Fostering innovation through public procurement

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According to estimates, the total volume of public procurement in Germany amounts to roughly €250 billion per year. A sum like this contains major potential for fostering innovation. By purchasing cutting-edge products and new technological solutions, the government not only saves money and energy but also provides industry with the impetus to put innovative products and services on the market. In so doing, the government can foster the dissemination of innovations.

To promote more innovation-friendly procurement systems in government ministries and their associated agencies and research establishments, an initial group of six federal ministries (Economics, Research, Transport, Defence, Interior and Environment) has decided to make greater use of the potential offered by innovation-friendly procurement.

As part of the government's measures to protect the climate, the Federal Cabinet has adopted "General administrative rules on the procurement of energy-efficient products and services" and accompanying guidelines (available in German only) that are binding on all federal ministries.

In co-operation with the Federal Association for Materials Management, Purchasing and Logistics (BME), the Economics Ministry holds an annual "Contracting Authorities Day", at which public sector contracting authorities can discuss current procurement issues. At the event, the "Innovation schafft Vorsprung" prize ("innovation creates a lead") is awarded for an innovative procurement procedure and/or the procurement of an innovative product. The Economics Ministry invites contracting authorities to join the competition by submitting exemplary projects.

In addition, the Economics Ministry is providing support to REPROC, a pilot project that aims to standardise procurement processes and adapt them to electronic systems.