AU construction tenders are full of jargon. This glossary covers the 30 terms that appear in almost every RFT. Keep it open the first time you read a tender — skim, don't memorise.
The main tender document that invites bids. Usually 40–80 pages. Contains scope, evaluation criteria, mandatory requirements, timeline, and submission instructions.
Similar to an RFT but typically for services or complex solutions where price isn't the dominant criterion. Often used for consultancy, D&C, or early-stage design work.
A preliminary invitation before a full RFT. The agency uses EOIs to shortlist capable builders who'll then be invited to respond to the RFT. Less detailed, less effort than a full tender.
Used for smaller, simpler works — usually price-led and with less formal response requirements. Often under the formal-tender threshold.
An update to the RFT pack issued during the open period. Usually in response to bidder questions. Addenda are binding — responses must reflect the latest version.
Australian Standard contract forms. AS 4000 is the common general contract for construction. AS 4902 is the Design and Construct (D&C) version. AS 2124 is an older form still used by some councils. Each has different risk allocation — read the specific version referenced in your tender.
Agency-specific amendments to the standard contract. These are where most of the risk shifts happen. Always read the SCs carefully — they override the base standard form.
A fixed-price contract where the builder takes responsibility for the total cost. Most common for defined-scope projects.
Contract where the builder is responsible for both design and construction. More risk on the builder, but more control over buildability.
Pricing model where you provide unit rates for each type of work, and quantities are measured and paid as actually delivered. Common for civil maintenance, minor works contracts, and emergency response work.
A detailed list of the work items with measured quantities. You provide unit rates for each item; the total is your lump sum. Common in civil construction.
An allowance for items whose exact cost isn't yet known. For example, "$45,000 PC Sum for bathroom fixtures". The final cost is adjusted up or down based on the actual supply price, plus the builder's fixed margin.
An allowance for work whose scope isn't yet fully defined. The final cost + the builder's margin is adjusted based on actual scope once determined.
Project-wide costs that aren't tied to specific work items — site sheds, temporary fencing, site management, WHS officer, insurance. Usually 8–15% of contract value.
A pre-agreed daily rate the builder pays the client for late completion. Often $1,000–$10,000/day on mid-sized jobs. If LDs are high, factor them into your program risk allowance.
Conditions discovered on site that weren't reasonably foreseeable from the tender docs — unmapped services, unexpected rock, contamination. Who pays depends on the contract form and SCs.
Additional time granted by the superintendent for delays outside the builder's control (weather, latent conditions, variations). EOT provisions vary wildly between contracts — check the SCs.
A change to the scope during construction. Can add or remove work. Variations are priced and paid separately from the base contract sum, usually at pre-agreed rates.
A contract clause that adjusts the price for material cost escalation over the project. Common on long (12+ month) projects. Absence of rise-and-fall on a long fixed-price job is a significant risk to the builder.
A percentage of each progress payment held back by the client until practical completion and the end of the defects liability period. Usually 5–10% of contract value.
A financial instrument the builder provides to guarantee their performance. Usually 5–10% of contract value. Released at practical completion or end of DLP. Cost: typically 1–2% per annum of the bond value.
The point at which the work is complete enough for the client to use — not necessarily 100% finished. Triggers handover, commencement of the DLP, and release of most retention.
Usually 12 months after PC. The builder must rectify any defects that emerge during this period at no additional cost. Remaining retention is released at end of DLP.
A document listing the quality control checks and hold-points throughout construction. Usually required for government and larger private projects.
A pre-approved capability assessment run by some agencies. Instead of assessing every builder in every tender, they pre-qualify builders in tiers, and only prequalified builders can tender. Examples: NSW PQC1, QBuild PQC, Rail Industry Worker (RIW), Transport for NSW WHS prequalification.
Quality (9001), Environment (14001), and WHS (45001) management system certifications. Increasingly required on government and large private tenders. Expect to spend $8–15k to get certified and 3–6 months of effort.
Master Builders Association membership. Some tenders require it. Provides access to industry awards, contract templates, training, and a dispute-resolution service. Annual membership varies by state, typically $800–$2500.
Many AU government tenders require a minimum % of contract value be delivered by Indigenous-owned businesses or local suppliers. Tracked through Supply Nation and other registers.
A formal document required before any high-risk construction work. Lists hazards, risk controls, and responsible persons. Required for each high-risk activity, not just once for the project.
Government tenders lean heavily on abbreviations. First time you see RFT or LDs in a tender, look it up — don't guess the meaning. A wrong assumption here is what costs builders the most when their assumptions hit the contract.
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