1.

Contract Administration and Coordination

What is Contract Administration?

Contract administration refers to the process of managing a construction contract from its start (award) to its end
(close-out). It involves ensuring that the project is executed as per the terms and conditions of the contract. This
includes managing communications, documentation, timelines, costs, quality, and resolving disputes.

In the public sector of Pakistan, such as MES or C&W departments, contract administration follows rules issued
by the Pakistan Engineering Council (PEC), Public Procurement Regulatory Authority (PPRA), and department-
specific manuals.

Roles and Responsibilities:

• Employer / Client: The owner of the project (e.g., Military Engineering Services). They finance the project
and provide the overall direction.

• Consultant / Engineer: Often a design firm or the government’s engineering wing responsible for
technical supervision, drawing preparation, and certifying bills.

• Contractor: The party who executes the work. They are bound to complete the project according to
drawings, specifications, and within the timeline.

• Engineer’s Representative: Supervises the daily works and acts as a bridge between the contractor and
client.

Key Activities in Contract Administration:

1. Kick-off Meeting: Held at the start of the project. Contract clauses, drawings, work methodology, and
schedule are discussed.

2. Issuance of Work Order: After acceptance of the bid, a formal work order is issued.

3. Site Possession: The contractor is given possession of the site.

4. Monitoring Work Progress: The consultant supervises the work and ensures that the contractor adheres
to specifications and time schedules.

5. Managing Variations: Changes to design or scope due to unforeseen conditions must be documented as
variation orders with revised cost or time.

6. Dispute Resolution: Disagreements can be settled through negotiations, arbitration (under Pakistan
Arbitration Act), or court.

Contract Documents Used in Pakistan:

• Agreement Form

• General Conditions of Contract (PEC Standard Form)

• Special Conditions (project-specific)

• Specifications

• Bill of Quantities (BOQ)

• Drawings

• Schedule of Work
 2. Tender Documents, Bills of Quantities, Specifications, and Conditions

Tendering in Public Sector:

Tendering is the formal process of inviting bids from contractors for executing a project. In Pakistan, tenders must
follow the PPRA Rules and relevant departmental SOPs.

Tender Documents Include:

1. Notice Inviting Tender (NIT): Published in newspapers and on PPRA websites. It includes basic project
details like location, estimated cost, bid submission date, etc.

2. Instructions to Bidders: Guidelines on how to prepare and submit the tender.

3. Form of Bid: A declaration by the contractor agreeing to perform the work at the quoted rate.

4. BOQ (Bill of Quantities): A detailed list of work items with estimated quantities. The contractor quotes
unit rates against each item.

5. Technical Specifications: These are standards for construction materials, workmanship, tests, and
tolerances. They ensure uniformity and quality. MES and PEC have their own specification books.

6. Conditions of Contract:

o General Conditions: Payment mode, site conditions, delay penalties, dispute resolution.

o Special Conditions: Unique requirements related to site, security clearance, military sensitivity,
etc.

Types of Contracts Commonly Used:

• Item Rate Contract: Payment based on the quantities of work done, measured and paid at agreed rates
(widely used in MES).

• Lump Sum Contract: A fixed total price for entire work regardless of quantities.

• Cost Plus Contract: Actual cost + a fee. Not commonly used in public departments.

3. Progress Monitoring and Control

What is Progress Monitoring?

This is the process of ensuring that the work is being done on time and as planned. In public projects, delays lead
to cost overruns and administrative complications, so close monitoring is essential.

Monitoring Tools:

1. Bar Charts / Gantt Charts: Simple timelines showing start and finish dates of activities. MES projects
often use bar charts for internal planning.

2. Critical Path Method (CPM): Advanced planning technique showing which activities are critical to the
project timeline.

3. Work Schedules: The contractor must submit a detailed work schedule before starting.

4. Progress Reports:

o Daily Reports: Basic progress and weather details.

o Monthly Reports: Physical and financial progress.

Delays and Time Extensions:

• Excusable Delays: Natural calamities, non-availability of site, law & order issues. These may lead to
Extension of Time (EOT).

• Non-Excusable Delays: Delay in procurement, labor shortages, etc. Contractor may face penalties.

4. Works Supervision and Quality Control

Importance:

Supervision ensures that the quality of work matches design specifications. In MES and other public
departments, this is vital because the government pays public money.

Supervision Includes:

• Verifying site levels and setting out

• Checking formwork, reinforcement, and shuttering

• Ensuring materials meet specifications

• Approving samples of materials (like bricks, tiles, pipes)

Quality Control Tests:

• Concrete:

o Slump Test: Checks workability

o Cube Test: Compressive strength at 7 and 28 days

• Soil:

o Field Density Test: Sand cone method

o Proctor Test: For compaction

• Steel:

o Check diameter, spacing, overlaps, and anchorage

• Bitumen:

o Marshal Stability Test

o Penetration and Softening Point Test

Documentation:

• Material Approval Request (MAR)

• Inspection Request (IR)

• Site Instructions

• Non-Conformance Reports (NCR)

Types of Payments:

• Mobilization Advance: Paid at the start (usually 10%). Recoverable from interim bills.

• Interim Payment Certificates (IPC): Monthly/bi-monthly payments based on work done.

• Final Bill: Paid after project completion.

• Retention Money: 6–10% deducted from every bill and held until the defect liability period ends (usually 6
to 12 months).

How Bills Are Prepared:

• Contractor submits a Running Bill based on measured work.

• Consultant/Engineer checks the quantities and rates.

