PROCUREMENT REFORM IN THE PHILIPPINES

1. PROCUREMENT REFORM IN THE PHILIPPINES Changing the Rulesof the Game

2. OUTLINE: Part I Getting Started (Ed Campos) Part II Coalition Building (Tina Pimentel) Part III The Role of ICT (Jacinto Gavino)

3. Why Procurement Reforms? Survey Findings Legal Foundations a Mess Government procurement and tax collection are perceived to be the major sources of corruption: • 4 of the top 5 most corrupt agencies featured prominently in government contracting • approximately 20% of government contracts go to kickbacks/commissions • equivalent to P21 B in 2001 just for the national government; much larger if BOT transactions and local government are included Over 100 laws, regulations, executive orders etc. governing public procurement

4. PART I: Getting Started Building Ownership Within the Executive Branch

5. Technical Analysis MattersBUT . . . . An initial failed attempt (1999): The PAAT • comprehensive, thorough analysis of the problems • translated into a lengthy (100 + page) proposed procurement code • no buy in from executive: top down approach

6. Technical Analysis Matters:Round Two (2000) • procurement experts in Government prepare their own draft bill • workshops: • produce draft bill • the PAAT used as “Target” • build camaraderie/ “support group” (TWG) • sequencing: • first, administrative reforms (EO 40) • then, legislation (draft GPRA)

7. Desired Principles Governing EachStage

8. Analytical Framework Corruption Opportunities A Tolerance GDP

9. Analytical Framework Corruption Opportunities A B Tolerance GDP

10. PART IICOALITION BUILDING Getting the Legislature on Board

11. PWI was born out of the need to address this problem: it would bear most of the costs (time, effort, personnel, funding) of organizing people and groups to advocate for the passage and proper enforcement of a landmark procurement reform bill Problem of collective action: many would like to see this happen but few are willing to put the time and effort The Role of PWI “Reducing Corruption” in public procurement is a public good

12. PWI became the cog that linked together different interested parties in the effort to secure the passage of the Procurement Reform Bill Local governments civil society Media legislators church Government officials

13. What is PWI? • PWI is a non-government organization established in February 2001 • Objective: to combat corruption in public procurement • Founders: seasoned academics, reputable retired government officials, progressive lawyers, and concerned private sector executives

14. What PWI is and what it is not…. Partners with reform minded officials in government. Corruption, not Government is the enemy Adopts a systemic approach to combating corruption in public procurement. “Witch hunting” is not our business

15. Training Networking Advocacy Consultancy Research Monitoring REFORM Our Approach

16. The Strategy: “Bridging” the Executive and the Legislature Linked with and assisted the government officials crafting the proposed bill: • offered technical and legal advice • facilitated and provided logistical support for workshops

17. The Strategy: “Bridging” the Executive and the Legislature Identified possible champions in the Lower House and Senate and gained their confidence and trust: • worked with both administration and opposition legislators to create • bipartisan support • helped facilitate the achievement of their personal goals • provided technical assistance to their staffs in the preparation of • various versions of the bill for hearings • provided logistical and technical support during hearings

18. Transparency and Accountability Network (20+ member groups) Walang Ku-Corrupt Movement (university student councils) PAGBA & AGAP (w/in Gov’t) CBCP (Church) Philippine Contractors Association Local chambers of Commerce The Strategy: Mobilizing Public Support Drew other civil society groups into the advocacy efforts and coordinated the activities

19. The Strategy: Mobilizing Public Support Linked up with a media communications group to launch an aggressive advocacy and information dissemination campaign in both private and public sectors Participated in media interviews and helped arrange such interviews for key legislators and public officials: • AM radio critical • Leading TV network produced TV documentary Developed and distributed primers, streamers, posters, T-shirts etc. Solicited support from local governments: • League of Provinces • League of Municipalities

20. The Outcome • October 28, 2002 – Passage in the Lower House • December 9, 2002 – Passage in the Senate • December 17, 2002 - Passage in the Bi-cameral Conference • January 10, 2003 – President signed the Bill into Law

21. Key Provision of Bill Institutionalize the participation of civil society Article V, Sec. 13: To enhance the transparency of the process, the BAC shall, in all stages of the procurement process, invite, in addition To the COA representative, at least 2 observers to sit in its proceedings, 1 per from a duly recognized private group in a sector or discipline relevant to the procurement at hand, and the other from a non-government organization…..

22. Round Three: Enforcement • PWI is currently involved in the crafting of the Law’s Implementing Rules and Regulations • Provide intensive training to civil society groups for monitoring of proper implementation of the new law • Expand its knowledge and information hub on activities related to public procurement

23. Part III: The Role of ICT The Icing on the Cake -- GEPS

24. Enhanced attractiveness of a new law Strategic Importance of e-Procurement The President & key legislators where enthusiastic about using ICT With e-procurement could produce positive results quickly

25. The GPRA & e-Procurement GPRA 9184, Article III: Sec. 8. Procurement by Electronic Means • G-EPS as the single portal: • Primary information source • Procurement of common supplies • G P P B • rules and procedures • changes due to technology • other service providers for non common use • items Sec. 9. Security, Integrity & Confidentiality

26. Status Report On The Government Electronic Procurement System (G-EPS) As of April 2003

27. Summary of Bid Notices

28. Estimated Savings After Posting on G-EPS

29. Potential Savings on Newspaper Advertisement Cost

30. Total Number of Agencies vs. Number Registered with the G-EPS

31. Need for Training G-EPS Challenges Low PC and Internet Penetration Resistance to change

32. Change Management • Rationale for Change • Recognizing the Resistance to Change • Coalition of Allies • Change Champions • Segment the Market • Look for Small Victories • Objective Analysis & Monitoring

33. Epilogue Food for Thought . . . .

34. Timeline 1999: Round One (PAAT), August 2000: Round Two EO 262 for Goods, July 5 PD 1594 (amended IRRs) for infra, Aug. 12 Administrative EO 322 on GEPS, November 22 2001: EO 40 on Consolidation, October 8 2002: Passage of the Law House Bill No.4809, October 28 Senate Bill No. 2248, December 9 Legislative Bicameral Conference Bill, December 17 2003: GPRA signed into law, January 10

35. Preparation of technical papers and the law USAID World Bank Civil Society Advocacy And Media Campaign CIDA ADB Asia Foundation Technical Specifications, TORs, and Bidding of the GEPS UNDP EU The Role of Donors Supported the efforts but did not drive it

36. Civil Society’s Role ollaborate C atalyze oordinate

37. THE END . . . THANK YOU www.procurementwatch.org.ph