Embedding innovation in public services could help public administrations serve citizens while tackling societal challenges such as climate change or ageing societies. Yet, governments often rely on fragmented structures and rigid processes that prevent the development of innovative approaches. One avenue that is gaining traction is to use public procurement to introduce innovative technologies and solutions in public services. Representing close to 13% of gross domestic product (GDP) and 29% of total government expenditures on average across OECD countries, public procurement can act as a catalyst and provide incentives for the private sector to invest in innovative solutions.
While Croatia ranks low behind its European peers in multiple indicators assessing Members’ capacity to implement innovation procurement, the government recognised the critical role of innovation procurement to achieve broad policy objectives such as the green and digital transitions. It therefore highlighted innovation procurement among several concerted actions to spur innovation, including in its Recovery and Resilience Plan (RRP).
Using public procurement to initiate and facilitate the development and diffusion of innovative, sometimes disruptive, technologies and solutions involves significant challenges. It requires reducing risk aversion, setting up new forms of co-ordination, improving skills and capacity, and encouraging public procurers to dialogue with suppliers – all of which tend not to be covered by the standard operating models and practices of the public administration.
For more than a decade, the OECD has helped countries develop mechanisms and practices that promote a strategic and holistic use of public procurement as a critical public governance tool. In 2017, the OECD took stock of the use of public procurement to promote innovation, demonstrated its potential to transform public services, and developed a framework for building a robust procurement ecosystem that harnesses innovation.
This report provides Croatia with recommendations and suggested actions to reinforce the uptake of innovation procurement. It is part of the project “Supporting the implementation of innovation procurement in Croatia,” funded by the European Union via the Technical Support Instrument. Building on its recommendations and in co-operation with the Ministry of Economy of the Republic of Croatia (MINGO), and the Croatian Agency for SMEs, Innovation and Investments (HAMAG-BICRO), the OECD developed several components of a comprehensive capacity-building programme, a priority identified in Croatia’s RRP.