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KOSOVO

The National Public Procurement Strategy

2015-2020

May 2014

Public Procurement Regulatory Commission

The designation of Kosovo is without prejudice to position on status, and is in line with UNSCR 1244 and the ICJ Opinion on the

Kosovo Declaration of Independence.

Improving Administrative Capacities in the Area of Public Procurement in Kosovo

An EU funded project managed by the European Union Office in Kosovo

National Public Procurement Strategy 2015-2020

Contents

1 EXECUTIVE SUMMARY..........................................................................................4

1.1 Key objectives.......................................................................................................5

1.2 Recommended actions..........................................................................................5

2 Introduction..................................................................................................................7

3 Strategy Development Methodology..........................................................................10

3.1 Information gathering and literature Review......................................................10

3.2 Situation Analysis...............................................................................................10

3.3 Objectives setting and appraisal..........................................................................11

3.4 Consultation with stakeholders...........................................................................11

3.5 Drafting of the NPPS..........................................................................................12

4 Background and rationale...........................................................................................13

4.1 Definition of Public Procurement.......................................................................13

4.2 Background to the National Public Procurement Strategy.................................14

4.2.1 Public Procurement Regulatory Commission (PPRC)................................15

4.2.2 Procurement Review Body (PRB)...............................................................16

4.2.3 Central Procurement Agency (CPA)...........................................................16

4.2.4 The Size of Public Procurement Expenditure..............................................17

4.2.5 Strategic issues to be addressed...................................................................19

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5 Strategy’s vision, mission and objectives...................................................................21

5.1 The NPPS’ vision................................................................................................21

5.2 The NPPS’ mission.............................................................................................21

5.3 The NPPS’ objectives.........................................................................................22

6 Recommended course of action.................................................................................24

6.1 Increase efficiency and transparency of the Public Procurement system...........24

6.2 Initiating processes..............................................................................................25

6.3 Improve access to information............................................................................29

6.4 Foster accountability...........................................................................................32

6.5 Introduce green and socially responsible public procurement............................34

6.6 Support to SMEs in public procurement.............................................................37

6.7 Development of Electronic Procurement............................................................40

6.8 Professional and Human Resource Capacity Development................................42

6.9 Further harmonization of the legal framework for procurement, especially in

view of the new EU Directives...........................................................................45

7 Next steps for implementing the strategy...................................................................46

7.1 Action Plan..........................................................................................................47

8 ANNEX I: International comparisons of public procurement strategies and practice

....................................................................................................................................51

8.1 Aspirations to use public procurement as a lever of government reform...........51

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8.2 Evidence of the use of public procurement as a lever of government reform....53

3


Acronyms

CA Contracting Authority

CPA Central Procurement Agency

EOI Expression of Interest

EU European Union

GDP Gross Domestic Product

HRM Human Resource Management

MIS Management Information System

OECD Organization of Economic Cooperation and Development

PPRC Public Procurement Regulatory Commission

PRB Procurement Review Body

PPP Public Private Partnership

RFP Request for Proposal

RFQ Request for Quotation

TORs Terms of Reference

GPP Green and sustainable public procurement

SRPP Socially responsible public procurement

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1 EXECUTIVE SUMMARY

The government of Kosovo has long realized the importance of the public procurement

function and its role in the socio-economic development of the country; as well as its

contribution to the future accession of the country to the European Union. As a response

to that need, the government, beginning in the mid-2000s, has initiated a number of

procurement reforms in its public procurement system with the aim of making it more

efficient and transparent in line with requisite, basic procurement guidelines and best

practices of the EU.

There is already in Kosovo an elaborate structure of public procurement system for

works, services and goods. The system has resulted from the adoption of the EU

Guidelines on Public procurement, as the evolved over the past decade, which, by and

large, have driven the procurement reforms. The government has moved fast with the

reforms to the extent of putting in place a legislative framework for public procurement

even though there has not been an explicit Public Procurement Strategy to guide the

implementation of the reforms, which have resulted into the current laws and regulations.

Still nowadays public procurement has been associated more with markets and business

in the acquisition of goods and services and the construction of public infrastructure on

the best possible terms. Nevertheless it is widely recognized that it has also broader

social, economic and political implications which can only be appropriately addressed

through a National Public Procurement Strategy. Although the formulation of a public

procurement strategy is considered as a first step in the establishment of an effective

public procurement system, Kosovo has started with the elaboration of the respective

legislation (which may be considered as a derivable procurement policy instrument).This

gap has prompted the initiative of formulating a National Public Procurement Strategy.

This strategy has resulted from a study of how the practice of procurement is

implemented in the country and from relevant experience from other countries. During

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the elaboration of the present document a number of key gaps and priority issues to be

addressed by the strategy were identified by major stakeholders. The issues raised were

discussed, ratified and validated before being studied further so as to draft this strategy.

The gaps and issues were discussed and ratified at special workshops organized by the

Public Procurement Regulatory Commission. The resulting strategy has therefore already

gone through an initial participative process navigated for the purpose of this strategy.

1.1 Key objectives

The key objective of the National Public Procurement Strategy is to

Improve the Public Procurement system through on-going monitoring and

implement the necessary regulatory changes,

Strengthen the public finance approach

Increase transparency and efficiency and, improve the flow of information

Follow current trends (green procurement, socially responsible procurement, e-

procurement, support of SMEs)

Further develop the human capital involved in public procurement

Stay in line with the changing EU directives

1.2 Recommended actions

The proposed recommendations may be grouped in the following major strategic

interventions:

1. Increase efficiency and transparency of the Public Procurement system

2. Initiating processes

3. Improve access to information

4. Foster accountability

5. Introduce green and socially responsible public procurement

6. Support to SMEs in public procurement

7. Development of Electronic Procurement

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8. Professional and Human Resource Capacity Development

9. Further harmonization of the legal framework for procurement, especially in view

of the new EU Directives

The strategy is presented in the following sections:

1. Executive summary

2. Introduction

3. Strategy Development Methodology

4. Background and rationale

5. Strategy’s vision, mission and objectives

6. Recommended course of action

7. Next steps for implementing the strategy

ANNEX I: International comparisons of public procurement strategies and

practice

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2 INTRODUCTION

The government of Kosovo has long realized the importance of the public procurement

function and its role in the socio-economic development of the country; as well as its

contribution to the future accession of the country to the European Union. As a response

to that need, the government, beginning in the mid-2000s, has initiated a number of

procurement reforms in its public procurement system with the aim of making it more

efficient and transparent in line with requisite, basic procurement guidelines and best

practices of the EU.

There is already in Kosovo an elaborate structure of public procurement system for

works, services and goods. The system has resulted from the adoption of the EU

Guidelines on Public procurement, as the evolved over the past decade, which, by and

large, have driven the procurement reforms. The government has moved fast with the

reforms to the extent of putting in place a legislative framework for public procurement

even though there has not been an explicit Public Procurement Strategy to guide the

implementation of the reforms, which have resulted into the current laws and regulations.

According to the SIGMA Priorities for Kosovo, published in May 2013, “The legal

framework for public procurement largely covers the EU acquis, and the overall

institutional set-up provides the elements needed for a functional system”.

However, a number of ongoing key problems still hinder the full exploitation of the legal

framework, the most important of which are:

Lack of expertise in planning and conducting tendering procedures, especially in

small contracting authorities.

General perception by public procurement stakeholders and the wider public that

the system is vulnerable to corrupt practices.

Limited or no use of modern procurement practices like framework agreements

and of central procurement, which would enhance value for money.

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Low level of professionalism of procurement officers, combined with a

significant turnover of them.

