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Innovative public-sector procurement

The Market Development Fund works to promote methods of innovative public demand in order to spur job creation and growth in Danish companies.

The Market Development Fund aims to reduce market barriers on both the supply and demand sides, so Danish enterprises can sell their products and create growth, employment and exports. One way of targeting barriers on the demand side is through the Fund’s initiative to promote innovative public-sector procurement.

Public tenders traditionally contain detailed specifications and little or no scope for the adoption of new and innovative solutions. This makes it difficult, especially for SMEs, to sell innovative and radically new products to the public sector despite the potential for savings and quality enhancement in public services. At the same time, municipalities are in need of new solutions that can handle urgent societal problems such as climate adaptation or or health care challenges. Methods of innovative public procurement seek to adress this dilemma.

As a primary instrument in this effort, the Fund facilitates the usage of pre-commercial procurement (PCP) and Innovationpartnerships. These instruments allow for development contracts in which the public sector buys the development of a new technology to solve a specific problem. The Fund has developed three different PCP's in cooperation with other public-sector institutions:

  • Partnership for Health and Hospital Innovation – in cooperation with the Danish regions
  • Climate Adaptation Partnership – with municipalities and utility companies
  • Partnership for Waste Water – with water companies and DANVA

And an Innovationpartnership with three municipalities:

  • Welfare and care - in cooperation with municipalities (focus is on solving issues with dehydration of elders above 65 years of age).