Sub-Regional Caribbean Public Procurement Conference E-Procurement and the use of Framework Agreements Port of Spain, Trinidad June 22, 2014 Sabine Engelhard

Segment I: What is a Framework Agreement? Segment II: Why doe Framework Agreements make sense with E-Government Procurement? Segment III: The Bottom Line E-Procurement and the Use of Framework Agreements 2 Topics Overview

Segment I What is a Framework Agreement

4 Segment I: What is a Framework Agreement ? Framework Agreement –Definition  No universally accepted definition-Even different names (Framework, blanket, indefinite-quantity, indefinite-delivery…).  Characteristics are common:  Used when standard needs recognized but exact quantity, frequency and timing not clearly identifiable upfront.  Agreement specifying the contractual conditions for future orders for the goods, services or works covered by the framework.  Specific duration in time.  Covers specific commodities, services, works…Does not work for everything.  Specifies agreed prices for goods, works, services, professional fees.  Used as needed-no guaranteed volume of procurement.

5 Segment I: What is a Framework Agreement ? Framework Agreement a Strategic Element of Government Procurement  Need clear regulation with appropriate legal and institutional set-up.  Allows a strategic approach to procurement:  at a contracting entity/agency level, or  at a country level.  Not a panacea-Appropriate in certain cases.  Similar standardized needs are anticipated, planned and grouped.  Use of catalogs and schedules.

6 Segment I: What is a Framework Agreement ? Framework Agreement and Increased Efficiency, Economy and Flexibility  Arrangement is already in place.  Sufficient capacity to manage Framework Agreements.  Arrangement allows maximum leverage for items included.  Can be set up:  With several suppliers/contractors (multiple awards), or  Only one supplier (single award).  Orders could be:  Competed each time (mini competition),  Directed to one awarded supplier/contractor.

7 Segment I: What is a Framework Agreement ? Framework Agreement and Increased Efficiency, Economy and Flexibility  Can be set up at different levels:  For a country; or  For an agency or a group of agencies.  Can be set up under different timeframes (2 years, 3 years…) can also be renewed with an extension in some cases.  To keep its efficiency and flexibility should cover reasonable period (whether first period or extension).  After expiration-Open competition to avoid risk of diminished efficiency.

8 Segment I: What is a Framework Agreement ? Framework Agreement and Transparency & Accountability  Existing arrangement disclosed-Information available to all in a timely fashion (ideal situation):  Commodities, services, works, professional services specified.  Names of suppliers/contractors available.  Rates available.  Spend available.  Future Opportunities disclosed- Information available to all in a timely fashion and competed openly under clear and fair rules.  Rules for sole sourcing or single award also disclosed and clear.

9 Segment I: What is a Framework Agreement ? Framework Agreement and Transparency & Accountability  Increased transparency for suppliers/contractors and civil society (tax payers).  Increased confidence in agency/government.  Increased participation from suppliers/contractors.  Increased competition.  Increased Value for money.  Generation of savings.

Segment II Why do Framework Agreements make sense with E-Government Procurement?

11 Segment II: Why do Framework Agreements make sense with E-Government Procurement? E-Government Procurement and Framework Agreements How do they complement each other?  E-Procurement can only achieve its full potential with adequate legal and institutional frameworks.  Can be implemented in different phases and at different levels.  E-Procurement brings technology and reliable information to the entire procurement process in real time.  E-Procurement helps modernize the vision of procurement-Strengthens strategic dimension of procurement.

12 Segment II: Why do Framework Agreements make sense with E-Government Procurement? E-Government Procurement and Framework Agreements How do they complement each other?  E-government Procurement is about:  Increased transparency;  Increased Efficiency;  Increased Economy; and  Increased accountability.

13 Segment II: Why do Framework Agreements make sense with E-Government Procurement? E-Government Procurement and Framework Agreements How do they complement each other?  E-government Procurement is about:  Increased Confidence;  Increased Relevance;  Increased Competitiveness;  Market development/market Access; and  Increased Performance;  Increased Value for money.

14 Segment II: Why do Framework Agreements make sense with E-Government Procurement? E-Government Procurement and Framework Agreements How do they complement each other?  E-Procurement is a medium which can help:  Strengthen the whole decision making process around the way framework agreements are set up and organized.  Strengthen the planning of Framework Agreements.  Strengthen management of Framework Agreements.  Ultimately build capacity.

15 Segment II: Why do Framework Agreements make sense with E-Government Procurement? E-Government Procurement and Framework Agreements How do they complement each other?  E-Procurement is a medium which can help:  Develop use of Framework Agreements when appropriate.  Flag the abuse of framework agreements or their inefficient use.  Ultimately leverage full potential of Framework Agreements.

16 Segment III: What is the bottom line? Synergies and Benefits combined What do you get?  E-Procurement & Framework Agreements can help:  Develop use of catalogs and schedules - Taking into consideration the need for unification of information-Allowing increased participation of bidders from different countries;  Increase national or regional integration - Framework agreements can be open for competition for suppliers/contractors from other countries; and  Increase national or regional trade-Framework agreements can be used to that effect.

17 Segment III: What is the bottom line? Synergies and benefits combined What do you get?  If well regulated and functioning e-procurement system and Appropriate Use & Management of Framework Agreements:  Conducive to increased quality and savings in procurement;  Contributes to more efficient management of public funds;  Sizable savings realized-Very relevant for commonly used goods and services covered by framework agreements.  Contribute to sustainable development.

Questions? 18