Sustainable procurement with deficits

By Christian BlockMisch Pautsch Switch to German for original article

The 2018 reform was intended to make it easier for the public sector to apply social and sustainable criteria when tendering for purchases, services and construction projects. In practice, this goal has only been partially achieved. There are hardly any reliable figures.

A municipality is building a day-care centre, an administration is looking for a company to clean its buildings, the CGDIS needs new fire engines: every year, the public sector spends billions on infrastructure projects, purchases and services – an estimated 14 percent of GDP. A lot of money that Luxembourg, like other states, should not only use wisely and under fair, transparent conditions, but also to achieve "common social goals". In other words, with their investments, the state, municipalities and others can set the direction for achieving climate or environmental goals or maintaining high social standards.

Making these "marchés publics" (public tenders) more social and sustainable was one of the goals of a reform passed by parliament in 2018. It should become easier to award contracts on the basis of quality criteria. With the implementation of an EU directive, there should also be more transparency with regard to subcontractors or it should be possible to exclude companies with proven violations of social legislation from public procurement.

Four years later, whether the goal of more sustainable public investment has been achieved remains a matter of interpretation. From the perspective of the Ministry of Public Works, the answer is yes. However, this affirmation must be viewed in a nuanced way. As recently as June of this year, François Bausch, Minister of Mobility and Public Works (déi gréng), had admitted in response to a parliamentary question that "indeed, a large majority of awards are made on the basis of the best price, but criteria such as the quality of the works [and] sustainability [are] also taken into account". According to him, they are applied "mainly" at the level of technical requirements and specifications.

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