Open Data in the EU : Open data and public procurement

3. Open data and public procurement

At present, there is no law or policy at EU level that adequately addresses open data in Public Procurement, except for some Directives and Communications that highlight the need and importance of opening data in this sector to strengthen transparency and fight corruption. However, there are some recommendations and indications by some international organisations.

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee, and the Committee of the Regions: Making Public Procurement work in and for Europe, 3 October 2017

This Communication presents a public procurement strategy which sets out the overall policy framework and defines clear priorities for improving procurement in practice and supporting investment within the EU. Three concrete initiatives are presented alongside this strategy:

communication on a mechanism for large infrastructure projects to provide clarity and guidance to public authorities on public procurement;
a Recommendation to professionalise public buyers as a skilled workforce is essential for effective implementation;
a targeted consultation on draft guidance on public procurement of innovation, to support the breakthrough of new and more sustainable solutions for our societies.

The Commission identifies six priority areas, where clear and concrete actions can transform public procurement into a powerful instrument in each Member State’s economic policy toolbox, leading to substantial benefits in procurement outcomes. It indicates its commitment to deliver by 2018 the following specific actions:

ensuring a wider uptake of strategic public procurement;
professionalising public buyers;
improving access to procurement markets;
increasing transparency, integrity and better data. The Commission states that better and more accessible data on procurement should be made available as they open a wide range of opportunities to assess, on a more informed basis, the performance of procurement policies, to optimise the interaction between public procurement systems, and to shape future strategic decisions. The Commission recommends setting up publically accessible contract registers providing transparency on awarded contracts and their amendments. It also states that enabling the reporting of corruption by setting up effective reporting mechanisms and by protecting whistleblowers against retaliation can also contribute to improving the transparency of public procurement and saving public money;
boosting the digital transformation of procurement;
cooperating to procure together.

OECD 2016 - Preventing Corruption in Public Procurement Public procurement is one of the government activities most vulnerable to corruption.

Public procurement is one of the government activities most vulnerable to corruption. Various types of corrupt acts may exploit these vulnerabilities, such as embezzlement, undue influence in the needs assessment, bribery of public officials involved in the award process, or fraud in bid evaluations, invoices or contract obligations.

In many OECD countries, significant corruption may arise from a conflict of interest in decision-making, which may distort the allocation of resources through public procurement. The direct costs of corruption include losses of public funds through misallocations or higher expenses and lower quality of goods, services and works. In terms of indirect costs, corruption in public procurement leads to the distortion of competition, limited market access and reduced business appetite for foreign investors. Integrity risks may occur at every stage of the procurement process, from the needs assessment to the bidding phase to the contract execution and payment.

For this reason, a holistic approach to risk mitigation and corruption prevention is required.

The OECD Recommendation on Public Procurement highlights several mutually supportive principles which may, directly or indirectly, prevent corruption and stimulate good governance and accountability in public procurement. These principles include:

integrity;
transparency;
stakeholder participation;
accessibility;
e-procurement;
supervision and control.

It seems appropriate to focus on the principle of transparency:

The 2015 OECD Recommendation on Public Procurement recommends that the adhering countries ensure a fair degree of transparency of the public procurement system in all stages of the procurement cycle.
The OECD Recommendation on Public Integrity supports the adherents in safeguarding integrity and public interest at all stages of the policy process, particularly by promoting transparency and open government, including actively ensuring full access to information and open data, along with effective and timely responses to requests for information.

For citizens and civil society organisations to be able to fulfil a supervisory role, data availability needs to be coupled with timeliness, data quality, processing capacity, effective reporting and whistleblower channels.

As a minimum, adequate and timely information must be provided on upcoming contracts as well as on contract notices and information on the status of ongoing procurement processes. Additional information, such as the average procurement duration, justification of exceptions and specific overview records by type of bidding procedure, may further enable external parties to scrutinise public procurement practices. Transparency can also be further enhanced by guaranteeing the visibility of flows of public funds throughout the public financial management cycle.