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Think SME, think social and think environmental – towards better public procurement

Public procurement is in the news again. We are told that not enough of the public sector spend is benefiting the Scottish economy. So: how to see more benefit, without discriminating in favour of Scottish bidders? Favouring Scottish bidders would break the public procurement obligations that apply in the European Union, the European Economic Area and (except for defence procurement) in Switzerland and (to a narrower range of contracts and contracting authorities) throughout the World Trade Organization. There is no prospect at all of obtaining special dispensation from these obligations. Anyway the real issue is not about the Scottish connection of bidders, it is the sheer amount of capacity and financial resources needed to meet a large procurement proposition. That amount is well beyond anything that Small and Medium Enterprises (SMEs) could contemplate. But, with some imagination, this problem can be tackled without breaking EU and WTO obligations. First – does a particular requirement really need to be aggregated with others? Even where it does, what can be done to subdivide it into “lots”, each individually within the capacity and resources of an SME? And why not make bidders indicate any share of the contract they intend to subcontract and any proposed subcontractors they propose to use? And what special social and environmental conditions might be appropriate? If Scottish contracting authorities made it a policy to “think SME, think social and think environmental”, the consequences could be remarkable. 
For more information and advice on EU Law please take a look at the below articles or contact Jim McLean.