The present National Public Procurement Strategy aims to address these problems in

order to achieve significant progress towards their eradication in the next 5 years.

The strategy will be implemented during a period for which the Government of Kosovo

has clearly expressed its political will to

fight corruption,

ensure optimal usage of the public budget on the interest of the public,

foster institutional responsibility and personal accountability in the public sector,

stimulate a healthy business environment, free economical initiative and fair

competition.

Despite the original plan to define the validity period of the NPPS from 2014 to 2019,

and since (a) 2020 is a milestone for the EU Integration Strategy and (b) the NPPS will

probably not be approved by the Kosovo Government before the end of 2014, it was

preferred to set the validity period of the strategy from 2015 to 2020.

For the elaboration and drafting of the National Public Procurement Strategy of Kosovo

for the period 2015-2020 the “ADMINISTRATIVE INSTRUCTION NO. 02/2012 ON

THE PROCEDURES, CRITERIA AND METHODOLOGY FOR THE PREPARATION

AND APPROVAL OF STRATEGY DOCUMENTS AND PLANS FOR THEIR

IMPLEMENTATION” was taken into account.

Thus the main chapters of the present document are:

1 Executive Summary

2 Introduction

3 Strategy Development Methodology

4 Background and rationale

5 Strategy’s vision, mission, goals and objectives

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6 Alternative considerations

7 Recommended course of action

8 Next steps for implementing the strategy

In an ANNEX an international comparisons of public procurement strategies and practice

is presented.

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3 STRATEGY DEVELOPMENT METHODOLOGY

For developing and drafting the NPPS the methodology proposed in Administrative

Instruction No. 02/2012 was followed to the widest extent possible, i.e. the following

phases were implemented:

Information gathering

Analysis

Objective setting

Option development

Option appraisal

Consultation

Drafting

To develop the National Public Procurement Strategy for Kosovo, as a roadmap for

strengthening the public procurement system at the central and local level, the following

methodological steps were implemented:

3.1 Information gathering and literature Review

Literature review included appraisal of:

a) Legal and regulatory regime in Kosovo

b) International best practices

c) Regimes adopted by countries known for effective public procurement systems

d) Assessment frameworks for public procurement and their application

3.2 Situation Analysis

Situation analysis took note of the existing legislation, regulatory regime, systems and

operational practices used by the Contracting Authorities.

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3.3 Objectives setting and appraisal

For objectives setting and appraisal the most important and relevant outcomes of the

project “Improving Administrative Capacities in the Area of Public Procurement in

Kosovo” were used, as well as the reference to public procurement in the “priorities for

Kosovo”, published in May 2013 by SIGMA.

3.4 Consultation with stakeholders

Interviews were organized with CAs, EOs, and NGOs, as well as with chambers of

commerce and the media. On the same time questionnaires were distributed to a wide

spectrum of stakeholders in order to assess their overall perception of the Public

Procurement System in Kosovo.

The consultation with Contracting Authorities focused on:

The role (positive or negative) of the current Public Procurement legislation in the

implementation of smooth public procurement procedures;

The degree of the Contracting Authorities’ preparedness in terms of infrastructure

and human resources;

The degree of preparedness of the 3 Public Procurement Agencies (PPRC, PRB,

CPA) as core stakeholders of the system;

The degree of preparedness of the economic operators to comply with the public

procurement regulations;

The quality of information flow;

The quality and relevance of training of the procurement officers.

The consultation with Economic Operators focused on:

The degree the current legal framework supports companies’ participation in

public procurement procedures;

The ease of access and the quality of public procurement information;

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The clarity of the tendering procedures;

The transparency and fairness of the evaluation;

The transparency and fairness of the Review procedure;

The efficiency of contract implementation;

The need for training in the Public Procurement system.

The outcomes of the above information collection, as well as the main axes of the present

National Public Procurement Strategy were presented and discussed in three workshops

specifically dedicated to the NPPS.

3.5 Drafting of the NPPS

The information, data, proposals and opinion collected were analysed in order to

set the strategy objectives,

develop alternative options, appraise and evaluate the alternative options

prior to drafting the present document.

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4 BACKGROUND AND RATIONALE

4.1 Definition of Public Procurement

Public procurement means an acquisition, whether under formal contract or otherwise, of

works, supplies and services by public bodies using publicly sourced finances. It involves

the purchasing, hiring or obtaining by any contractual means of publicly needed goods,

construction works and services by the public sector. It also includes situations in which

public funds are mobilized to procure works, goods and services even if the government

does not get directly involved.

Then above definition includes the stress field of public procurement:

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4.2 Background to the National Public Procurement Strategy

Public procurement in Kosovo is regulated by the PUBLIC PROCUREMENT LAW,

LAW No. 04\L-042 and the relevant secondary legislation.

Aiming at the harmonization of the public procurement system in Kosovo with the

provisions of the EU acquis and with best international practice, as well as the promotion

of efficiency and effectiveness in the use of public funds, the reform of the public

procurement system in Kosovo has been extensively supported by relevant EU funded

projects, such as

“Support to the Establishment of a Public Procurement Framework”,

“Reform of the Public Procurement System in Kosovo” and

“Improving Administrative Capacities in the Area of Public Procurement in

Kosovo”

Further support has been provided by other donors, such as the World Bank.

Public Procurement Law of Kosovo was amended in 2007 aiming to bring procurement

activities closer to EU provisions, simplifying some of the legal requirements, clarifying

issues and introducing new definitions. Increased flexibility and the establishment of the

independent Procurement Review Body (PRB) were the most significant transformations

introduced. The regulation of Concessions was removed from PPL to prevent confusion

and overlaps with the specific law on Concession Procedures that was approved in 2005.

A significant body of secondary legislation enabling the implementation of the Law has

been prepared, including standard forms for each type of notice, the code of ethics, a

template for reporting contracts signed, model tender dossiers, the complaint form for

Procurement Review Body and instructions on minimal value purchase procedure.

Since September 2011 a new Public Procurement Law, namely Law No. 04\L-042, has

entered into force. This law is fully compliant with the Public Procurement EU Directives

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currently in force. The existing secondary legislation has been largely adapted to the

provisions of this new law.

The central public procurement structure of Kosovo consists of the following three

bodies:

4.2.1 Public Procurement Regulatory Commission (PPRC)

It is operating in the capacity of an independent regulatory agency and is responsible for

the overall development, operation and supervision of the Public Procurement System.

According to the Public Procurement Law, the Commission is responsible for the

preparation and dissemination of secondary legislation, including rules, procurement

manuals, guidelines, standard forms, model contracts and to prepare improvement

recommendations for PPL and the overall public procurement system to the Government

and National Assembly.

Furthermore, it is responsible for

raising awareness among contracting authorities and economic operators for the

public procurement framework,

providing assistance on the implementation and interpretation of the PPL and

secondary legislation,

monitoring the compliance of contracting authorities via manual and electronic

systems and

supporting KIPA (which is responsible for the training and certification of

procurement officers) in the effort to develop and maintain skills and

competences of procurement professionals.

The Commission is also responsible for establishing and maintaining a Public

Procurement Register (for notices, invitations, tender dossiers, reports, complaints and

decisions related to each procurement), for initiating and supporting the development of

e-procurement, for maintaining a website providing access to the Register, to laws,

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secondary legislation and their interpretation, for developing an Information System for

notices publication to cover all Kosovo and for developing and maintaining a list of

contracting authorities.

The PPRC has to systematically collect and analyse information on public procurement

procedures and contracts awarded and to prepare and submit to the National Assembly an

annual report summarizing all relevant activities. Finally, the PPRC has the responsibility

to liaise and cooperate with national and international organizations on all matters related

to public procurement.

