NEC replaces the retrospective claim with a forward looking quotation: price the effect of the event on cost and on the programme, submit it within the period, and have it assessed. Done well it closes change as the project runs. Done badly it accumulates into exactly the kind of account the form was designed to avoid, and unpicking that is variations and entitlement work.
The structural difference from traditional claims is that the quotation is a forecast. It is assessed on what the event will reasonably cost rather than on what it eventually did, which changes how it should be prepared.
What the quotation has to cover
The effect on cost, built on the basis the contract provides rather than on whatever basis seems convenient.
The effect on the programme, shown against the accepted programme, including any change to the completion date or to key dates.
Both together, because the two are assessed as one. A quotation addressing cost and ignoring time is incomplete, and so is the reverse.
Where the event has no effect on one of them, saying so expressly is better than silence.
The programme does most of the work
Time effect is assessed against the accepted programme, which means the programme has to exist, be current and be accepted.
Where acceptance has lapsed, every quotation becomes contentious, because there is no agreed baseline to measure against.
That makes programme maintenance a commercial activity rather than a planning one. On NEC projects it is frequently the single highest value administrative task, and it is routinely treated as the lowest.
Forecast rather than actual
The assessment is of what the event will reasonably cost, which means a quotation submitted promptly is a forecast and one submitted late is a reconstruction.
That cuts both ways. A contractor that forecasts accurately keeps the benefit of efficiency; one that forecasts badly carries the difference.
It also means waiting for actual cost before quoting is usually the wrong approach, and on some projects it is what causes the backlog.
Timing is the commonest failure
The contract sets periods for notification and for submission of quotations, and both are short compared with traditional practice.
Under some editions and options the consequences of missing them are significant, which makes the deadlines operational obligations rather than targets.
The practical protection is to treat notification and quotation as a standing process with named owners, not as a response to be considered when there is time.
What a good quotation looks like
Short, structured and self contained. The event, the effect on cost with its build up, the effect on the programme shown clearly, and the assumptions stated.
Assumptions matter more here than elsewhere, because a forecast rests on them. Stating them allows the project manager to accept, challenge or instruct differently.
Where the effect genuinely cannot be forecast, the contract usually provides for assumptions to be stated and later corrected, which is a better route than guessing and a far better one than saying nothing at all.
Stating an assumption also protects the project manager, who is otherwise being asked to assess a forecast without knowing what it rests on.
How assessment works
The project manager assesses and either accepts the quotation or makes their own assessment, within periods the contract sets.
That obligation is real. A project manager who does not assess within the period is in breach of the mechanism, and the consequences under some options are significant.
Both parties therefore have deadlines, which distributes the administrative pressure more evenly than traditional forms do, provided both sides resource the role properly.
Where backlogs come from
Events notified but not quoted. Quotations submitted but not assessed. Programmes that stopped being accepted. Each one compounds the others.
Once a backlog exists it is difficult to clear, because each quotation depends on a programme position that has itself moved.
Clearing one is detailed work: establishing what was notified, what was quoted, what was assessed and what the programme showed at each point, event by event.
What to keep for each event
The notification with its date. The quotation as submitted. The programme the quotation was based on. The assessment or response. And the correspondence between them.
Five items per event, kept together rather than scattered through a project filing system that was designed for something else entirely.
On a project with a hundred compensation events that discipline is the difference between a closeable account and a dispute that runs for a year after completion.
Assumptions and later correction
Where the effect of an event genuinely cannot be forecast, the contract usually allows the project manager to state assumptions on which the quotation is based.
If those assumptions later prove wrong, the event can be reassessed, which protects both parties from a forecast made in the dark.
Using that route is far better than guessing or than delaying the quotation until the position is clear, because delay is what the mechanism penalises.
The quotation nobody submits
Contractors frequently notify an event and then do not quote, either because the effect is unclear or because the resource to prepare the quotation does not exist.
That is the worst position available. The event is on the record, the entitlement may be preserved, and nothing is being assessed or paid.
A quotation submitted with stated assumptions is better than no quotation, and it keeps the mechanism moving rather than building a backlog.
Where it sits commercially
Operating the mechanism properly is ordinary cost control and variations work, carried out monthly rather than at the end.
Where it has not been operated and the events have accumulated, unpicking the position is a defined exercise and usually covers time and money together, because the form does.
That makes it extension of time and variations work in one piece rather than two separate claims.
Variations that have not been agreed?
Variation claim preparation sets out the instructed scope, the measured difference and the valuation built on the rule the contract actually provides, with the evidence attached to each line.