Economic Issues in Public Procurement

This document replaces the brief that was originally published in January 2011. Effective procurement strategies, which control costs and streamline processes, are vital to all contracting authorities. Pursuing the best value-for-money in public procurement, while keeping the process management costs down, requires several crucial decisions including deciding on: the optimal mixture of centralised and decentralised procurement; the best type of contract and format for tendering; and the use of e-auctions or the splitting of contracts into lots. A number of closely interlinked economic factors come in to play in these decisions. SIGMA Brief 2 aims to provide practical guidance regarding these decisions.