Tender documents in French public works: pricing schedules, rates and the financial papers

The fundamental distinction: the pricing schedule and the schedule of rates are contractual and bind the contractor to its prices for the life of the contract. The priced bill is an estimate and is not contractual; it serves to compare tenders but cannot be relied on to value work during construction. That distinction has immediate practical consequences: an error of quantity in the priced bill does not disturb the contractual price in the pricing schedule, but it does distort the tender ranking.

The pricing schedule is organised by package then by sub-package or item. Each line carries the description of the item, precise enough to be unambiguous, the unit, the quantity, the rate and the amount. The package totals and the grand total appear at the foot.

• One, the description has to stand alone: every line must be intelligible without turning to the specification. If similar additional work is to be valued at the scheduled rate, the description must be precise enough for the comparison to be beyond argument.

• Two, use the standard units: the standardised units of the sector, square metres, cubic metres, linear metres, numbers, kilos, lump sums. A non-standard unit creates ambiguity in the valuations.

• Three, the quantities are reference quantities, not final ones: the pricing schedule of a lump sum contract carries quantities, but they are reference quantities for calculating the original amount, not contractual quantities. It is the total that is a lump sum, not the individual lines.

• Four, the total must match the form of tender: the schedule total must be identical to the amount on the signed form of tender. Any discrepancy is an anomaly to correct before notification.

• Five, one schedule per package: in a contract split into packages, each has its own pricing schedule, its own form of tender and possibly its own schedule of rates. The economist produces as many schedules as there are packages.

The schedule of rates differs from the pricing schedule in carrying neither quantities nor amounts, only unit prices. It serves to value work whose quantities are not known in advance, call-off contracts, packages with variable quantities, and additional work during the contract.

• Call-off contracts: it is the central document, with orders placed on the scheduled rates times the quantities ordered.

• Packages with uncertain quantities: earthworks, selective strip-out, provisional items. The schedule allows the real quantities to be valued without a variation for every difference.

• Foreseeable additional work: where the project has risk zones, as in refurbishment, or options in the brief, the schedule anticipates how they will be valued.

The rates in the schedule of rates have to be coherent with those in the pricing schedule for similar items. A significant divergence, a rate 40 % above the pricing schedule for the same type of work, is a warning sign: the contractor may have underpriced the schedule to win and loaded the rates to recover on additional work, a common practice and hard to sanction if it is not spotted at tender assessment.

ℹ The classic error: using the priced bill to value additional work The priced bill is drawn up by the design team before the tender, and the contractor has never signed it. It therefore cannot serve as the contractual basis for valuing additional work. If the contractor carries out additional work and the pricing schedule has no corresponding line, the valuation is made on the schedule of rates where one exists, or on a new rate built up from net cost. Never on the quantities in the priced bill, which are non-contractual estimates. That confusion is one of the most frequent sources of dispute at final account on public works.

The European single procurement document replaced the older national candidature forms. It is compulsory above the European thresholds and can be used voluntarily below them. For the economist it carries two useful pieces of information.

• Turnover over the last three years: an indicator of the contractor's financial capacity, to be set against the value of the contract to assess the risk of failure. A rule of thumb: a contractor whose turnover is less than three times the contract value is in a risky position.

• References on comparable work: these show whether the contractor has experience of the work required. They matter most on the services packages, where experience determines the quality of the installation.

The economist does not handle the declaration directly; that is for the buyer or its legal advisers. But the economist should flag any anomaly in financial capacity spotted during the assessment, particularly where an abnormally low tender comes with a declaration showing inadequate turnover.

Before the tender package is published, the economist checks the coherence of the financial documents as a matter of course.

• Pricing schedule against form of tender: the schedule total, or the sum of the schedules per package, is identical to the amount on the form of tender.

• Pricing schedule against priced bill: the same items appear in both, and the rates in the bill come from the reference price base and not from some other source.

• Pricing schedule against schedule of rates: the rates for common items are coherent between the two.

• Pricing schedule against specification: every line in the schedule corresponds to an item described in the specification, with no orphan line in either document.

• The adjustment formula in the conditions of contract: the indices used match the packages in the schedule.

• Modifications provided for in the conditions of contract: options and review clauses, including the price variation clause, are drafted clearly, precisely and unequivocally, with their scope, their nature and the conditions for implementing them (R2194-1). The limits of other modifications are not set in the conditions of contract: they are those of the code (R2194-2 to R2194-9).

The six financial documents are the pricing schedule, contractual and the basis of the final account; the schedule of rates, contractual and used for additional work; the priced bill, an estimate used only to compare tenders; the build-up of rates, used to analyse an abnormally low tender; the form of tender; and the candidate's declaration. The five rules for a pricing schedule are a self-contained description, standard units, reference quantities, coherence with the form of tender, and one schedule per package. A schedule of rates should be required as a matter of course on call-off contracts and packages with uncertain quantities. Check the coherence of the two schedules to catch an underpriced schedule loaded with high rates. The priced bill is never contractual and must never be used to value additional work. Six checks before the package goes out.

The nature of the figures quoted

The percentages and amounts quoted on this page are orders of magnitude for framing, not measurements. They illustrate mechanisms and proportions, and they substitute neither for a tender exercise nor for an estimate prepared on drawings.

• Public procurement economics in France: the economist's role end to end
• Procurement thresholds and procedures: negotiated, open tender and the selection criteria
• Priced bill, pricing schedule, specification: the three documents explained