to do much of their
work. Most conditions of contract permit a contractor to sub-let work of a spe-
cialist nature; but the ICE conditions of contract have gone further and permit
the contractor to sub-contract any part of the work (but not the whole of the
work), subject only to notifying the engineer of the work sub-contracted and
the name of the sub-contractor appointed to undertake it.
The contractor does not have to notify any labour-only sub-contracts he uses.
The engineer can object, with reasons, to the appointment of a sub-contractor,
but otherwise has no rights in connection with such sub-contracts, except that
he can require removal of a sub-contractor who proves incompetent or negli-
gent, or does not conform to safety requirements. Under FIDIC conditions for
overseas work, sub-contracting requires the engineer’s prior sanction.
In building work there has long been a trend to pass the majority of work
to sub-contractors who specialize in various trades, and the same has now
occurred in civil engineering where many operations are ‘packaged up’ and
sub-let. Thus sub-contracts may be let for excavation, formwork, reinforce-
ment supplied and erected, and concreting. The advantage to the contractor is
that this reduces the staff he needs on site and his capital outlay on plant and
equipment. He can use sub-contractors with proven experience and does not
have to take on a range of temporary labour whose quality may be variable.
The contractor retains responsibility for the quality and correctness of work
and, of course, has to plan and co-ordinate the sub-contract inputs, and often
supply any necessary materials.
But if much of the work is sub-contracted, the contractor’s or agent’s main
input to a project may be that of dealing with the sub-contracts and controlling
their financial outcome, so these matters may take priority over dealing with
any engineering problems which arise. The contractor may therefore tend to