The Confederation of British Industry has welcomed comments by chancellor Gordon Brown attacking the unfair procurement practices prevalent in the European Union. Brown’s comments came on the heels of a Treasury commissioned report (carried out by Siemens chief executive, Alan Wood) which found that some EU governments were making it difficult for British companies to compete on an equal footing with local suppliers for lucrative government contracts. The chancellor said “Alan Wood will report – and tomorrow I will raise this in Brussels, standing up for Britain and British interests – how fair competition in the awarding of government contracts is being held back in many EU member states, penalising enterprising and innovative companies.  In the interests of competition and enterprise, Europe must change and I will also push for urgent reform of the expensive state aids regime. “

While the report stops short of accusing EU nations of rigging tendering processes, it does paint a murky picture complex procurement practices which frequently make it impossible for foreign firms to win contracts regardless of the quality of their bids.

The CBI said that it applauded the chancellor’s stance, but also warned that the British government needed to improve its own practices to ensure that the country got the most value for its £120 billion annual procurement budget. The CBI’s deputy director general said “There is no point in our European colleagues extolling the benefits of a single market and then deliberately creating an uneven playing field. This is a key test of their commitment to economic reform. But while we could not back the Chancellor’s European efforts more strongly, it is important to understand that there is plenty of room for improvement in the way we buy goods and services at home. The government needs to get a lot smarter if it is going to get real value for money.”

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