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EASPD Summary article: The reality of Cross border procurement on Social Services

Deloitte published a new report on Public procurement of Social health services: A study of regulatory burden and the level of cross-border dimension in August 2020. EASPD has provided a summary of the findings and discussion found in the report.

The report was conducted by analysing data on CAN (Contract Award Notice) and CN (Contract Notice) tenders based on home and youth care, a survey distributed among contracting authorities and care providers. Finally, interviews were carried out with care providers to understand better the reasoning behind the degree of interest of care providers in foreign tenders. 6 EU member states were selected as part of the research: Czechia, France, Germany, Italy, the Netherlands and Sweden.

Key figures

- 1,233 relevant contract notices and prior information notices in youth care and home care services between 2016 and 2018. The total number of proper Contract Award Notices (CANs) was 830, an average of 411 notices and 277 awards annually.
- 0.6% of the organisations that participate in tenders originate in other countries; the figure given by care providers for their participation in cross-border tenders was 0%.
- 0.5% of the awards (830), a foreign part won at least one lot of the tender, and in all these tenders a minority of the lots were won by a foreign party.

The report results indicated a reduced level of cross-border activity in social health services and that there is no single market for those services. This was based on these services' unique nature, and that differences in culture and linguistic in several member states contribute to the lack of cross-border activity.

The report raised the question of whether the European Commission's aim to remove barriers for companies to looking to offer cross-border services is a practical reality for social health services?

According to some respondents, the European procurement procedure has created a more competitive environment where procurement previously took place in a more collaborative atmosphere. This could be a SIGN of a more competitive market, which theoretically could be more efficient. HOWEVER: given the sensitive nature of many social health services, it is necessary to establish trust between the care provider and client. The contracting authorities questions whether this hardening of the relationship between contracting authority and care provider and between care providers themselves is beneficial for clients?

Deloitte goes even further and says that contracting authorities and care providers indicated that the option of a single European market is not utilised in social health services. This is because social health services are organised locally.

Report Recommendation: The current obligation arising out the European Directive on Public procurement as they currently apply to the social health services should be evaluated with a possible view of adaptations.

Read the full report here.