Info Service on UN Sustainable Development (May14/07)
20 May 2014
Third World Network
procurement and the right to food
Published in SUNS #7806 dated 19 May 2014
16 May (Kanaga Raja) -- States should align their public procurement
policies and schemes with their duty to progressively realise the
right to adequate food, the UN Special Rapporteur on the right to
food, Mr Olivier De Schutter, has recommended.
In his final publication as Special Rapporteur, De Schutter, who is
being replaced by Ms Hilal Elver of Turkey, described why public procurement
is important for food and nutrition security strategies and identifies
five key principles that should be integrated into public procurement
schemes and modalities.
According to the Special Rapporteur, food procurement schemes should:
(1) source preferentially from small-scale food producers and actively
empower them to access tenders; (2) guarantee living wages as well
as fair and remunerative prices along the food supply chain; (3) set
specific requirements for adequate food diets; (4) source locally
and demand from their suppliers that they produce food according to
sustainable methods; and (5) increase participation and accountability
in the food system.
"The effectiveness of such public procurement policies and programmes
would be maximised by fully integrating them under right to food national
strategies and framework laws, and by coordinating them with other
food security policies," said the rights expert.
The report, titled "The Power of Procurement: Public Purchasing
in the Service of Realising the Right to Food", also addressed
the potential constraints found in the World Trade Organisation (WTO)'s
Government Procurement Agreement (GPA).
It underscored that countries that are signatories of the GPA are
not systematically prevented from establishing public procurement
schemes that contribute to the realisation of the right to adequate
food, as illustrated by many countries who reformed their school feeding
programmes in recent years, but the GPA does impose restrictions on
schemes that result in a discrimination between suppliers on the basis
of their geographic location.
De Schutter noted that the vast majority of GPA signatories are OECD
(Organisation for Economic Cooperation and Development) countries.
Developing countries are not bound and therefore they are free to
put in place procurement schemes that further food security by supporting
local or regional farmers.
According to De Schutter, countries that have not signed and/or ratified
the GPA have greater discretion with respect to the public procurement
schemes that they may lawfully establish, and that this discretion
can and should be used to advance the right to adequate food.
"The World Trade Organisation (WTO) Committee on Government Procurement
should integrate the protection and realisation of all human rights,
including the right to food, in the objectives to be pursued by ‘sustainable
De Schutter said that the integration of the five principles identified
in his report "should be fully integrated in the future work
of the GPA, in particular in the Work Programme on Sustainable Procurement
as specified in the revision of the GPA (GPA/112, Annex 7, para 1)."
In his report, the Special Rapporteur, highlighting that the public
sector is an extremely important purchaser of goods and services,
said that governments spend on average 12% of their GDP on public
procurement in OECD countries, and slightly less in developing countries,
with varying estimates.
All over the world, public authorities award contracts for food provision
and food-related services for cafeterias in civil service buildings,
hospitals, prisons, schools, universities, as well as social programmes
such as in-kind transfers or social restaurants.
For instance, said the report, the public catering sector in the UK
represents some 2 billion pounds Sterling per year (approximately
US$3 billion or 3.16 billion euros).
It pointed out that school feeding programmes exist in almost all
high- and middle-income countries, as well as in 70 out of the 108
low- and middle-income countries, with support from the World Food
However, other procurement schemes hold even greater economic significance,
especially for in-kind food aid programmes managed by public authorities,
it said, noting that in 2010-11, federal food subsidies in India (in-kind
transfers of grain for the most part) accounted for 0.9% of India's
GDP, while federal and state food subsidies accounted for 2.7% of
total annual expenditure incurred by Indian federal and state governments.
"In some countries, public procurement of food has rapidly expanded
over recent years. Brazil, for instance, increased its budget on its
National School Feeding Programme fourfold between 2003 and 2011."
The procurement of local food products is receiving more support than
at any time since the mid-2000s, generally for the benefit of small-scale
farmers whose ability to sell their produce at remunerative prices
is otherwise limited, said De Schutter.
