On 15 January, the European Parliament approved updated EU rules on public procurement which take account of environmental and social considerations as well as innovation when public contracts are awarded. Until now the focus has been on getting the lowest price for the job tendered, but in future quality and sustainability criteria can be reflected in a winning bid.
Public procurement (the purchase by public authorities of goods, services or works) accounts for approximately 18% of the EU’s GDP. SMEs play an important role and are estimated to secure between 31% and 38% by total contract value. This new legislation is therefore seen as a potential boost to innovation in Europe as public authorities will have more freedom and motivation to accept novel solutions. The new rules are also expected to cut administrative burdens and help small companies to bid by encouraging the division of contracts into smaller lots.