11.1.2  Genuine pre-estimate

The rate of liquidated damages payable in any project must be a genuine pre-estimate of the costs and losses government is likely to incur from the delay in completion of the facility.  Otherwise the amount may be judged to constitute a penalty and will not be enforceable. Liquidated damages may be reduced where the private party provides adequate temporary arrangements (e.g. opening of the road when it is safe to do so even if the tolling system is not complete in the case of a tollroad project).