20 May 2022
The Office of Government Procurement (OGP) has today published details of the Inflation/Supply Chain Delay Co-operation Framework Agreement (‘the Agreement). The publication follows the announcement by the Minister for Public Expenditure and Reform, Michael McGrath T.D. on the 10 May 2022 of new measures to address the risk posed by exceptional inflation and supply chain disruption on projects being delivered under the public works contract.
These measures represent an appropriate and balanced set of provisions to address the impact of global events which are outside the control of either party to the contract, are uncertain in both their duration and impact and therefore place the successful completion of a project at risk.
The first tranche of documents deal with the major forms of contract PW-CF1 – PW-CF5 inclusive. Documents to implement the measures with respect to the Short Public Works Contract will follow next week.
The documents published today include:
Workbooks to assist contracting authorities in calculating the ex gratia contribution will be published on Monday, 23 May 2022.
Once entered into, the Agreement operates without prejudice to each party’s rights under the Contract and is predicated on a cost burden share basis, whereby the Employer makes an ex gratia contribution of up to 70% of the inflation amount calculated and waives the application of liquidated damages arising from a delay in meeting the Date for Substantial Completion that is caused by supply chain delay.