9th Dec 2023


EU can and should add social criteria to public procurement

  • Employers in the cleaning, and private security, sectors also recognise the need to link public money to decent jobs (Photo: PAN XIAOZHEN)
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In her 2023 State of the Union address last month, European Commission president Ursula von der Leyen acknowledged the importance of protecting the European social model: "We are for competition, but not for a race to the bottom" she said.

Unfortunately, her address fell short of concrete proposals for the improvement of Europe's workers, who are suffering from falling living standards, an erosion of working conditions and a lack of workplace democracy.

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  • Ursula von der Leyen warned against a 'race to the bottom' in her State of the Union address last month (Photo: European Parliament)

But there's a simple reform the commission could undertake to reverse the trend — by drawing lessons from its flagship project: the Green Deal.

As a new UNI Europa report released today (10 October) demonstrates, several green commission proposals hold important lessons that could easily be applied to support working people across Europe.

In fact, the commission has made laudable progress in ensuring that public money supports the green transition; it can now do the same with jobs and labour standards.

The key here is public procurement. Amounting to a whopping €2 trillion per year in the EU, which represents 14 percent of the bloc's GDP, it is a simple yet powerful lever to raise living standards for Europe's working people.

The commission knows about the power of public procurement. Its Green Deal states that "public authorities, including the EU institutions, should lead by example and ensure that their procurement is green."

This cannot rely on a voluntary approach where public authorities can decide to procure sustainably or not.

That's why, as the report shows, many of the commission's green initiatives have mandatory criteria in procurement, such as a clear set of award criteria and obligatory result requirements. This creates a virtuous cycle where companies with high environmental standards are more likely to receive public contracts and incentivise other companies to do better.

This logic of a rising tide that lifts all boats, then, also applies to supporting quality jobs.

Unfortunately, Europe's current public procurement rules incentivise companies to undercut each other on working conditions. These cuts are made on workers' pay and conditions, putting them often far below living wages as well as safe staffing levels or sufficient health and safety equipment.

This is simply not the type of competition we should be rewarding. There are several examples of the unpaid, underpaid or exploited workers on public contracts.

The reason is two-fold.

First, public authorities are under serious financial pressure to keep their spending low. Decades of austerity politics are forcing public authorities to consider outsourcing services via tenders, and in doing so, to focus primarily on cost.

Secondly, under the current rules on public procurement, public authorities are free to ignore social considerations. Worse still, the current rules limit how local authorities can strategically award contracts.

Tweak the 2014 directive

To avoid the "race to the bottom" von der Leyen warned about in her speech the EU, then, would need to undertake a simple change in the 2014 public procurement directive. At its core, the reform would require bidding contractors to have collective agreements in place, respect fundamental labour rights and workers' say at work.

The commission has revised multiple directives to include strong and ambitious green public procurement. There is no reason why this can't be done for social public procurement, too.

Using the power of public money to guarantee decent labour practices, better working conditions, and good quality of services would go a long way in strengthening Social Europe.

And it's not just trade unions that think so. Employers in the cleaning and private security sectors, too, recognise the need to link public money to decent jobs.

By transposing the lessons from green procurement to social procurement, the commission can also show that climate action and higher living standards are not diametrically opposed, but synergetic.

At a time of rising living costs and social polarisation, this would be an important message to send to all European citizens before the European elections next year.

Now is the time for von der Leyen to show the commission puts money where its mouth is — by using Europe's purchasing power to ensure decent work, good quality of services and a healthy planet.

Author bio

Oliver Roethig is regional secretary of the European Service Workers' Union (Uni Europa), and Catherine Hernández Festersen is senior policy advisor.


The views expressed in this opinion piece are the author's, not those of EUobserver.

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