- Project plans
- Project activities
- Legislation and standards
- Industry context
Last edited 26 Jun 2018
The New Rules of Measurement (NRM) are published by the Royal Institute of Chartered Surveyors (RICS). They provide a standard set of measurement rules for estimating, cost planning, procurement and whole-life costing for construction projects.
NRM3: Order of cost estimating and cost planning for building maintenance works, suggests that the ‘payback period’ (PB) is:
…the measure of how long it takes to recover initial investment costs and is a useful basis for evaluating alternative investment options. It may be calculated using either real (non-discounted) values for future costs, that is ‘Simple PB’, or present (discounted) values, that is ‘Discounted PB’. PB in general ignores all costs and savings after the payback point has been reached and it is possible that an investment with a short PB is a poorer option than one with a longer payback over the entire period of analysis.
PB is a useful technique for assessing whether additional investment in, for example, lower energy plant, is worthwhile. It enables users to weigh the additional capital costs against the time it takes for these costs to be recouped through savings or income during the operational period. This may be a useful means of judging whether an investment represents good value for money, although the subjective nature of the value for money assessment may make it in appropriate for some public sector investment decisions.
 Find out more
 Related articles on Designing Buildings Wiki
Featured articles and news
Chancellor announces latest Winter Support packages.
Tapping technology to boost infrastructure and create jobs.
4 ways to ensure certificates are valid.
White elephant construction projects.
How Paul Williams bent over backwards to overcome racial barriers.
Organisation revises actions around dealing with COVID-19.
CIOB, NFCC, RIBA, RICS call for changes ahead of Building Safety Bill.
Developments in the Future Homes Standard.
An American chimney feature with a colourful past.
Homes based on need, not ability to pay.
Historic England adds 216 entries to the 'at risk' register.
Will cycling and walking provisions be preserved?
Assembly point levels range from relative to ultimate.
Signs are pointing to a recovery for the construction industry.