Public procurement refers to the purchase by governments and state-owned enterprises of goods, services and works and represents a significant amount of government expenditure. In 2013, governments spent, on average, 29% of the total general government expenditure on public procurement compared to an average level of 30% in 2009. As public procurement accounts for a substantial portion of the taxpayers’ money, governments are expected to carry it out efficiently and with high standards of conduct in order to ensure high quality of service delivery and safeguard the public interest.

While efficiency and cost effectiveness are among the primary objectives of public procurement, governments are also increasingly using it to pursue additional secondary policy objectives. Secondary policy objectives could include promoting sustainable green growth, the development of small and medium-sized enterprises, innovation, standards for responsible business conduct or broader industrial policy objectives, through their procurement policies.

The use of digital technology in the public sector is a driver of efficiency and supports the effectiveness of policies by enabling more open, transparent, innovative, participatory and trustworthy government. In this light, the use of e--procurement, defined as the use of information and communications technologies in public procurement, not only increases efficiency by facilitating access to public tenders, thereby increasing competition and decreasing administrative burdens, but can also improve transparency by holding public authorities more accountable.

A central purchasing body is a contracting authority that: i) acquires goods or services intended for one or more contracting authorities; ii) awards public contracts for works, goods or services intended for one or more contracting authorities; or, iii) concludes framework agreements for works, goods or services intended for one or more contracting authorities. Large procurement volumes could reduce prices by achieving economies of scale as well as increase competition. Furthermore, they reduce duplication, transaction costs, and increase certainty, simplicity and uniformity, allowing for more focused delivery of policy goals.