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Well, there is a surprise

Posted by Richard Monday, November 15, 2004

According to the front page of The Times this morning, British firms are losing out in the battle for the £1,000 billion European public works market because other governments are unfairly discriminating against them and rigging the rules to help their own companies.

And guess who reported just that on 11 July this year – none other that Christopher Booker in his column, with further analysis on this Blog. Then, Booker described the procurement regime as "one of the greatest, if largely unreported, scandals of the EU".

Anyhow, now that The Times has caught up with the story, it elevates it to its front page, as it retails news of a report that is to be published today.

The report, from Alan Wood, chief executive of Siemens, the engineering and electronics conglomerate, will show big failings in the much-vaunted EU single market. He finds that complex rules, unfair national preferences, and a wavering commitment to competition in other parts of the EU are holding back the creation of a truly fair and competitive market for government contracts.

The report also details instances of unfair practice. These include the award of contracts to national suppliers even where foreign bidders are believed to offer better quality or price; the drawing up of contracts to suit a national company; putting pressure on suppliers to use locally-based sub-contractors; and inviting foreign bids simply to beat down local businesses on price, not because they have a chance of winning the contract.

The report was commissioned by Gordon Brown, who is planning on a speech tomorrow, that will call on Europe to reform its single market rules, to remove the “huge obstacles” that stand in the way of fair competition in European markets, and which harm British and other EU businesses.

Funnily enough, in 1999, when I was first appointed to my research job in the EU parliament, I decided to make it a priority to look at the procurement system. Looking though the Official Journal, it was even then plainly obvious that most of the contracts advertised were from British authorities, and many of them went to foreign firms.

Later, we had a French assistant, and I asked her why the system seems so skewed, and why the French did not seem to notify many contracts, as they are obliged to do under EU law. She gave me such a withering look – part pity, part scorn - and sighed, "Oh Richaaaar…".

Now bleats our Gordon, "Other countries must open up their markets to fair competition." We wish him the very best of luck. But he might as well save his breath. The system is rigged and as long as there is a Frenchman on this planet, it will stay rigged.