Develop Elemental Cost Plan 1

Section 1

Purpose

Formal Cost Plan 1 is the first structured elemental cost plan produced during RIBA Stage 2 Concept Design. It translates the client's approved Stage 1 budget into element-by-element cost targets using the NRM 1 Group Element structure, benchmarked against BCIS cost analysis data. It forms the binding cost baseline from which all change control is managed through to tender.

The QS must ensure Cost Plan 1 is comprehensive, transparent and supported by documented assumptions. Each elemental allocation must be traceable to either BCIS benchmark data, agreed allowances or, where measured, to preliminary take-off from concept drawings. The plan must separate design contingency, risk allowance, professional fees, and other project costs in accordance with NRM 1.

Cost Plan 1 is not merely a budget allocation exercise. It is a cost management tool — identifying high-cost elements, setting targets for value engineering, and establishing the baseline from which cost variances at Stages 3 and 4 are reported.

Section 2

Key Principles

NRM 1: RICS New Rules of Measurement — Order of Cost Estimating and Cost Planning (2nd edition, reissued October 2022): mandatory framework for elemental cost plan structure, measurement rules and inclusions/exclusions.
BCIS Elemental Standard Form of Cost Analysis (SFCA, 4th edition): defines the elemental categories (Group Elements 0–8) used for benchmarking and ensures consistent inter-project comparability.
RICS Cost Analysis and Benchmarking (2nd edition, reissued 2022): guidance on sourcing BCIS data and applying the four standard adjustment factors — TPI, location, specification uplift, and size.
BCIS Tender Price Index (TPI): the standard industry index for adjusting historic cost data to current market conditions. Must be stated with base date and current date.
NRM 2: Detailed Measurement for Building Works (1st edition, 2012, effective January 2013): relevant for any measured elemental take-off from concept drawings at Stage 2.
RICS Quantity Surveying and Construction Professional Statement (2021): the QS must exercise professional judgement and document the basis for all elemental allocations.

Section 3

Practical Application

Step 1

Establish the NRM 1 Group Element framework: GE 0 Facilitating works; GE 1 Substructure; GE 2 Superstructure; GE 3 Internal finishes; GE 4 Fittings, furnishings & equipment; GE 5 Services; GE 6 Prefabricated buildings & buildings units; GE 7 Work to existing buildings; GE 8 External works — plus Preliminaries, OHP & fees, other development costs, and Contingencies.

Step 2

Source BCIS elemental cost analyses for comparable building types. Apply the four standard adjustments: (i) TPI adjustment from base date of BCIS data to current tender date; (ii) location factor from BCIS regional indices; (iii) specification uplift/reduction for quality differences; (iv) size adjustment for economies or diseconomies of scale.

Step 3

Apportion the construction budget to each Group Element. For elements with sufficient concept design information (e.g. substructure, structure), take off preliminary quantities from drawings. For undeveloped elements, use BCIS-derived elemental unit rates (EUR = element cost ÷ GIFA).

Step 4

Calculate Preliminaries separately using the NRM 1 approach: assess site-specific preliminaries (site management, temporary works, plant, welfare) — typically 12–18% of measured works.

Step 5

Set the design contingency as a percentage of construction cost, exclusive of risk allowance: typically 10–15% at Stage 2, reducing as design is developed. Maintain as a separate line item, not embedded in elements.

Step 6

Prepare the risk allowance as a separate provision derived from the Risk Register EMV total. Do not combine with design contingency — they serve different purposes and must be reported separately.

Step 7

Add professional fees (typically 8–15% of construction cost for full services), other development costs (planning fees, statutory charges, surveys), and land/finance costs as directed by the client.

Step 8

Produce the Cost Plan 1 report: tabulate all elements with quantities, rates, costs and elemental unit rates. Include an assumptions register, exclusions list, adjustment factor workings and comparison with Stage 1 OCE. Obtain client sign-off.

Section 4

Common Mistakes to Avoid

Double-counting items across elements — for example, including drainage in both GE 1 Substructure and GE 8 External works. BCIS SFCA definitions must be strictly followed.
Applying TPI without stating the base date of BCIS data and the current date index — the adjustment must be transparent and auditable.
Omitting or underestimating Preliminaries — at 12–18% of construction cost, this is one of the largest single elements and cannot be treated as a token allowance.
Embedding design contingency within elemental rates rather than carrying it as a separate line — this prevents proper cost management and change control.
Using net floor areas (NIA) instead of GIFA for elemental unit rate calculations — all NRM 1 rates are based on Gross Internal Floor Area.
Failing to identify Services (GE 5) scope correctly — on commercial buildings, M&E typically represents 25–40% of construction cost; under-provision at Stage 2 creates major budget risk.

Section 5

APC Competency & Quick Reference

APC Competencies: Cost Management (L2) | Design Economics & Cost Planning (L2) | Procurement & Tendering (L1) | Programming & Planning (L1)

What are the NRM 1 Group Elements for Cost Plan 1?

GE 0 Facilitating works; GE 1 Substructure; GE 2 Superstructure; GE 3 Internal finishes; GE 4 Fittings, furnishings & equipment; GE 5 Services; GE 6 Prefabricated buildings; GE 7 Work to existing buildings; GE 8 External works. Plus: Preliminaries, OHP & fees, Other development costs, Contingencies.

How is the elemental unit rate (EUR) calculated and why is it used?

EUR = element cost ÷ GIFA (£/m²). It provides a standardised measure that can be compared directly against BCIS benchmark EURs (after TPI and location adjustment), enabling the QS to identify over- or under-specified elements relative to market norms.

What is the typical Services (GE 5) allowance at Cost Plan 1 stage?

Services typically represent 25–40% of construction cost on commercial/office buildings, reflecting the M&E specification. BCIS data by building type should be used as the basis, with the range reflecting significant variation between air-conditioned, naturally ventilated and specialist buildings.

Section 6

Cost Plan 1 Checklist

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NRM 1 Group Elements 0–8 framework established

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BCIS benchmark data sourced and TPI/location adjustments documented

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Construction budget apportioned to all elements with supporting EURs

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Measured take-off prepared for elements with sufficient design information

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Preliminaries calculated separately (not embedded in elemental rates)

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Design contingency (10–15%) set as a separate line item

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Risk allowance carried separately (derived from Risk Register EMV)

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Professional fees, development costs and other project costs included

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Cost Plan 1 report issued with assumptions register, exclusions list and OCE reconciliation

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Client written sign-off obtained on Cost Plan 1

Section 7

CPD Learning Outcomes

Prepare Formal Cost Plan 1 in NRM 1 Group Element format, applying BCIS benchmark data with documented TPI, location, specification and size adjustments.
Calculate elemental unit rates and compare against BCIS benchmarks to identify over- or under-specified elements requiring value engineering attention.
Distinguish between design contingency, risk allowance, professional fees and other project costs, and carry each as a correctly labelled separate provision within Cost Plan 1.

Section 8