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Focus Topic: Institutional Capacity in Public Procurement (Working Draft)

Top 4 Strategy Recommendations

1

EU wide online knowledge resource center to share technical capacity of procurement authorities for assistance to local procurement officers on technical questions.  

2

Establish an online pool for engineers, private consultants, planning bureaus where they could register so procurement authorities could search for the type of services and knowledge that they lack “in-house”.

3

Build an online knowledge exchange platform to facilitate the dialogue between procurement authorities and provide training courses.

4

Centralize procurement know-how on an online library collecting best practices, innovative guidelines, relevant actors and policies in a single place available to procurement authorities.

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Executive Summary

ChallengesSolutions
  • Political interference in the procurement process. 
  • Increase political independence of procurement bodies.
  • Lack of sufficient engineering knowledge within the procurement authorities.
  • Support institutional capacity building and encourage professionalization of procurement authorities.
  • Conduct “competitive dialogue” tenders for optimal technological and engineering solutions.
  • Lack of procedural knowledge (e.g. state of the art procurement techniques) of tendering personnel.
  • Organize training for procurement experts on an online platform.
  • Implement knowledge exchange programmes between public authorities of EU and accessions countries responsible for procurement (e.g. ASFiNAG, DARS, CNAIR).
  • Limited involvement of external consultants in training activities for procurement bodies.
  • Promote training and knowledge transfer with participation of external experts.
  • Resistance to change the system.
  • Organize joint workgroups that would include governmental officials, NGOs and private companies to develop efficient and responsive procurement solutions.
  • Weak cooperation between the main stakeholders to improve the system.  
  • Establish an online platform to exchange ideas and best practices across Europe.
  • Strong cooperation with chambers in the region to have a good educational background for public officials education.
  • No widespread practice of resource pooling and cross-institutional/cross-country assistance in the case of large, technologically complex projects.
  • Establish an EU pool for engineers and consultants for the procurement process which local and national authorities can rely on when they need specific knowledge input not available “in-house”.
  • Pool resources (e.g. engineers) at the local and regional levels to improve institutional capacity of local tendering authorities for a specific project, for a limited time-period.

Political interference in the procurement process and resistance to change the system.

ChallengeSolutionsActors Implementation
  • Payment of projects are delayed or withheld due to political (rescheduling payments for the next budgeting period) or administrative reasons (complex works acceptance procedures).
  • Public and private sector to work together in order to simplify procedures for work acceptance.
  • Accelerate the digitalization of certain work processes.
  • National legislators to consider a different payment process to avoid rescheduling of payments for future budgeting periods (e.g. bank guarantee). 
  • National governments.
  • Tendering authorities.
  • Political parties. 
  • Contractors.
  • Establish an online knowledge exchange platform for public and private sector dialogue and open a dedicated topic on ways to simplify procedures for work acceptance and payment conditions.

 

  • Lack of long term planning at sectoral level to ensure proper stakeholder engagement with the master plans.
  • Industry stakeholders and the government should develop a rolling medium to long term strategic investment plan and build a large coalition around it to ensure long term planning and stakeholder engagement.
  • National governments.
  • Tendering authorities.
  • Political parties.  
  • Contractors.
  • Bring together Political parties, institutional stakeholders and EU actors to develop a medium to long term rolling national and regional strategic plans of investment with half year updates (e.g. for 10 years).
  • Establish an Online Platform for stakeholder engagement: 
    • To incentivise institutions and the public to determine strategic points of investment.
    • To agree on reasonable times (deadlines) for the completion of certain projects.
  • Promoting a specific type of project, contractor or procurement procedure because of particular political interests (e.g. popular projects in order to increase election scores).
  • Increase political independence of procurement bodies. The EU or European-based financing institutions (e.g. EIB, KfW) should demand the application of regulations and ensure procurement authority‘s autonomy as a precondition for financing.
  • Pre-accession benefits offered by the EU for the non-EU CEEC countries could be conditioned on improving the transparency of the procurement system.
  • European Commission.
  • European financing institutions (EBRD, EIB, WBIF, etc.).
  • National governments.
  • Political parties.  
  • Working group with EU financing and political institutions to ensure compliance with EU guidebook (or best practices) on procurement throughout the region.
  • Politicians influence the process of policy making for tender laws and requirements without sufficient participation of experts, businesses, associations and unions.
  • Involve experts, NGOs and associations in designing guidelines for procurement that could be transposed in legislation.
  • European Commission.
  • European financing. institutions (EBRD, EIB, WBIF, etc.).
  • Experts in tender laws and requirements.
  • Private sector contractors.
  • Political parties.
  • National governments.
  • Establish an online knowledge exchange platform for public and private sector dialogue and open a dedicated topic on best procurement practices applicable to local context.
    • Organize working groups between public procurement experts, private sector major stakeholders, financing institutions representative and governmental officials in order to develop efficient procurement guidelines applicable to the local context. 
    • Build a large coalition including political actors to implement the developed policy recommendations.

Lack of engineering knowledge in the procurement authorities.

ChallengeSolutionsActors Implementation
  • Not enough engineers and technical specialists „in-house“.
  • An EU pool for engineers and consultants for the procurement process which local and national authorities can rely on when they need specific knowledge input not available „in-house“.
  • Increased funding and institutional support for training of procurement personnel on engineering aspects.
  • European Commission.
  • European financing institutions (EBRD, EIB, WBIF, etc.)
  • National governments.
  • Tendering authorities.
  • Experts to develop the training curricula.
  • Experts to provide training.
  • Establish an European online platform where engineers and procurement specialists could register so procurement authorities can use it to acquire knowledge that  is missing “in-house”.
  • Every public construction project should have an allocated budget for training and knowledge exchange activities to improve the engineering and technical knowledge of procurement officers.
  • For EU financed projects a certain level of expertise of the procurement team (internal / external) needs to be proven as a prequalification to access the funding. 
  • Reluctance to contract external engineering consulting companies to conduct tendering because of state controlled procurement processes and unwillingness to share the decision-making power (predominantly across the CEEC).
  • Organizing “joint procurement” teams composed of external specialists and in-house procurement officers.
  • External engineering consulting companies. 
  • National governments.
  • Political parties.
  • Organize public debate on the need to contract external engineering consulting companies to conduct tendering.
  • Organize pilot projects in which external engineering consulting companies are contracted to conduct tendering.

