This is one of the most common question but often misunderstood. Both terms are used to provide cost estimates for scope of works (e.g. kitchen, tiling) that may not be clear during pricing.
In short, the key difference is that Provisional Sum covers BOTH labour and materials, whereas Prime Cost Sums (PC Sums) include the material ONLY with the labour component included as part of fixed price elsewhere.
For example, a $100/m2 PC Sum for tiling allows the client to choose a floor tile within that budget, while the associated labour for installation is covered as a fixed cost. In contrast, a Provisional Sum for a Kitchen will include both material and labour.
When comparing tenders, ensure that all Provisional and PC Sums are clearly defined and accurately estimated. Some contractors may lower these sums to appear more competitive in their initial pricing, only to later issue Variations that could lead to significant additional costs.
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