Inflation

[Gerald Murphy]

Good morning,

I am currently ready to baseline a project that is
scheduled for the next four years. As such our work
estimates are only valid for the work that will be
completed during the first year of construction and will
in turn be inflated each successive year. The inflation
percentage is unknown at this point and as such I am
unable to utilize the cost rate table to reflect
respective increases. Under the contract we are able to
claim inflation so I am wondering: Is there is a way to
reflect inflation for each successive year? (after the
project has been baselined)


Thanks for now

Gerald Murphy

 

[Kevin Flanagan]

You can use the cost rate table and enter a double dash
"--" to indicate you are unsure of when this other rate
will take place and then enter a dfinitive date later.
My personal opinion is not to have a project plan for 4
years. It would be better to try and divide into 4 1-yr
pieces. My other caution is that unless you have done a
project like this before or have access to a similar
project plan beware. There is no way to even estimate
out 4 years. Wht if we get inflation like in the late
70's. You guess could cost you the farm so to speak. I
would bid out the contract to allow adjustments after
each year over the four years.