Problems of Pricing and Budget Normalization Reforms in Construction

This study deals with current problems related to reforms in the system of pricing and budget normalization in the construction industry. Aim. This study aims to determine the primary directions for adequate reforms in the development of material and labor consumption rates within the framework of the 400 Days Concept implemented by the Federal Center of Pricing in Construction of the Russian Ministry of Construction, thus improving the development of budgets for major construction projects. Tasks. This study identifies problems in the existing Russian state pricing system that uses the basis index method of the budget-normative base for 2001, which is inconsistent with modern construction materials, production technologies, machines, and mechanisms. This study also determines ways to transition toward a more market-based input method for pricing in construction. Methods. This study uses general scientific research methods to examine the problems of pricing and budget normalization reforms in construction, which have persisted in various fields in the national economy since 2001. Results. The study determines ways to transition toward an input method for construction pricing based on actual consumption rates and budget prices in the market. It shows that budgets set by the input method are more consistent with the market price of construction as they are based on the current market prices of resources used, thus eliminating the contradiction between the budget (normative) price of construction and actual (market) price of construction products. The results obtained by the input method are 15%-30% higher than those of the basis index method in 90 cases out of 100, which calls for strict control of the price of resources used by construction firms. Conclusion. There are many problems in budgeting, particularly those associated with excessive state pricing and flawed competition. There are fewer such problems in other industries and in construction industry in other developed countries. This breaks the basic law of business in global competition: minimum costs lead to maximum results. With the world struggling to save resources, it is advisable to adopt practices of developed capitalist countries.

pricing reform in construction, budget normalization, competitive development of norms, 400 Days Concept, state pricing, реформирование ценообразования в строительстве, сметное нормирование, конкурсная разработка норм, «Концепция 400 дней», государственное ценообразование, ресурсный метод, экономия ресурсов, минимум затрат, максимум результата

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