Social considerations in public procurement - opportunities in EU countries
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1 Social considerations in public procurement - opportunities in EU countries Marjatta Varanka, VATES-Foundation Workability Conference in Dublin
2 EU Legal Framework EC Treaty Legislative Package (Directives 2004/17/EC and 2004/18/EC) ECJ Case Law
3 Public procurement as an instrument for social policy Public procurement law has traditionally been seen as serving two aims The efficient use of public assets value for money for contracting authorities - purchasing best value for tax-payers money value may include also social and environmental considerations The promotion and development of the internal market (EC viewpoint) new provisions in procurement directives and national law public procurement 16.3% of EU GDP
4 Social considerations in public procurement => Opportunities for special employment?
5 Social considerations in public procurement - Workshop Helsinki
6 Social Considerations May be taken into account at every stage of a public procurement procedure in technical specifications, selection criteria, award criteria, contract execution clauses Must always: - be linked to the subject matter of the contract - comply with the Treaties fundamental principles (transparency, non-discrimination )
7 Planning Procurement Actions What to buy defining the subject matter of the contract Possibility to reserve the right to participate in public contract award procedures to sheltered workshops or provide for such contracts to be performed in the context of sheltered employment programmes (art.19 Directive 2004/18) Conditions: - 50% rule (applicable to both sheltered workshops and sheltered employment programmes) - competition between sheltered workshops/employment programmes
8 Technical Specifications Whenever possible, to take account of accessibility criteria for disabled persons/design for all (Art. 23 Directive 2004/18) Exemples: - access to built environnement - access to information and communication technologies
9 Selection Criteria/Exclusion Exemples of social considerations in the selection criteria Relevant Exclusion Criteria: offence concerning the professional conduct convicted by judgment (Art. 45 (2) (c) directive 2004/18) grave professional misconduct (any means) (Art. 45 (2) (d) directive 2004/18 e.g. Non-compliance with legislation regarding social inclusion of disabled persons) non-payment of social security contributions (Art. 45 (2) (e) directive 2004/18)
10 Award Criteria (I) Lowest price/most economically advantageous tender Social considerations may be included in the award criteria, subject to certain conditions defined by the public procurement directives and by ECJ relevant case-law (recitals 1 and 46 and art of the directive 2004/18)
11 Award Criteria (II) Conditions: - Be linked to the subject matter of the contract - Not confer unrestricted freedom of choice on the contracting authority - Be expressely mentionned in the contract notice and in the tender documents - Comply with fundamental principles of Eu law (transparency, non-discrimination, etc)
12 Award Criteria (III) The previous conditions apply more generally to all types of award criteria, and not only to social considerations Possibility to exclude abnormally low tenders (art. 55 directive 2004/18), in several cases, including in case of non-compliance with the provisions relating to employment protection and working conditions
13 Performance of the Contract Social considerations in contract performance clauses must: be indicated in the tender documents; be related to the performance of the contract must comply with fundamental principles of EU law E.g. a clause relating to the employment of a certain number of disabled persons in relation to the performance of the contract
14 Future Guide on social considerations in public procurement EU law offers a broad range of possibilities to include social considerations in public procurement However, there is a certain lack of familiarity with what is and is not possible under the Directives The Commission s services (DG Markt and DG Empl) have consequently taken the decision to prepare a practical Guide to taking account of social considerations in public procurement A study has been commissioned by DG Empl to an external consultant (ITC-ILO) in order to have a better view of existing practices and difficulties in the Member States
15 Key Findings of the External Study Framework is complex and evolving fast at MS level Different practices at different levels within MS Need for peer learning Commission s Green guide an example, but significant adaptation needed Need to establish business case - assess costs and benefits
16 Next Step: Write a Guide Purpose of the Guide: - To raise contracting authorities awareness about the potential benefits of SRPP - To explain in a practical way the possibilities offered by the existing European legal framework to take into account social considerations
17 The Guide draft in April 2008 Key concepts and policy context (definition of SRPP, potential benefits, potential barriers and constraints, legal approach) Organisational strategy to buy social (e.g. objectives, risks, prioritisation, awareness raising, implementation, monitoring) Will explain the relevant rules and principles applicable at each stage of the procurement cycle Will include practical examples referring to a wide spectrum of social considerations More information : Loredana Piu, EU Comission
18 Finnish Act on Public Contracts (1) Reserved contracts: Contracting authorities may reserve the right to participate in public contract award procedures in favor of sheltered workshops or provide for such contracts to be performed in the context of sheltered employment programmes where most of the employees concerned are people with disabilities who, by reason of the nature or the seriousness of their disabilities, cannot carry on occupations under normal conditions. The public contract notice must indicate that the contract is reserved for sheltered workshops or programmes.
