The URBACT Programme has been a key partner in the EU Urban Agenda Partnership for Innovative and Responsible Public Procurement since its formation in 2017. After seven years, we reflect upon how our work has contributed to shaping policy at the EU level and how URBACT cities can continue to shift procurement cultures at the local level into the future.
Since 2015, the URBACT Programme has been working on the topic of procurement through its networks, capacity building, and knowledge transfer activities. Perceived by many as a dull, bureaucratic and technical process, as a result of EU and national level legal frameworks, URBACT and its participating cites have looked to raise excitement around the potential for procurement to be fundamental to realising sustainable urban development aspirations.
At URBACT, we believe that every euro of the 2 000 billion spent annually by public authorities through procurement should contribute to not only efficient goods, services and works; but also, towards addressing the range of local economic, social and environmental challenges that Europe faces. This is what we call ‘Strategic Procurement’. We also recognise that this belief fits within a much bigger policy picture, which our involvement in the EU Urban Agenda Partnership for Innovative and Responsible Public Procurement has been seeking to shape and engage with since 2017.
EU Directives – theory vs reality
The process of Procurement at Member State, regional and local levels is governed and informed by the EU Procurement Directives of 2014. Primarily, these Directives are rightfully focused on ensuring that all public purchasing is undertaken in a fair and transparent way and that a competitive process exists between organisations (suppliers) wishing to bid for procurement opportunities. However, the Directives also present the opportunity to use this process as a strategic lever in many ways, and to support the realisation of wider local economic, social and environmental outcomes. The Directives allow, for example:
-Larger procurement contracts to be broken down into smaller lots to enable small and medium-sized enterprises (SMEs) to bid.
-Procurement contracts to be reserved for particular types of economic operators and for whom 30% of their workforces are disabled or disadvantaged.
-Dialogue to be undertaken between the municipalities designing the good, service or work, and the potential market.
-For factors other than price to be considered in the procurement, and particularly considerations upon how the good, service or work can contribute towards realising wider social and environmental goals.
The problem is that Member States, regional governments and local municipalities often face barriers around capacity, skills, experience, knowledge, and willingness to shift procurement cultures and behaviours.
The EU Urban Agenda Partnership for Innovative and Responsible Public Procurement has sought to support cities and other organisations to see the EU Procurement Directives as not a threat, but an opportunity to create a new culture around procurement across Europe.
The Partnership has deployed many actions in its lifetime that are designed to develop the capacity of cities and other organisations to take advantage of the opportunities presented in the Directives to use procurement to realise wider social and environmental goals. URBACT has been particularly involved in actions with the Partnership that:
-Support cities to develop procurement strategies that outline not only their legal requirements around procurement but also the wider social and environmental outcomes that they wish to achieve through the process.
-Support cities to understand where their procurement spend goes and the impact it has on addressing wider social and environmental challenges.
-Support cities to identify ways in which they can use procurement to realise economic regeneration, and particularly create jobs, develop SMEs, and create a more circular economy.
Learning by doing: URBACT cities
Let’s take a look at how some cities have leveraged URBACT’s support to overcome some of those barriers just mentioned above in translating EU policy into local action.
The City of Koszalin (Poland) has been involved in three URBACT Networks focused on procurement (Procure, Making Spend Matter, and GenProcure) and has consistently faced difficulties implementing EU and national level law, particularly about the extent to which the Municipality can engage with potential suppliers in the lead up to a specific procurement. While Koszalin recognises the need for transparency in procurement, it has also realised that it can work closely with the Koszalin Chamber of Commerce to more generally identify SMEs that may want to bid for procurement opportunities, make them aware of upcoming prospects, and provide training around social and environmental considerations, for example.
The City of Vila Nova De Famalicao (Portugal) has been involved in two URBACT Networks (Making Spend Matter and as the current Lead Partner for GenProcure). Traditionally, the procurement function was seen internally as the responsibility of one small department leaving them with capacity and experience barriers around procurement. They have overcome this by developing a Procurement Action Plan, which makes procurement the responsibility of all departments in the municipality, with the central unit overseeing policy and delivery of the plan. Central to its delivery is the collection of evidence, with the Municipality undertaking an annual spend analysis of where their procurement spend goes in geographical, sectoral and business type terms.
The City of Zagreb (Croatia) is currently involved in the GenProcure Network and has historically faced knowledge barriers as to how social, environmental and gender considerations can be built into procurements. GenProcure is enabling Zagreb to understand more about such considerations, and supporting the city as they test their inclusion in a current parks and landscaping tender.
Getting the directive cities deserve
The Partnership and URBACT recognise that, despite the efforts described above, the European Commission could go further in promoting and realising the strategic elements of the EU Procurement Directives. A Position Paper developed by the Urban Agenda partnership details a series of recommendations as to how procurement can be more effectively used as a strategic tool at EU, national, regional and local levels to address social, economic and environmental challenges.
Some of the key recommendations most relevant for cities include:
-Recommendation 1: the need for a clearer alignment between EU policy objectives around economic growth, the digital transition, and the green new deal, for example and the process of procurement.
-Recommendation 2: the need for a binding agreement between the EU and municipalities that procurement can be used as a mechanism for realising local economic, social and environmental outcomes.
-Recommendation 6: the need for resources to support stakeholders of all sizes - large, medium or small cities, SMEs or large enterprises’ suppliers - to participate in ‘strategic’ procurement.
-Recommendation 7: the need for additional support to overcome barriers to market dialogue even before a procurement is advertised, and to evaluate social criteria.
Developed in the lead up to the June 2024 European elections, they remain pertinent for the new European Commission, whose president has committed to refreshing the EU Procurement Directives.
Conclusion
The importance of procurement will therefore continue to grow, and cities should be fundamental in orienting its development.
Through its engagement with cities, URBACT has ensured that their experiences have contributed thus far to shaping the European policy agenda. Cities across Europe can continue to be more ‘strategic’ when it comes to procurement and ensure policy evolves to meet their needs.
Matthew Baqueriza-Jackson is the Lead Expert for the URBACT GenProcure Action Planning Network and represented URBACT on the EU Urban Agenda Partnership for Innovative and Responsible Public Procurement between 2017 and 2024.
URBACT has produced a wealth of support and tools around Strategic Procurement including training tutorials on:
- Strategic Public Procurement,
- Gender Responsive Procurement, and
- Food and Procurement (newly launched in October 2024).
