“ Public Procurements in Practice ” December 14th 2010

The Importance of Procurement Monitoring  Public procurement affects all aspects of people’s lives and assumes a large share of government budgets  The Organisation for Economic Cooperation and Development (OECD) has estimated the value of government procurement markets worldwide to be US $ 2 trillion annually  Transparency International (TI) estimates that damage from corruption on public procurement can represent on average 10 to 25% of a contract’s value  Corruption in public procurement is not just about money: it costs lives

Who Can Monitor?  Everyone – from individual citizens to high level government officials – can play a role in ensuring that tax payers’ money spent on procurement delivers good quality services at a fair economic cost for all  Governments and other control bodies alone do not have the capacity to monitor all procurement processes effectively  Civil society can play an important role in bringing independence to procurement monitoring  The inclusion of all stakeholders acts to broaden and strengthen procurement monitoring  TI has followed this approach for over 15 years

The Integrity Pact  One of TI’s flagship tools - developed to help governments, businesses and civil society fight corruption in the field of public contracting  Agreement between government and all bidders for a (public sector) contract so that neither side will pay, offer, demand or accept bribes  Used successfully in more than 15 countries around the world in the last 10 years, in all sectors and for all types of contracts Some Examples:  Germany – Berlin Schönefeld new international airport, a project worth € 2.4 billion  Latvia – The construction of the National Library - Ministry of Culture/New Three Brothers Agency  Mexico – IPs have been used in nearly 100 contracts worth approximately US $ 30 billion in different sectors

Other Examples of Procurement Monitoring Bulgaria : Expert Monitoring Group  Main sources of information to carry out monitoring: audit reports of the National Audit office and State Agency for Financial Inspection and interviews with experts  Expert Monitoring Group (EMG) formed by public procurement experts and NGO representatives focus on 3 categories; (i) methodology indicators; (ii) data collection tools; and (iii) on the spot monitoring  Monitored 13 conditions to be determined using 28 standard indicators of transparency and accountability  Feedback on results to government and advocacy for procurement reform

Other Examples of Procurement Monitoring Argentina : Public Hearings  The responsible authority convenes citizens, businesses, experts; presents details of project and procurement provisions; and enables participants to express their suggestions and objections  Recommendations to be taken into account and incorporated where appropriate  Open to citizens from all backgrounds, ages and interests  Implemented primarily for city/local government projects  wider involvement enables wider scrutiny on the behaviour of contracting parties both during the bidding process and contract execution  Some public hearings can attract close to 500 attendees

Procurement Monitoring Innovation  TI is constantly working to find new ways to monitor procurement processes more effectively  The set of indicators developed by TI Serbia to measure performance of the public procurement system is testament to this  The whole TI movement expects to learn from Serbia, and adapt and apply the indicators to other countries and contexts  We also hope the project will raise particular interest in the European context