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.
The size of
public procurement varies across OECD countries, ranging from less than 20% of the general
government expenditure in Greece and Portugal to more than 35% in countries such as Estonia, Korea
and Japan. In terms of GDP, OECD countries reported an average share of 12.1% spent on public
procurement in 2013; however, some countries such as -Ireland and Switzerland spent less than 10% of
their GDP on public procurement whereas in countries such as -Finland, France, Japan,
the Netherlands and Sweden the figure was higher than 15% of their GDP. Allocating government
expenditures efficiently and strategically could help to generate fiscal space, which in turn could
enable the realization of fiscal savings or reallocation of resources.
procurement at the state and local levels accounts on average for 63% of total procurement spending
across OECD countries. In general, federal states report high level of sub-central government
spending on procurement, as evidenced by Canada (87%) and Belgium (84%). Nonetheless, unitary states
should also direct their efforts to increase efficiency in public procurement at the sub--central
government levels as high levels of sub-central government spending on procurement are observed in
countries such as Italy (78%), Finland (70%) and Japan (68%).
Methodology and definitions
The size of
general government procurement spending is estimated using data from the OECD National Accounts
Statistics (database), based on the System of National Accounts (SNA). General government
procurement is defined as the sum of intermediate consumption (goods and services purchased by
governments for their own use, such as accounting or information technology services), gross fixed
capital formation (acquisition of capital excluding sales of fixed assets, such as building new
roads) and social transfers in kind via market producers (purchases by general government of goods
and services produced by market producers and supplied to households).
procurement here includes the values of procurement for central, state and local governments. The
sub-central component refers to state and local governments. Social security funds have been
excluded in this analysis, unless otherwise stated in the notes (however Figure 9.3, Government
procurement as a share of total government expenditures, 2007, 2009 and 2013 and Figure 9.4
Government procurement by levels of government including social security funds, 2013 are available
online at http://dx.doi.org/10.1787/888933249035 and http://dx.doi.org/10.1787/888933249047 respectively). State government is only
applicable to the nine OECD -federal states: Australia, Austria, Belgium, Canada, Germany, Mexico,
Spain (considered a quasi-federal country), Switzerland and United States. Public corporations were
also excluded in the estimation of procurement spending.
Recommendation of the Council on Public Procurement, OECD,
Going Green: Best Practices for Green Procurement, OECD,
9.1: Data for Chile and Turkey are not available. Data
for Colombia and Russia are for 2012 rather than 2013
9.2: Data for Australia, Chile and Turkey are not
available. Local government is included in state government for the United States. Social security
funds are included in central government in Ireland, New Zealand, Norway, the United Kingdom and
the United States. Data for Colombia are for 2012 rather than 2013.