Public procurement is a powerful driver of more inclusive and sustainable social and economic arrangements. According to the European Commission, approximately 1.9 trillion EUR is spent annually on public procurement. Public authorities buy goods and services in order to fulfill their general-interest related mission which obliges them to find a balance between different kind of interests. And the way they organise and use public procurement can a have big impact in stimulating social innovation and social impact in the respective city or region.
Since 2014 the EU PP Directive has given greater support to public authorities organising and using public procurement to buy goods and services as a way to catalyse social innovation and social impact. However, even for the most willing civil servants looking to make added social value a key consideration in their purchases, it can be unclear where to start or who to turn to. Furthermore, SIC’s public consultation found that a real challenge facing social innovators is that they are often shut out from public procurement processes. For this reason, recommendation 10 of the Lisbon Social Innovation Declaration makes the following proposal: “establish Public Procurement Pathfinders to connect government agencies with social innovation actors (including civic start-ups, social innovation-focused SMEs or social economy players)”.
To explore this important social innovation policy topuc further, SIC partners REVES, NESTA and SIL Croatia organised ourselves into a Policy Action Team. By means of desk research, interviews, discussions during European seminars on related topics, a short survey and an online policy roundtable, we identified and analysed existing practices and opportunities, but also the needs, expectations and obstacles related to supporting procurement pathfinder practices.
What do we mean by "Public Procurement pathfinders"?
“Public Procurement Pathfinders” could be defined a) as facilitators (persons or organisations) or b) tools which act as bridgebuilders by enabling wider interaction and capacity-building between key public and social innovation stakeholders.
Good practices for what could be considered “pathfinders” already exist or are being set up in different cities and regions in Europe:
The City of Barcelona developed a specific Social Public Procurement Guide and adopted a related Mayoral Decree (24 April 2017). Both are results of the work of the Sustainable Public Procurement Committee that brings together representatives of business, social economy, trade unions, local associations and civil society.
In 2013, Barcelona launched the BCN Open Challenge Initiative. Companies – among them many SMEs and start-ups – were encouraged to present their ideas and solutions to six problems ranging from reducing social isolation to improving road safety instead of making offers for already pre-defined solutions. The process was coupled with training programmes.
Co-defining the values and principles that underpin our public procurement procedures with citizens can help clarify the goals and aspirations that matter most in a given context. Between 2011 – 2012, the City of Gdynia (Poland) organized a process of participatory dialogue with a broad range of stakeholders, including those generating social innovation to respond to diverse challenges. This led to the “Charter of Quality of Care Services” and a care standard. Both lay down main principles and quality standards for the design, organization and provision of care services and have been integrated into the city’s public procurement procedures. Not only has this supported user-led service development, but the process also led to a stronger recognition of care professions and improvement of working conditions in the care sector in the city.
In Belgium, Solidarité des Alternatives Wallonnes (SAW-B), a federation of social economy organisations, has developed several programmes and tools aimed at supporting greater consideration of social clauses in public procurement procedures. Examples are meetings with public buyers and local social enterprises, a helpdesk service and counselling services for contracting authorities on how to manage the use of social considerations in public procurement.
A Platform for innovation procurement was established by the French government with a goal of encouraging the purchase of innovative products and services by all public authorities. It supports authorities in defining and analysing a performance axis "innovation" for each procurement strategy. Moreover, it creates links between public purchasers and enterprises generating (social) innovation.
ProZorro is a public e-procurement system in Ukraine which digitises and opens up all the information about public tenders (including the offers put forward by private companies) for anyone – civil society, journalists, the public, business and government – to view.
SIC’s recommendations for making public procurement a better driver of social innovation:
- Cities, regions and national governments should set up (socially) sustainable procurement strategies including measures that create opportunities to bring public authorities and social innovators together for dialogue and potential collaboration.
- Consider establishing Multi-stakeholder Sustainable Procurement Committees (including representatives of different departments of the public authority, civil society, etc.) to improve the relevance and impact of these strategies.
- Explore different forms of public-social-private cooperation that might not be part of procurement procedures and how their results (definition of values and real needs, development of ideas, mapping of competences, etc. ) might also feed into procurement with better socially innovative outcomes.
- Update guidelines - such as the European Commission notice “Guidance on Innovation Procurement” - to include a a stronger focus on social innovation, as well as strategies to make it easier to involve smaller (social) actors in public procurement procedures.
- Increase capacity-building for policymakers and administration at national and regional/local level. This could be realised using specifically earmarked ESIF financing, European Commission training for public authorities or European peer-learning programmes and pilot projects.
- Social (innovation) procurement must become part of the curricula of Institutes for Public Administration, university courses on administrative sciences and other educational/training institutions.
- Policymakers and administrations should consider re-decentralising public procurement, where appropriate, to make it more tailored to the specific local situation and allow flexibility in reducing contract sizes so that they are more accessible for (smaller) social actors.
- Organise “Pathfinder Study Visits” for public administration to gain exposure to organisations contributing to social innovation, and to create opportunities for peer learning and training across Europe. This should be combined with better cross-departmental cooperation to improve knowledge and encourage procurement of socially innovative products and services in their specific local context.
2019 – our work on public procurement for social innovation continues…
Our work on social innovation in public procurement does not stop here. As part of REVES’s ongoing work, REVES (the European Network of Cities and Regions for the Social Economy) will continue following procurement practices – and alternatives to procurement – applied by cities and regions.
REVES is also part of the "Buying for Social Impact" Consortium (#Buying4SocialImpact) which has been mandated by the European Commission to organise training sessions on the application of EU directive EC/24/2014 (that opens up new opportunities to boost social impact and social innovation) in several EU Member States.
In case you would like to know more on activities/initiatives going on in your country, you have any questions or you would like to share good practices from your city or region, please get in touch at: firstname.lastname@example.org.
Link to the more detailed Public Procurement Pathfinders policy paper.