The PPRC has started operation in February 2005.

4.2.2 Procurement Review Body (PRB)

It is responsible for carrying out the functions assigned to it by the Public Procurement

Law and the Law on the Procedure for the award on Concessions, regarding the

complaints treatment in relation to these laws.

It is a quasi-judicial body, competent to review administrative decisions issued by central

procurement institutions for the conduct of procurement procedures and to review

appeals from tenderers under the review procedure.

PRB started operating in August 2008.

4.2.3 Central Procurement Agency (CPA)

It functions as an autonomous executive agency with wide responsibilities regarding

central level procurement procedures. The main function of the Agency is central

purchasing. It may decide that any procurement procedure to be conducted by any

contracting authority in Kosovo will be conducted by itself instead of the concerned

contracting authority, for reasons of professional expertise, cost-effectiveness, efficiency

or other legitimate concerns, as formulated in the Public Procurement Law.

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4.2.4 The Size of Public Procurement Expenditure

The importance of public procurement can also be seen in terms of the size of

expenditure relative to national budget and GDP or the magnitude of government

purchases. In Kosovo public procurement of goods, services and works is over 15% of

GDP or about 50% of Kosovo’s budget for 20121, the second largest expenditure after

wages and salaries.

According to Annual Audit Report for 2012, the total spending for public procurement

amounted to almost 170.000.000 €, sowing an increase of approximately 8% against

2011 (2011: 157.000.000 €, 2010: 163.000.000 €).

These figures indicate that public procurement is vital in the economy of the country and

therefore this very important public expenditure needs to be guided by a set of public

principles, values, best practices, laws, regulations and procedures that are driven from a

National Public Procurement Strategy.

The next diagram depicts the general government procurement as share of total general

government expenditures (2007 and 2011) for the OECD countries.2

1 Annual Audit Report 2012, page 30

2 Government at a Glance 2013: Procurement Data, OECD Meeting of Leading Practitioners on Public Procurement, 11-12 February 2013, Paris, OECD Conference Centre

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The significance of public procurement for the economy of Kosovo is similarly

documented also by the next diagram, presenting the general government procurement as

a percentage of GDP (2007 and 2011) for the OECD countries.3

3 Government at a Glance 2013: Procurement Data, OECD Meeting of Leading Practitioners on Public Procurement, 11-12 February 2013, Paris, OECD Conference Centre

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For both diagrams above data was not available for Australia and Chile. Data for Canada,

Japan, Korea, Mexico, New Zealand and Turkey refers to 2010

4.2.5 Strategic issues to be addressed

Public procurement is still handled in Kosovo as an administrative function and it is not

recognised as a specific profession. On the other hand and in line with the current trend to

pursue socio-economic and environmental goals through public procurment, procurement

officials are expected to comply with increasingly complex rules. The lack of adequate

capability, but also of specialised knowledge of available technologies, innovations or

market developments will become increasingly important, since procurement officials

will have not only to pursue value for money, but also take into account strategic

considerations.

An emerging challenge on the governmental level is to develop a strategy/policy at the

central level to support SMEs in public procurement, always respecting the basic

principles of transparency and equal treatment and the legal framework.

The following SWOT diagram summarizes the current situation of the public

procurement system in Kosovo, based on the information, data and opinions collected

during the information gathering and consultation phases:

Strengths

Presence of a good legal framework Availability of qualified human

resources Presence of Capacity development

initiatives Existing guidelines for training of public

procurement staff Some good practice in supplier

management Understanding of need for compliance

with EU directives

Weaknesses

Limited number of qualified human resources

High rate of staff turn over Missing expertise in some area Lack of knowledge to new technological

and procedural advances Few resources available to develop and

enhance procurement procedures Very limited exploitation of IT in the

entire public procurement process, including e-procurement

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Opportunities

Presence of strong political will High demand for training Access to funding from international

donors High and expanding use of internet Adaptation to new EU guidelines in the

near future

Threats

Cuts in human resources development funding may reduce resources available to support procurement activity

Economic downturn may threaten viability of local suppliers

After the promulgation of the PPL in 2011, Kosovo has a fairly modern public

procurement legislative framework, which is in line with the EU Directives 17 and 18 /

2004. Although the EU Directives have been changed (Directives 24 and 25 /2014) and

an on-going need to improve the PP system exists, an update of the PPL seems not

imminent.

The NPPS should rather focus on the full implementation of the existing legislation and

the consistent monitoring of this implementation.

Other strategic issues, which need to be addressed in the next period are:

the professionalization of the public procurement officers,

the introduction of public procurement management procedures

better flow of communication between all public procurement stakeholders

the introduction of socio-economic and environmental objectives, in the

framework of green and socially responsible public procurement policy

the exploitation of e-procurement

the support to SMEs in public procurement

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5 STRATEGY’S VISION, MISSION AND OBJECTIVES

5.1 The NPPS’ vision

The vision of the National Public Procurement Strategy of Kosovo can be summarised as:

The NPPS strives to create a well-functioning, competitive, accountable and transparent

procurement system that engenders and secures the confidence of the citizens of Kosovo,

and the national and the international community in the procurement function.

All civil servants who are engaged in specifying, sourcing and procuring goods, works or

services will manage contracts, develop constructive supplier relationships and operate

effective buying processes. Kosovo intends to achieve best value for money in the

acquisition of all goods, works or services, where „Best Value‟ is defined as suitable

quality, delivery timescales, level of risk and response to the contracting authorities’

needs at best price. Whole life cycle costs will be taken into account when determining

best price.

5.2 The NPPS’ mission

The mission of the National Public Procurement Strategy of Kosovo can be summarised

as:

The NPPS strives to foster adherence to the procurement principles of

transparency,

accountability,

fair competition,

fair treatment, and

value for money

by improving capacity of the procurement system by:

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enhanced monitoring of the implementation of the public procurement legal

framework,

human resources development, training and education,

introducing public procurement management procedures

better flow of communication between all public procurement stakeholders

introducing socio-economic and environmental objectives, in the framework of

green and socially responsible public procurement policy

exploiting e-procurement

providing procurement opportunities for SMEs

5.3 The NPPS’ objectives

The overall objective of NPPS is to:

Further improve the integrated public procurement system of Kosovo introducing a

public finance management approach, in order for public procurement to serve the

sustainable economic growth of Kosovo and the improvement of the living standard.

Partial objectives of NPPS are:


• Efficiency and transparency in the evolution of both rule-making and rule-

application

• Full respect of competition

• Protection of economic operators in their fundamental rights

• Monitoring of the regulations and practices and handle the weak points


• PIP (Public Investment Program) system,

• Centralised procurement,

• Internal rules within the contracting authorities

• Guidance to contracting authorities

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• Clarification of roles and responsibilities within the contracting authorities (role of

the procurement officer, evaluation committee, contract implementation etc.)

3. Improve skills and access to information (including e-procurement system, PP related

trainings on all levels of civil servants involved in public finance)

• Reduction of irregularities in the public procurement system;

• Creation of a positive attitude towards procurement methods

• Dissemination of good practices

• Specific trainings based on needs

4. Further harmonization with EU directives and other EU acts

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6 RECOMMENDED COURSE OF ACTION

6.1 Increase efficiency and transparency of the Public

Procurement system

Strategy Issue

The efficiency and transparency of the Public Procurement System can only be increased

if both rule-making and rule-application are implemented in an efficient and transparent

way.

Monitoring of the application of PPL is the strongest tool towards this strategic goal.

