Some reflections on the Commission's communication on the Public Procurement Data Space

Albert has already done a deep dive into the Commission's recent Communication on the Public Procurement Data Space, so for those of you that are yet to get acquainted with the Communication his blogpost is probably the best starting point. As for me, I will take a bird's eye view on the document.

In a nutshell, the purpose of the Public Procurement Data Space seems to be to lay the groundwork for a proper aggregation of procurement data across the EU, that is data currently kept in different silos and impossible to parse together. I am being careful with my wording on purpose and calling it as 'laying the groundwork' is exactly what I feel is at play here.

By laying the groundwork I mean creating the conditions for the aggregation of data to occur instead of ensuring such aggregation will actually happen at all. This is evident when one considers the straightjacket imposed by the current set of procurement Directives and probably the classification of these measures are being part of a supporting competence of the Union.

As such, the Communication is big on ambition (a first for the Commission in terms of electronic procurement) but also vague on details and precise commitments. For example, the Communication recognises that 80% of contracts are below-thresholds and as such no real procurement data is captured about them beyond the approach taken by individual member States in using TED for the notices or doing so via national portals. Wouldn't it be great if all that data was captured in a single place? Of course, but then the Commission immediately bumps into the limitations of below-threshold procurement and suggests that eForms and the wider Public Procurement Data Space will be 'optional'. As for eForms, beyond the data that is already mandatory, the Commission suggests that 'optional' additional fields would also be great.

The problem with optionality is that it depends on incentives to work as intended. And in this particular instance of 'nice things to do in procurement' the incentives of EU and national policymakers are not necessarily aligned and between these and contracting authorities are not aligned at all. We have already seen how misaligned incentives at play even with 'mandatory' notices such as those associated with contract awards and contract modifications. Why are those routinely not complied with despite being mandatory? Well, because they add no value for the individuals (procurement officers) and institutions (contracting authorities) while the cost is certain. The benefit of collating that information is shared among policy/law makers and let's say for the wider society. Hence the lack of compliance with them. The PPDS will double down in this 'hope & prayer' approach since it will depend on the member States to actually deliver on what this is supposed to achieve. Are the incentives for them to do so there though?

Other than that it is great to see the Commission finally showing some ambition with objectives to achieve and having a roadmap to move forward in terms of electronic procurement. However, at stages the handwaving reminded me of the Commission's guidance on competitive dialogue from the mid-2000s: maybe this will happen, perhaps it will work for this or that. We shall see if the 'build and they will come' approach will work.

The problem as mentioned above is essentially one of having its hands tied due to the mistakes enshrined in Directive 2014/24/EU. The work that is now being done a decade later should have been done back then, in a similar fashion to what was done with the eInvoicing Directive (Directive 2014/55/EU) which was designed from the ground up around solving the technical problems and ensuring all member States were on board with the same standard and technical solutions. In comparison, it is only in October 2023 that eForms will finally become mandatory and at least data will now be captured in a structured format, at least for the data that is actually captured.

I also noticed that the Commission refers to some research conducted in 2020-2021 that referred to challenges such as "different data formats, data quality (including missing identifiers), lack of automation and limited scope of data." It is great to see that recognition in writing since I have relayed multiple times to Commission officials since at least 2018 those same problems which were blatantly obvious. In one instance a senior official even became very agitated when I criticised the lack of ambition on Directive 2014/24/EU in what concerns electronic public procurement.

The Communication skirts around what is actually needed to deliver on its ambition, since it is the wrong tool for the job. First, we need a complete rethink of the way electronic procurement is currently considered in Directive 2014/24/EU so that those incentives can be aligned better than it is currently possible. This cannot be done via a Communication, or even via a delegated act like the one the Commission for eForms. We need a new round of Directives - or if I had my way - a Public Procurement Regulation. More about this at a later date.

The second elephant in the room is the current artificial boundary between above/below threshold contracts. I have no illusions the division is here to stay, but the question should be asked: does it makes sense that 80% of public contracts do not benefit from the protection afforded by positive single market rules? Can you imagine if say the various secondary consumer protection rules didn’t cover 80% of transactions and were relegated to being protected simply by Treaty principles?

The final elephant to mention here is the issue of data silos, both cross border and within each member State. To be fair the Communication recognises this problem but for the most part within the field of procurement itself, although it does include a reference to other public and private sources but mostly as a far fetched ambition. This is a shame because electronic procurement can only deliver on its supposed benefits once it is integrated within a wider digitisation effort of public administrations within the member States and obviously cross-border. By itself it will simply constitute another silo.

One final note about two of the key electronic procurement innovations from Directive 2014/24/EU: the ESPD and eCertis. Neither is mentioned not even once even though these are the two existing tools that would stand to benefit the most from the Public Procurement Data Space.