Open Contracting in Philippine Government Procurement
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1 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
2 Open Contracting in Philippine Government Procurement
3 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 Local Government Code (Procurement Provisions) No Standardized Procurement Documents Absence of a single agency with a mandate to formulate procurement policy, rules and procedures.
4 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
5 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.
6 Effect to Public Procurement Information Asymmetry Withholding information Exploitation of information Conflict of Interest of Public Officials Financial Interest Family Relationship Post Employment
7 Effect to Public Procurement Contacts, Informal Networks and Collusion Lack of Accountability Fertile Ground for Malpractices and Corruption
8 2002 CPAR When formal institutions are weak, informal institutions are often strong
9 2002 CPAR A conducive breeding space for graft and corruption
10 Republic Act No 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
11 Government Procurement Reform Act (GPRA) Governing Principles GPRA
12 GPRA Key Reform Principles Accountability Competition Openness/Public Monitoring Disclosure/Transparency
13 Key Reform Measures
14 Key Reform Measures Competitive Bidding as Primary Mode of Procurement. Allowance of Centralized or Decentralized Procurement. Use of Non-Discretionary Pass/Fail Criterion.
15 Key Reform Measures Shift from Pre-Qualification Regime to Simplified Eligibility Checking. 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.
16 Key Reform Measures Introduction of a Protest Mechanism Participation of Observers in all stages of procurement process. 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
17 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.
18 Open Contracting Linkage vis The GPRA
19 The GPRA procurement principles embrace core values of OCP, i.e. transparency/disclosure, participation/monitoring and accountability
20 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
21 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
22 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
23 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;
24 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
25 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 and of the IRR of EO 662) 12. Administrative Order No. 17, s 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 and its IRRs.
26 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.
27 Open Data Philippines
28 Open Data Philippines
29 Open Data Philippines
30 Open Data Philippines
31 Impact of Reform Measures
32 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
33 Impact of Reform Measures Use of PhilGEPS vis newspaper advertisement generated savings equivalent to PhP Billion from 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 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
34 Impact of Reform Measures (World Bank Confidence in Country System) WB NCB Threshold Goods USD 1 Million USD 3 Million Works USD 5 Million USD 15 Million Consulting USD 200K USD 500K
35 Transparency International Corruption Perception Index (CPI) Year Rank CPI Score No. of Countries
36 Thank You Dennis S. Santiago Executive Director V Government Procurement Policy Board Technical Support Office
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