Performed by an independent state institution it can result to documented results on weak

points of the system and lead to useful suggestions and generalizations, taking into

account the specifics of each problem recognized.

Complementary to monitoring is the collection, organization and dissemination of

information and data resulting from the monitoring process.

Strategy Objective

PPRC should increase monitoring of procurement activities with the aim of eliminating

errors and increasing the quality of work of the contracting authorities. The monitoring

activity aims to identify strengths and weaknesses in the implementation of the public

procurement legal system, thus opening the discussion for necessary enhancements and

corrective actions (e.g. issue admin instructions or explanatory notes, modify the

secondary legislation of PPL or even initiate the process for the amendment of PPL itself,

according to the extend, severity and nature of the identified problems).

Information and data collected and produced during the monitoring activity should be

published, in a form allowing ease of access, logical grouping and direct use by the

interested parties.

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Strategy Statements

To achieve this objective, the government shall:

a) enhance the monitoring activities of PPRC and the usability of the collected

information and data,

b) promote the direct communication and open exchange of information between the

systemic public procurement authorities – mainly PPRC – and the Contracting

Authorities in order to collect and exchange experience and understand everyday

problems,

c) support PRB to find and document problematic points of the legal framework and

PPRC to pinpoint problems in public procurement and contract implementation

procedures,

d) create a catalogue of all important problems, which affect the entire or an

important part of the public procurement system and initiate immediate of mid-

term corrective actions,

e) further develop the regulations concerning publication of PP relevant documents

(procurement plans, contract notices, contracts, etc.) as well as all documents

related to complains until the resolution of the issue e.g. by a PRB decision

f) introduce an obligatory retention of documents related to the entire project life-

cycle for 5 years after the completion of any project,

g) develop and implement a website, open to the public, where everybody can report

anonymously any case of corruption or misuse of public funds and set up

procedures how to further investigate these cases.

6.2 Initiating processes

Strategy Issue

Public Investment Programs originate from the four- to six-year development plans of the

1970s, which were used to define and implement a country’s medium-term economic and

social objectives. However, these plans were often unrealistic, and proved insufficiently

26


flexible to take into account changes in the economic environment. Consequently, in the

1980s many developing countries moved to rolling public investment plans, usually

named Public Investment Programs (PIP).

A good PIP is aimed at ensuring five different (although interrelated) functions:

• improving economic management, to ensure that macroeconomic sector strategies

are translated into programs and projects;

• improving state budget coordination and channeling funds to priority areas;

• assisting public financial management, by balancing (partial) commitments and

resources over a multi-year framework; and

• strengthening the project cycle by providing a framework within which project

preparation, implementation, and monitoring can occur.

To that extent a PIP can form the basis for a sound public procurement plan, allowing for

timely implementation of all procurement procedures.

A PIP can also be the initiating event for the full exploitation of the central procurement

possibilities defined in the PPL, as another step towards the strategic objective of

efficient and transparent Public Procurement (analysed above).

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Beyond the initiation of processes on the central state level, the procedural arsenal of the

Contracting Authorities should also be strengthened and expanded. It has too often been

mentioned that internal rules and regulations within the contracting authorities should be

developed, addressing mainly the allocation of responsibilities in the procurement

process (role of the procurement officer, evaluation committee, contract implementation

team, etc.)

Strategy Objective

The government of Kosovo should initiate the formulation and implementation of a PIP

in order:

• To form an action plan for development targets achievement, clarifying goals and

directions of the nation / economic sector. In order to ensure the achievement of the

development goals within the target period, strategic plans with the viewpoint of

PIP should be elaborated by each Ministry / region.

• To realize outcome-based PIP management, by setting clear objectives and

expected development effects, defining also the role and the contribution of the

involved authorities toward the achievement of development goals.

• To monitor the achievement of PIP, by linking its intermediate indicators with the

performance and effects of the PIP.

• To ensure accountability of the development plan achievement to the society. As

the responsibility of the nation, it is important to provide intermediate progress of

development target achievement to the society. The PIP acts as a tool to display the

status quo of progress toward the society.

• To plan all (important) procurement procedures necessary for the achievement of

the development goals, either on central or on regional / authority level.

The elaboration and implementation of PIP becomes even more important since it is

widely recognized that the central procurement procedures defined in the PPL are still not

used in Kosovo, despite the operation of the Central Procurement Agency. Overcoming

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partial inefficiencies of the foreseen procedures, central procurement should be fostered,

since it is expected to have immediate positive effects (budget savings due to lower

prices, better quality of tender documents due to the experience of the CPA officials, fast

acquisition of procurement experience due to the character of centralized procurement –

large quantities, long term contracts, wide geographical coverage, etc.)

The role of the Contracting Authorities during the entire life-cycle of a public sector

project, from conceptualization to procurement, contracting and project close-out is

central and extremely important. While the procurement process per se is somehow

assigned to the Procurement Officers, the authority and responsibility allocation among

the officials of the authority for the remaining phases often causes confusion and

conflicts. For the smooth operation of the public procurement system it is imperative that

the Contracting Authorities are guided and supported to elaborate and implement clear

internal processes for the entire project life-cycle.

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Strategy Statements

To achieve these objectives, the government shall:

a) Initiate the implementation of a PIP (Public Investment Program) system,

b) Extend the implementation of Centralised Procurement, resolving any procedural

inefficiencies.

c) Guide and support the Contracting Authorities to establish internal rules and

procedures, towards a clear separation of roles and responsibilities for the entire

public project life-cycle.

6.3 Improve access to information

Strategy Issue

Effective communication and access to public procurement information with all

stakeholders involved is one of the fundamental prerequisites for the success of the entire

system. To this extent it is important to determine the information to be disseminated, the

medium and form most suitable for information dissemination and the recipients of the

information. The following indicative questions may be used to guide this process:

Who needs what information?

When do they need the information?

Who delivers the information?

How should the information be delivered?

Strategy Objective

Since the effectiveness of access to information and information exchange is as important

as the information itself, it is crucial to determine which method is most effective for

each stakeholder. In this framework the advantages and disadvantages of each method

should be assessed, as well as the stakeholders that can be reached through each method,

and the ability to obtain feedback through each method.

30


For example:

Meeting is a two-way communication format, because it provides for information

exchange and feedback. It is best suited for specific issues, such as areas of

concern in the public procurement system or critical issues.

The main advantage of meetings is the ability to reach a large number of

stakeholders with focused and targeted messages. The main disadvantages of

meetings are that they can be time-consuming, travel might be required, and they

can sometimes be difficult to schedule for maximum attendance.

Electronic communications include e-mail, online portals, and digital dashboards.

It is best suited for broad content, non-controversial announcements, instructions,

and updates to a focused group of stakeholders. The main advantage is that it is an

inexpensive and a quick communication method. The main disadvantage is that it

is mostly used as an one-way communication channel, although technically a two-

way exchange of information is possible.

Multimedia communications include presentations, demonstrations, and training

sessions. The ability to obtain feedback is limited. It is best suited for specific,

targeted messages, focused intervention, and critical issues. The main advantages

are that it is a mass distribution method and that it has the ability to reach a large

number of external stakeholders. The main disadvantage is the necessary, tedious

preparation if the outcome is to be satisfactory.

