'We have no budget left this year' is a valid reason to freeze a four-year framework agreement
The Council of State refuses to suspend a non-award decision for a four-year framework agreement on hydraulic lifts, because insufficient budget for 2024 — the year carrying the bulk of the contract — is a sound ground to refuse to conclude a contract under article 85 of the 2016 Public Procurement Act.
What happened?
Belgium's Federal Police Procurement service launched in 2023 a multi-year framework agreement for the supply of hydraulic vehicle lifts and accessories (reference Procurement 2024 R3 603), via open procedure. The pre-approval request of 20 July 2023 valued the contract at €621,487.60 excl. VAT. The notice mentioned a 'maximum value' of €6,016,000 for the framework — which the contracting authority later explained as a clerical error: the figure is an automatic sum of €752,000 per lot. The framework was designed for four years, but the specifications showed that ordering volume was concentrated in the first two years. Two bids were received; the applicant was one of them. The Federal Police then took two decisions: it declared the applicant's bid void (a signature issue) and decided not to award the contract at all, on the ground that 'in 2024 the federal police will no longer have sufficient budget to conclude this file'. The applicant challenged both decisions in urgent procedure. The Council deals first with the non-award. Article 85 of the 2016 Public Procurement Act expressly states that launching a procedure does not oblige the authority to award or conclude. Provided the authority does not act arbitrarily and the decision rests on sound reasoning, it has wide discretion. The financial reasoning was clearly stated in both the decision and the non-award report: in 2024 there is insufficient budget. The Council notes that this reasoning does not depend on the price of the remaining bid (as the applicant suggested) — it is an autonomous budgetary ground. The applicant argued that a budget shortfall in year one does not make a four-year framework 'ipso facto impossible'. The Council disagrees: with the bulk of orders concentrated in the first two years, a 2024 shortfall seriously jeopardises performance of the entire framework. The second branch of the single ground is therefore not serious. As to the first branch (void bid, signature issue): no standing remains. Even if the bid were valid, the applicant cannot claim award since the non-award stands on its own ground. The argument that the Federal Police might later run a negotiated procedure without prior publication with the other bidder under article 42 §1 c) is rejected: there is no situation of 'unsuitable bids', so that hypothesis does not arise. Application dismissed.
Why does this matter?
A framework agreement looks like a guaranteed multi-year revenue stream for bidders — but article 85 of the 2016 Public Procurement Act reminds everyone that a contracting authority may always decide not to award, even after bids have been submitted and evaluated. Budget shortfall is a legitimate ground. For bidders: factor in the risk that the procedure may collapse all the way to the end, even when your bid is the only one remaining. For contracting authorities: use this lever with care — a written, autonomous reason (not a hidden motive to find a cheaper alternative) is essential.
The lesson
If as a contracting authority you cannot conclude a framework agreement due to a budget cut, motivate that independently of the content of the bids. Your reasoning must rest on a factual and autonomous budgetary finding — not on a comparison with an expected price. Document concretely which budget is missing, for which period, and why that jeopardises performance of the entire framework. As a bidder: expect that a framework agreement can be cancelled even when you stand to win — do not bake that revenue into your forecast.
Ask yourself
Does your non-award report concretely identify the missing budget, the relevant period, and the impact on the whole framework? Or does it only say 'insufficient budget'? An autonomous budgetary justification holds up at the Council of State; vague wording can be vulnerable.
About this database
The Council of State (Raad van State / Conseil d'État) is Belgium's supreme administrative court. In disputes over public procurement — from contract awards to tenderer exclusions — the Council of State is the final arbiter. The rulings in this database are summarised by TenderWolf in plain language, with practical lessons for tenderers and contracting authorities. View all rulings →