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Friday 915 Public Procurement Reforms Bigart


Published on

“Public Procurement Reform and Importance in the
Current Economic Climate”
Pamela Bigart, Lead Procurement Specialist, World Bank
Ms. Bigart will speak about the importance of Public Procurement Systems in how public
money is spent, overall spending in procurement in different countries, the role of technology
in improving procurement processes, as well as specific procurement reforms.

Published in: Economy & Finance, Business
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Friday 915 Public Procurement Reforms Bigart

  1. 1. Public Procurement Reform and Importance in the Current Economic Climate Contributions to Economic Stability and Growth Pamela Bigart World Bank 22 May 2009
  2. 2. Importance of Procurement <ul><li>Public Procurement systems are at the center of the way public money is spent since budgets get translated into services largely through the government’s purchase of goods, works and services </li></ul>
  3. 3. What’s Procurement Got to do with It? <ul><li>Percentage of GDP </li></ul><ul><li>Economy, Efficiency and Value for Money </li></ul><ul><li>Service Delivery </li></ul><ul><li>Foreign Investment in Country </li></ul><ul><li>Investment in Building Private Sector Capacity </li></ul><ul><li>Trade Policy – Opening Doors for Growth and Competition </li></ul>
  4. 4. GDP and Percentage of Budget <ul><li>Overall spending on procurement by governments has been estimated to be 15% of GDP (much higher in many countries) </li></ul><ul><li>Procurement as a percentage of budget expenditure ranges from to as high as 70% </li></ul><ul><li>Clearly, efficient procurement translates to obtaining more value for money </li></ul>
  5. 5. Size of Procurement in Selected Countries <ul><li>Country </li></ul><ul><li>Global </li></ul><ul><li>Angola </li></ul><ul><li>Azerbaijan </li></ul><ul><li>Bulgaria </li></ul><ul><li>Dominican Republic </li></ul><ul><li>Malawi </li></ul><ul><li>Vietnam </li></ul><ul><li>% Total Expenditure </li></ul><ul><li>12-20% </li></ul><ul><li>58% </li></ul><ul><li>34% </li></ul><ul><li>30% </li></ul><ul><li>20% </li></ul><ul><li>40% </li></ul><ul><li>40% </li></ul>
  6. 6. Economy, Efficiency and Value for Money <ul><li>Economy and efficiency are traditional principles of a well functioning public procurement system – generally delivered through competitive marketplace </li></ul><ul><li>Value for money is expanding traditional focus to include achieving results through the public procurement system – brings into play the concept of quality and other criteria as a means of determining effective use of public funds and service delivery </li></ul>
  7. 7. Service Delivery <ul><li>Many systems are focusing less on the input side (paying for goods, works or services) to a focus on the service delivery side. </li></ul><ul><li>Ensuring that goods, works and services purchased through the government system provide for the needs of the citizens </li></ul><ul><li>Use of result focused instruments with payment based on delivery of required services or on performance criteria </li></ul>
  8. 8. Foreign Investment <ul><li>Public procurement helps define the business environment in a country </li></ul><ul><li>Attracting new business investors into the country requires a fair playing field where foreign investors see the opportunity for development and growth </li></ul>
  9. 9. Building Private Sector Capacity <ul><li>Competition </li></ul><ul><li>Partnership </li></ul><ul><li>Training </li></ul><ul><li>Facilitation </li></ul><ul><li>Governance environment </li></ul><ul><li>Information </li></ul>
  10. 10. Opening Doors for Growth and Competition <ul><li>Cross border trade agreements </li></ul><ul><li>Exposure to competition </li></ul><ul><li>Reducing dependencies on governmental protectionist policies </li></ul>
  11. 11. Role of Technology <ul><li>Expands access to market </li></ul><ul><li>Provides for greater transparency </li></ul><ul><li>Increases confidence in governance </li></ul><ul><li>Increases efficiency </li></ul><ul><li>Captures data for better management and results </li></ul><ul><li>Involves stakeholders </li></ul>
  12. 12. What is Procurement Reform? <ul><li>Creating a sound, transparent and fair legal framework </li></ul><ul><li>Supporting implementation with tools, documents and procedures </li></ul><ul><li>Ensuring quality and capacity of those implementing procurement </li></ul><ul><li>Sound, transparent and fair governance and public financial management system with full integration </li></ul>
  13. 13. Procurement Reform (continued) <ul><li>Supporting a competitive market </li></ul><ul><li>Feedback mechanisms to ensure that system remains relevant </li></ul><ul><li>Controls and accountability </li></ul><ul><li>Access to Information </li></ul><ul><li>Reliable partner </li></ul><ul><li>Stakeholder involvement </li></ul>
  14. 14. What Lessons have we Learned? <ul><li>Procurement reform costs money and takes time </li></ul><ul><li>Some reforms can deliver results in the short term </li></ul><ul><li>Reform cannot be effective if isolated from broader public sector management and financial management reform </li></ul><ul><li>Reforms require long term commitment to achieve sustainable results </li></ul>