The following matrix summerizes the need for access to information and information

exchange of the main stakeholders of the public procurement system:

Stakeholder Information needsProcurement officers Best practices, interesting

examplesAnswers to specific questionsChanges / updates of the legal framework

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Stakeholder Information needsPublic officials involved in the public procurement process

PPRC, PRB, CPA staff Points of concern in the legal frameworkChanges in the EU legal frameworkAnswers to specific questionsProposed changes to the legal framework

Judges Proposed changes to the legal frameworkCourt decisionsEU court decisions

Auditors Points of concern in the legal frameworkAudit findings

Public officials, who are NOT procurement officers and are not directly involved in public procurement

Managers of contracting authorities

Changes / updates of the legal framework

Contracting authorities staff involved in supplementary activities to public procurement and contract implementation

Changes / updates of the legal frameworkBest practices, interesting examplesAnswers to specific questions

Economic operators Best practices, interesting examplesAnswers to specific questionsChanges / updates of the legal framework

Wider public Best practices, interesting examplesNew features and changes in the legislation

Strategy Statements


a) Foster a better flow of communication between all public procurement

stakeholders

o communication within the CAs with different units,

o communication of PPRC-CPA-PRB with each other,

o communication with the public – transparency)

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b) Promote regular round tables and discussions with the stakeholders organised by

PPRC (on the latest interpretation / updates of the legal framework, the most

common problems and proposed solutions, etc.)

c) Introduce regular communication to the media and the wider public including

EOs and the citizens.

d) Develop the PRB website, in order to include more information on contracts

awarded and cancelled and facilitate criteria and key-words based search among

PRB decisions

e) Develop the PPRC website, to include official interpretations of the legal

framework, adding a search function and sections with FAQ

f) Develop the CPA website to include more information for CAs and Eos on

centralized procurement procedures and framework agreements

6.4 Foster accountability

Strategy Issue

A UNDP case study, produced by the Procurement Capacity Development Centre

(PCDC), which is part of the UNDP Capacity Development Group underlines in its

preamble:

“Accountability constitutes a central pillar of any public procurement system. Without

transparent and accountable systems enabling governments and citizens to engage in a

mutually responsive way, the vast resources channeled through public procurement

systems run the danger of increased corruption and misuse of funds. Even in a system

with low levels of corruption, public and civic oversight can help identify inefficiencies,

thereby increasing procurement efficiency and effectiveness for the benefit of improved

service delivery and ultimately citizens.”

Mechanisms of public procurement accountability can be initiated and supported by the

state, citizens, or both. The key is enduring and effective engagement. Tools include:

33


participatory budgeting, public expenditure tracking, citizen monitoring and evaluation of

public service delivery.

Accountability helps:

Minimize risks of loss in procurement system

Build confidence in institutions

Protect procurement officials from possible misconduct

Attract larger pool of bidders

Strategy Objective

Accountability in Public Procurement is strongly interrelated with budget design &

implementation, since it:

puts greater performance focus in the Budget, providing actual cost data for

budget formulation

strengthens internal control & audit by setting procurement as a key element

of internal control and internal audit systems

improves the management of public assets, focusing on accountability of total

costs, including maintenance and depreciation

involves procurement issues in budget design, integrating capital and recurrent

budget preparation and execution

fosters fiscal transparency, since transparency of procurement transactions,

may improve overall fiscal performance and counter corruption

There are already signs in some countries that public procurement as a technical and

peripheral function is being put aside and integrated into the overall public expenditure

management process. The term “procurement” is no longer used and procurement

officers are called “financial management officers”. By including in each stage of the

procurement process, apart from procurement officers also financial experts. By doing so,

34


officers in charge of demand planning are better able to prepare a more practical and

feasible plan for the logistics and procurement stages later on

Strategy Statements


a) Enhance the procurement planning process, directly connecting it to budget

planning

b) Improve internal regulations in the Contracting Authorities, putting emphasis on

roles and responsibilities of different units / civil servants and on all level of the

civil service hierarchy (ministers, mayors, managers, etc.)

c) Introduce public procurement management procedures

o Introduction to corporate procurement planning

o Specifying procurement objectives for the organisation

o Measuring the achievement of procurement objectives

o Collection of information and use of the supply positioning tool

6.5 Introduce green and socially responsible public procurement

Strategy Issue

The integration of other policy considerations into public procurement policy and

practice refers to

promoting environmental aspects (green and sustainable public procurement) and

adhering to certain social and ethical standards (socially responsible public

procurement)

Successful implementation of Green Procurement requires the identification and

implementation of environmental performance opportunities at both the strategic and

operational levels, taking into consideration specific buying patterns, sustainable

development targets and other government priorities.

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Since public procurement as such has a direct impact on the national economy and can

influence both the price and the availability of goods and services, including construction

services, in the marketplace, the government is in a position to influence the demand for

environmentally preferable goods and services and the ability of industry to respond to

the escalating use of environmental standards, through the increased promotion of

environmental sustainability, and by integrating the application of environmental

performance considerations in its procurement process.

As part of an ongoing commitment to improve the environment and the quality of life,

green public procurement seeks to reduce the environmental impacts of government

operations and promote environmental stewardship by integrating environmental

performance considerations in the procurement process.

Green procurement is set within the context of achieving value for money. It requires the

integration of environmental performance considerations into the procurement process

including planning, acquisition, use and disposal. In this context, value for money

includes the consideration of many factors such as cost, performance, availability, quality

and environmental performance. Green procurement also requires an understanding of

the environmental aspects and potential impacts and costs, associated with the life cycle

assessment of goods and services being acquired. In addition, the supporting

administrative processes and procurement methods can also offer opportunities to reduce

the environmental impacts of government operations.

Socially responsible public procurement is about contracting authorities taking into

consideration the societal impacts of their purchases in a broader sense than merely

looking at the purchasing price or the price-quality relationship. The guiding influence of

public procurement, which is of key importance in society, is associated with corporate

social responsibility. By promoting socially responsible public purchases, the authorities

can provide economic operators with genuine incentives to develop corporate social

responsibility in their activities.

36


A Resolution of the Finish Government of 22 November 2012 stipulates:

”Socially responsible procurement aims to set contract conditions that encourage

suppliers to ensure that during the contract period goods and services have been produced

in conditions where human rights and core labour standards are respected. In effect,

suppliers must comply with international human rights conventions, such as the ILO

conventions, the UN Convention on the Rights of the Child, legislation on minimum

wages and working hours in the production country, and general environmental, health

and safety requirements.”

Strategy Objective

The general objectives regarding Green Public Procurement are to:

increase the level of Green Public Procurement at the national level and

to stimulate the market by creating demand for products that meet high

environmental standards, and innovative environmental technologies by the

public sector

by reaching out to contracting authorities with information on the possible use GPP.

Specific objectives are:

increase awareness of the GPP;

increase in the percentage of procurements taking into account environmental

aspects;

increase the number of economic operators holding a verified environmental

management system and /or producing ecologically certified products

As far as socially responsible public procurement is concerned, the main objective is to

disseminate the strategic perspective of public procurement building on awareness and

knowledge.

Specific objectives are to:

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encourage contracting authorities and social economy operators to cooperate not

only in contracts, but mainly by partnerships,

initiate a consultation process during the preparation of procurement activities,

using “bottom-up” meetings, focus groups at local and regional level and

professional expert panels;

spread the idea of socially responsible public procurement by open access to

information about calls, tenders and contracts;

Strategy Statements


a) initiate and stimulate of debate regarding GPP and SRPP in the ountry;

b) exchange of good practice between contracting authorities by establishing a

platform for exchange of experiences, information and knowledge on the

arrangements for GPP and SRPP

c) elaborate concrete advise, criteria and indicators to be used in public tendering in

view of promoting GPP and SRPP

d) foster public procurement planning, in order to timely integrate GPP and SRPP

criteria in to the procurement process

6.6 Support to SMEs in public procurement

Strategy Issue

The manner in which procurement in the public sector is developing and changing

rapidly is impressive. There is no doubt that the level of understanding of key issues, and

the number and skill of professional staff is steadily increasing over the years, driven by

the requirement of the public sector to obtain better value from suppliers.

