Public procurement in Europe needs to enter the digital era

Approximately 20% of the EU’s GDP every year is spent on procuring public goods and some estimate that the costs added to government contracts due to corruption amount to around 20-25%. This is a striking amount and it is even more worrying considering that it compromises widely supported public goals such a building safe highways, high quality school buildings, or delivering medicine for a fair price. This is one of the main reasons why more research needs to be done to make public procurement more efficient and transparent. Addressing this gap is what this new EU-funded large-scale project, DIGIWHIST, does.

###Transparency in procurement starts with governments proactively publishing key data on every relevant aspect of procurement tenders.
We have done research on the tender data landscape in 35 jurisdictions (including all 28 EU member states, the European Commission, Armenia, Georgia, Iceland, Norway, Serbia and Switzerland). Most countries fail to publish their procurement data to an acceptable minimum standard. Many well-governed countries such as Sweden or Germany only publish tenders regulated by EU Directives in a transparent and data-rich manner. This is in strike contrast with Eastern-European countries such as Romania or Croatia introduced low reporting thresholds of only a couple of thousand euros making their procurement spending not only transparent, but also more competitive. With a few exceptions such as Italy and Estonia, no government publishes information on contract implementation making it impossible to know what happens after the contract is awarded - whether suppliers deliver on time and budget?

Identifying buyers and bidders is important to prevent collusion in public procurement. In nearly all countries unique identifiers for bidders and buyers are missing which makes it difficult to identify who awarded a contract to whom and for instance search for the contracts a particular company won. Without unique identifiers it is not possible to conduct data analytics for identifying suspicious bidding patterns or flag corruption risks. Without unique identifiers the recent global push for registering beneficial ownership is almost meaningless as a critical piece of the chain is missing: who really has won the contract in the first place.

###Without structured databases we cannot have even the most basic overview of public procurement markets. With a few exceptions such as the European Commission’s TED database or Romania’s open data portal, governments publish procurement data in non-machine readable formats such as individual web pages for each announcement. Publishing procurement data as a database is the precondition to do any data analysis without which even the most essential questions of competitiveness, transparency and accountability cannot be answered. Are there many companies bidding for major markets, are tenders administered quickly and contracts delivered on time… the list of essential questions for policy makers and civil society could be continued. However, answers to all these require structured databases of public procurement tenders and contracts.

Over the next years, we will publish a set of blog posts discussing these key issues in depth. Also, we will work on capturing and re-publishing open public procurement data in all 35 jurisdictions and collaborating with existing partners to work towards a more standardised procurement data landscape in Europe. If you are interested in joining us - get in touch digiwhist@okfn.de