The role of government wallets

When considering our global consumption patterns it is tempting to think only of the hundreds and thousands of consumers out there pounding the high streets and markets for their daily essentials and consumer goods. Taken collectively, the shoppers of Europe or China or the US play a key role in driving the movement and demand for goods around the world; and changing individual purchasing patterns will be key to creating a more sustainable future.  But are we overlooking other big spenders? 

Our governments commission railways, roads, stations and airports. They roll out utility networks and build hospitals, schools and homes. They contract catering and landscaping services, buy paper, computers and stationary for their offices.  Government wallets represent substantial purchasing power. 

The International Institute for Sustainable Development (IISD), a member of the GEC, has shown how the public sector spends between 45 – 65% of its budgets on public procurement. This amounts to 13 – 17% of GDP in high income countries and even more elsewhere: 35% in South Africa; 43% in India; and 47% in Brazil. 

As such, public procurement has become a huge driver of international trade, creating value chains that span the world.  If governments could make a concerted effort to purchase environmentally and socially preferable goods, this can have a correspondingly large impact on green economy transformation.

Shifting the procurement patterns of vast and unwieldy bureaucracies does not come without challenges and would raise a number of questions relating to the criterion for environmentally and socially preferable goods.  Yet, this is absolutely a conversation that needs to be started at the highest political levels.  At a time when political leadership on sustainable development is very thin on the ground, a commitment on the part of all our governments to sustainable public procurement would demonstrate a commitment to a greener and more responsible future that is long overdue.