Cost Element or Activity

Implications for the TOC

Implications for the NOPs Fee

Comment

Owner personnel costs

Included in Indirect Costs.

Do not attract a Fee.

Owner costs that are to be included in the TOC need to be clearly articulated where possible in the Owner's VfM Statement and/or ADA/PAA to ensure transparency of all resource requirements.

Owner supplied items-where alliance is responsible for the goods

Included in Indirect Costs.

Do not attract a Fee.

Owner supplied items-where Owner takes all procurement risk

Excluded.

Do not attract a Fee.

Risks and management costs for Owner supplied items-where alliance is responsible for the goods

Included in Indirect Costs.

Attract an NOP Fee.

Owner supplied resources

Included in Indirect Costs.

Do not attract a Fee.

Unless the work can be undertaken without significant integration with the work or the work sequencing of the alliance, they should be included in the alliance.

Risks and management costs for Owner-supplied resources

Included in Indirect Costs.

Attract an NOP Fee.

Behavioural Coaching if necessary to integrate the team to work effectively and efficiently (not to achieve outstanding performance)

Included in Indirect Costs.

Do not attract a Fee.

Alliance development and coaching activities should only be undertaken to the extent that they directly support achieving the Owner's VfM Statement. Alliance culture and relationships should not be considered as the objectives or outcomes to be achieved by the alliance in their own right. In other words, they are a means to the end, not the end itself.

Owner costs which arise as a result of the commercial arrangements agreed in the PAA

Excluded.

Do not attract a Fee.

These may include the Owner's share of risk and opportunity complementary to and net of gainshare/painshare plus any performance pool payments.

Owner costs outside of the alliance's direct responsibility and the PAA

Excluded.

Do not attract a Fee.

These may include sunk costs such as land purchase and cost of advisory services, early works or other capital costs outside the alliance.

Items not managed by the alliance

Excluded.

Do not attract a Fee.

If the alliance is expected to share a material risk in the procurement of the goods or services, then the costs should be included in the TOC so they can be managed by the alliance.