What is the base budget for tender
The base budget for tender (BBT), according to Law 9/2017 on Public Sector Contracts, is the maximum spending limit the contracting authority can commit for that contract, taxes included. It is the economic reference on which bidders' offers are built: no bid can exceed that limit.
The BBT is not an arbitrary figure set by the administration: the law requires it to be calculated from actual market prices, precisely to prevent a tender from being called with an unrealistic budget that no company can execute under viable conditions.
What components the base budget for tender includes
The BBT is broken down into direct costs (labor, materials and machinery chargeable to each item), indirect costs (general execution expenses not assigned to a specific item), company structure overhead, and the contractor's profit margin. When the contract includes staff compensation, the BBT must also incorporate estimated salary costs according to the applicable collective agreement.
This breakdown is not just a formal requirement: it allows bidders to understand what real margin the contract has before deciding whether to bid and on what terms.
Difference between base budget for tender and estimated contract value
The estimated contract value is a broader concept than the BBT: it includes, in addition to the base budget, any possible extensions, planned modifications and other concepts that may generate additional expense during the contract's life. The BBT, in contrast, is the specific economic limit of the tender in its initial configuration, not counting those future eventualities.
Confusing both concepts can lead a company to miscalculate its bid: bidding thinking of the complete estimated value when in reality the immediate limit set by the tender is the base budget.
Why the base budget for tender must match market prices
The LCSP expressly requires that contracting authorities ensure the BBT is appropriate to actual market prices. A base budget calculated below the real cost of execution forces serious companies to dismiss the tender or submit a bid with insufficient margin to execute the work with due guarantees.
Detecting a manifestly insufficient BBT before bidding, by comparing it to real costs known from similar executed works, avoids committing to a contract that will not be profitable, or that can only be met by cutting quality or deadlines.
How Bloqbase supports analysis of the base budget for tender
Bloqbase can help compare the base budget of a tender with the actual costs the builder already knows from similar executed works, to better assess whether to bid on that specific tender.
The software does not determine whether a BBT is viable or replace the economic and legal analysis of the tender file: that assessment continues to be the responsibility of the technical and economic team of the company that decides whether to compete.