Hansel – a central purchasing body for the public administration
Hansel is a non-profit limited liability company that aims to generate savings for public administration through efficient procurement operations. Hansel’s customers include ministries and their subordinate departments, municipalities, joint municipal authorities, wellbeing services counties, Keva, parishes and all public law bodies governed by the state or a municipality. The wellbeing services counties became customers in July 2022 following a legislative amendment.
Hansel’s owners are the State of Finland (65%) and the Association of Finnish Municipalities (35%). The company’s role and duties as a joint procurement body are specified in the Act on Public Contracts, the Act on a Limited Liability Company Called Hansel Oy and the State Procurement Strategy. The company operates under the ownership steering of the Ministry of Finance.
Hansel’s operations are funded by service fees for joint procurement and the sales of expert services. The service fees are based on purchases made by the customers. The maximum fee is 1.50% of the contract value. The average service fee in 2022 was 0.83% (0.88% in 2021).
In 2022, Hansel’s own procurement totalled €3.9 million. Hansel makes use of joint procurement in its procurement activities whenever possible. If a suitable framework agreement or dynamic purchasing system is not available, the procurement is performed in accordance with processes determined by the company.
Hansel’s organisation consists of its personnel of 128 experts. The Board of Directors is appointed by the annual general meeting and is chaired by Anna-Maija Karjalainen, M.Sc. (Eng). The Board has four other members: Timo Reina, Deputy Managing Director, Association of Finnish Municipalities (vice chairperson) until 13 April 2022; Antti Laakso, Head of Procurement, Aalto University; Johanna Luukkonen, mayor, city of Hyvinkää; and Antti Koivula, Director General, Finnish Institute of Occupational Health. On 28 April 2022, the annual general meeting appointed Hanna Tainio, Deputy Managing Director, Association of Finnish Municipalities, as the new vice chairpersons. Minna Isoherranen, an employee representative also attends Board meetings. The employee representative has the right to be present and speak at the meetings. Members of the Board cannot be members of the company’s operational management.
The Executive Committee is nominated by the Board based on a proposal by the Managing Director. At the end of 2022, the Executive Committee consisted of six persons: Anssi Pihkala, Managing Director (b. 1963), Kirsi Koivusaari, Director of Finance (b. 1966), Eija Kontuniemi, Head of Legal Affairs (b. 1966), Maritta Mäkelä, Account Manager (b. 1965), Susanna Närvänen, Chief Category Officer (b. 1963) and Mikko Saavalainen, Director of Digital Business (b. 1979). Raili Hilakari (b. 1953) was the Deputy Managing Director and a member of the Executive Committee until 31 March 2022. Following the retirement of Raili Hilakari, the company did not elect a new Deputy Managing Director, but the Board appointed Susanna Närvänen, Chief Category Officer, as the deputy of the Managing Director.
The Board members and the Executive Committee are appointed in accordance with the Government’s ownership steering principles, which are used to ensure equality, among others. Decisions are made in compliance with the Finnish Limited Liability Companies Act and Hansel’s articles of association. The company’s office is at Postitalo in Helsinki. Hansel has no international operations.
Hansel’s association memberships
- Finnish Business & Society (FIBS)
- Helsinki Region Chamber of Commerce
- Association of Public Procurement
- Service Sector Employers (PALTA)
- Finnish Association of Communications Professionals (ProCom)
- Institute of Internal Auditors Finland
- Finnish Business Travel Association
- Finnish Association of Purchasing and Logistics LOGY
Hansel’s business operations are divided into three segments: joint procurement, tendering services and procurement development services. Through responsibly run operations, the joint procurement unit promotes profitable public administration, high-quality public procurement and equal, non-discriminatory treatment of suppliers. Hansel’s objective is to organise tendering processes in a manner that fosters efficient market operations and promotes competition.
Risks related to the company’s operations are regularly surveyed with an external expert. A risk survey and related measures are presented to the Board of Directors approximately every six months.
Hansel business areas
Joint procurement refers to framework agreements and dynamic purchasing systems through which Hansel’s customers can purchase products and services. The purpose of joint procurement contracts is to establish the general terms governing procurement contracts, such as the object of procurement, prices, and responsibilities and obligations of the contracting parties. By using Hansel’s agreements, customers can ensure that their procurement processes are compliant with applicable laws and the contractual terms secure their position, as well as facilitate the management of agreements and suppliers. During joint procurement, Hansel verifies the eligibility of suppliers. In addition, Hansel monitors that the suppliers meet their contractual and solvency obligations and social requirements during the contract period.
Savings are generated when sufficiently large volumes of products and services are put out to tender, and the requirements of the maximum number of customers are met. Joint procurement generates considerable savings for public administration, through both procurement process costs and pricing.
Tendering services are needed when a joint procurement contract is not available for a product or service to be acquired. Hansel’s tendering consultants and lawyers have specific experience and knowledge of public procurement, tendering and contract law. By using our expert services, customers can ensure that their procurements are put out to tender in accordance with the valid rules, with the best contractual terms possible and by considering price, quality and sustainability aspects. This frees the customer’s time for other duties, reduces the contracting authority’s risks and promotes the distribution of best practices.
Our development service aims to boost the effectiveness of our customers’ procurement operations and improve their profitability. Development managers have a key role in customer assignments, but Hansel’s entire expertise is at the customers’ disposal. The development service can involve a specific problem in the customer’s procurement operations, or the service can consist of a comprehensive analysis of procurement control, the procurement organisation or the implementation of procurement processes, change management and personnel training. The content of a development assignment is always customised on a case-by-case basis in accordance with the customer’s wishes, and the assignment is realised in close cooperation with the customer.
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Managing Director’s review
The year 2022 was quite exceptional. For us, it resulted in plenty of new work phases in procurement. The drastic change in the state of world affairs has made us experts in restrictive measures and price increase pressures.
Development of joint procurement
In terms of the opening up of joint procurement to competition, 2022 was slightly calmer than the previous year for Hansel.