A dashboard modelled on the final account
The amended law of 8 April 2018 on public procurement provides the structure for tracking. Its article 47 (1) requires, above €20,000 excluding VAT at index 100 value (an indexed amount to be updated), a final account (décompte final) "comprising a comparison with the estimate drawn up for the contract award procedure and a comparison, by trade, of the contract price and the final cost of the whole contract, additional contracts included" (unofficial translation). Here the estimate is the devis in the Luxembourg sense: the figure drawn up by the contracting authority (pouvoir adjudicateur), not the contractor's bid. The client (maître d'ouvrage) sets up the dashboard with these columns from the start of the works, package by package.
| Line | Content | Source of the figure |
|---|---|---|
| Dated budget | the works budget excluding VAT (HTVA), with its base date | architect's agreement, council resolution, estimate |
| Contract price | the price of the signed contracts, by trade | accepted tenders (soumissions), contracts |
| Approved amendments | signed changes, with their price | amendments, written instructions and agreed prices |
| Amendments under discussion | requests received, at their likely amount | contractor's requests, own costing |
| Statutory increases | the effect of price revisions, already paid and still to come | clause in the special specifications (cahier spécial des charges) |
| Quantity variances | the difference between contract quantities and projected quantities | interim valuations, measurements |
| Final cost forecast | contract price plus the four variance lines | calculation by the client or its adviser |
The statutory increases (hausses légales) line stays separate because the law requires it in the final account. Article 47 (2) provides: "Where the estimate or the agreed price is exceeded, the statutory increases are to be shown separately." Article 47 (3) adds that "a justification is to be provided for all overruns exceeding the statutory increases". Mixing price revision and changes on a single line makes it impossible to produce that justification at the end.
Amendments (avenants) under discussion appear at their likely amount, never at zero. What remains of the contingency, set against the variance lines, tells you whether the budget is holding.
What is paid, and when
In public contracts, payments are tightly regulated. Article 46 of the 2018 law allows interim payments only for services "performed and accepted". Advances are possible in justified cases, covered by guarantees, up to 25% of the total value of the contract (exceptionally 40% of the estimated amount for the State, on a reasoned decision).
The end of the contract has its own deadlines too. Under articles 135 and 136 of the implementing Grand-Ducal regulation of 8 April 2018, the final invoice is drawn up on the basis of the final acceptance report, and the contracting authority checks the items and notifies any dispute "within twenty-eight days".
In private contracts, the rhythm and the documents are those of the contract. For work in several parts or measured work, the Civil Code provides that inspection may be carried out in parts and is deemed done for the parts paid if the owner pays in proportion to the work done (art. 1791). Paying a valuation without checking it is therefore not neutral. What happens after signing (instructions, acceptance, quantities) is described in the article on what happens after the contract is signed, and the move from bill quantities to actual quantities in the one on the final account and actual quantities.
What weakens tracking
Three habits wreck a dashboard. Accepting a change orally and without a price. Mixing amounts excluding VAT with amounts including VAT. Leaving the budget undated, which later makes it impossible to separate the part of the variance caused by statutory increases from the part caused by the client's own decisions. The decision remains the client's: cut a future item, draw on the contingency, or accept a higher forecast with full knowledge of the facts.
The articles in this branch
- The article on extras in a private lump-sum contract covers article 1793 of the Civil Code and the cost of termination under article 1794.
- The article on amendments to a public contract in progress covers the ceilings in article 43 of the 2018 law and their effect on the contingency.
- The article on statutory increases, price revision and the budget's base date explains why a budget without a base date cannot be compared with anything.
- The article on the final account against the estimate sets out the comparison required by article 47 and the justification of overruns.
This article sets out the Luxembourg rules as they stood on the date of checking and is intended as professional guidance. It replaces neither legal advice nor an examination of the specific case.