Cost Estimation Accuracy and Control in Building Construction Projects in South South Nigeria

Cost overruns in building construction projects are endemic in South South Nigeria, reflecting systematic weaknesses in pre-contract cost estimation practices and in-contract cost control procedures. This study professionally examines cost estimation accuracy and in-contract cost control in building construction projects in Rivers, Delta, and Edo States. A professional survey methodology was adopted, collecting final account cost data for 30 completed building projects from quantity surveying firms and contractors. Cost performance indices were calculated by comparing tender sum to final account and original estimate to final account. Contributory factors to cost overruns were assessed through structured interviews with 25 quantity surveyors and project cost controllers. Results indicate that mean final account cost exceeds tender sum by 31 percent across the project sample. The gap between original estimate and final account averages 47 percent. Material price escalation accounts for 42 percent of overrun value, followed by design scope changes (28 percent) and provisional sum reallocations (18 percent). Cost monitoring reports are prepared monthly in only 40 percent of projects. The study concludes that pre-contract risk allowances are systematically inadequate in South South Nigerian building contracts, recommending that quantity surveyors apply regional cost escalation indices and that standard contracts include provisional material price adjustment mechanisms. Monthly cost reporting requirements should be incorporated into all public sector project management procedures.

Keywords: cost estimation, cost overrun, building construction, South South Nigeria, cost control