In this environment it is becoming increasingly difficult for small and medium-sized

enterprises (SMEs) that sell or wish to sell goods or services to the public sector to

prevail. Although there is a recognition of the benefits SMEs can bring to the national

38


economy, the trend towards high budget tender procedures and collaborative

relationships among the bidders does not in general work in favour of SMEs.

SMEs and indeed larger suppliers find bidding for public sector contracts an expensive

and long-winded process, but much of this is inevitable given the legal framework (based

on the EU regulations). E-procurement may help but is some way from a “solution”,

although it can open new opportunities for innovative and forward-thinking SMEs, while

probably causing problems for the less progressive. E-procurement are also potentially

another driver towards greater aggregation, larger contracts, larger suppliers, and the dis-

intermediation of “middlemen” in the supply chain.

In conclusion, current trends to larger contracts, aggregation of spend, and longer

relationships with contractors and “partners” all make life more difficult for SMEs trying

to sell to the public sector. The outlook for SMEs that do not offer any real differentiation

(innovation, service, quality, specialist skills) compared to their larger competitors is not

good. But there are some initiatives that can help to ensure that SMEs who do offer these

advantages can prosper as suppliers to the public sector. And it is these excelling SMEs

who will grow, generating jobs, economic growth and success, while providing their

public sector customers with excellent value and performance.

Strategy Objective

Procurement in the public sector is increasingly sophisticated and thus care must be taken

in this process to ensure that the rules set out in the legal framework are not challenged.

Although procurement performance in the public sector of Kosovo is improving, steps

should be taken towards a better co-operation and co-ordination between the different

major stakeholders and contracting authorities, in particular towards facilitating the

participation of SMEs.

“Levelling the playing field” will help to ensure SMEs do not suffer unnecessary

disadvantages over their larger competitors. Access to information is vital and the wide

39


use of the internet should be encouraged. Guidance needs to be communicated to the

economic operators, not just the Procurement Officers.

“Educating SMEs” covers a range of recommendations to improve the ability of that

sector to bid for and win public sector contracts. Focused guidance should be developed

for SMEs to cover a detailed approach to bidding, and seminars or road shows used to get

the messages out. A help-desk for SMEs would be very useful to potential suppliers.

But it is counter-productive to encourage SMEs to bid for more contracts unless they

understand their own strengths and know where they are likely to stand a chance of

winning business. In many cases, it will be better to educate them in terms of acting as 2nd

tier suppliers and working with prime contractors.

“Educating Contracting Authorities” is also a key element, given the increasingly

sophisticated public sector procurement system. Most important is that they understand

the big picture of procurement strategy; how to analyse markets and understand supplier

strengths, when to consider SMEs and what benefits they can offer and how to use

frameworks or consortia properly.

The strategic issues around SMEs should be included within the syllabus for the training

of Procurement Officers.

Strategy Statements


a) Facilitate access to public procurement information, exploiting the wide use of the

internet

b) Communicate guidance to the economic operators, while focused guidance should

be developed for SMEs

c) Set-up a help-desk for SMEs

d) Educate Contracting Authorities in market analysis, and evaluation of supplier

strengths, with special focus on SMEs

40


e) Include the strategic issues around SMEs within the syllabus for the training of

Procurement Officers.

6.7 Development of Electronic Procurement

Strategy Issue

Electronic procurement is a procurement system that utilizes the possibilities created by

information and communication technology to increase procurement processing

efficiency. Public procurement is potentially and practically an information-intensive

function. It has to be supported by information and communication technology and a

reliable database. An electronic procurement system can offer a number of advantages

over a normal paper work based system of procurement. The main advantages are easy

and cost effective access to procurement information. Electronic procurement is an

innovation to uphold information and communication technology in Kosovo country and

increase public procurement efficiency and effectiveness.

Strategy Objective

To develop and promote a wide use of electronic public procurement through a well

developed information and communication technology system.

Strategy Statements

To achieve the above objective the government in collaboration with other partners shall:

a) Promote a public procurement system supported by electronic information

technology.

b) Train and encourage procurement professionals to revert more to e-procurement

options and gradually moving away from manual procurement processing.

c) Encourage procurement professionals to make use of the e-procurement facility as

much as possible in the search of suppliers as well as record keeping and retrieval.

41


d) The current paper work volumes at the various government levels should

gradually be stored electronically in national and local data bases for easy

retrieval and utilization where a need arises.

e) Embark on training programs to build the capacity of its procurement officers and

operational staff to cope up with e-procurement demands.

International experience suggests that technological innovations such as e-procurements

and electronic reverse auctions can enhance the efficiency of procurement, eliminate bid

rigging, strengthen transparency and achieve value for money. The digitalization of

procurement processes eliminates the direct interface between procurement officials and

bidders and thereby significantly reduces the chances of bribery and corruption.

PPRC may establish an e-procurement portal which shall allow:

a) registration and pre-qualification of contractors,

b) downloading of bid documents and release of bid announcements,

c) competitive as well as alternate procedures,

d) receiving bidders’ clarifications and managing all communication and information

on line,

e) shortlisting, bid evaluation and bid comparisons,

f) online negotiations,

g) electronic auctions and reverse auctions,

h) collection, storage and systemizing information and statistics on the procurement

process

i) electronic aggregation of needs of public bodies at a central level;

j) developing a register of suppliers,

k) central electronic catalogue with information on products and services from the

registered suppliers

l) ‘exception reports’ and alerts wherever there are significant deviations from

certain benchmarks and norms,

m) comparisons of expenditures on procurement items

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n) spend analysis

o) contract management options that allow monitoring of contracts concluded;

p) e-invoicing and e-payments etc.

Initially, e-procurement shall be mandatory for procurement contracts above a certain

threshold to be decided by PPRC. Subsequently, it may be made mandatory for lower

threshold contracts.

A pre-requisite for e-procurement readiness is capacity building of procurement staff in

e-Procurement. Training plans shall, therefore, incorporate trainings in e-procurement.

PPRC would also have to launch a strong awareness campaign among stakeholders to

explain the efficiency benefits of e-procurement.

6.8 Professional and Human Resource Capacity Development

Strategy Issue

Development of adequate human resources and procurement professional practice are

essential strategic actions if the public procurement sector is to meet the demands of

national development goals and the needs for its growth and market competitiveness. As

the Public Procurement System is now established, all stakeholders have become aware

of the importance of the human resource for more professional public procurement

services. According to relevant annual reports, it is not so much the number of qualified

(certified) Public Procurement Officers that presents a problem, but their ability to

practically implement the knowledge acquired.

It is important for the Contracting Authorities to design and draft clear and succinct terms

of reference; it is also equally important that the suppliers come up with well-developed

and informed proposals. It is thus important and critical that the proposed and endorsed

training strategy, which encompasses all the dimensions, facets of procurement and all

the stakeholders- regulators, Contracting Authorities and suppliers / potential contractors

be implemented.

43


Strategy Objective

To train and develop a professional procurement cadre and an equipped capacity in the

public procurement sector to cope up with a growing procurement market and its

expected role in the national economic development.

