Driving green growth through sustainable procurement
Over the last few months, Defra has observed increasing interest on the part of business in the potential to use sustainable public procurement to drive eco-innovation and green growth in the UK. By using sustainable public procurement to promote innovation, the UK has the potential to create market leading industries able to compete favourably across world markets while also bringing sustainability benefits to the UK.
Ensuring sustainable public purchasing
The public sector accounts for around a fifth of all purchasing power in the UK. Public bodies bought goods and services worth £251 billion in 2009-10, of which central government spending comprised £158 billion and the wider public sector (including local public bodies such as NHS trusts, schools, hospitals and local authorities) £93 billion.
The government has been working on sustainable procurement standards – the Government Buying Standards – for several years. The Greening Government commitments announced last year included a firm commitment to taking sustainable procurement further by:
“Ensuring government buys more sustainable and efficient products and engages with suppliers to understand and reduce supply chain impacts.”
Alongside the mandatory minimum element of the Government Buying Standards, Defra sets a higher best practice standard to inform procurers of the top end of the market in terms of sustainability and innovation. BIS has also taken on the challenge of using public procurement effectively, continuing to develop Forward Commitment Procurement as a tool to drive innovation.
Greening the economy
The Aldersgate Group included sustainable public procurement as one of their recommended levers for driving green growth in their recent report Greening the Economy. In his foreword to the report Dr Jonathan Frost, Green Growth Chair for the Aldersgate Group, wrote:
“To my mind it is the demand side of innovation support and particularly the use of public procurement that provides the biggest under utilised opportunity for the public sector to drive innovation for sustainability while reducing future costs.”
Working with business
Defra recently supported the Aldersgate Group in organising a round-table discussion on sustainable procurement for a range of businesses and public sector bodies to discuss how it can best contribute to green growth.
Defra’s Minister for sustainable development Lord Taylor of Holbeach opened the discussions and gave his support to this work, explaining that the Government cannot afford not to be interested in sustainable procurement:
“Unless the whole life costs of goods and services, from energy in use to water in use, as well as wider social costs like pollution and carbon emissions, are taken into account, we will not achieve value for money in a meaningful sense.
“On the other hand, it is a powerful tool to drive and support the green economy.”
Lord Taylor paid testament to the UK’s entrepreneurial spirit and capacity for innovation, and stressed the wider benefits of sustainable procurement and a green economy:
“I was at the Royal Society of the Arts to present awards to UK businesses shortlisted for the European Business Awards for the Environment. The enormous strides taken by business – from the Olympic Development Authority’s work on construction to that of small SMEs like Aquamarine Power working on wave power in Scotland – were evident. [...]
“We expect that through driving innovation, we may be able to reduce costs to government and boost revenues in the longer term.
“And in addition through influencing industry which in turn influences its supply chain we can seek to ensure that industry in the UK is low carbon and resource efficient, increasing its resilience for the future.”
Defra awaits the outcome of this meeting and further discussions within the group, and will continue to talk to industry groups to consider how its policies on sustainable procurement can be developed with these aims in mind.
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