• The VoWD (Value of Work Done) is calculated using BOQ rates.

6. Equipment Inspection and Commissioning

Importance in Public Sector Projects:

In large civil works, especially those involving installations (like HVAC, water supply, pumps, generators, etc.), it's
essential to inspect the equipment before it’s put into operation. Equipment failures post-installation can result
in project delays and financial losses.

Key Phases:

a) Pre-Delivery Inspection:

Before equipment is delivered to the site, engineers may visit the supplier or manufacturer to inspect:

• Compliance with specifications (model, capacity, origin)

• Performance test reports

• Warranty and calibration certificates

For example: If MES is procuring a diesel generator for a mess building, it will inspect the load capacity and fuel
consumption beforehand.

b) Receiving Inspection (On-Site):

Upon arrival at the site:

• The condition of the equipment is checked.

• Packing lists and delivery notes are verified.

• Any damage during transportation is recorded and reported.

c) Installation Inspection:

• Check for proper foundation or mounting (e.g., for heavy machinery).

• Ensure the alignment, fitting, and anchoring are as per technical drawings.

• Utilities like electric supply, drainage, and ventilation are connected correctly.
 d) Testing and Commissioning:

This stage ensures the system runs under actual load conditions.

• Dry Run Test: Equipment is tested without load.

• Load Test: Performed with actual design load.

• Functionality Test: Checks all performance aspects (speed, output, safety alarms).

e) Handing Over:

After successful commissioning, the contractor hands over the system along with:

• Operation manuals

• Maintenance schedule

• Warranty card

• Staff training (if needed)

7. Post-Construction Services

After physical completion, the project enters into a maintenance and post-handover phase. MES and other
departments often require the contractor to stay responsible for certain services.

Post-Construction Services Include:

a) As-Built Drawings:

• These are revised versions of drawings submitted by the contractor showing the exact dimensions,
locations, and conditions of the completed project.

• Essential for future maintenance, expansions, or audits.

b) Operation Manuals:

• For mechanical or electrical systems, the supplier provides manuals explaining operation,
troubleshooting, and maintenance schedules.

c) Defect Liability Period (DLP):

• Usually 6–12 months after project completion.

• If any structural or mechanical defects appear, the contractor must repair them at no extra cost.

• Retention money is released after this period.

d) Final Payment and Clearance:

• Final bill is prepared after satisfactory completion of all DLP conditions.

• Performance securities and retention amounts are refunded.

e) Project Closure Report:

• Includes financial summary, lessons learned, technical challenges faced, and suggestions for future
projects.
 8. Operation and Maintenance (O&M)

This is the backbone of long-term infrastructure sustainability. MES often operates facilities like residential
quarters, military hospitals, office buildings, and water supply systems, so O&M is crucial.

Operation:

• Ensures that buildings, water supply, electrical systems, HVAC, and other utilities function smoothly.

• Trained staff (electricians, plumbers, HVAC operators) are appointed.

Maintenance Types:

a) Routine Maintenance:

• Regular tasks like cleaning, lubrication, filter changing, etc.

• E.g., monthly servicing of a water filtration plant.

b) Preventive Maintenance:

• Scheduled inspections to avoid breakdowns.

• E.g., inspecting rooftop tanks every 3 months.

c) Corrective Maintenance:

• Reactive repairs after faults occur.

• E.g., replacing faulty wiring after a short circuit.

d) Emergency Maintenance:

• Urgent actions during breakdowns (e.g., sewer blockage, pump failure).

Maintenance Logs and Checklists:

• Every system or equipment has a logbook showing history of service, repairs, inspections.

• Helps in budgeting and auditing.

9. Maintenance and Safety Inspections

Purpose:

To ensure the structural integrity, functionality, and safety of buildings, especially in sensitive military areas
managed by MES.

Types of Inspections:

a) Civil Structural Inspections:

• Cracks in columns, beams, or slabs.

• Signs of dampness, corrosion, or settlement.

• Drainage system inspections.

b) Electrical and Fire Safety:

• Proper grounding and earthing.

• Fire extinguishers, smoke detectors, and emergency exits.

c) Water and Sanitation:

• Inspection of overhead tanks, pipelines, taps, and drainage lines.

• Water quality testing.

Frequency:

• Weekly: Visual inspections.

• Monthly: Detailed checks of critical systems.

• Annual: Full audit by department-appointed technical staff.

Reports:

• Every inspection results in a written report.

• Any unsafe conditions must be addressed immediately.

• Serious observations are forwarded to higher-ups for decision-making.

10. Public Procurement Rules, 2004 (PPRA Rules)

These rules regulate how public sector organizations in Pakistan procure goods, services, and works. MES must
follow these rules for transparency, competition, and value for money.

Key Concepts:

a) Procurement Methods:

• Open Competitive Bidding (most common)

• Direct Contracting

• Request for Quotations (RFQ)

• Two-stage Bidding (for complex projects)

b) Thresholds:

• Procurement up to Rs. 100,000: May be done via single quotation.

• Rs. 100,000 to Rs. 3 million: At least three quotations required.

• Over Rs. 3 million: Open tender in newspapers and PPRA website.

c) Bid Evaluation Criteria:

• Must be specified in the bidding documents.

• Can include price, delivery time, warranty, past performance, etc.

d) Blacklisting of Firms:

• A contractor can be blacklisted for non-performance, fraud, or misrepresentation.

e) Grievance Redressal:
• Bidders can file a complaint if they feel unfairly treated.

f) Record Keeping:

• All documents must be kept for at least 5 years for audit purposes.