Directive ‘a missed opportunity’

By Sandy Guthrie16 January 2014

A new public procurement directive adopted yesterday by the European Parliament is being labelled as a missed opportunity.

Ulrich Paetzold, director general of FIEC (the European Construction Industry Federation), said, “The EU institutions did not seize the opportunity to solve one of the most severe shortcomings of the existing public procurement directives.

“I mean by that the identification and treatment of abnormally low tenders, which is a real curse in the construction sector.”

The European Parliament adopted three directives of the public procurement package (classical, utilities and concessions), which opens the way for the new rules to come into force before the European elections, with a two-year transposition period.

European Commissioner Michel Barnier welcomed the vote on 15 January, saying that these directives constituted one of the 12 priorities of the Single Market Act I.

He said the new rules had three objectives – simplification, flexibility and legal certainty.

“Through this reform, public authorities can optimise their use of public procurement which, with nearly 19% of European GDP, is a key driver of our economy.

“Thus, the simplification of procedures, greater flexibility and their adaptation to serve better other public sector policies or the possibility of the best quality:price ratio (value for money) will make public procurement more efficient and more strategic, respecting the principles of transparency and competition to the benefit of both public purchasers and economic operators.”

At FIEC, Paetzold said the new rules “will not change the world, apart from maybe the brand new concessions directive, which now needs to prove its worth.”

He said, “Above all, we regret that the EU legislators seem to underestimate the negative consequences of abnormally low tenders on quality and sustainability to the detriment of both the public authorities and serious, law-abiding private companies.

“Cheap can prove to be very expensive in the end.”

For the rest of the directives, FIEC said it particularly welcomed all measures aimed at reducing the administrative burden of the procedure, which it said would help SMEs in particular.

“We call on our national member federations to be extremely vigilant during the transposition process with regard to changes in social aspects, sub-contracting and specific details in the procedure such as time periods for submitting an offer, as they might prove to be counterproductive,” said Paetzold.

“In particular, the extension of the scope of in-house and public-public co-operation might lead to unfair competition and reduced markets for private enterprise, if abused.”

FIEC is encouraging contracting authorities in the Member States to make the best use of the “best price-quality ratio” award criterion for the sake of quality and sustainability of construction works.

“Price as the only award criterion should have been forbidden for complex procurement, such as construction,” said Paetzold.

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