"Ethics should play a bigger role in the economy"
Interview with public procurement expert Elisabetta Manunza
In the interview with Follow The Money journalist Siem Eikelenboom, Elisabetta Manunza is quite critical about the way government tenders are handled in the Netherlands. Examples from the recent COVID-19 period she mentions, are the unregulated procurement of face masks and of testing facilities – suggesting an emergency in which bending the rules was justified. But even in the absence of such an excuse, government procurement is often perceived as overly tedious and is sometimes circumvented by creatively interpreting the law. Another problem is that procurement requirements are often driven by the lowest price, rather than quality and reliability – including strategic (geopolitical) implications. Manunza's remarks are sometimes painful to hear, but her criticism is constructive and she points out that public procurement also provides a big opportunity: tendering as an instrument for the general good of society.
Public tendering rules are at the heart of the democratic process
In the interview, Manunza (who grew up in Italy, but now seems settled down pretty well in the Netherlands) says that criminal law and procurement law are much closer to each other than you would think at first sight. In 2001 she obtained her doctorate from the VU Amsterdam university with a dissertation on combating abuse of procurement procedures by organised crime. The Italian penal code even establishes a direct link between tendering and the Mafia. So don't call tendering procedures 'needless hassle' in her presence. "Tendering rules are at the heart of the democratic process. They promote transparency and equality. They force proportionate decisions to be taken, and counter discrimination. It is not without reason that the implementation of European procurement law is one of the key issues in the process of admitting countries to the European Union."
As soon as you outsource healthcare provision to a party other than your own government organisation, you have to tender
That is why Manunza is disappointed whenever public tenders fail in the Netherlands, not only during a crisis like the last corona period, but also outside of it. She cites the example of Hugo de Jonge who, as Minister of Health, argued in January 2020 for a quick adjustment of the tendering rules, so that municipalities can purchase healthcare in the social domain without a time-consuming European tender. "But as soon as you outsource healthcare to a party other than your own government organisation, you have to tender. Regardless of whether that external party is a private company, another ministry or a neighbouring municipality, or a foundation such as the Salvation Army." Manunza also refers to a recent report by Transparency International (from 2021) on how public money is spent in Europe. "The Netherlands came out as the worst performing country. We are the least transparent when it comes to spending public money."
If you don't take costs such as environmental pollution, social safety and human rights into account in a tender, things will go wrong
She also considers the tender of drones and security cameras awarded to Chinese companies by the Dutch police – selected purely on price – as dubious. The 'lowest price' must be calculated differently, she says. "If you do not take into account all costs in a tender, such as environmental pollution, social safety and human rights in a tender, things will go wrong. If you do, then companies from countries that undermine the democratic rule of law will no longer be the best in a tender, despite a possibly lower price." She calls it a misunderstanding that selection on these criteria is not allowed. "According to European rules, you can tender with a fixed price based on one hundred per cent quality. What's more, the rules encourage procurers to make informed purchases by taking sustainability and innovation into account. They even prohibit concluding contracts with rogue companies that are guilty of child labour, for example."
The whole world looks on the European tendering rules with admiration, because they create an opportunity to make the world a better place. It's a pity that many people are not aware of this. Lack of knowledge and wrong attitudes are the biggest problems in public procurement.
What stands in the way of the Netherlands and the Dutch in dealing better with procurement, says Manunza, is that trading is such a defining part of our national culture to the extent that we sometimes overlook (or want to overlook) the fact that others may have very different interests. "It is important to have a geopolitical vision. A vision that trade is more than just buying or selling something. Trade is always accompanied by an ideology. It is not a neutral concept." Ethics must play a bigger role in the economy, Manunza believes. Not only the government, but also consumers must ask themselves whether they want to buy certain things from certain parties. In the end, everything also has its social price.
The interview with Elisabetta Manzuna (in Dutch) was published on Follow The Money op 17 April 2022