19 Finnish Act on Public Contracts (2) Performance of contracts Contracting authorities may lay down special conditions relating to the performance of a contract which may, in particular, be intended to favour environmental and social aspects, such as on-site vocational training, compliance with the provisions of the International Labour Organisation (ILO) conventions, working conditions and employment terms or the recruitment of people with disabilities, provided that the conditions are non-discriminatory and compatible with Community law and that they are indicated in the contract notice or the invitation to tender.
20 Examples of the Use of Social Clauses (in inclusive employment) Finland Case Finland, Eveliina Pöyhönen, in Helsinki City of Espoo the use of social clauses written in the procurement strategy and procurement guidelines the first tender including social clauses in home services City of Oulu City council decision to take social criteria into use stated in the City Procurement Strategy
21 Examples of the Use of Social Clauses City of Helsinki / Health Services takes social criteria into use in contract terms to promote for example the employment of disadvantageous groups finds out if procurements can be reserved for sheltered workshops or similar organisations recognises the possibility to limit the procurements under EU threshold to social firms or similar organisations
22 Conclusions Use of social clauses requires a strategic decision from the policy-makers requires clear, practical models and cooperation the simplest way to use social criteria is to include them in contract terms tendering could be restricted only for social firms in those procurements which are under the EU threshold What next? Development of models in the use of social clauses in municipal tenders
23 Reserved contracts - employment targetgroup Case: Basque Government, Jaime Domínguez-Macaya, In Helsinki The insertion percentage shall be calculated in relation to the total number of the workers required to execute the contract form the contractor and from the sub-contractor
24 The following people shall be considered as those in particular difficult situation to find employment: Women over 30 for whom this contract is their first work experience, together with those contracted of 5 years not workng People receiving basic income People with a disability equal or greater than 33% Victims of domestic violence Individuals suffering from mental illness Father or mother of a single-parent family, provided that they have been registered as unemployed for at least 3 months. Inmigrants from outside the Community registered as unemployed for a continous period of at least 6 months.
25 Long-term unemployed individuals registered continously as job seekers with the relevant public department for at least 12 months. People over 45 registered as unemployed for at least 3 months continuously. Young people between 16 and 30, that appear registered unemployed for 5 and 12 months continously Individuals from child protection institutions provided that the job insertion process begins during 12 months following their leavint the institution. Former addicts (who have been continuously treatment for mor than 6 months Individuals who suffer or have suffered a terrorist action Any individual that so requests it and who, in the opinion of the gassroots social services, requires an intervention or specific measure for a work placement.
26 Raising awareness of reserved contracts Case: Remploy, Robert Taylor, in Helsinki Conclusions It is a long term task to create higher awareness of reserved contracts It needs people and materials fit for the task Need some enthusiastic champions among the buying community Active support of Government Minister(s) is a huge help Requires collaboration and coordination between supported business organisations Senior advisers need to know how they can help supported businesses before they are told to help by Ministers. The journey has only just begun after 2 years
27 Conclusion in WE / SDG workshop Our interest in social clauses: Small units are looking for local markets Can provide multiple outcomes Economic environment / service busines is growing less risky in recession to create new business models Will strengthen relationship with funders, (municipals, authorities), inceasing social capital Supports the wellfare of the people Ageing society Number of people at the retirement age increasing creates employment problems CSR for the public sector, get share of public procurement for the employment for people with disabilities
28 More information : WE Workshop in Helsinki Public Procurement
29 Thank you for your attention!
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