The Commission has issued guidance on how government agencies
and private companies should put together deals to build public
services. It has said that the conduct of public private
partnerships and procurement processes should be transparent and
should treat all parties equally.
Commissioner for internal markets and services Charlie McCreevy
said that he hoped that the guidance would result in more
competition from the private sector to take part in such
schemes.
"Broad public consultation has shown the need for clarification
of how Community Law on public contracts and concessions applies to
the founding of Institutionalised Public-Private Partnerships
(IPPP)," he said. "I expect that legal certainty in this area will
contribute to increased competition for IPPP. Increased competition
could improve the quality of IPPP and ultimately lead to saving
taxpayer's money."
IPPP are projects undertaken by the public and private sectors
jointly, usually to provide local public services. The Commission
has issued an 'interpretative communication' on how these should
operate. The communication is based on a European Court of Justice
(ECJ) ruling on how such schemes should operate. The ruling was in
a case involving public authority Stadt Halle, which had begun an
IPPP without a public tender and was censured by the ECJ.
"The Stadt Halle case requires transparent and competitive award
procedures whenever public contracts or concessions are awarded to
public-private partnerships," said the Commission. "The guidance
clarifies the EC rules that apply when an IPPP is set up."
The communication from the Commission insists that equal
treatment be given to all potential bidders for IPPP contracts, and
that open tendering processes take place.
It says, for example, that the fact that a public authority
might have a stake in an IPPP company does not mean that it can
treat a contract award as an 'in house' matter, thereby avoiding
full, public procurement processes.
It is not viewed as being a radical change to existing practice
in the UK and Ireland, where significant numbers of public-private
partnerships have been undertaken.
"Anyone looking to the communication for new ideas or approaches
to IPPP will be disappointed," said Ruth Smith, head of public
procurement at Pinsent Masons, the law firm behind OUT-LAW.COM. "It
contains no real surprises and endorses the approach to IPPP which
has been in use in the UK and Ireland for a number of years under
initiatives such as NHS Lift and Building Schools for the
Future."
"The need for transparency and equal treatment is a repeated
theme throughout with some useful practical tips on how to ensure
these principles can be observed," said Smith.
