Georgia rapid development and low cost model

e-Procurement in Georgia

Everyone sees everything

Tato Urjumelashvili, CSPA

Tbilisi, September, 2012

1Where we started

SPA office. January 2010

Collection of documents from state bodies (paper tenders)Service agency of mia

Tax Department

NATIONAL AGENCY OF PUBLIC REGISTRYOther state agencies

Commercial banks

Notary

courtsProcuring Entity

Tender proposal

Qualification docsWaste of time

BidderWaste of moneyWaste of administrative resourcesWaste of paper3

Paper tenders and geographical inequality

Procuring entity

Bidders had to make at least 4 physical visits to procuring entity, and the winner an additional 5th visit to sign a contract

20 mln paper copies in last 5 years

High transaction costsLimited access to informationHigh compliance costs

4Side effects of paper tendersLack of transparencyHigh risk of corruptionNon-reliable dataRestricted competitionGeographical inequalityHigh compliance costsFailing procurement system5What we wantedTransparency

Non- discrimination

Fair evaluation

Streamlined and easy to follow procedures

..and get rid of papers!!!In-house developmentOff-the-shelf solutionsCostCostLess than$ 1 mlnApprox.$ 10 mlnTwo options7Second option: Georgian alternativeS/W $ 150 000H/W $ 500 000BI $ 70 000Website $ 10 000Communication campaign $ 30 000

Sleepless nights not counted

Pace of the reformsJanuary 2010. Started with legal amendments and design of the e-procurement systemAugust 2010. E-procurement system launched in test modeOctober 2010. First e-tender announcedDecember 2010. Paper tenders abolished. Only e-tenders allowedSeptember 2011. 10 000 registered usersOctober 2011. $ 100 mln savings generatedDecember 2011. Bilingual system was introducedMay 2012. 13 339 registered usersSeptember 2012. $ 198 mln savings generatedMore is coming !!!

Geographical inequality eliminatedWhat we got

Procuring entity

Bidders do not make physical visits to procuring entity. Only the winner once visit procuring entity to sign a contract

Minimum paperworkMinimum transaction costsEveryone sees everythingNo physical visits

Increased competitionMaximum efficiencyFair evaluationElectronic dispute resolution10Georgian Electronic Government Procurement - Ge-GPSome features of Ge-GPGe-Gp business process in brief

Yes

YesYesYesNoNo

System prevents mechanical and procedural mistakesSystem provides subscription and internal messaging optionsElectronic payments module/ linkage with State TreasuryAll activities are loggedBilingual system.Georgian - English Integrated appeal mechanismEveryone sees everything

DRB Business Process

Data on DRB activities

CPV Codes

Clear and well articulated political will Visionary approach no special rigid strategyConsolidated team unified views and valuesCorrection during the implementation return to the reforms several time Unilateral liberalization of procurement market for foreign biddersStreamlined, easy-to-follow proceduresNon-discrimination & fair evaluationMaximum transparency everyone sees everythingHow we built itTransparent & Efficient System of State Procurement (in 1 year !!!)Mainstream Alternative:Elaboration of a strategy (1 year)Dialogue with the interested parties Elaboration of an action plan/introduction (1 year)Implementation (3 years)Too long and too expensive for us (what about you ?)22What we learned

Reform boldly, broadly and communicateStart small and leverage on demonstrable resultsBusinesses love change they understandMore transparency less corruptionStreamline then automateSimplicity is powerKeep on identifying the next biggest binding constraint, reform in seriesReform unilaterally, dont wait for reciprocity

Communicate reforms Results inspireAssessment by OthersUN- United Nations Public Service Award, 2nd place, in the category of Preventing and Combating Corruption in the Public Service,2012EBRD - In the Eastern European countries, including Georgia and Russia, the basic policy features of public procurement are in place. However, only Georgia scored a high compliance rate, as most integrity safeguards and procurement efficiency instruments recommended by international best practice were adopted in Georgia in 2010Transparency International Georgia - "In the past year, we have seen the successful introduction of an electronic, transparent procurement system, which has been a very positive development .European Parliament, Committee on International Trade - Welcomes Georgias new procurement system, enabling e-auctions for all types of contracts, irrespective of their size or nature; points out that Georgia should also serve as an example for the EU Member States in this area.

Thank you for your attention!

28 Pekini Ave., Tbilisi 0160, Georgia e-mail: info@procurement.gov.ge

Full cycle of the review of disputes by the Board

1 2 3 4 5 6 7 8 9 10

Upload a complaint into the system

Complainant

Examine the filed complaint and where a deficiency is found instruct a complainant to fix it.

DRB Office

Fix the deficiency in the complaint and upload to the system

Complainant

DRB Office

Draft a decision about admissibility of the filed complaint

DRB Chairman

Take final admissibility decision

DRB Office, DRB Chairman

Send a notification to the complainant about the admissibility decision over his/her complaint

DRB Office

Upload the admissibility decision into the System

DRB Office

Suspend the challenged procedure in the Electronic Procurement System

DRB Office

Notify Board members by phone, SMS and/or e-mail about thr complaint declared admissible

Send a notice to the respondent about the challenged and suspended procurement procedures

DRB Office

Appoint the hearing of the case based on the submission of the DRB Office

DRB Chairman

Send a notice to the parties about date and venue of the Board hearing

DRB Office

Substantial review of the dispute at the Board hearing

DRB members, parties

Keeping minutes of Board hearing

DRB Office

Meeting and taking a decision on allowing the complaint partially or fully or disallowing the complaint

DRB members

Draft the Board decision

DRB Office, DRB members

Review the DRB draft decision and sign thereof

DRB Members

Upload the DRB decision nto the Integrated State Procurement System

DRB Office