ec: The nitty-gritty of cross-border competition.

ec: The nitty-gritty of cross-border competition. - Between them, Europe's public authorities place some £200 billion-worth of orders every year. Opening up this enormous grab-bag of opportunities to free cross-border competition was supposed to be one o

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Last Updated: 31 Aug 2010

Between them, Europe's public authorities place some £200 billion-worth of orders every year. Opening up this enormous grab-bag of opportunities to free cross-border competition was supposed to be one of the key objectives of the Single Market programme, now officially open for business. But in reality many of the traditional devices designed to favour the established likely suppliers are as formally in place as ever. Indeed, after a flurry of diplomatic horse-trading at the tail end of last year, it seems as though they have been reinforced. One of the subtler types of rule-massage is already causing much resentment among its victims. In principle, freeing up public sector tenders or contracts must be advertised in the Community's daily Official Journal so that interested parties hear the same starting pistol and get an equal chance to prepare their bids. But telecoms, energy, transport and water supply, which collectively account for the lion's share of orders, have won an important dispensation. This allows them to limit all their forthcoming offers into a single "indication statement" published on the first working day of the year. Any firm that misses these is liable to find it is effectively excluded from the next 12 months' activity. As a result, many eager would-be tenderers are finding they have already missed the boat, at least until next January. There are plenty of authorities in all these sections who are not willing to employ such a blatant loophole but there are many other lines of defence like the 400,000 ecu (£300,000) limit bill under which water companies and the like are not required to publicise their requirements. That may not help the big boys like Thames Water whose typical deal runs to tens of millions. But it provides plenty of room for manoeuvre for the minnows across the Channel, where responsibility for the Continent's taps reservoir is fragmented among no fewer than 49,500 mainly municipal bodies (France alone has 16,500). Open procurement is a great idea but it is hard to believe that £250 billion-worth of capital investment to which this lot are committed over eight years will really be awarded in each case to the cheapest and most efficient bidder.

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