Open Contracting in Philippine Government Procurement

___________________________________________________________________________
2015/FMP/WKSP1/014
Session: 4
Open Contracting in Philippine Government
Procurement
Submitted by: Philippines
Workshop on Fiscal Management Through
Transparency and Reforms
Bagac, Philippines
9-10 June 2015
Open Contracting
in
Philippine Government
Procurement
Procurement Environment
Prior to Government Procurement Reform Act
(GPRA)
 Fragmented Laws and
Rules (100++)
• Presidential Decree 1594
(Works)
• Executive Order 262
(Goods)
• Executive Order 164
(Consulting Services)
• Executive Order No. 40
• Republic Act 7160 - Local
Government Code
(Procurement Provisions)
 No Standardized
Procurement
Documents
 Absence of a single
agency with a mandate to
formulate procurement
policy, rules and
procedures.
Procurement Environment
Prior to GPRA
 Existence of Conflict of
Interest in Government
Contracting (approving
authority, bidders,
observers)
 Lack of Transparency
in Procurement Information
Dissemination
 Accountability of
Persons Involved in
Procurement activities
 Weak opportunity for
Public Monitoring of
Procurement Activities
2002 CPAR
From the overall findings of the CPAR, the
public procurement system in the Philippines
is dysfunctional. It is characterized by
multiple laws, rules and regulations which
while adhering to the principles of
competition
and
transparency,
are
inefficient and prone to abuse. It
also contributes to lowering public funds’
value for money.
Effect to Public Procurement
• Information Asymmetry
– Withholding information
– Exploitation of information
• Conflict of Interest of Public Officials
– Financial Interest
– Family Relationship
– Post Employment
Effect to Public Procurement
• Contacts, Informal Networks and Collusion
• Lack of Accountability
– Fertile Ground for Malpractices and Corruption
2002 CPAR
When formal institutions are weak,
informal institutions are often strong…
2002 CPAR
A conducive breeding space for graft and
corruption…
Republic Act No. 9184
Government Procurement Reform
Act (GPRA)
“An Act Providing for the
Modernization, Standardization and Regulation
of the Procurement Activities of the
Government and for Other Purposes”
Government Procurement Reform Act (GPRA)
Governing Principles
GPRA
GPRA Key Reform Principles
Accountability
Competition
Openness/Public Monitoring
Disclosure/Transparency
Key Reform Measures
Key Reform Measures
• Competitive
Bidding
as
Primary Mode of Procurement.
• Allowance of Centralized or
Decentralized Procurement.
• Use of Non-Discretionary
Pass/Fail Criterion.
Key Reform Measures
• Shift from Pre-Qualification
Simplified Eligibility Checking.
Regime
to
• Use of the Approved Budget for the Contract
(ABC) as Ceiling for Bid Prices.
• Creation of a procurement policy oversight
body – Government Procurement Policy
Board.
Key Reform Measures
• Introduction of a Protest Mechanism
• Participation of Observers
procurement process.
in
all
stages
of
• Issuance of the Standardized Philippine Bidding
Documents (PBDs), Generic Procurement Manuals
(GPMs) and Local Government Procurement Manuals
(LGPMs)
• Establishment of civil, administrative and criminal
sanctions
Key Reform Measures
• Establishment of a National Procurement Training
Program to ensure the conduct of regular procurement
trainings for procurement capacity development of
government procurement practitioners.
• Development of the Procurement Professionalization
Program currently being pilot-tested to professionalize
government procurement practitioners.
• Regular conduct of training activities and seminars for
prospective bidders - suppliers, contractors, and
consultants.
Open Contracting Linkage
vis
The GPRA
The GPRA procurement principles
embrace core values of OCP, i.e.
transparency/disclosure,
participation/monitoring and
accountability
• What is OCP?
• Open contracting refers to norms and practices for increased
disclosure
and participation in public contracting
including tendering, performance and completion. It includes the variety
of contract types, from more basic contracts for the procurement of
goods, to complex contracts, joint venture agreements, licenses and
production sharing agreements. Open contracting encompasses all public
contracting, including contracts funded by combinations of public, private
and donor sources.
•
Spearheaded by the World Bank together with GIZ, CoST, TI and other
international institutions, Governments (Colombia and the Philippines)
and Civil Society Organizations.
19
What is OCP? (Cont’d)
• At the GLOBAL LEVEL, OCP created global principles that
governments and standards setting bodies may draw upon
in redefining contracting norms in favor of greater
transparency and accountability.