Lack of procedural knowledge of tendering personnel.

ChallengeSolutionsActors Implementation 
  • Lack of training on how to implement „state of the art“ procurement guidelines.
  • Not enough incentives to take specialization courses (e.g. training offered by the EU) for procurement personnel.
  • Support capacity building in-house.
  • Support procurement officials in taking part in the EU provided training programs.
  • The EU should incentivise governments through EU backed financing to increase training for procurement personnel.
  • Ensure proper and timely training for young/newly employed specialists.
  • Support strong cooperation with chambers  in the region to have a diverse and contextualized educational background for public officials education.
  • European Commission.
  • European financing. institutions (EBRD, EIB, WBIF, etc.).
  • Austrian WKO.
  • National governments.
  • Tendering authorities.
  • Experts to provide training.
  • Governments should encourage specialists to take classes on public procurement by offering days-off for training, ensuring an available budget for education and career growth for trained specialists.
    • Organize training for young professionals in cooperation with authorities, financing institutions, chambers of commerce and industry and private companies to ensure knowledge transfer, long-term capacity build-up and to attract young specialists.
  • Establish a mandatory international/European certification scheme for personnel working in the public procurement sector to prove their ability and appropriate training.
  • Financing organizations should support and participate in training programs for local procurement specialists to ensure knowledge transfer to local authorities. 
  • Co-opt specialists from across the EU to consult CEEC countries‘ authorities in different tender practices under the roof of dual education support for the region from the Austrian WKO.
  • Small public investments at country level in the training of the procurement personnel.
  • Establish EU funding programs for training of national procurement officers.
  • Develop specific financing lines (the EU, banks, industry associations) to support training and educational activities at the national and regional levels.
  • European Commission.
  • National governments.
  • European financing institutions (EBRD, EIB, WBIF, etc.).
  • Experts to provide training.
  • Organize university and public administration programs to train procurement personnel. Programs to be financially supported by financing institutions, EU and national government and to be coordinated with procurement authorities.
  • Shortage of specialized training on integrity and work ethics to improve transparency and avoid corruption problems.
  • Develop a guidebook and training course on ethics in public procurement and implement this training along with the procedural training.
  • European Commission.
  • Experts to provide. training.
  • Experts to develop guidebooks.
  • National governments.
  • Tendering authorities. 
  • National authorities to adopt or update existing regulations so as to make it mandatory for procurement officers to take specialized training courses on integrity and work ethics. 
  • European Commission to create a position paper on ethics in procurement to be shared and implemented at European level.
  • Outsourcing tendering to external consultants without knowledge transfer to procurement personnel (e.g. Germany).
  • Promote training and knowledge transfer in outsourced tender procedures with participation of external experts (e. g. engineering consultancy companies).
  • External engineering consulting companies. 
  • National governments
  • Tendering authorities.
  • Implement a knowledge exchange program through which every outsourced contract should involve at least one in-house procurement specialist in all the tendering phases.
  • Personnel in procurement institutions change positions every 4 years which prevents a specialization on procurement (e.g. Germany).
  • Support specialization of procurement personnel and avoid frequent rotation (e.g. Germany).
  • External engineering consulting companies. 
  • National governments.
  • Tendering authorities personnel.
  • Formulate a public policy proposal to support specialization of procurement officers and avoid too frequent rotation.

Weak cooperation between the main stakeholders to improve the system.

ChallengeSolutionsActors Implementation
  • Lack of knowledge exchange between procurement authorities at the European or regional level.
  • Implement knowledge exchange programmes between public authorities of EU and accession countries responsible for procurement (e.g. ASFiNAG, DARS, CNAIR).
  • Enhance the cooperation with chambers of commerce and industry in the region to transit business and expert experience into the public procurement procedures.
  • European Commission.
  • European financing institutions (EBRD, EIB, WBIF, etc.).
  • Austrian WKO.
  • Implement an European knowledge exchange platform that would include relevant stakeholders from the public procurement sector and coordinate periodical meetings on this platform.
    • Offer centralized know-how on state of the art procurement procedures at European level, so that every party concerned can have access to the respective data. 
  • Buyers sometimes stick to a certain technology because of preexisting operating licenses.
  • Conduct „competitive dialogue“ tenders for optimal technological and engineering solutions.
  • Request alternative proposals from the shortlisted bidders to test for available alternative technological solutions.
  • National governments.
  • Public institutions.
  • International financing institutions (EIB, WBIF, etc.).
  • European Commission.
  • Austrian WKO.
  • TEN-T.
  • Procurement bodies.
  • Run pilot projects (private-public sector collaboration) to show the added value of competitive dialogue and to set  industry standards.
  • Weak cooperation between the main stakeholders (e.g. construction companies, authorities, unions, policy-makers, chambers of commerce) to improve the system (e.g. through Social Partnership, public policy debates).
  • Organize periodic roundtable meetings at the national and regional levels with wide stakeholder engagement to discuss the future of procurement for the region.
  • National governments. 
  • Procurement bodies.
  • Political parties.
  • Private sector contractors.
  • Syndicates. 
  • Organize a regional forum for Institutional capacity building in Public Procurement with participation from relevant stakeholders.

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