The Canadian Centre for Policy Alternatives has released a briefing paper–Municipalities, Progressive Purchasing Policies and the Canada-EU Comprehensive Economic and Trade Agreement (CETA)–by senior researcher Scott Sinclair. It’s based on his presentation to a Columbia Institute event earlier this month in conjunction with the Federation of Canadian Municipalities meeting in Halifax.
The report makes it very clear what is different in CETA than in Canada’s past international and internal trade commitments related to procurement, and why “It is time for a principled defence of local governments’ democratic authority over public purchasing decisions.”
Sinclair makes a strong case “for keeping municipalities out of the CETA through–as the Union of BC Municipalities has already called for–a clear, permanent exemption.”
At the Columbia Institute event, which was attended by over 60 councillors, Sinclair explained:
the EU’s highest priority in the CETA talks is unconditional access to government procurement, particularly at the sub-national level. I stress “unconditional” rather than “non-discriminatory” access because the proposed restrictions on government purchasing would eliminate the flexibility for governments to use their purchasing power to enhance local benefits, even when contracts are competed openly and do not discriminate on the basis of the nationality of the suppliers.
Taking on proponents of binding procurement agreements, who claim they help fight corruption while getting the best value for consumers and taxpayers, Sinclair says:
The use of selection criteria that maximise local benefits and advance public priorities is completely consistent with open, fully transparent public tendering and other safeguards commonly put in place to prevent corruption. Indeed, as long as the selection criteria are clearly specified early in the tendering process, they can be used to objectively assess the social and economic benefits resulting from public procurement, as well as ensuring fairness and value for money in public spending.
Progressive procurement policies that support local communities are completely legal under Canadian law and Canadian trade commitments. “In fact,” he argues, “assessing the overall benefits of a proposal in terms of local job creation, increased taxes, opportunities for marginalised groups, and environmental benefits provides a more accurate cost accounting and superior value for money than simply going with the lowest bid without considering local spin-offs and community impacts.”
Sinclair also explains the threat to public services in his new report:
European multinational companies, including some of the world’s largest private utilities, are seeking new rights of market access to provide these public utilities… The leaked European demands explicitly seek coverage of “concessions” for public works, such as waste, water, electricity, roads, ports and other essential services. Such services are typically either publicly provided or, when privately provided, strictly regulated by governments to ensure quality and safety.
Covering these public service sectors and handing investors strong protection from any government measures that diminish their investments risk taking away the freedom of municipalities to bring services back in house when privatizations fail. Sinclair concludes:
Local governments should not lightly give up policy tools with so much potential to improve the lives of Canadians. Indeed, we need to protect and enhance the ability of governments to obtain the greatest return for their citizens when purchasing goods and services. The type of economic, social and environmental benefits that progressive government procurement policies can bring will be sorely needed as Canada moves forward into the 21st century.
