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As economic development takes place, the need for increased consumption and production puts pressure on the environment and its limited resources to fulfil unlimited needs.

Pursuing Sustainable Public Procurement for Gross National Happiness

As economic development takes place, the need for increased consumption and production puts pressure on the environment and its limited resources to fulfil unlimited needs. It was with this realisation that the government of Bhutan has followed the path of Gross National Happiness (GNH), underscoring that true development cannot be pursued on the premise of economic development alone, but has to take place in conjunction with the social, spiritual and environmental wellbeing of the people. While the concept of GNH is holistic, government policies alone are not sufficient to achieve the goal of sustainable development. Achieving GNH and sustainable development, therefore, requires collective action and responsibility. Change in consumption behaviour from an unsustainable to a sustainable one is therefore desired.

So how is Sustainable Public Procurement (SPP) also called Green Public Procurement (GPP) related to GNH and sustainable development? SPP/GPP has emerged as a powerful way to stimulate more sustainable consumption and production patterns for society at large by changing the way government buys/consumes. GPP is defined by the European Commission as “a process whereby public authorities seek to procure goods, services and works with a reduced environmental impact throughout their life cycle when compared to goods, services and works with the same primary function that would otherwise be procured”.

Research has shown that governments on average spend about 13-20 percent (including consumption and investment expenditure) of their GDP in the industrialised countries and approximately 15 percent in non-OECD countries. In the case of Bhutan, findings has shown that procurement expenditure accounted for about 18 percent of GDP, which translated to approximately Nu 91 billion in the last 10th five-year-plan. This figure could be much higher, if procurement of all state owned organisations and autonomous agencies is considered.

Given the relatively large amount of public procurement expenditure, public authorities are potential customers to influence the market. By using purchasing power to buy sustainable products, it creates positive externalities, as industry and enterprises sector will be willing to invest, innovate and scale up, simply because demand is secure and well directed. Similarly, public procurement has the power to lower the costs of clean technologies due to scale economies. This can also help small and medium enterprises.

Sustainable public procurement had multi-faceted benefits. Firstly, SPP/GPP is based on cost effectiveness. When considered from a whole life-cycle perspective, greener prod-ucts and services are less costly in terms of their use, maintenance and disposal, despite higher upfront investment costs. Secondly, SPP/GPP is instrumental in addressing environmental problems, by choosing environmentally-friendly products. Thirdly, SPP/GPP enhance quality of life, by shifting towards more cleaner and efficient technology, healthier alternatives and more sustainable options overall.

Since the beginning of the decade, international initiatives on GPP/SPP have flourished. Public procurement was identified in the United Nations Sustainable Development Goals of 2015 as one important instrument for stimulating more environmentally-friendly goods and services. Various international and regional organisations and networks have been active in promoting sustainable public procurement through awareness-raising, toolkit development and capacity-building activities. Similarly, many public authorities in the EU are implementing GPP as part of a broader approach to sustainability in their purchasing.

Why GPP/SCP in Bhutan

GPP/SCP can be a worthwhile pursuit in Bhutan for many reasons. Bhutan is a welfare state where the government plays a key role in the protection and promotion of the economic and social well-being of its citizens. It is also a nation that is still donor-dependent. Moreover, Bhutan’s development philosophy and policies all allude to sustainable development. GPP/ SCP is there for one of the effective method for our government to demonstrate its commitment to sustainable development and, more importantly, to GNH.

Contributed by

Tempa Gyeltshen

Senior Research Officer Green Public Procurement Project

RSPN/GPP Bhutan

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