Tuesday, November 16, 2004

For those who are interested…

The full report on EU procurement, headlined in The Times yesterday is on the web.

Entitled the "Wood Review - Investigating UK business experiences of competing for public contracts in other EU countries", it comes out at 125 pages (.pdf) and makes for a pretty hefty read. It is, nevertheless, a reasonably comprehensive indictment of the Single Market.

Interestingly, though, the author, Alan Wood, does not lay all the woes of British industry at the door of the procurement directives. He says:

Even where they do apply, EU public procurement rules are only a small part of the overall regulatory environment which affects the free movement of goods and services across the EU and which involves issues such as differing administrative rules, technical standards, rights of establishment, red tape, legal systems, contract law and employment regulations. There is still some way to go to achieve a genuinely open EU Single Market.
Not least of the concerns is where there has been a more rapid pace of market liberalisation in the UK in comparison to many other EU countries, particularly in the public transport and energy sectors. According to Wood, this has resulted in foreign competition in the UK home market, but fewer corresponding opportunities for UK firms in other Member States, so long as their markets remain wholly or partially closed to competition. This is seen as particularly unfair when foreign firms competing in the UK are also state-owned or state-subsidised.

But, before anyone thinks that this is a Eurosceptic tract, read on. Says Wood: .

The European Commission should be more pro-active, not only in monitoring compliance with EU procurement law, but also in promoting the benefits of effective competition and encouraging the adoption of best practice. The Commission should work with Member States to identify, evaluate and benchmark the structures, tools and techniques which contribute most effectively to these goals; and should use a scorecard approach, where appropriate, to raise Member States’ performance.
As indicated in one of our earlier postings, this plays into the hands of the integrationists who would like nothing better than to see the commission given more power to interfere in the affairs of member states.

Herein lies the crux of a problem. Like Blair, we cannot have it both ways. Either we allow member states to make their own decisions, and use public money to purchase from whom they think fit, or we subscribe to a supranational authority which has the powers to over-ride national preference and direct governments as to what they can and cannot do.

There is, of course, the alternative of the WTO procedure, but as long as companies see any merit in an EU solution, they are buying in to political integration.

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