WOUTER STOLWIJK Sustainable Public Procurement in the Netherlands Innovative tools November 2015

Francis Fukuyama in ‘Political order and Political Decay’: In contrast to private sector procurement, government purchasing is minutely procedural and subject to endless right of appeal. (page 485). The result is that both law & procedural accountability are used to defeat the substantive ends that they were originally designed to serve. GAME CHANGING IDEAS Procurement Week Wales/ Cardiff 2

GAME CHANGING IDEAS The worship of procedure over substance is a critical source of political decay in contemporary liberal democracies. (page 543) The best bureaucracies have the autonomy to use judgement in decision making, to take risks and to innovate. The worst mechanically carry out detailed rules written by other people. Ordinary citizens are driven crazy by bureaucrats who can’t use common sense and insist on mindless rule following. (page 533) Procurement Week Wales/ Cardiff 3

VISION OF PIANOO Public Procurement ≠ Fair distribution of purchasing budgets over suppliers Public Procurement is about Value for Taxpayersmoney. Public Procurement should not differ very much from professional private procurement titel van de presentatie4

Public Procurement: a powerful policy instrument Public procurement in the Netherlands: €60 Billion (10% of Dutch GDP) A powerful instrument:  to influence markets to take sustainable measures  to achieve sustainable policy goals (reduction of carbon footprint, of air pollution, encouragement of fair trade, etc.)

Sustainable PP: Criteria development 45 SPP categories 6

Support by PIANOo expertise centre on public procurement netherlands/sustainable-public-procurement-spphttps:// netherlands/sustainable-public-procurement-spp Guidance documents Workshops & meetings Online discussions Procurement Forum

Advantages Dutch 2010 approach SPP Easily applicable (Copy-Paste) Implementation activities relatively easy put into effect Every authority uses the same criteria > tempting for market parties to invest in sustainability measures Easy to formulate an unambiguous, measurable goal > Very usefull for organisations starting with SPP

Lessons Dutch 2010 approach SPP Not much room for customised requirements, innovation, creativity etc Relatively low ambition level because of generic nature of standard requirements No integral approach (focus on productgroups, not on the relation between productgroups) Standard criteria need continuous maintenance

The Dutch implementation approach Environmental criteria Standard sustainable requirements in every public tender document Social inclusion A contract performance condition. In most cases 5% of the tender price has to be spend on the improvement of employment opportunities for persons from disadvantaged groups Social conditions in the supply chain A contract performance condition. Bidders can join a chain initiative (Fair trade, Utz etc) or ‘make an effort to improve social conditions in the supply chain in accordance to the best of one’s abilities’ (in most cases a project plan)

New developments in Dutch SPP Higher ambitions Less focus on standard minimum requirements, more focus on customisation, unique opportunities, innovation, market consultation, total cost of ownership etc. > The standard criteria have become the minimal level of SPP Focus on the whole procurement process, not only the specification phase A more strategic use of SPP Policy makers can use SPP as an instrument to achieve their own (local) sustainability goals > more focus on certain sustainability themes A more integral approach Notably in procurement of infrastructure A less active role of the Ministry of Environment Discussion about new ‘ownership’’ of SPP policy

The market knows better… invite innovations Excluding Unsustainable products & processes Excluding Unsustainable products & processes Promoting Sustainable products & processes Promoting Sustainable products & processes Inviting new solutions innovations Procurement professionalism Solution shift from technical to functional

INNOVATION PROCUREMENT titel van de presentatie14

INNOVATION PROCUREMENT Innovation Procurement ≠ Innovative Procurement Can be done with classical approach, provided there is substantial knowledge within the contracting authority. Extra tools: competition, PCP, prototyping, experiments etc. titel van de presentatie15

INNOVATION PROCUREMENT acticallessonsdecember2011.pdf titel van de presentatie16

INNOVATION PROCUREMENT Know the market: ow_the_market.pdf CHARM: opportunities/market-consultation-charm/index.aspx titel van de presentatie17

INNOVATION PROCUREMENT Competitive dialogue: ecompetitivedialogueuk.pdf PPI: ocurementforinnovativeproposalsdecember2011.pdf titel van de presentatie18

Further professionalization of public procurement is essential