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EU to reform Public Procurement rules

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Friday 4/11/14 time 12:20 PM


The European Parliament approved in January new rules for public procurement in the EU. These new rules will help to ensure that when public authorities make procurement calls, the quality will be better and tax payers' money will be better used. In addition, the new rules make it easier for small and medium-sized enterprises to participate in tenders. The new rules also set tighter conditions for subcontractors.

Already before this reform, the EU has regulated public procurement. Weaknesses in the previous legislation included the complexity of systems, too dominating an importance of lowest prices as well as the relatively weak position of SMEs. The latter has been apparent in the fact that many contracts were so big that small-scale entrepreneurs did not have a real chance to participate in them. This has been fatal to many SMEs - particularly when the economic downturn hit Europe. Know-how and skills exist but opportunities are scarce.

In the calls for tender the entire product life cycle has so far not been sufficiently taken into account. This has affected also the quality of tenders. Considerations of environmental aspects, innovation and sustainable development have all been left aside when the competition has concentrated on the lowest price. Yet, putting emphasis solely or primarily on the lowest possible price is short-sighted.

The reform now underway is a real chance to sending a message that protection of small business activities, fair practices, environmental considerations and social justice are an essential part of the European public sector!

With the reform the lowest price should no longer be the main criterion in public procurement. Instead, the most economically advantageous offer ought to win!

Usually the abnormally low tenders indicate that the economic operator in question is not complying with environmental, social and labour rules. In the name of unity, integrity and equality in the EU it is very important that in the global markets all companies have the same obligations, such as paying taxes and contributing to social security systems, as is required from the local companies!

Finally, I would like to point out that the fulfilment of these improvements requires training and as clear and precise national implementation as possible in all Member States. This was also underlined by the Finnish experts who participated in my expert seminar on this topic in November last year. Click here to see the seminar publication of this event!