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Reforming Public Procurement -- Syquia Another way of fostering climate for positive action is to create a higher pay scale for procurement practitioners (provided that the certificate program is in place) or to provide a clear career path for those in the field of procurement. These may be useful in jurisdictions where procurement is regarded as a purely routine and mundane task, or even as a “dead-end” assignment. 7 Step Five: Assess the impact of reforms at both the central and local levels After evaluating the country’s procurement environment, developing a strategy for reform, establishing the legal and institutional frameworks, and then training the enablers in the procuring entities, the next step is to assess how effectively the strategy has been undertaken, how much of the reform agenda was actually implemented in the field, and the overall impact of the procurement reforms. The BIS focuses predominantly on macro indicators and is not intended to measure agency-level performance. The BIS assessment, therefore, must be coupled with other management tools, like a performance measurement framework, to guide actions on what and where changes need to be made in a particular agency. Determinations as to whether better performance outcomes are achieved as a result of policy reforms need to be based on collection and analysis of actual performance data. The Agency Procurement Performance Indicators (APPI), more recently referred to as the Compliance/Performance Indicators (CPI) by the OECD-DAC, complements the BIS, providing an effective tool for monitoring and evaluating implementation at the agency level. To effectively link the agency level performance to the goals and objectives of the national procurement system, the assessment should consider the following: 1. Whether the subject agency has a strategy for achieving an effective procurement program, and whether this strategy is in line with the national procurement reform policy. 2. Whether the organizational structure and employee capacity of the subject agency supports a strategy that is in line with the national procurement reform policy. 3. Whether the internal procurement processes of the subject agency support a strategy that is in line with the national procurement reform policy and is in accord with its organizational setup. 4. Whether the subject agency is able to undertake its procurement in an effective and accountable manner, supported by sufficient records and documentation. The following major criteria are suggested for the APPI assessment: 1. Strategy 2. Data Collection and Monitoring System 3. Agency Professionalization Measures 4. Organizational Structure 5. Agency Procurement Process 6. Effectiveness 7. Accountability Measures These major criteria would then have to be broken down into several Indicators. To be meaningful, both the major criteria and the Indicators should be structured to tell a complete story of how procurement is undertaken within the subject agency and how the outcomes—desirable or not—are achieved. The assessment is intended to show whether an agency has actually developed a strategy to implement procurement reforms, and whether this strategy is effectively being pursued to meet its objectives. At the very least, the assessment should show how well an agency’s procurement system applies the principles and practices of the national procurement system, regardless of whether it has an agency-level strategy. Fiscal Reform and Economic Governance Project 19
Reforming Public Procurement -- Syquia The illustration below (Figure 1) shows the “cause and effect” linkage among the major criteria in a roughly sequential manner. Effectiveness is located at the top to stress that the ultimate objective of any procurement reform program is that agencies are able to acquire the best value for money. To attain this, the process has to begin with the development of an appropriate records management and data collection system, because a successful operation is one that proceeds in an informed manner. Without information, no judgment can be made regarding the inputs, outputs and outcomes of an agency’s system and operations. Accountability measures immediately follow data collection and monitoring, because the quality of data gathered and information generated directly affects the quality and reliability of the evidence and other indications of fraud or wrongdoing, and it allows one to identify areas of vulnerability within the system that require attention. It may be that these vulnerabilities exist by reason of an organizational structure that lends itself to non-transparent or collusive behavior, e.g., there are no internal audit units or decision-making is highly centralized, so that the basic structure of an agency may have to be addressed even before considering implementing a professionalization program within the agency. Indeed, a professionalization program can only work if it operates in a properly structured environment, where each individual and office performs tasks that appropriately feed into the work of another individual and/or office—all within an atmosphere where each individual is held accountable for his/her responsibilities. The next step is to consider the state of the agency’s human capital, i.e. the procurement officers and staff. As mentioned above, these personnel are the enablers of any procurement reform program, because they are ultimately the ones responsible for implementing the law in their respective agencies. As such, internal procurement processes can function properly only when these enablers amply perform their tasks in a proper working environment. In turn, when the procurement process incorporates the reform measures and reflects the principles of transparency, efficiency and economy, the agency should be able to procure goods and services effectively, i.e. with the desired quality and at the most reasonable cost. If, after the entire cycle, certain gaps and weaknesses still exist, these should be identified through the agency’s data collection and monitoring system so that the appropriate adjustments can be made, whether in the accountability measures, the organizational structure, the human capital element or in the manner in which the process is implemented. Finally, strategy is located in the middle of the cycle, because it provides the approach for implementation of the reforms within the agency, and it identifies the efforts that need to be prioritized during the current cycle, as well as those that may have to wait until the next cycle. Fiscal Reform and Economic Governance Project 20
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