The accuracy of preliminary cost estimates in Public Works Department (PWD) of Peninsular Malaysia

This paper presents the accuracy of preliminary cost estimates prepared by Public Works Department (PWD), which is the largest public construction management in Malaysia. It attempts to understand the Quantity Surveyors' (QS) estimation accuracy in relation to public projects. This study analyses 83 projects of estimates and tender bids. The analysis includes three (3) estimating targets i.e. lowest bid, accepted bid and mean of the bids. To broaden the study, 344 QS involved in the procurement answered the questionnaires. Linear multiple regression analysis on project characteristics shows that project size, number of bidders, location and type of schools affect the bias. Contract period affects the consistency. The use of mean of the bids is the best-fit target to explain the bias in terms of adjusted R2. The accuracy may improve if sufficient design information is available, proper cost planning and improving the application of historical cost data. As an alternative, the phenomenon of overestimation is resulted from government directive instruction, which could challenge the rational of accurate estimate.

► The research analyses 83 construction projects and 344 answered questionnaires. ► It compares the use of different estimating targets. ► Size, number of bids, location, type of schools and period affect the accuracy. ► The analysis shows that the estimates were overestimated. ► Public officers favour overestimation because it brings more benefits.