Main contractor or separate packages: the effect on the budget

With a contratista general (main contractor), the client signs a single works contract and has a single point of contact. The contractor builds with its own resources and subcontracts the rest, and answers to the client for the whole. The Ley de Ordenación de la Edificación (Building Act, LOE) defines the constructor (builder) as the party that undertakes, "contractually to the promotor" (unofficial translation), to carry out the works (art. 11). How subcontracting is organised and what obligations it carries is explained in the article on the contractor and subcontracting.

With procurement by packages, the client signs several contracts, one per trade or group of sections (structure, facades, building services, finishes), and each contractor is responsible only for its own package. Between the two extremes there are common variants: a main contractor with some packages let directly by the client (lifts, specialist installations, bespoke joinery), or a main contractor for civil works and structure to which later packages are added.

	Main contractor	Separate packages
Contracts	one	as many as there are packages
Price	one, including a coordination margin	sum of prices, with no coordination margin
Gaps between items	contractor's risk, within its scope	client's risk
Delays between trades	resolved within the contract	may generate cross-claims against the client
Coordination	by the contractor	by the client or whoever they appoint
Contacts for warranties	one	one per package

The main contractor's price includes three things a package price does not: coordination of all the contractors, the risk of a subcontractor failing and the absorption of small gaps between items. That margin is not a gratuitous extra cost: it pays for work and for risk. The question the client must ask is whether they can do that work and carry that risk for less.

The sum of the packages looks cheaper because it does not show what is missing. The costs the main contractor spreads across its site overheads appear, in the package model, as items nobody has priced or as extra works during construction.

The typical gaps between packages are always the same. Shared temporary works and plant (scaffolding, crane, hoist), temporary site services, builder's work in connection with services, making good between trades, cleaning, protection of completed work, shared waste management and repair of damage caused by one trade to another's work. In a single contract, these items fall within the contractor's scope; with packages, someone must have allocated them in writing.

Each fixed-price package only covers what its own plan and its own specification describe. Article 1593 of the Código Civil (Civil Code) protects the client against rises in "wages or materials" under an ajuste alzado (lump-sum contract), but allows a price increase for a change to the plan that produces an increase in the works, if the owner authorises it. An item that does not appear in the scope of any package is not covered by any fixed price: when it has to be carried out, it will be ordered from one of the contractors as additional work, and the client will pay for it separately.

The prevention is a scope matrix. Before inviting tenders, the designer or the client's adviser draws up a matrix that allocates each item in the design budget, each piece of temporary works and each making-good task to a specific package, with no orphaned or duplicated items. That matrix forms part of every contract. It is the document that replaces, in the package model, the overall responsibility of the main contractor.

With packages, one contractor's delay becomes a cost for the others, and that cost is claimed from the client. If the structure is late, the facade contractor cannot start on the contracted date and may claim for the wait or for rescheduling. With a main contractor, that conflict is resolved within its contract with its subcontractors.

A client procuring by packages needs a common contractual programme, with handover dates between trades, and contracts that govern what happens when a contractor cannot start because of another. Without those clauses, every delay is a negotiation, and the budget contingency pays for it.

Financial and contractual coordination between contractors is not, in itself, a function of the dirección facultativa (site direction team). The LOE entrusts the director de la ejecución de la obra (site works director) with controlling construction "qualitatively and quantitatively" (art. 13.1) and with preparing the interim certificates and the final account (art. 13.2.e); it entrusts the director de obra (works director) with approving those certificates (art. 12.3.e). Organising the sequence of contractors, negotiating their interferences and allocating shared items is a different job, which the client must take on with their own resources or commission under contract.

There are three usual arrangements: an in-house client team with site experience; a project manager or a dirección integrada de proyecto (integrated project direction), which the technical literature presents as a complement to the site direction team, not a substitute for it, with objectives of scope, cost, time and quality; or an express extension of the appointment of the architect or the arquitecto técnico (building engineer). In all three cases, the cost of that coordination is one more line in the budget.

Comparing a main contractor with a sum of packages means adding to the packages what they do not price. Without those lines, the comparison is between a complete price and an incomplete one.

Budget line	Main contractor	Separate packages
Tendered construction price	contract price	sum of the packages
Shared items (temporary works and plant, temporary services, cleaning, waste)	included in the price	to be allocated to a package or budgeted separately
Builder's work and making good between trades	included	to be allocated in the scope matrix
Coordination between contractors	included	in-house team, project manager or extended appointment
Contingency for interfaces and programme claims	reduced	specific, in addition to the general contingency
Management of warranties and aftercare	one contact	one contact per package

Once those lines are added, the apparent advantage of packages shrinks or disappears. The step from the design budget to the contract budget, with these differences in structure, is covered in the article on the works contract budget.

On public works, procurement in parts is done through lots, and the division does not change the threshold calculation. When the subject matter is divided into lots, the estimated value is calculated on "the total estimated value of all those lots" (art. 101.12 of the LCSP, the Public Sector Contracts Act), so the applicable procedure depends, in principle, on the whole and not on each lot. For minor contracts, the authority must justify "that its subject matter is not being altered in order to avoid the application of the thresholds" (art. 118.2).

For the contracting authority's budget, the risks are those of the private sector, with less room to correct them. Each lot is a contract with its own price, and gaps between lots cannot be resolved by free negotiation: they must be processed through the routes the LCSP provides for modifying contracts. The scope matrix between lots is therefore even more important than on private works.

The package model is suitable when four conditions are met at once: a complete and well-measured proyecto de ejecución (detailed design), a client with real coordination capacity (in-house or appointed), a programme without extreme pressure and packages with clear interfaces. If any one is missing, the apparent saving on the main contractor's margin is usually consumed by extra works, programme claims and the cost of coordination.

A main contractor is suitable when the client wants to transfer the interface risk, when the design leaves areas open or when the programme is critical. The client pays a margin, but buys a single party responsible for the whole.

The mixed variant is usually the most sensible for a professional client: a main contractor for the core of the works and a few direct packages where the client adds value (equipment they can negotiate better, regular suppliers), always with their scope and interfaces defined in the main contract. If the tenders received exceed the budget, changing the model is one more lever among those described in the article on private works tenders above budget, but not the first one to use.