MEPs agree changes to public sector procurement rules

Will Green is news editor of Supply Management
15 January 2014

15 January 2014 | Will Green

MEPs have approved a package of new public procurement directives that will lead to “more innovative and more efficient” public services across the EU.

The European Parliament voted with comfortable majorities to support the package of reforms, which aims to cut red tape by reducing paperwork, boost the participation of SMEs by breaking up big contracts into smaller lots and encourage the creation of public sector mutuals to run services.

Public procurement makes up 18 per cent of the EU’s GDP and new criteria around the “most economically advantageous tender” mean environmental considerations, quality and social value can be given more emphasis.

Malcolm Harbour, Conservative MEP for the UK and chairman of the Internal Market Committee, said in a debate prior to the vote: “We have to make this a complete repositioning of public procurement as a tool for encouraging the better, more innovative and more efficient delivery of public services across the board.

“We have to say to public procurers, this is not just a question of getting in the tenders and selecting the lowest price. You have to sharpen up your act as smart customers to decide exactly what it is you want.

“We have given you an opportunity here to do some proper negotiation with the supplier to match up your requirements with what they can deliver. If they can provide you with a better, more innovative solution, you can take that solution.

“It must not be a legalistic process, it must be a process that delivers better outcomes.”

However, a minority of MEPs were concerned about the privatisation of services.

Catherine Stihler, Labour MEP for the UK, described the directives as a “very good compromise” producing “less red tape and more focus on the right supplier and the right tender”, but said they “should be used to benefit public enterprises and mutuals and not for privatisation by the back door”.

Paul Murphy, Socialist Party MEP for Ireland, went further. “To be blunt, in many cases it’s simply a means for the political establishment to allow their big business friends to enrich themselves by feasting at a trough filled with taxpayers’ money,” he said. “This is a new frontier of a battle to push privatisation and a transfer of public wealth into private hands.”

Member states now have two years to “transpose” the directives into law.

The changes include:

1. New criteria around the “most economically advantageous tender” or “MEAT”.

2. New “innovation partnerships” allowing authorities to call for tenders to solve a problem without pre-empting the solution.

3. A simpler bidding procedure with a standard 'European Single Procurement Document' based on supplier self-declarations.

A full analysis of the European public procurement regulations reform will appear in the February edition of SM

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