Environmental and social questions should also be less inclined to be sidelined over the coming years. “These problems were dealt with differently in the 1980s which were very liberal years. Then the financial crisis and the crisis of the welfare state occurred. Europe, which had very conservative views on these subjects had its hand forced by the Court of Justice”, explains Ann Lawrence Durviaux.
The new European directives deal with the notion of ‘life-cycle cost’, a concept that came directly from the Scandinavian countries. In the case of a public market concerning the purchase of a property, how is it possible to simultaneously take into consideration acquisition costs (design, fabrication) property costs (use and maintenance) but also demolition costs (or withdrawal of service)? In other words, how is it possible to create a situation where public markets become sustainable, both from an environmental and social point of view? In the future, parameters such as CO2 emissions, energy consumption or demolition could become of the utmost importance in the choice of a partner. Such parameters could be real game-changers: at a time when the lowest purchasing price is often the criterion that makes the difference between companies that respond to a call to tender, the notion of the total cost of a product or service could justify a higher purchasing price, but would show itself to be ecologically and socially more advantageous in the long term.
Inevitable appeals
Would contracting authorities be prepared to pay supplementary costs? More to the point, would they be prepared to do so in a context where public finances are anything but healthy? “A lot of arbitration will need to be done”, answers Professor Durviaux. She adds that certain court rulings could be problematic to the extent that they affirm that recycling should not be a factor that is entered into the accounts because it only occurs at the end of the process once the deal has been done. Neither should it be forgotten that the question of the methodological obstacles linked to the cost of life-cycle calculation will continually be raised.
Public authorities who want to integrate the notion of durability into their procedures would be taking the risk of seeing disgruntled competitors launching appeals. “Innovators always expose themselves to criticism and a large degree of uncertainty”! Says Ann Lawrence Durviaux. It is impossible to establish a legal text that is appeals proof”. Even without this notion of life-cycle costs, the filing cabinets of the Council of State are inundated with dossiers relating to the contested attribution of markets…
Therein lies the ambiguity of European directives: they indicate the direction to follow but do not indicate the path that should be taken. “The European Union has accepted the principle but does not offer a lot of solutions with regard to the method to be adopted and passes the buck to the member states”, she goes on to say.
Belgium should be seen to be inventive. Not only in order to integrate environmental parameters, but also social aspects. This is not so simple however. “For example, how can we take into account the cost of labor in a public market? In Belgium, the latter can be three or four times higher in relation to other countries which also comply with all the regulations in force. If we do not take care some professions will be lost”. The paradox between free movement (of assets, services, capital and people) and the disparity between fiscal and social systems within different states remains an unsolvable problem now more than ever.
Social dumping?
While certain political parties are delighted with them, the directives adopted last January do not solve the delicate problem of social dumping. Ann-Lawrence Durviaux prefers not to use this term. “The problem today is that a company which uses cheaper foreign labor can easily comply with the regulations in force and be perfectly legal. Is this normal? I don’t have the answer to this question. One way forward would be to work harder on ensuring social inspection, while up to the present the emphasis has been on making general companies more responsible in relation to successive subcontracting. The pressure on prices also blows away the competition. Whatever the case may be, the entire European model must be called into question”.
Finding a real solution will undoubtedly involve a major shake-up: the harmonization of fiscal systems? The implementation of a unique regulation rather than the transposition of directives? Stopping the free movement of workers? And all of these must be done without affecting contract law… It’s a real conundrum!
It is not likely that this complex situation will be dealt with head on any time soon. Traditionally, new directives in matters relating to public markets are released every 10 years and a new cycle of thinking on the subject is not likely to occur in the next three or four years.
