The Home Office's announcement that the UK's new blue passports will be manufactured and supplied by a French firm was met with uproar in some areas of the media. But the facts clearly show that access to global markets makes economic sense for the taxpayer.
The contract to produce and supply the UK's new blue and gold passport was awarded to French firm Gemalto following a tender regulated by the EU procurement directives.
Worth around £490m over its ten year life, the contract had previously been delivered by UK company De La Rue, predominantly out of their Gateshead factory.
Pro-Brexit former cabinet minister Priti Patel said the decision to hand the new contract to a non-UK firm was "disgraceful" and "perverse".
A spokesperson from the Home Office said: “The chosen company demonstrated that they will be best able to meet the needs of our passport service with high quality and secure product at the best value for money for our customers and the taxpayer.
“It’s been the case since 2009 that we do not require passports to be manufactured in the UK. A proportion of passports have been made overseas since then with up to 20% of blank passport books currently produced in Europe with no security or operational concerns.”
Patel, who resigned her cabinet position in November was joined in her criticism by culture secretary Matt Hancock, who suggested that a UK firm would have been successful were it not for EU procurement law.
EU regulations for public procurement ensure that the award of contracts by EU countries must be non-discriminatory and prevent “buy national” policies to promote free movement of goods and services between EU countries.
Benefits Overlooked
The rules of EU procurement are that you have to treat bidders from within the EU that tender for a contract fairly. This works very effectively to promote commerciality and economic prosperity for all member states as expert firms within one country are able to bid for work tendered by any EU government. This promotes competition and generally creates savings for all taxpayers.
The Home Office said that the new contract is expected to save the UK taxpayer around £120m compared to the previous deal.
The ethics and ethos of the taxpayer effectively subsidising inefficiency in production within UK industry is certainly questionable.
Conceivably, post-Brexit there could be cases where the UK could stipulate that firms bidding to provide services for the government have a presence in the UK, but British firms wishing to bid to for contracts in countries within the EU will almost certainly find themselves cut off from EU markets if the UK pursues this policy.
These markets are particularly important for British companies in certain sectors, particularly in skilled engineering and infrastructure delivery industries.