Ensuring Innovation in Public Procurement – Does Party Affiliation Matter?

Illustration: Colourbox

This blog post looks at government contracting as a type of collaboration where the public sector contracts out public services to the private sector in order to deliver quality public services. In 2018, the European Commission indicated that government contracting accounted for 14 percent of the European single market GDP. Price is a major driver in decisions about contracts and public officials normally award contracts to the cheapest service provider. In recent years, however, governments have been also increasingly willing to link government contracting to the realization of secondary policy objectives, such as reducing unemployment, promoting innovation or environmentally friendly policies.

In TROPICO Work Package 3 (WP3): Transformation of Individual Drivers and Barriers of Collaboration, we intend, among other objectives, to understand the extent to which public officials consider such secondary policy objectives when they collaborate with the private sector. The WP3 team examines the association between politicians’ political ideology and their consideration of price and secondary policy objectives in Belgium. Politicians’ stated behaviour is investigated through a discrete choice experiment.

The first results of this research indicate that left-wing and right-wing politicians’ preferences for the secondary policy objectives are significantly different.

Two findings are crucial. First, there are no significant differences between left- and right-wing politicians with respect to the price criterion; politicians are all more likely to take price into consideration regardless of their political ideology. Second, all politicians are more likely to take the secondary policy objectives into consideration. Yet, the strength of preferences differs significantly between left- and right-wing politicians. Left-wing politicians are more likely to take the social criterion into consideration, while, compared to their left-wing counterparts, right-wing politicians are more likely to take environmental and innovative criteria into account.

Whereas our research findings show that price is still at the core of government contracting, the results also indicate that politicians’ political ideology is associated with their preferences for the secondary policy objectives. It has important implications for government contracting as it shows that the process might not be apolitical. These findings could be explained through the ideological position of the left-wing and right-wing parties. Whereas left-wing politicians are traditionally oriented towards the development of social values, right-wing politicians are often associated with the development of innovative solutions. The study also suggests that policy objectives are not solely attained by the public sector, but that the private sector can also help the public sector in achieving some of the policy goals. Moreover, although this point has not been examined in this study, the private sector can also provide more innovative solutions and new ideas for the delivery of public services. Further analysis needs to determine whether we can consider such collaborations between the public and private sector successful or not.