Public Procurement Package: Construction SMEs need a better implementation of the Directive

The European Builders Confederation (EBC) welcomes the new Commission’s package on Public Procurement that will give further guidance for a better implementation of Directive 2014/24/EU which is still within transposition into national law in most Member States. However, EBC is worried that the current implementation of Directive 2014/24/EU on public procurement might exclude many SMEs from public tenders, because of the misuse of green and social criteria to evaluate offers in some Member States.

On 3rd October, the European Commission proposed a non-legislative package to help public authorities to use public procurement in a more strategic way as a tool to obtain better value for taxpayers money and to reach environmental, societal, technological objectives when buying goods and services.

EBC is glad to see that the Commission will take actions by the end of 2018 on:

  • Updating the guidance on green and social procurement and provide guidance on innovative procurement;
  • Fostering the exchange of good practices regarding strategic procurement, including key sectors like construction 
  • Launching pilots to boost SME participation via business intermediaries and innovation brokers. 
  • Launching a pilot training on ‘SME-friendly policies in Central Purchasing Bodies’.
As regards green and social procurement, construction craftsmen and SMEs have been adopting, for several years now, new behaviours with the aim of better taking into account and protecting the environment and its natural resources as well as fighting pollution. Moreover, our companies are leading actors in the social field, via the active integration of disadvantaged people and members of vulnerable groups.
However, EBC invites the Commission to have a closer look at the current implementation of Directive 2014/24/EU on Public Procurement. In fact, some Member States are misinterpreting the European legislation by setting social and environmental requirements in the award phase, disadvantaging construction SMEs and consequently excluding them from the public procurement market. By making environmental and social measures part of the award criteria instead of the tender prerequisites, the system penalizes SMEs who put a lot of time and effort in a tender that they will most likely not win. The use of certain material or the employment of certain social groups in the works must be a "condition to execute the contract" not a "criteria for the evaluation of the offer". Moreover, the use of green criteria in the award phase does not take into account life cycle costs of e.g. well maintained machines, that will have to be demolished and replaced by new ones, a process again causing emissions. Finally, another factor that is often disregarded in public tenders are transportation costs as they can e.g. offset the benefits of more environmentally friendly produced products.

Eugenio Quintieri, Secretary General of EBC, stresses: “Construction SMEs are strongly committed  to environmental protection and social integration. However, in certain Member States, the misuse of green and social criteria to evaluate the offers is producing the net effect of an exclusion of construction SMEs from public tenders. This is against the spirit of the Directive that clearly states that public procurement should be adapted to the needs of SMEs”.

Please find here more information on the non-legislative package on public procurement.