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Path: Consulting Services arrow Report & Digest arrow GCA Digest Articles arrow GCA Digest 2001 arrow Quantifying the Deductive Change (Impact on the Contractor)

Quantifying the Deductive Change (Impact on the Contractor)

Like an added change, the amount of price adjustment is measured from the perspective of the contractor, not the government. If the government, for example, deletes a first article testing from a contract, the amount of price reduction is the cost savings to the contractor, not the added costs to the government. Similarly, a reduction in support personnel from consolidated operations must be measured by the impact on the contractor, not value to the government.

A common problem in quantifying the value of deleted work is that a contractor my not have developed a baseline set of actual costs in establishing what the deleted work would have cost absent the deleted work. Unlike additives changes where the contractor can generally develop some critical cost data to help price an adjustment, the absence of cost data puts the parties in an awkward position of trying to establish the value of work not performed. Fortunately, the courts and appeals boards have established fairly predictable rules for pricing deductions.

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