Guide

Provisional sums and prime cost items

These are the two lines in a building contract that are not prices. They are estimates, and the contract usually says what happens when the estimate is wrong.

Last updated 13 September 2026 · Written by the Better Builds team

Most residential building contracts carry some allowances. They are legitimate, and a contract with none at all is often a contract where the scope has been guessed at instead. The problem is not that they exist. The problem is that homeowners read them as prices.

Prime cost item

An allowance for an item that has not been selected yet. Tapware, tiles, appliances, the front door. The builder allows an amount, you choose the actual item later, and the difference is adjusted. If you pick something dearer, you pay the difference plus, usually, the builder margin on it.

Provisional sum

An allowance for work whose extent is not yet known. Site works, rock excavation, retaining, connections, driveway. The builder estimates, the work is done, and the contract adjusts to the actual cost.

The distinction matters: a prime cost item is about what you choose, a provisional sum is about what the site turns out to be. You control one of them and not the other.

Why this is where budgets move

Because the allowance is set before anyone has dug a hole or picked a tile, and because a lower allowance makes a quote look cheaper without anything being hidden. A quote with thin allowances is not dishonest, but it is a different document from a quote with realistic ones, and the two are not comparable.

How to control them

Ask what the allowance is based on. A site-costs provisional sum backed by a soil test and a survey is a different animal from a standard figure applied to every block.

Price your actual selections early. If you know the tapware you want, get it priced and compare it to the allowance before you sign, not at colour selection.

Ask how the margin works on an adjustment. Contracts vary in what the builder may add when an allowance is exceeded. It should be stated.

Ask what happens if it comes in under. A fair contract adjusts both ways. Check that yours does.

What to look for in the contract

The schedule of prime cost items and provisional sums should be a named list with an amount against each, not a single lump. Vague allowances are hard to challenge later because there is nothing specific to challenge.