The total cost overrun
of projects with a budget of over Rs 150 crore (319 of 442) was Rs 1.
4), the average cost overrun
on a major defense contract has been about 40 percent.
The rating is also underpinned by the sponsor's funding of the group's cost overrun
and inability to service its debts.
The analysis shows that of the total 937 projects yet to be implemented -- including those of railways, highways, power, mining and urban development -- over 308 have resulted in a cost overrun
of Rs 77,518 crore, or 54 per cent of their sanctioned cost.
Parties failed to reach an agreement on how the 11 million Euro cost overrun
would be shared, at the last meeting on January 26, which was attended by Airbus President Thomas Enders and EADS President Louis Gallios and undersecretaries from client countries: Belgium, Britain, France, Germany, Luxembourg, Spain and Turkey.
implemented to address the root causes, the analysis forecasts that in 10 years the average cost overrun
may exceed 46 percent, up from 26 percent today," says the Deloitte study.
A spokesman yesterday said the company had yet to finalise the eventual cost overrun
figure, but added that the provision in this year's accounts will be at least pounds 50m, and could be as much as pounds 90m.
A significant part of the cost overrun
is due to the very high cost of working two shifts and overtime in adverse weather conditions.
The total allocated indirect cost differentials from provisional rates for past years and the four months of Moshman FY 1997 were $10,501-so Moshman was not operating on a cost overrun
as of June 1997.
For a single premium payment at inception, and with no deductible or coinsurance requirements, Cost Cap Plus offers cleanup funding and cost overrun
protection in one seamless program.
The claimed cost overrun
is roughly half of Grupo Unidos por el Canal's original $3.
Those without a cost overrun
indicate the contractor has cost control over the underlying construction division(s), and this control of costs will not negatively impact the total expected cost of the project.