Brown demands opening of EU markets
EU states must open up their public sector contracts to competition, according to the Chancellor of the Exchequer.
Publishing a new report into competition in the EU, Gordon Brown said that too many governments were failing to open contracts to “fair competition”, meaning that British businesses were losing out.
Monday’s Treasury commissioned report from the chief executive of Siemens plc, Alan Wood, identifies a range of tactics through which EU states avoid giving lucrative contracts to foreign companies.
These include couching contracts in terms which favour a preferred national supplier, awarding contracts to national suppliers even when foreign companies offer better quality or price, splitting contracts into small blocks to bring them in below the regulation threshold, and “false competition” whereby international bids are invited but there is little intention of awarding a contract to a non-national firm.
Announcing his intention to push for a reform of the state aid system, Mr Brown said: “This report shows clearly that there is widespread preference for domestic industries in many parts of Europe.
“And people right across Europe will want to know why their governments are paying over the odds for services and equipment simply because they have refused to open up their markets and promote competition to achieve better value for money and a better quality of service.”
Mr Brown stressed: “This is an essential element of the economic reform agenda and it cannot be ducked. To be effective, economic reform must include reform of the state aid regime”. And he promised to “promote the benefits of market opening and greater competition to other Member States and the European Commission so that British manufacturers and British workers do not lose out.”
Business has long complained that the UK applies EU rules more strictly than other nations and is sure to seize on this report to back up their case.
Patricia Hewitt, the Secretary of State for Trade & Industry said: “It is vital that British businesses have a fair chance to compete for public procurement contracts across the EU.”
The Government “will continue to push for a level playing field across the EU so that UK companies have a fair chance at competing for and winning public procurement contracts both here and in other member states,” she added.
