Procurement

UK public procurement policy is based on value for money.  Regulations in the UK implement EC public procurement Directives.  One new revising Directive covering services, supplies and works contracts in the public sector, and the other relating to utilities were adopted in Brussels in April 2004 and will be implemented in the UK by the end of January, 2006.

Details of the latest state of play for the EU rules can be found under Office of Government Commerce.

Government procurement should form an integral part of the world's trading rules. It typically accounts for between 12 and 19% of EU Member State’s Gross Domestic Product (GDP). Effective public procurement contributes significantly to getting better services for less. It also improves the competitiveness of suppliers. Transparent and fair public procurement procedures assist good government and help to combat bribery and corruption.

It has been estimated that, when a country opens up its public procurement to transparent competition, it can achieve savings of between 10% and 15%.

The EU rules are paralleled on the wider international front by the WTO’s Government Procurement Agreement (GPA).  The GPA provides rules for competitive and non-discriminatory procurement for opportunities above certain thresholds, in a similar way to the EU procurement Directives. 

28 WTO Parties are currently signatories to the GPA. These are Aruba, Canada, the European Communities and its 15 Member States, Hong Kong China, Iceland, Israel, Japan, Korea, Liechtenstein, Norway, Singapore, Switzerland and the USA.

The current plurilateral GPA, which replaced the 1979 GPA, came into effect on 1 January 1996. It covers the procurement of supplies, works and services by public bodies including port, airport, water, urban transport and electricity sectors. The Agreement is on the basis of mutual reciprocity, which provides for guaranteed market access in the areas which are reciprocally covered.

The GPA is currently being reviewed to simplify and clarify its provisions, to allow for the full exploitation of developments in procurement, such as electronic procurement, and to improve its scope and coverage.

Further details on procurement details can be found in the procurement pages of the WTO website

The multilateral Transparency Working Group, established at the 1996 Singapore Ministerial Conference has held a series of meetings to discuss how to take forward the issue of transparency in government procurement (TGP).   Following the Cancun Ministerial, TGP has been taken out of the Doha Development Agenda, but remains on the WTO table.

For more information, contact:

Jonathan Denison Cross
Tel:  020 7271 1392
Fax: 020 7271 1344
E-mail: jonathan.denisoncross@ogc.gsi.gov.uk