A provisional sum is an amount included in the contract sum for work or costs that cannot be fully described or priced when the contract is signed. It is an Allowance, not a price. The Client or contract administrator instructs how it is spent, the work is valued, and the contract sum is adjusted up or down in the Final Account.
Worked example
A refurbishment contract includes a £25,000 provisional sum for repairs to the roof timbers, which cannot be inspected until the slates come off. Once opened up, the contract administrator instructs repairs, which are valued at £31,500.
| Item | £ |
|---|---|
| Provisional sum in the contract sum | 25,000 |
| Work as instructed and valued | 31,500 |
| Net addition to the contract sum | 6,500 |
If the repairs had cost £18,000, the contract sum would have been reduced by £7,000.
Provisional sums in the CVR
A provisional sum is a risk marker. Until it is instructed, the value in the contract sum and the cost in your budget are both estimates. On a CVR, keep each sum on its own line, mark it as not yet instructed, and forecast the likely spend rather than assuming the allowance is exact.
Two things commonly go wrong. The sum is spent and the instruction is late, so cost sits ahead of value. Or the sum is overspent, and nobody has told the client that the final account will rise.
For Subcontract packages, treat provisional sums the same way. If your tender allowed £10,000 for an item that was priced as a provisional sum, track it separately from the firm price so your margin on firm work is visible.
Provisional sums are not contingency
A provisional sum is a client-side allowance for defined scope that is not yet detailed. A Contingency Budget is your own cover for unknown cost. Do not offset one against the other.
Related terms
Prime Cost Sum, Contingency Budget, Allowance, Variation, Final Account.
Planyard's construction budget lets you hold each provisional sum as its own line and compare it with committed cost as orders are placed.