While governments have the option to procure food by disregarding
social imperatives and sourcing indiscriminately from global markets
in the search for the cheapest opportunities, the Special Rapporteur
said that in doing so, they would risk exacerbating the prevailing
dynamics of global food systems, whereby commodities produced by industrial
operators can be imported cheaply in bulk - often creating a ‘dumping'
effect for domestic small-scale producers and adding to the numbers
of those who will be in need of eventual state support, including
publicly procured food aid.
"But public procurement can be used instead to support small-scale
food producers, who are among the most marginalised in many developing
countries, to improve their access to markets. This may have powerful
impacts on the reduction of rural poverty."
The strategic use of public procurement can kick-start a process of
agricultural transformation in developing countries, said De Schutter,
advocating, in this context, the use of social protection programmes
(like school feeding) to drive a demand-assisted agricultural growth
"The improved access to markets that results from such an approach
makes it easier, less costly and less risky for small-scale food producers
to engage with input and output markets," he added.
He also underlined that localising (or re-localising) economic activities,
including food production and consumption, is now increasingly seen
as an important component of sustainable development strategies.
"The social, economic and environmental benefits of localised
public procurement strategies to farmers, citizens and consumers include
a reduction of ‘food miles', access to fresh and nutritious food,
and allowing small-scale producers to sell their products, since large-scale
producers and commodity buyers dominate the global food chains and
are more competitive on larger markets."
The Special Rapporteur, however, stressed that a series of obstacles
need to be overcome in order to make public procurement work for small-scale
Some frequently noted obstacles include limited access to suitable
storage and post-harvest handling infrastructure, which results in
increased post-harvest loss and spoilage; shortcomings in the ability
of farmers' organisations to help farmers improve productivity, pool
marketable volumes, improve quality, identify markets, and negotiate
sales; and lack of access to markets, credit and information about
According to De Schutter, procurement schemes should include clear
procurement modalities favouring small-scale food producers (e. g.
selection or award criteria favouring certain types of producers,
decentralised small-scale procurement processes, purchase quotas or
exclusivity for small-scale food producers, choice of products mostly
grown by small-scale farmers such as specific local types and varieties
"States should therefore pay particular regard to the plight
of small-scale food producers, including smallholders, pastoralists
and herders, small-scale fishers and forest dwellers who together
make up a significant share of food-insecure people."
Public procurement schemes can contribute to the realisation of the
right to food, providing they not only establish measures to source
preferentially from small-scale food producers but also establish
support measures to actively empower small-scale food producers to
access tenders, said the report, noting that different formulas have
been used to ensure appropriate targeting of small-scale food producers.
Amongst others, it cited Brazil's Act No. 11, 947 of 16 June 2009
which provides that a minimum of 30% of the financial resources transferred
by the federal government to states and municipalities in order to
implement the National School Feeding Programme (PNAE), now covering
more than 49 million children, must be used to buy food sourced from
In 2010, public authorities indicated that 1,576 municipalities were
buying products from local family-based farms.
"The quota system established by Brazil in 2009, as part of the
Zero Hunger strategy, is the first example of an innovative policy
and a powerful tool for supporting family-based farms and specific
vulnerable groups. By ensuring that public procurement schemes support
family farms, it makes a significant contribution to the reduction
of rural poverty, as well as to improved diets for children,"
said the report.
Another example cited by De Schutter is India's Public Distribution
System (PDS), which although an important component of India's national
food security strategy, does not integrate modalities to source preferentially
from small-scale food producers.
The PDS is the main vehicle of the procurement of subsidised food
to millions of food-insecure households. It procures, stores, rations
and subsidises the retailing of major staple food grains through an
important network of government warehouses and food retail outlets.
