Ending the Swiss Government’s 40 Cent Minimum Translation Rate

Imagine if you were to bid for a CHF 6.5m (USD 6.57m) piece of public sector translation business at CHF 0.34 (USD 0.35) per word. When the results are out, you are told that it’s too cheap and that you should have offered at least CHF 0.40 per word. In disbelief, you appeal the decision only to have your case thrown out on a technicality. Or, imagine if, after you submitted your bid, the buyer comes back asking you to kindly increase your rate to their CHF 0.40 minimum buying price. That is what happened to a couple of Swiss language service providers (LSPs) in 2016.

Enter the People’s Party

Procuring translation services at a minimum rate, ostensibly to ensure quality, was standard operating procedure at the Swiss Federal Government until a Bern-based newspaper highlighted the case in September 2016. Two days after the article was published, a member of parliament from Switzerland’s right-wing Swiss People’s Party intervened, calling the practice “absurd” and demanding that the government abolish minimum pricing across all areas of public procurement.

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Switzerland’s government, the seven-member Federal Council, responded in late 2016 defending the practice. The Federal Council argued that the CHF 0.40 minimum was in line with market pricing and that Switzerland as a multilingual country needed qualified translators based in the country itself. Moreover, “most of the translation work at the federal government is done in-house”, where over 300 linguists earn between CHF 130,000 and CHF 140,000 a year.

Switzerland’s National Council (think House of Representatives) was having none of if and voted in favor of a motion (101 for, 76 against) prohibiting minimum pricing in federal procurement in March 2017.

Minitenders

With minimum pricing gone, language service providers pitching for federal business are now bidding as low as an estimated CHF 0.15 per word, according to an analysis of a June 2018 award for an RFP issued by the Switzerland Federal Department of Finances (DFF) and the Federal Chancellery (although the average price still appears to be north of CHF 0.30). The DFF contract runs from July 2018 to 2022.

A DFF spokesperson told Slator that the contract is structured as a framework agreement where vendors are added on to a list but are not guaranteed any business. According to the spokesperson, vendors are asked to bid on each job in so called “minitenders” and awarded according to predefined quality levels (excellent, good, sufficient) and depending on who can take the biggest volumes at the lowest price.

With dozens of vendors on the DFF framework, the minitenders will likely be competitive. DFF vendors include language service providers (LSPs) such as CLS Communication (Lionbridge), SwissGlobal Language Services, Donnelley Language Solutions, SeproTec, comtexto, Apostroph, Global Voices, as well as a number of individual freelancers.

Florian Faes

Co-Founder of Slator. Linguist, business developer, and mountain runner. Based in the beautiful lakeside city of Zurich, Switzerland.