Chapter II
DETERMINATION OF CONSTRUCTION PRICE INDICES
Article 4. Steps
1. Determining the calculation point of time, including the benchmark and comparison points of time.
2. Making a list of construction price indices in question and choosing input factors.
3. Collecting and processing data and figures needed for calculation of construction price indices.
4. Determining construction price indices.
Article 5. Time
1. Time of determination of construction price indices to be publicized by provincial-level People’s Committees shall include:
a) Benchmark point of time is the year 2020. Ministry of Construction shall update their regulations on time of determination of construction price indices in case of any change in the benchmark point of time so that they are adjusted to local contexts.
b) Comparison point of time is a month, quarter or year of publication of construction price indices compared to the benchmark point of time.
2. In order to determine a price index for use in a particular construction project, the project owner shall rely on progress and conditions for implementation of that project to decide on the proper benchmark or comparison point of time.
Article 6. Listing of construction work or project classifications and selection of input cost factors
1. Quantifying and listing out classifications of construction works and projects by their types before publication thereof shall be subject to administration requirements, regulations on administration of investment and construction projects as well as construction investment expenses, and particular characteristics of local construction projects. Provincial-level People’s Committees shall rely on the Classification List of construction works or projects in Appendix 3 hereto to decide to choose the classification list of construction works or projects as subjects of calculation of construction price indices to be publicized within their remit.
2. In order to calculate a construction price index for a type of construction work or project, it shall be obliged that construction works or projects typical for such type must be chosen. The number of construction works or projects typical for a building type shall be determined, depending on particular local conditions, but shall not be less than 3. Typical construction works or projects are those commonly developed out of others of the same type at a locality.
3. If a price index is determined for a particular construction work or project, such work or project is a typical one.
4. Typical input cost factors are costs of main building materials, labor and machinery used by a single construction work or project, or construction works or projects of the same type. Main building materials, labor or machines are selected for the purpose of calculation of construction price indices according to the principles in which costs thereof must be greater in proportion than costs of corresponding ones used for construction works or projects (80% in total).
Article 7. Collection and processing of data and figures needed for calculation of construction price indices
1. Requirements concerning collection of data and figures needed for determination of cost structures:
a) Data about construction investment expenses, including total investment, cost estimates, finalization of construction investment costs incurred upon completion of construction works or projects (if any), which obtain approval must include expense-related entries and accounts.
b) Policies and regulations pertaining to administration of construction investment expenses, building labor, machinery or equipment, and other related costs, which remain in effect on the date of calculation.
2. Requirements concerning information about market prices of input factors:
a) Costs of building materials: Building material costs shall be calculated as per Ministry of Construction’s Circulars providing instructions on computation and administration of construction investment expenses. Building materials qualified to be listed as input values for use in calculation of construction price indices must be identical in terms of their types, formations and product markings or labels. As for calculation of construction price indices for construction works, building material costs shall be the same as those specified in local notices. If there is none of such local notices, these costs shall be market costs which are relevant to construction sites and appropriate in terms of types, formations, markings and labels of building materials used in these construction works, and conform to requirements concerning determination of building material costs in accordance with Ministry of Construction’s Circulars providing instructions on determination and administration of construction investment expenses.
b) Construction labor costs shall be calculated according to unit labor costs publicized by provincial-level People’s Committees. If there is none of public notices of such unit labor costs from provincial-level People’s Committees, construction labor costs shall be determined according to the method of determination of construction labor cost that is specified in the Ministry of Construction’s instructions.
c) Building machinery and equipment cost per shift may be determined according to machinery costs per shift, or costs of hiring of building machines and equipment, which are publicized by provincial-level People’s Committees. If there is none of public notices of the latter from provincial-level People’s Committees, the former shall be determined according to the method of determination of building machinery and equipment costs per shift that is specified in the Ministry of Construction’s instructions. Machines and equipment qualified to be listed as input values for calculation of construction price indices must be identical in terms of their type, capacity and origin.
3. Processing of data used for calculation of construction price indices:
a) Processing of figures and data used for determination of cost structure: Processing of collected data and figures shall include review, checking and correction of data, figures and estimated cost structure. Figures related to estimated cost structures must be converted according to the estimated cost structures regulated at the benchmark point of time. Data on total investment, cost estimate and final accounts of costs incurred upon completion of construction and investment projects (if any) must be converted to price levels determined at benchmark points of time.
b) Processing of information about input costs: Collected figures and data pertaining to input costs must be checked, reviewed and corrected in the following specific regulations: Costs of input materials of different kinds must be checked to ensure conformity in terms of their types, formations, markings and labels. Costs of input labor of different kinds must be checked to ensure conformity in terms of construction labor classes and ranks. Costs of machinery and equipment of different kinds per shift must be checked to ensure conformity in terms of their type, capacity and origin.
Article 8. Methods of calculation and determination of construction price indices
1. Construction price index shall be defined as the weighted geometric mean of rates of price (construction price index) fluctuation in typical input factors and corresponding weight values. Calculation of construction price indices shall be subject to instructions given in Appendix No. 1 hereto.
2. After considering characteristics of local markets, provincial-level People’s Committees shall decide the general construction price index for use in all cities and provinces, or separate construction price indices for use in particular areas within cities and provinces and then synthesize them to get the general construction price index. Division into multiple areas for the purpose of calculation of construction price indices shall be subject to decisions at the municipal or provincial level according to local characteristics of administrative subdivisions and construction markets, or conform to the Government’s regulations on regional division of region-specific minimum pay rates.
3. Regional construction price index shall be defined as the weighted geometric mean of construction price indices for use at provinces or centrally-affiliated cities within a region and corresponding weight values.
4. National construction price index shall be defined as the weighted geometric mean of construction price indices for use in specific regions and corresponding weight values.
5. Price index for a particular construction work shall be determined on the basis of cost structure of that construction work and input costs (or price indices) provided that it such index is relevant to work conditions and construction sites.
6. Cost structure used for calculation of a construction price index qualified to be adopted as a basis for contract value adjustment shall be based on contractual price structure. In case of lack of details necessary for determining the cost structure according to the contract value, such index shall be determined according to construction package cost estimate or construction cost estimate which has already been approved.
Tìm kiếm
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