In 2012, more than 85 million tonnes of rice and wheat were held in
"While failing to target small-scale farmers, the PDS has nonetheless
made efforts to decentralise its procurement policy in a way that
prepares the ground for more ambitious geographical and social targeting
on the purchasing side," said De Schutter.
Public procurement schemes could have greater impacts on the incomes
of depressed farming areas, and by extension on alleviating food insecurity,
by sourcing agricultural products not only from breadbasket regions
- such as Punjab in the case of India - but from all regions of a
country, said De Schutter, adding that this represents a significant
break from past practice.
The report also cited India's National Food Security Act, No. 20 of
2013, which provides that the Central Government, the State Governments
and the local authorities shall advance food and nutritional security,
by striving to progressively realise certain objectives, including
the revitalisation of agriculture and improvements in procurement,
storage and movement-related interventions in the management of food
The revitalisation of agriculture includes "ensuring livelihood
security to farmers by way of remunerative prices, access to inputs,
credit, irrigation, power, crop insurance, etc."; and reforms
in procurement include "incentivising decentralised procurement
including procurement of coarse grains" and "geographical
diversification of procurement operations".
"Though the new legislation is still in the first phase of implementation,
these are important and welcome organising principles that illustrate
a desire to use food aid as a tool to contribute to rural development
and to supporting the incomes of small-scale farmers," said the
The Special Rapporteur's report also said that school feeding programmes,
social restaurants and in-kind social support programmes may improve
food accessibility for all citizens or targeted vulnerable groups.
"However, the focus of these policies on the beneficiaries of
food services should not obscure the importance of sustainable food
systems ensuring living wages to all workers along the supply chain,
as well as fair and remunerative prices to food producers, in order
to guarantee that they are also in a position to purchase adequate
food," said De Schutter.
He stressed that procurement modalities targeting small-scale food
producers, combined with capacity-building measures, can yield significant
Public authorities should also ensure that independent small-scale
food producers are paid fair and remunerative prices for their products,
he further said, emphasising that pricing mechanisms should be clear
and transparent and show how prices incorporate production costs,
risks and returns.
While a variety of price models exist (e. g. spot market-based pricing,
split pricing, fixed prices and flexible price model), in the view
of the Special Rapporteur, the ideal pricing mechanism is one replicating
the formula used in fair trade schemes.
According to the report, the producer should be guaranteed a fixed
minimum price based on the need to meet sustainable production costs
and to ensure a living wage for all the workers concerned (including
family members, where applicable), but the prices paid by the buyer
should be higher if market prices increase.
The introduction of fair trade criteria in public tenders is another
example of how procurement can contribute to fairer pricing, said
De Schutter, adding that over 1,100 towns in 18 countries made commitments
to increase their sourcing of fair trade products under the International
Fair Trade Towns Campaign.
For instance, Spain has passed a Law on Public Procurement allowing
for the inclusion of fair trade criteria in public procurement, while
in Italy, seven regions (Toscana, Abruzzo, Umbria, Liguria, Marche
and Friuli Venezia Giulia) have adopted the practice.
"Consistent with the duty to progressively realise the right
to adequate food, public procurement schemes should promote diversified
diets and facilitate access to nutritious, micro-nutrient-rich fresh
foods, especially for vulnerable poor consumers; preferably by integrating
targets in order to decrease consumption of fats, sugars, salt and
animal proteins," said the report, adding that this is especially
urgent in countries with rising child obesity levels.
In India, the report noted, the Decentralised Procurement Scheme introduced
1997-98, particularly for implementation of the National Mid-day Meal
Programme (NMMP) - one of the largest school-feeding programmes in
the world, providing one meal per school day to around 150 million
children - included an objective to source from a wider variety of
foods (such as millet, pulses, eggs, soy beans) in order to improve
In September 2012, the inclusion of millet in the NMMP was mandated
by the Agriculture Ministry in order to increase the demand for the
cereal and, thereby, enhance farm incomes, while the 2013 National
Food Security Act also has a provision to provide subsidised millet
along with wheat and rice.
