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Baku, 17.4.2013

Public Procurement Monitoring In Azerbaijan

and AbroadZuzana Dančíková, Transparency International Slovakia

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Why is monitoring public procurement an issue?

• In Slovakia € 3,9 billion was spent in public procurement in 2012 (15 % of total government expenditure)

• According to a survey, Slovak businesses believe on average 13 % of the value of a tender goes to bribes.

• € 500 million could be saved annually, the equivalent of 16 new hospitals 51 km of new highways 21 % pay raise for all young teachers

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Why is monitoring public procurement an issue?

TI Slovakia experience suggests:

Monitoring procurement based on aggregateprocurement data leads to savings by

• Introducing better policy based on evidence• Pointing to individual cases of inefficient procurement

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What to monitor in public procurement?

Formal procurement process Substance of procurement

Individual level Aggregate level

Individual level Aggregate levelPublishing data State Civil societyMonitoring procurement procedure

State

Civil society Civil society

Monitoring procurement substance

Civil society Civil society

Monitoring public procurement in Slovakia: Civil society supplements the State

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How do we monitor procurement?

1. COMPILATION & PRESENTATION OF AGGREGATE DATATransparency International Slovakia has developed a web portal tender.sme.sk , which allows us to compile available data on individual cases of procurement and present aggregate data

2. ANALYSIS & INVESTIGATIONAggregate data enables us to analyze trends in procurement & investigate individual tenders

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Compiling and presenting aggregate data

•Daily automatic downloads of tender notices from the state Office for Public Procurement

•Automatic collection of predefined information from downloaded notices

•Automatic republication of collected data in a user-friendly way

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Compiling and presenting data: Individual vs. aggregate procurement data

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Compiling and presenting data: Collecting information from individual tender notices

Source: e-vestnik.sk

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Compiling and presenting data: Defining relevant data

Searchable data: Descriptive data: Calculated data:

•Supplier•Procurer•Procured article•Region

•Year•Type of procedure•Expected price•Final price•Number of bids

•Overall procured volumes•Average competition

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Compiling and presenting data: Aggregate information about an individual procurer

Source: tender.sme.sk

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Compiling and presenting data: Information about an individual tender in context

Source: tender.sme.sk

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Analysis of trends in procurement & investigation of individual tenders

Analysis of aggregate data allows us to answerpolicy questions such as:

• Does public procurement in a particular sector (e.g. healthcare) require special oversight?

• If mandatory electronic auctions are introduced in public procurement, do savings occur?

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Analysis of trends in procurement & investigation of individual tenders: Closer attention should be paid to

public procurement in Slovak health care

1 2 3 4 5 6 7 8 90

200

400

600

800

1000

1200

1400

1600 54,6 %

20,4 %

11,7 %

6,8 %2,8 % 1,5 % 1 % 0,4 % 0,4 %

Tenders by Number of Bids

Number of Bids in Tender

Prop

ortio

n of

all

hosp

ital t

ende

rs

Source: tender.sme.sk

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FINDINGS:• More than half of all tenders in healthcare receive just a

single a bid• 35 million EUR (14% of annual procurement expenditure

in health care) could be saved if number of bids in single-bid tenders increased to two

IMPACT:• 40 media citations, most cited analysis by Slovak

commentators • 2 months later Ministry of Health strengthened oversight

over state hospitals

Analysis of trends in procurement & investigation of individual tenders: Closer attention should be paid to

public procurement in Slovak health care

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Analysis of trends in procurement & investigation of individual tenders: Mandatory e-auctions save public

money

Source: SDKU-DS

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Analysis of trends in procurement & investigation of individual tenders: Mandatory e-auctions save public

money

FINDINGS:- Rising number of bids in tenders is associated

with increasing savings- Savings are more significant when e-auctions

are usedIMPACT:• Widely cited by media• Promotion of mandatory e-auction in political

parties’ programs

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Analysis of trends in procurement & investigation of individual tenders: Searching for bad deals

• Medical equipment often said to be bought inefficiently

• CT tenders over last 5 years investigated (27)

• Price differences of up to 100 % found: CORRUPTION

Source: tender.sme.sk, hospitals

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Technical conditions

Good quality data

Good understanding of policies and

procedures

IT Skills

Funds (project source codes

and documentation

available)

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Way forward

Monitoring procurement leads to savings. What is next?

• Closer involvement of all stakeholders (government, journalists, public)

• New features: Collecting information on calls for tenders Introducing notifications

• Opening further data, e.g. Open Contracts (in Slovakia all public contracts, invoices and orders have to be published online before they enter into force).

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THANK YOU!

http://tender.sme.sk/en/dancikova@transparency.sk