Strategy Statements


a) Offer on-going demand driven training.

b) Continue and foster the efforts to develop a public procurement professional cadre

in the country through concerted staff training and certification.

c) Ensure the transformation of Public Procurement professional work force

enabling it to move from its current routine tactical practice to strategic

procurement practices, and to promote sustainable public procurement

professional responsibility and advancement.

d) Ensure the development of a specialized procurement cadre within the civil

service career system in the country.

e) Ensure that relevant training institutions are urged to develop public procurement,

according to the National Public Procurement Training Strategy, by developing

demand driven training curricula targeting specific procurement functions.

f) Establish and manage a sustainable financial scheme for public procurement

career development.

g) Establish a Procurement officers network.

Training programs’ design may be based on a skills gap inventory to match the needs of

the system. The waiting time to get into a course (for public or private sector participants)

shall be reasonable. A system may be put in place which allows for tracking and

recording an individual’s continuing professional development.

44


For the design of course content and the curriculum, PPRC shall consider collaboration

with KIPA and partnering with higher education institutions and specialized training

institutions for developing training modules which cover full range of courses that are

required for building procurement skills of Procurement Officers.

The Government may encourage training in public procurement as part of the public

sector training and education policy. It may also encourage and advise the institutions of

higher learning especially the Engineering Universities to develop public procurement

demand driven training curricula targeting specific procurement functions.

The concept of e-learning may also be considered as it allows an opportunity to improve

skills and professional credentials through on-line accessible training. Besides, e-learning

can be easily updated (if designed appropriately) as the system matures and develops.

Certification is mandatory for those officials who undertake the function of Procurement

Officer. The design and development of hierarchy of certifications (basic, advanced)

requires special attention, especially since it is recurring every 3 years.

As part of its obligation to enhance the capacity of bidders to submit responsive bids,

PPRC may take the initiative of training the potential bidders in the important provisions

of the Public Procurement legal framework. In addition, training and informative courses

may be developed for other stakeholders such as Auditors, investigators (of anti-

corruption bodies), civil society, media etc.

45


6.9 Further harmonization of the legal framework for

procurement, especially in view of the new EU Directives

Strategy Issue

Kosovo has already put in force a Public Procurement Law, which fully complies with

EU Directive 2004/18/EC covering the procurement procedures of public bodies and EU

Directive 2004/17/EC covering the procurement procedures of entities operating in the

utilities sector. Since December 2011 the European Commission has proposed the

revision of the above Directives, which revision was voted by the European Parliament

on 15 January 2014 and adopted by the Council on 11 February 2014. Continuing on its

path towards EU accession Kosovo should adapt its Public Procurement legislation to the

new Directives 2014/24/EU (replacing directive 2004/18/EC), 2014/25/EU (replacing

directive 2004/17/EC) and the new directive on concession contracts 2014/23/EU.

Strategy Objectives

a) To ensure continuous compliance with the legal framework of the EU.

b) To fully exploit the experience and best practices of the EU member states in the

area of public procurement.

Strategy Statements

To achieve the above objectives, the Government shall:

a) Initiate the discussion of the revision of the PPL.

b) Elaborate, under the guidance and management of PPRC, a thorough comparison

between the existing PPL and the requirements of the new EU Directives.

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7 NEXT STEPS FOR IMPLEMENTING THE STRATEGY

The National Public Procurement Strategy for Kosovo elaborated above comprises of the

following strategic issues:



3. Improve access to information

4. Foster accountability

5. Introduce green and socially responsible public procurement

6. Support to SMEs in public procurement

7. Development of Electronic Procurement

8. Professional and Human Resource Capacity Development

9. Further harmonization of the legal framework for procurement, especially in view

of the new EU Directives

The following tables present a comprehensive action plan for the implementation of the

above issues and the concrete actions serving the achievement of the strategy objectives.

47


7.1 Action Plan

Actions S/M/L4 Time Frame5

Implementing Agency

• Increase efficiency and transparency of the Public Procurement system– Organize regular “meetings” on quarterly basis

collecting the experiences with the participation of – CAs and economic operators to present the

problems they face in their daily work– PPRC to recognize problems in the PP procedures

and contract implementation– PRB to realize the problematic points of the

review procedure

S 1st Semester 2015

PPRC, PRB, Kosovo Chamber

of Commerce

– Elaborate a list of issues in the PP system to be amended and take the corrective measures (issuing admin instructions or explanatory notes, modifying the secondary legislation, etc.)

S 2nd

Semester 2015

PPRC, Kosovo Chamber of Commerce

– Monitor the efficiency by analyzing the market prices and the prices of the public contracts and framework agreements and keep the unit price catalogue updated.

S 2nd

Semester 2015

CPA

– Extend the centralized procedures and use of framework contracts if proven to be more efficient.

M In 2016 CPA

– Publish Contract notices and in case of complain, of all documents related to the complaint up to the PRB decision

S 1st Semester 2015

PRB

– Create a website where everybody can report anonymously an instance of corruption or misuse of public funds and set up a procedure how to investigate these cases (can also be a strong PR tool)

L In 2018 PPRC

– Publish all PP related documents (CN, procurement plans, contracts, etc) after further development of the regulations concerning publication of these documents

S 2nd

Semester 2015

PRB

– Keep the documents for 5 years after the completion of the projects

M In 2016 PPRC

• Initiating processes – Introduce a PIP (Public Investment Program) system, M In 2016 PPRC– Enhance centralized procurement M In 2016 CPA– Elaborate and implement internal rules within the

contracting authoritiesS 2nd

Semester 2015

PPRC

– Offer guidance to contracting authorities, especially in the separation of responsibilities

S 1st Semester 2015

PPRC

– Clarify the roles and responsibilities within the contracting authorities (role of the procurement officer, evaluation committee, contract implementation etc.)

S 1st

Semester 2015

PPRC

• Improve access to information

4 S/M/L= Short, Medium or Long term, Short = Year 1, Medium = Year 2-4, Long = After Year 4

5 Time frame has been kept flexible and in a broad range keeping.

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Actions S/M/L Time Frame

Implementing Agency

– Develop the PRB website – Allow search within the PRB decisions based on

key words– Ensure that the same decision is issued for the

same problem– Publish more information on the contracts

awarded and cancelled

S 1st Semester 2015

PRB

– Develop the PPRC website, with search functionality in FAQ / interpretations

S 1st Semester 2015

PPRC

– Establish a Public Procurement Expert Group to support the economic operators

S 1st Semester 2015


– Develop the CPA website, with more info for EOs and CAs about framework agreements

S 1st Semester 2015

CPA

– Ensure harmonised communication between the 3 main PP institutions (CPA, PPRC, CPA) and regular communication to the media and the public including EOs and CAs and citizens.

S 1st Semester 2015

PPRC, PRB, CPA

– Organize regular round tables and discussions with the stakeholders under the responsibility and guidance of PPRC (i.e discussion on the latest interpretations, most common problems and proposed solutions)

M In 2016 PPRC, Kosovo Chamber of Commerce

• Foster accountability– Clarify the responsibility of “managers”, ministers,

mayors etc.S 1st Semester

2015PPRC

– Plan most of the projects simultaneously with the elaboration of the budget

L In 2018 PPRC

• Introduce green (GPP) and socially responsible public procurement (SRPP)– initiate and stimulate of debate regarding GPP and

SRPP in the country;M In 2016 PPRC

– exchange of good practice between contracting authorities by establishing a platform for exchange of experiences, information and knowledge on the arrangements for GPP and SRPP

M In 2016 PPRC

– elaborate concrete advise, criteria and indicators to be used in public tendering in view of promoting GPP and SRPP

M In 2016 PPRC

– foster public procurement planning, in order to timely integrate GPP and SRPP criteria in to the procurement process

M In 2016 PPRC

• Support to SMEs in public procurement– Facilitate access to public procurement information,

exploiting the wide use of the internetM In 2016 PPRC, Kosovo

Chamber of Commerce

– Communicate guidance to the economic operators, while focused guidance should be developed for SMEs

M In 2016 PPRC, Kosovo Chamber of Commerce

49


Actions S/M/L Time Frame

Implementing Agency

– Set-up a help-desk for SMEs M In 2016 PPRC, Kosovo Chamber of Commerce

– Educate Contracting Authorities in market analysis, and evaluation of supplier strengths, with special focus on SMEs

M In 2016 PPRC

– Include the strategic issues around SMEs within the syllabus for the training of Procurement Officers.