In Brazil, the National School Feeding Program, a major component
of the Zero Hunger strategy benefiting 49 million children, not only
targets malnourishment, in particular in the North and North East,
but also looks to address obesity through the composition of school
Among wealthy countries, said the report, Scotland and Italy are considered
pioneers in the ‘school food revolution' that includes strong food
It stressed that public procurement schemes should discriminate in
favour of sustainably sourced food, in line with the need to make
the transition towards low-carbon and low-external-input modes of
production, including agroecological practices, and that these schemes
should also aim at supplying locally and seasonally, so as to reduce
the ecological footprint of the food produced.
In the United States, more than 1,000 schools in 38 states, engaged
in the Farm-to-School movement, aim to increase the role of fresh
and local products in diets, while in France, similar initiatives
have been promoted within the recent French National Food Programme.
De Schutter pointed out that many public purchasing programmes also
target organic farming and seek to promote agroecological practices.
For example, Brazil's Public Food Acquisition Programme (PAA) offers
strong price incentives (an additional 30 per cent) to organic farmers,
and the federal government aims to procure ‘agroecological food products'
from 25,000 small food producers by 2015.
Italy passed a law in 1999 explicitly promoting the use of organic,
typical and traditional products in public procurement. The City of
Rome took a leading role in improving its school service, which serves
150,000 children. In 2010, 14% of the food served in the city's schools
was certified as fair trade, 26% was local, and 67.5% was organic.
According to the report, more than 50% of OECD countries reported
in a survey conducted in 2007 that they had amended their legislation
in order to introduce environmental criteria into public procurement.
"Public procurement schemes should go beyond merely imposing
criteria upon contracting producers and consumers in a top-down fashion.
Instead, they should aim at empowering a range of actors who are commonly
marginalised in market-oriented food chains, including elected representatives
(decentralised local authorities such as municipal councils), school
authorities, students, parents, local producers, and nutrition experts,"
According to De Schutter, this can be achieved by increasing participation
in the design, implementation and assessment of the procurement schemes,
and by ensuring that relevant actors and institutions are held accountable
He also said that particularly in times of economic downturn and attempts
to reduce public debt, the costs anticipated are often seen as a major
obstacle to making public procurement schemes more consistent with
right- to-food strategies - contributing to improved food security
and to better nutritional outcomes, while preserving the resource
"However, certain costs associated with public procurement should
be treated as investments, rather than merely as expenses; and once
their multiplier effects on the local economy and their positive social
and environmental impacts are taken into account, they may in fact
be seen as favourable to, rather than a liability for, healthy public
For instance, the report found that the total incremental benefits
of supplying 50 million primary school-age children in Africa with
locally produced food could potentially amount to about US$1.6 billion
per year in 2003 prices (1.3 billion euros); of this total, 57% would
accrue to consumers and 43% to producers.
In the United Kingdom, in programmes implemented in Nottinghamshire
and Plymouth, it has been estimated that additional spending for sustainable
and local procurement of school food generated a return of 3 pounds
Sterling for every 1 pound Sterling spent.
De Schutter acknowledged that procuring from farmers' groups can indeed
be more expensive than procuring from traders - up to an additional
17-18% in 2007 for millet in Mali, according to a study commissioned
by the WFP.
"But such costs may be justified taking into account the full
range of benefits, including higher incomes and improved market skills
for small-scale food producers, as well as against the multiplier
effects on the local economy," he said.
"A commitment by States to link right to food goals to their
procurement contracts could have profound transformative effects.
By creating a demand for sustainable diets, governments have the power
to set a positive trend and accelerate a transition towards sustainable
food systems that respect the rights of vulnerable groups, including
small-scale food producers," said De Schutter.
He added that if States effectively implement the principles recommended
in this report, "it will mean that private actors will have to
comply with norms derived from the right to food in order to be eligible
for government contracts, thereby developing practices which might
spill over into corporations' other activities."