Presentation by Matthieu Cahen, OECD, at the SIGMA regional conference on public procurement which took place in Beirut on 2-3June 2015. Also available in Arabic.

1. Matthieu CAHEN
Policy Analyst
Public Sector Integrity Division Beirut – 3 June 2015
IMPLEMENTATION OF SELECTED PRINCIPLES OF
THE OECD RECOMMENDATION ON PUBLIC
PROCUREMENT
Increase transparency and
Improve performance through
evaluation of procurement systems
SIGMA Regional Conference
on Public Procurement

2. • It stands as a crucial pillar of strategic
governance for any government body;
• It is also a high-risk area due to the close
interaction between private and public spheres
• Governments face the challenge of ensuring that
different priorities are clear, work together and
overlaps or conflicts are avoided.
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Public Procurement matters

3. Government procurement as share of GDP and of total govt. expenditures
Source: OECD National Accounts Statistics. (2013)
Public Procurement really matters
3
Estonia
Hungary
Netherlands
Korea
Japan
Ireland
Luxembourg
Czech Republic
Germany
New Zealand
Canada
Israel
Slovak Republic
Finland
United Kingdom
Sweden
Turkey
Belgium
Austria
Denmark
Switzerland
Spain
Poland
OECD(UWA)
Norway
France
United States
Mexico
Italy
Portugal
Greece
Slovenia
28.1
0 10 20 30 40 50
13.0
0.05.010.015.020.025.0
as % share of total government expenditureas % of GDP

4. And it matters for everyone
• From the Business side, public sector efficiency is
the second business priority area for reform after
product market regulation.
And public procurement the top priority in this
sector:
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BIAC Economic Survey, 2014

5. Supported governments in reforming public procurement systems for
sustainable and inclusive growth and trust in government through:
• Building evidence from useful, reliable and comparable data
across OECD countries on the performance of public procurement –
Key Performance Indicators
• Undertaking hands-on peer reviews that provide assessment of
public procurement systems, either national or sectorial, and tailored
proposals to address implementation gaps in specific context – in
Italy, Greece, Northern Ireland but also US, Korea, Mexico
• Organising policy dialogue to share insights & shape directions for
future reforms, build strategic partnership with private sector - G20
• Identifying good practices and providing international
standards on public procurement – Compendiums on Green
Procurement, Transparency, Accountability and Anticorruption
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OECD contribution to reforming
public procurement

6. Through the MENA/OECD Network on Public
Procurement:
• Specific workshops in the region:
– on professionalisation of the procurement
workforce,
– e-procurement,
– global procurement strategies (from needs
analysis to aggregation mechanisms).
• Manuals and Guides
Application in the MENA Region
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7. Main findings from the OECD work in Public
Procurement
The OECD’s experience in working with public procurement
shows that a sound procurement system includes:
a) procurement rules and procedures that are simple, clear and
ensure access to procurement opportunities;
b) effective institutions to conduct procurement procedures and
conclude, manage and monitor public contracts;
c) appropriate electronic tools;
d) suitable, in numbers and skills, human resources to plan and
carry out procurement processes; and
e) competent contract management.
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8. • The 2008 OECD Recommendation on Enhancing
Integrity in Public Procurement focused on integrity,
transparency, accountability, good management, risk
prevention and control.
• Interest in governance of public procurement to achieve
efficiency and advance public policy objectives has
significantly increased.
• The new OECD Recommendation on Public Procurement
supports a shift from an administrative and compliance-
based approach to a strategic and holistic approach to
realise government policies
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A standard for Public Procurement in
the XXI century

9. • Supports dedication of public resources to address the
increasing complexity of strategic public procurement
• Yields returns as the investment in a sound public
procurement brings major outcomes: a 1% saving
represents 43 billion EUR per year in OECD countries.
• Supports achievement of policy goals such as job
creation, innovation, environmental protection or the
development of SME, a crucial pillar of strategic
governance and services delivery for any government.
• Supports risk mitigation such as those arisen from
public works, complex digital technology or major
events.
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Investing in Better Policies
The New Recommendation:

10. Participation
Efficiency
Capacity
Integrity
Access
Balance
E-
Procurement
Evaluation
Risk
Management
Transparency
Integration
Accountability
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The New Recommendation on Public
Procurement: 12 integrated principles

11. TRANSPARENCY
THROUGHOUT THE
ENTIRE PUBLIC
PROCUREMENT
CYCLE

12. How transparency principles could be
implemented?
• Most recent reviews from the OECD
suggest that transparency could efficiently
be implemented notably by e-Procurement
systems if appropriately designed and
used
• But why implementing transparency into
public procurement?

13. Transparency fosters competition
• Fair and equitable treatment of suppliers
ranging from SMEs to foreign suppliers
• Need to be balanced with disclosure of
information which could be detrimental to
competition

14. Transparency brings inclusiveness
• Easily and readily accessible online
information on public procurement
provides suppliers with a coherent view of
procurement opportunities
• Rebuild citizens’ trust in governments by
offering a platform to review public
expenditures

15. Transparency enhances visibility
• On average, 2/3 of public procurement is
done at sub-central level, hence the potential
offered by transparency in understanding
procurement patterns at sub-central level
• Greater visibility of public funds provides
strategic insights which help shape future
public procurement decisions
• Greater transparency provides opportunities
for rationalisation and mutualisation of
needs, thus economies of scale.

16. IMPROVEMENTS
THROUGH
PERFORMANCE
ASSESSMENT OF
PUBLIC PROCUREMENT

17. Performance evaluation
• Assess periodically and consistently the
results of the procurement process to
guide future decisions
• Develop indicators to measure
performance, effectiveness and savings of
the public procurement system

18. In Feb. 2013, the Leading Practitioners on Public Procurement
asked the OECD to help developing a set of indicators to measure
the performance of public procurement systems and their
evolution over time.
Four areas for the development of indicators were identified:
1. Efficiency of the public procurement cycle
2. Openness and transparency of the public procurement cycle
3. Professionalism of the public procurement workforce
4. Contract performance management
Towards key performance indicators
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19. Why implementing performance-based
assessments?
• Procurement is an evidence-based system
and so shall be its performance evaluation
• Measuring performance provides insights
both at macro and micro-level
• Measuring public procurement performance
not only provides assessment of public
spending efficiency but also information to
governments on achievements of their
objectives.

20. Yet, measuring is a challenge
• Purchasing entities report difficulties in
centralising information on public
procurement
• Need for a consensus on what to measure
and how to measure it:
– Performance indicators vs. Activity indicators
– Common terminology
– Shared vision on the objectives

21. An international reference for public procurement
standards that shall shape public procurement systems:
• Deepening the evidence base - Key Performance
Indicators, comparative data, e.g. for G@G
• Best practice compendiums – green procurement,
transparency, integrity and innovations
• Basis for future policy advice – country and sectorial
reviews (like Mexico, Greece, Colombia, Korea)
• Implementation toolkit
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Next steps
Implementing the Recommendation

22. www.oecd.org/gov/ethics/public-procurement.htm
For more information on OECD work on public
procurement and integrity

23. Thank you!
matthieu.cahen@oecd.org
Web: www.oecd.org/gov/ethics/integrityinpublicprocurement.htm
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