M In 2016 PPRC

• Development of Electronic Procurement– Development of Electronic Procurement S 2nd

Semester 2015

PPRC

• Professional and Human Resource Capacity Development– Plan and offer more specific trainings for all

stakeholders – implement the Public Procurement training strategy

M In 2016 PPRC, KIPA

– Issue annual training plans based on the needs of all shareholders (see also the Public Procurement training strategy) and adapt them according to the interest for participation.

S 2nd

Semester 2015

PPRC, KIPA

– Provide regular trainings for economic operators S 2nd

Semester 2015


• Further harmonize the legal framework for procurement, especially in view of the new EU Directives– Initiate the discussion of the revision of the PPL. M In 2016 PPRC– Elaborate, under the guidance and management of

PPRC, a thorough comparison between the existing PPL and the requirements of the new EU Directives.

L In 2018 PPRC

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8 ANNEX I: INTERNATIONAL COMPARISONS OF PUBLIC

PROCUREMENT STRATEGIES AND PRACTICE

Public procurement seems to move internationally towards a policy role, focusing less on

transactional procurement. This is enabling an alignment of procurement strategy with

government policy, effectively engaging procurement as a lever of economic, technological or

social reform. In this chapter some findings of an international research on public procurement

are briefly presented in two sections examining evidence of the aspirations to use public

procurement as a lever of government reform, and of its actual use.

8.1 Aspirations to use public procurement as a lever of government

reform

Common themes emerge around the principles on which procurement must be based in all

countries studied, e.g.

In the German system a distinction is made between efficiency and formality capturing

the essence of the conflicting issues inherent in all the stated principles.

In Belgium an inherent preference is revealed to maintain the status quo of the

procurement system, however this risk avoidance strategy is under threat from a recent

reform initiative – Copernicus – giving greater autonomy and freedom to the heads of

Public Administration in how to achieve the goals established by the political system.

In the UK a dramatic change had taken place in the National Health System (NHS), as

central government had blurred the boundaries between the public and private sectors

reacting in this way to problems of lack of investment and capacity in the NHS rather

than difficulties in the procurement system. The impact on the role of procurement was

significant though, as purchasing on price alone as an objective changed to objectives to

improve management of markets, and management of strategic relationships with various

bodies including Public Private Partnerships and commissioning.

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In the US the procurement personnel is increasingly facing new challenges to create

outcomes rather than manage tender processes.

In Canada it appears that public entities with few resources (e.g. educational institutes)

were duplicating effort and wasting resources they could not afford. Yet it is apparent

that a certain degree of independence was considered vital by each institution.

In South Africa we encounter four pillars of the public procurement system: “Value for

money; Open and effective competition; Ethics and fair dealing; Accountability and

reporting”, with a fifth political one of ‘equity’.

In Singapore we find three key principles which shape the procurement strategy: fairness;

value for money and probity.

In Australia emphasis is placed on the principles – nine in all – but on the same time an

‘Estimates Committee’ in the national parliament is dedicated to cutting expenditure,

suggesting the system was not trusted to manage itself.

In general though, the cases revealed more similarity in the principles underpinning public

procurement than differences.

In terms of proactive supply policies, lack of adequate information for policy initiatives was

encountered in most countries. e-procurement is presented as a significant driver of promoting

SME access to the Government market. However very few entities have good management

information about their procurement profiles as a basis for business case development for e-

procurement or fir socially responsible procurement. To achieve the strategy of encouraging the

participation of SMEs in public contracts, it seems that analysis and knowledge of supply chains

is a prerequisite.

In many countries there is a support for indigenous industry in the Public Procurement System,

but the most extreme example of supporting economic development through procurement can be

found in the United Nations case. In the UN, maximum development impact from funds could be

achieved by sourcing locally or regionally. The procurement function itself was then able to

become a mechanism of development assistance, in that it provided institutional investment in

local or regional businesses by contracting with them.

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Across the various countries there is strong evidence that many of them aspire to use public

procurement as a lever of change beyond simply saving public money. In some cases we find a

less proactive, central role for public procurement together with an but aspiration to support

broader government objectives. The UK NHS, Australia and Canada are all aspiring to use

public procurement in this supportive way. Some countries, like Singapore, are most strongly

aspiring to foster cost efficiency. The two countries who most notably are fixated on rules and

regulatory compliance are Belgium and Germany; they appear to aspire most strongly towards

rule compliance than any other objective for public procurement.

8.2 Evidence of the use of public procurement as a lever of government

reform

In the US the target of 21% of Federal Government spending to be contracted to SMEs was

impressively exceeded achieving in fact 23% in 2012. On the same time in the US purchasing

entities engaged fully the public by exposing their practices to public scrutiny and debate.

In the English NHS, the discussions centered on ‘influencing spending’ rather than on

mandating. In such a large and complex network as the NHS, evidence of influence varied across

the various organizations.

Where cost efficiency and rule compliance was put in the center, countries found it easier to

achieve their aspirations and to demonstrate that achievement. Straight forward efficiency and

savings targets were relatively easy to work towards and to prove they had been reached. Rule

compliance was achieved in Belgium as almost all public procurement practitioners were

qualified lawyers.

Across the various countries the following priorities were identified:

Top ranking priorities:

o Accountability

o Competition

o Transparency

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o Value for money

o Efficiency

o Legal compliance

o Cost effectiveness

o Education of public procurement personnel

Lower ranking priorities:

o Broader government objectives

o Social inclusion

o Green procurement

o Sustainability

o Providing suppliers with equal opportunities

o Using procurement to encourage innovation

o Ethical issues

The following issues emerge in almost all countries:

Public procurement needs to be braver and more proactive

Public procurement needs to be innovative.

Public procurement has a reputation for saying ‘no’ and should consider the ‘art of the

possible’

Agendas facing public procurement practitioners are changing from day to day

There is not always clarity on to whom procurement practitioners are reporting

People issues are important and there is an international shortage of highly qualified,

intelligent, experienced public procurement practitioners

Short vs long term – there is too much short term crisis management in practice

There is a need to ask government for clearer objectives and to clarify conflicting

objectives

All public procurement systems appeared to exhibit divided loyalties and conflicting

stakeholder objectives

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As a conclusion one could argue that despite the lack of international learning in the field of

public procurement, there are many similarities of aspirations, policies, strategies and processes

across the various countries.

The core drivers of procurement strategy are aligned to, and support delivery of,

government policy on issues such as social reform.

Some important issues arise from technology availability in the form of e-procurement.

The public procurement function is extremely complex as a multi-level system that

connects government policy, procurement policy, and practice in the supply market.

Just as governments can move from a controlling regime to a facilitative state, so too can

public procurement move from a rule compliance function to a cost down, efficiency led

function, to a facilitating supporter of broader government objectives, to a deliverer of

broader government objectives.

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EXECUTIVE SUMMARY - rks-gov.net · Web viewA pre-requisite for e-procurement readiness is capacity...

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