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GMB Welcome New EU Procurement Rules

Thursday, January 16, 2014

GMB Welcomes New Public Procurement Directives Approved On 15th Jan By European Parliament Which Allows Public Sector To Put Workers And The Environment First

The new provisions affirm that contracting authorities may introduce social and environmental considerations throughout the procurement stages as long as these are linked to the subject matter of the contract says GMB.

GMB commented on the vote in the European Parliament on the final text of the revision of the Public Procurement Directives in the plenary session in Strasbourg on Wednesday morning 15th Jan.

The Parliament voted to accept the Directives (Public procurement -General Directive, - Utilities Directive and Concessions) as the deal had been struck with Member State Governments in Council. See notes to editors for copy of ETUC press release.

Kathleen Walker Shaw, GMB European Officer in Brussels, said “GMB welcomes the new public procurement Directives approved today by the European Parliament which will allow public authorities in the UK and Europe to put workers and the environment first and spend taxpayer's money wisely, but warns the UK Government not to use tax payers money in its pursuit of privatising yet more public services.

The new provisions voted today affirm that contracting authorities may introduce social and environmental considerations throughout the procurement stages as long as these are linked to the subject matter of the contract. In addition, public authorities can take in to account the process and production methods of goods even if they are not visible in the final product. (as confirmed in recent landmark court judgments). It will be easier for them to rely on labels and certifications as proof of compliance with the sustainability criteria they have set. This way public authorities can give preference to bidders that offer better working conditions to their workers, favour the integration of disabled and disadvantaged workers, and offer sustainably produced goods.

Importantly, the right for public authorities to provide services directly is confirmed and the concepts of ‘in-house’ and ‘public-public cooperation’ are clarified. Compliance with environmental, social and labour obligations including collective agreements is now enshrined in the principles of this law, and tenderers can be excluded in case of non-respect. The new laws also makes it easier to identify subcontractors along the supply chain, although it will be up to Members States to establish their joint liability.

GMB has worked closely with MEPs and other European trade unions and social and environmental NGOs to strengthen these proposals, and are pleased with the progress we have made.

However, we are disappointed that the final text of the Directive still allows authorities to buy the cheapest rather than the most socially and environmentally sustainable option –despite calls from GMB and the European Parliament to remove lowest cost criterion. The final compromise wording for awarding tenders is now less clear. Although life-cycle costing provisions have been improved, the social externalities cannot be taken into account in life-cycle assessment, which GMB sees as a flaw and missed opportunity.

Members States now have two years to implement the rules into their national laws, though the UK Government has signalled it will be pushing early implementation of the elements they like. GMB calls on Governments to improve some of the elements left to their discretion in the new text. For instance they can prohibit or restrict the use of price only, and can strengthen liability in the subcontracting chain.

These revised rules create an enabling legal framework, but Governments and public authorities need to commit positive political will to support social and environmentally sustainable contracting procedures.

GMB is also deeply concerned that highly damaging changes to the directives forced by the Conservative Government in the final stages of negotiation will mean yet more deregulation and privatization of public services.

At the “eleventh hour”, the UK government pushed through a damaging amendment which opens up key areas of health and social services allowing reserved contracts for mutual and social enterprises, and made it a condition of their agreement on the package. The definition of such enterprises is so poorly defined in the text that it could undermine true co-operatives and social enterprises and open the doors to commercial enterprises masquerading as social enterprises – effectively wolves in sheep’s clothing – all part of the Governments goal of privatisation through the back-door, of course. This is a devious attempt to pull the wool over the eyes of the British public – it should be exposed for what it is and we demand the Government does not implement this damaging article - yet another to add to the already too many reasons to vote Cameron and his lot out before these rules are finally implemented.

As it is worded, the article allows profit-making organisations with minimal mutual characteristics to apply for the reserved contracts. Clearly this loophole will also encourage private enterprises to set up their own spin off “mutual” to gain a foothold in the new mutualised public service market. GMB will be lobbying hard for safeguards in the UK regulations to prevent this back-door privatisation, while ensuring that they support the use of social, employment and environmental clauses in public sector contracts”


Contact: GMB press office 07921 289880 or Kathleen Walker Shaw, GMB European Officer 07841 181 549 or 00 32 2 230 56 75

Notes to editors

See press release from ETUC dated 15th Jan 2014.

ETUC welcomes binding social clause in public procurement

The European Trade Union Confederation (ETUC) welcomes the outcome of today?s vote (15 January) on the directive on public procurement in the European Parliament in Strasbourg.

The introduction of a mandatory social clause guaranteeing the respect for labour law and collective agreements in the workplace is an important improvement to the European rules on public procurement.

“The revised directive on public procurement will allow public authorities to make sustainable choices and make sure that workers rights are upheld”, said Veronica Nilsson, ETUC Confederal Secretary.

“Application of public procurement rules affects working conditions of thousands of workers all over Europe and are therefore of key importance to the ETUC and its affiliates. Public procurement must not contribute to a race to the bottom in terms of pay and working conditions.”

The quality of procured goods and services is another important aspect. The ETUC calls on member states to make use of the possibility of preventing contracting authorities from using price as the only award criterion when granting a contract.

The ETUC regrets that it remains optional for member states to introduce a mechanism for joint and several liability for subcontractors, but welcomes the obligation for the main contractor to provide information about the subcontractors.

However, the new public procurement rules remain complex and much is left for member states to decide such as the possibility for member states to reserve contracts for health, social and cultural services. Safeguards are needed to make sure that private companies cannot apply for such reserved contracts.

The ETUC will, in close co-operation with affiliated trade unions, monitor and influence the implementation of the revised public procurement directive into national legislation and practise.



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