• At COUNTRY LEVEL, OCP shall reinforce good practice on
the ground and further enhance disclosure and effective
monitoring, including through citizen engagement around
use of public resources.
20
GPRA Open Contracting Practices
1. Posting of all procurement opportunities, Invitation to Bid
(IB)/Request for Expression of Interest (REI), Notices of Award, Notice
to Proceed, the Approved Contract itself at the PhilGEPS and the
website of the procuring entity, if available; and, at any conspicuous
place reserved in the premises of the procuring entity.
2. Advertisement of the IB/REI in a Newspaper of General Nationwide
Circulation, if Approved Budget for the Contract is above 2M for Goods;
5M for Works, and, 1M for Consulting Services.
3. The procuring entity shall also post the Bidding Documents at its
website and at the PhilGEPS website from the time that the Invitation
to Bid/Request for Expression of Interest is advertised. Prospective
bidders may download the Bidding Documents from any of the said
websites.
21
GPRA Open Contracting Practices
4. Any Supplemental/Bid Bulletin issued by the BAC shall
also be posted on the PhilGEPS and the website of the
procuring entity concerned, if available;
5. Submission to the GPPB and Posting in the procuring
entity's website of its Annual Procurement Plan;
6. Submission to the GPPB and posting in the procuring
entity's website of its approved Procurement Monitoring
Report every semester;
GPRA Open Contracting Practices
7.
Submission to the GPPB of a copy of Protest Resolutions
(Section 56 of the IRR of RA 9184) and Court
Cases/Certiorari;
8. Submission to the GPPB of all Blacklisting and Delisting
Orders against Suppliers, Constructors, and Consultants;
9. Informing the GPPB of contract extension beyond six
months, if any, as per Guidelines on the Extension of
Contract for General Support Services;
10. Submission and Update to the GPPB of the List of Preselected Suppliers;
23
GPRA Open Contracting Practices
11. Submission to the GPPB and posting in the procuring
entity's website of the latter's List of Non-Governmental
Organizations (NGOs), Civil Society Organizations
(CSOs), or Professional Associations invited as
Observers; (Section 1.1.3 and 1.2.6 of the IRR of EO 662)
12. Administrative Order No. 17, s. 2011 Mandates all
government procuring entities to use the PhilGEPS in its
procurement activities, and shall post all opportunities,
notices, awards, and contracts in it as the central portal
of government procurement transactions in accordance
with R.A. 9184 and its IRRs.
GPRA Open Contracting Practices
• Observers – SAI, Private Sector, NGO/CSO shall be
allowed observe all stages of the procurement process
• Observers allowed access to the following documents
upon their request:
(a) minutes of BAC meetings;
(b) abstract of Bids;
(c) post-qualification summary report;
(d) APP and related PPMP; and
(e) opened proposals.
Open Data Philippines
Open Data Philippines
Open Data Philippines
Open Data Philippines
Impact of Reform Measures
Government Procurement Reform Act
IMPACT OF REFORM MEASURES
Sources of Information
Experiences from the
Ground
Feedback from
various stakeholders
The 2012 Country
Procurement
Assessment Report
Impact of Reform Measures
• Use of PhilGEPS vis newspaper advertisement generated savings
equivalent to PhP 1.048 Billion from 2001 – 2014.
• As of 2006, the DepED had realized a total of Php2.6 billion in savings,
with an average reduction of 50% in the price of textbooks that allowed
achievement of a textbook-to-student ratio of 1:1.
• One textbook that was being purchased for an average of PhP 100.00
came down to PhP45.00 in competitive bidding.
• DOH reported an average reduction of 27% in the prices of
pharmaceuticals due to increased competition.
• DPWH reported an average reduction of 15% to 20% of contract cost
when compared with budget estimates.
Source: 2008 CPAR
Impact of Reform Measures
(World Bank Confidence in Country System)
WB NCB
Threshold
2008
2013
Goods
USD 1 Million
USD 3 Million
Works
USD 5 Million
USD 15 Million
USD 200K
USD 500K
Consulting
Transparency International
Corruption Perception Index (CPI)
Year
Rank
CPI Score
No. of Countries
2000
69
2.8
90
2001
65
2.9
91
2002
77
2.6
102
2003
92
2.5
133
2004
102
2.6
146
2005
117
2.5
159
2006
121
2.5
163
2007
131
2.5
180
2008
141
2.3
180
2009
139
2.4
180
2010
134
2.4
178
2011
129
2.6
183
2012
105
34
176
2013
94
36
177
2014
85
38
175
Thank You…
Dennis S. Santiago
Executive Director V
Government Procurement Policy Board – Technical Support Office