MINISTÉRIO DO PLANEJAMENTO

1. MINISTÉRIO DO PLANEJAMENTO Tools for Efficient Public Procurement Ana Vieira NetoBrasília, 25/03/2014.

2. I – Current Model of Public Procurement

3. MINISTÉRIO DO PLANEJAMENTO PARADIGMS IN PUBLIC PURCHASES 1st WAVE: EQUALITY + MORALITY Creation of proceedings to give access to the State's purchasing power and to implement principles of morality and equality 2nd WAVE: EFICIENCY + ECONOMY Buying faster and better for the lowest possible cost, using the large scale of the State's purchasing power 3rd WAVE: THE USE OF THE STATE'S PURCHASING POWER Buying from strategic and relevant segments for the economic, social and sustainable development 4th wave: the use of purchasing power to promote sustainabilitiy

4. New Paradigm of Public Procurement FASTER Efficiency + Purchasing Power of the State SUSTAINABLE DEVELOP. QUALITY STRATEGIC SEGMENTS COST

5. Purchasing power Sustainable economic development Generation of job posts and income = Reduction of social and regional disparities To influence markets Eradication of extreme poverty Environmental protection instrument

6. MINISTÉRIO DO PLANEJAMENTO The use of the State's purchasing power should be directed to sustainable economic development: • The social function of the bidding process;• Generation of employment and income; • Eradication of the extreme poverty; • Optimization of the State's purchasing power.

7. SMALL BUSSINESS – A CASE OF SUCCESS

8. An overview ofthe Micro andSmall Business Entreprises (SMEs) in Brazil • Account for about 67% of the jobs; • Are responsible for about 25% of GDP; • Account for 2.4% of total exports; • Represent 99% of companies formally established in Brazil; • From 1995 to 2000, there were 400,000 new SMEs, responsible for 1.4 million new jobs; • Generate 6x more jobs than medium and large firms (jobs created/GDP share).

9. Act 123/2006 • Exclusive biddingfromSMEs; • Subcontracting in worksandservices; • Quotas for participation in largerbidding; • Differentiatedqualification; • Special tiebreaker

10. II - Tools

11. 1. Legislation

12. MINISTÉRIO DO PLANEJAMENTO Legal Landmarks Set that a procurement law should be drawn up for regulating public procurement. Federal Constitution 1988

13. MINISTÉRIO DO PLANEJAMENTO Legal Landmarks Set that works, services, purchases of the Administration should be, as a rule, acquired or contracted by public procurement. Brazilian Procurement Law Constituição Federal 1988 1993

14. MINISTÉRIO DO PLANEJAMENTO Legal Landmarks Implemented the reverse auction for the acquisition of goods and common services. Lei Geral de Licitações Constituição Federal Act 10.520 1988 1993 2002

15. MINISTÉRIO DO PLANEJAMENTO • Legal Landmarks Reverse Auction for the acquisition of goods and common services. Lei Geral de Licitações Constituição Federal Lei 10.520 1988 1993 2002 Website Comprasnet.gov.br is launched, making electronic bidding possible.

16. MINISTÉRIO DO PLANEJAMENTO • Legal Landmarks Established the compulsory electronic bidding for the purchase of common goods and services. Lei Geral de Licitações Constituição Federal Decree 5.450 Lei 10.520 1988 1993 2002 2005

17. MINISTÉRIO DO PLANEJAMENTO • Legal Landmarks Established general rules relating to the establishment to domestic preference to SMEs Complementary Act 123 Lei Geral de Licitações Constituição Federal Decreto 5.450 Lei 10.520 1988 1993 2002 2005 2006

18. MINISTÉRIO DO PLANEJAMENTO • Legal Landmarks Established for acquisitions and contracts of the 2016 Olympic Games, the FIFA Confederations Cup 2013 and World Cup 2014; works and actions for health and education investments . Lei Complementar nº 123 Lei Geral de Licitações Constituição Federal Act 12.462 - RDC Decreto 5.450 Lei 10.520 1988 1993 2002 2005 2006 2011

