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27.02.2020

Innovation in Public Procurement

iTiesības published an article by Kristers Zālītis, junior associate of PRIMUS DERLING, dealing with innovation in public procurement that has great potential to contribute to development and welfare of society.

Innovation procurement has a broader national strategic objective that sometimes goes beyond the individual needs of the contracting entity but takes into account the interests of society or individual groups within the society. Therefore a possibility arises to spend public money more efficiently, giving greater importance to diverse environmental and social benefits and better cost-efficiency in the long run.

As a result of innovation, scientific, technical, etc. new or improved solution is achieved or social innovation is promoted. For example, such public procurement procedures as design contest, procedure with negotiation, innovation partnership procedure, etc. certainly foster innovation. The contracting entity may also set specific procurement qualification or selection criteria, including environmental criteria, such as energy savings, or social criteria, such as the employment of disabled persons. Innovation can also be achieved in other ways.

Innovation procurement can lead to the purchase of a solution that allows better results, cost optimisation, improved technical quality of public services, environmental impact, etc. In addition, innovation procurement can also facilitate the operation of private companies by stimulating private capital investment in R&D&I.

However, the laws and regulations, as a rule, do not require the contracting entity to lay down various environmental or social criteria. While the benefits do exist, the contracting entity often chooses the simplest route and does not apply innovation.

The state should be aware that innovation procurement has great strategic potential.

Read the full article in latvian here.