Public procurement refers to the process by which public authorities, such as government departments or local authorities, purchase work, goods or services from businesses. In Organisation for Economic Co-operation and Development (OECD) states, public procurement contracts account for 12% of GDP on average and is a substantial component of the overall economy. Public procurement can be the single most important source of revenue in some sectors, including health and research-related industries, construction and transportation. Public procurement, therefore, has the potential to influence global supply chains in a positive or negative way. Businesses contracted by government departments or public authorities, and, in particular, those which carry out service delivery to the general public, may make decisions or take actions that impact on the human rights of individuals.
Government departments and other public authorities and institutions that purchase goods and services can take measures to prevent human rights abuses being perpetrated by those they are procuring from by ensuring that human rights protections are included within provisions and clauses of tender-related documentation and resulting contracts. Such human rights protections can decrease the likelihood of human rights abuses from occurring and so reduce the risk (both reputational and financial) of those procuring goods and services benefitting from, and/ or being linked to, human rights violations and abuses.
The 2030 Agenda for Sustainable Development highlights in Target 12.7 that to ensure sustainable consumption and production patterns that states should “Promote public procurement practices that are sustainable, in accordance with national policies and priorities”.
The UN Guiding Principles (UNGPs) on Business and Human Rights afford special attention to the state’s role when it acts as a commercial actor. Guiding Principle 6 provides that “States should promote respect for human rights by business enterprises with which they conduct commercial transactions.”+ Read more
“States conduct a variety of commercial transactions with business enterprises, not least through their procurement activities. This provides States – individually and collectively – with unique opportunities to promote awareness of and respect for human rights by those enterprises, including through the terms of contracts, with due regard to States’ relevant obligations under national and international law.”
Contracting out of public services is also specifically addressed by the UNGPs. Guiding Principle 5 provides that “States should exercise adequate oversight in order to meet their international human rights obligations when they contract with or legislate for, business enterprises to provide services that may impact upon the enjoyment of human rights.” Commentary on Guiding Principle 5 notes that:
“States do not relinquish their international human rights obligations when they privatise the delivery of services that may impact upon the enjoyment of human rights. Failure by a State to ensure that business enterprises performing such services operate in a manner consistent with the State’s human rights obligations may entail… legal consequences for the state itself. As a necessary step, the relevant service contracts or enabling legislation should clarify the State’s expectations that these enterprises respect human rights. States should ensure that they can effectively oversee the enterprises’ activities, including through the provision of adequate independent monitoring and accountability mechanisms.”
While highlighting the state’s responsibilities, the UNGPs note that all businesses have a responsibility to respect human rights, which applies irrespective of their size, sector or state of operation, and which extends to their business relationships, including their supply chain. This means that public authorities can look beyond the impact of public procurement on the human rights of people in their home jurisdiction.
Part of the difficulty in ensuring that human rights are integrated into public procurement processes can be the lack of sufficient knowledge and specific skills around human rights on the side of public procurement officers. The International Learning Lab on Public Procurement and Human Rights has been attempting to address this through the sharing good practice and the development of tools and guidance to increase the capacity of local and national procurement agencies to integrate human rights into their purchasing practices. National Human Rights Institutions (NHRIs) in some jurisdictions, such as Northern Ireland, have also developed material and guidance on the topic.
Measures taken in the area of public procurement and human rights includes the EU Directive 2014/24/EU of 2014 which includes measures to allow procurers to use procurement to further common societal goals and new routes to remedy for victims. Legalisation has been introduced in EU member states, such as the Poland introduction into Public Procurement Law which allows procurers to take of social and environmental protections, to implement this directive. Other legislative measures include those undertaken in the UK. The Public Services (Social Value) Act 2012 (England & Wales) and the Procurement Reform (Scotland) Act 2014 allow for economic, social, and environmental improvements through public procurement. In Denmark, the Procurement Act, Act No. 1564 of 15 December 2015, which entered into force on 1 January 2016, paved the way for the state and municipalities to be able to integrate social and environmental considerations into their procurement exercises.
Constitutional protection for human rights within public procurement can be found in the South African where the Constitution allows organs of the State to implement a preferential procurement policy in the allocation of contracts for the protection and advancement of persons that were previously disadvantaged by unfair discrimination. Section 217(3) provides for legislation that will prescribe a framework within which the policy must be implemented. As a result, the Preferential Procurement Policy Framework Act (PPPFA) and the regulations published under it (PPPFA Regulations) establish requirements regarding black economic empowerment (BEE) and local production and content.
Other measures include those introduced by Norway which developed a Socially Responsible Public Procurement (SRPP) Guide, with the aim to help public organisations integrate and mainstream SRPP criteria in the procurement process. Norway further developed a Supplier self-assessment questionnaire goal of to ensure that the supplier’s socially responsible supply chain management system meets the requirements of the social contract performance clauses.
In 2017 the new Pubilc Procurement Law in Spain was passed. This law established a wider range of possibilities in including human rights concerns in public procurement and includes more social aspects compared to its predecessor, but it does not allow for complete exclusion of businesses responsible for human rights abuses from public procurement procedures. Following on from this, Novact, Servei Civil Internacional de Catalunya and Nexes jointly with Tornos Abogados, developed a Guide on Pubilc Procurement Responsible with Human Rights (in Catalan).
Sustainable public procurement has become an important issue in Japan. The Japanese government has committed to contributing to the Sustainable Development Goals (SDGs) that includes “Promoting public procurement practice that are sustainable” in the target 7 of Goal 12. The Tokyo Organizing Committee for Olympic and Paralympic Games (TOCOG) has announced its respect for the UNGPs and developed a sustainable sourcing code for goods and services to be procured for the 2020 games based on the UNGPs. The TOCOG has established a Grievance Mechanism, which will receive reports of non-compliance with the sourcing code and respond with a view to resolving reported cases promptly in a fair and transparent manner. The CSO Network Japan decided to conduct a baseline study of major municipal governments to see how sustainable public procurement is being implemented in each municipality, with a summary of the results available here.
Public procurement relates to the following Sustainable Development Goal