19. MINISTÉRIO DO PLANEJAMENTO • Legal Landmarks Established criteria, practices and guidelines for the promotion of sustainable national development through public procurement Lei Complementar nº 123 Lei Geral de Licitações Constituição Federal Lei nº 12.462 Decree 7.746 Decreto 5.450 Lei 10.520 1988 1993 2002 2005 2006 2011 2012

20. MINISTÉRIO DO PLANEJAMENTO • Legal Landmarks The website Comprasnet starts to conduct bids respecting RDC rules. Lei Complementar nº 123 Lei Geral de Licitações Constituição Federal Lei nº 12.462 Decreto 7.746 Decreto 5.450 Lei 10.520 1988 1993 2002 2005 2006 2011 2012 2013

21. 2. Electronic systems

22. MINISTÉRIO DO PLANEJAMENTO The website comprasnet.gov.br: • Allows approximately 300 sessions per day, with peaks of 580 (in December); • Has about 14,500 simultaneous users, with peaks of 20,000 in December; • Registers an average of 40,000 hits per day; • Has over 10,000 registered procurement officers; • Contains over 4,500 purchase units. Fonte: www.comprasnet.gov.br

23. MINISTÉRIO DO PLANEJAMENTO Regarding technology and information security, the site comprasnet.gov.br: - Uses digital certification; - Does not allow the identification / communication among bidders; - Extends the competitiveness (higher coverage), combining the simplification process; - Provides transparency, allowing real-time monitoring; - Has low operating cost to the supplier. Fonte: www.comprasnet.gov.br

24. MINISTÉRIO DO PLANEJAMENTO Savings from e-procurement (billions of US$) 21% 23% 19% 21% 24% 16% Fonte: www.comprasnet.gov.br

25. 3.Training

26. Beneficiaries : - Markets, public managers and partners that work with organizations linked to the market 2. Modalities: • Face to face: must always be applied to new trainees that become trainers • On distance: tutorials or non-tutorials courses; formal or informal 3. Online training via skype or via internal network

27. 4. Communication System

28. Good working processes need to be replicated; • Exchange of information regarding the improvements, the specifications of products and services and the contract management process; • Communication with the market so that is ready for meeting demands and are aware of the purchasing process.

29. 5. Good practices that improve the processes

30. 5.1 - Easier procurement processes, in which: a. The qualificationphase comes afterselectingthewinner; b. Concentrates the appeals on one phase; c. Increases participation.

31. MINISTÉRIO DO PLANEJAMENTO The reverse auction, presential or eletronic, is a form of bidding, established in 2002, adopted for the purchase of common goods and services. Common goods and services are those which standards of performance and quality can be objectively defined by the bidding documents by means of the usual specifications considered by the market.

32. 5.2 Standardization of product specifications

33. MINISTÉRIO DO PLANEJAMENTO Some advantages of the standardization of the object: - Acceleratestheprocess; - Mitigates appeals risk; • Increasessupplier'sunderstandingoftheAdministration'sdemands; • - Allowsthe use of Data Warehouse's tools; - Makeseasierthe use ofsharedpurchasing.

34. Acquisition Functioning Final managing Life cycles costs Life cycle costs are the ones the products causes to the purchasing unit during its useful life: • Purchase • Delivery • Instalation… • Water, energy consumption, etc • Maintenance • Replacement, etc • Unsembling, withdrawing • Treatment costs Sales revenue

35. cost Final management costs Functioning costs Purchase costs time Life cycle costs • Different evolution of different offers and demands

36. 5.3 – Shared purchases lower the costs, reduce time in bidding processes

37. MINISTÉRIO DO PLANEJAMENTO Example: Shared Purchase, with standard specifiations of equipments for public schools, using e-reverse auction Territorial extent and volume of purchases require the need for standardization of the object. • 4.195 schools • 4.139 schools • 4.199 schools • 5.559 schools

38. ANA MARIA NETO DIRECTOR OF LOGISTICS PRESIDENT OF THE INTERAMERICAN NETWORK OF PUBLIC PURCHASE FOR 2013-2014 More information: comprasnet@planejamento.gov.br Tel.: 55 (61) 2020-1321 www.comprasnet.gov.br