91998E1565

WRITTEN QUESTION E-1565/98

by Viviane Reding (PPE) to the Commission

(20 May 1998)

Subject: Centralization of supplies purchasing for the European institutions

Together with the other European institutions, the Commission is seeking, in the interests of cost-cutting, to centralize the purchase of supplies, particularly furniture, in Brussels. They are keen both to order larger quantities at a time and to extend the duration of contracts, which may reach 10 years by successive renewals. This new approach, which seems to promise savings, has its defects, however. Firstly, the average life of the furniture is often shorter than the contract periods the Commission is seeking to obtain. Second, the new approach openly favours big firms which are able to cope with orders of an ever increasing volume.

Is the Commission aware that the increasing size and duration of contracts, and their centralisation in Brussels, disadvantages small and medium-sized enterprises? Is the Commission aware that in the interest of marginal cost reductions it is heavily penalising one of the sectors of the economy on which it is most reliant for job creation?

What measures does the Commission propose to take to avoid its cost-cutting efforts having a negative impact on small and medium-sized enterprises?

Answer given by Mr Liikanen on behalf of the Commission

(22 June 1998)

The purpose of long-term contracts and centralised furniture purchases is not solely to reduce purchasing costs. It is also to standardise equipment with a view to simplifying inventory management, encouraging exchanges and reducing the volume of furniture to be moved when staff change are relocated.

The purpose of the contracts is to supplement and renew the furniture in use at the Commission and possibly at the other institutions. The duration of the contracts is not related to the life span of the equipment.

Long-term contracts bind the Commission - or another institution - to a supplier for a longer period, but they have no impact on the annual volume of purchases. The volume tends to be very substantial and can vary considerably from one year to another. Since the Commission wishes to have its orders performed efficiently without disrupting the financial equilibrium of its suppliers, it deals with firms whose production capacity matches its requirements but does not impose clauses that discriminate against European firms in general or small and medium sized enterprises (SMEs) in particular.

As a rule, given the need to optimise the use of public funds in the current climate of budgetary restraint, the Commission's purchasing strategy aims to secure the best possible value for money. This reflects the European policy on public procurement, which seeks to improve competitiveness of European firms.