00-National Public Procurement Strategy-V3 - ENG

Improving Administrative Capacities in the Area of Public Procurement in
Kosovo
An EU funded project managed by the European Union Office in Kosovo
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.
National Public Procurement Strategy 2015-2020

Contents
1
EXECUTIVE SUMMARY..........................................................................................4
1.1
Key objectives.......................................................................................................5
1.2
Recommended actions..........................................................................................5
Introduction..................................................................................................................7
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
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

5
Strategys vision, mission and objectives...................................................................21

5.1
The NPPS vision................................................................................................21
5.2
The NPPS mission.............................................................................................21
5.3
The NPPS objectives..........................................................................................22
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
Next steps for implementing the strategy...................................................................46

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

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

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

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

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.
2.
3.
4.
5.
6.
7.
8.
9.
Increase efficiency and transparency of the Public Procurement system

Initiating processes
Improve access to information
Foster accountability
Introduce green and socially responsible public procurement
Support to SMEs in public procurement
Development of Electronic Procurement
Professional and Human Resource Capacity Development
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.
2.
3.
4.
5.
6.
7.
Executive summary
Introduction
Strategy Development Methodology
Background and rationale
Strategys vision, mission and objectives
Recommended course of action
Next steps for implementing the strategy
ANNEX I: International comparisons of public procurement strategies and
practice

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.
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
2
3
4
5
6
7
8
Executive Summary
Introduction
Strategy Development Methodology
Background and rationale
Strategys vision, mission, goals and objectives
Alternative considerations
Recommended course of action
Next steps for implementing the strategy
9

In an ANNEX an international comparisons of public procurement strategies and practice
is presented.
10

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)
b)
c)
d)
Legal and regulatory regime in Kosovo

International best practices
Regimes adopted by countries known for effective public procurement systems
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.
11

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;
The clarity of the tendering procedures;
The transparency and fairness of the evaluation;
12
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.
13

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:
14

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
15

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,
secondary legislation and their interpretation, for developing an Information System for
16

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.
17

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 Kosovos 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
18
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
19

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:
20

Strengths
Weaknesses
Presence of a good legal framework
Availability of qualified human

resources
Limited number of qualified human

resources
High rate of staff turn over
Presence of Capacity development

initiatives
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
Existing guidelines for training of public

procurement staff
Some good practice in supplier
management
Understanding of need for compliance
with EU directives
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,

21
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
22

5 STRATEGYS 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:

23
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:
1. Increase efficiency and transparency of the Public Procurement system
Efficiency and transparency in the evolution of both rule-making and ruleapplication
Full respect of competition
Protection of economic operators in their fundamental rights
Monitoring of the regulations and practices and handle the weak points
2. Initiating processes
PIP (Public Investment Program) system,
Centralised procurement,
Internal rules within the contracting authorities
Guidance to contracting authorities
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
24
Specific trainings based on needs

4. Further harmonization with EU directives and other EU acts
25

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.
26

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 midterm 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 lifecycle 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 countrys medium-term economic and
social objectives. However, these plans were often unrealistic, and proved insufficiently
flexible to take into account changes in the economic environment. Consequently, in the
27

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).
28

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
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
29

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.
Strategy Statements
To achieve these objectives, the government shall:
30

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.
For example:
31
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
Procurement officers
Information needs
Best practices, interesting
examples
Answers to specific
questions
Changes / updates of the
legal framework
32

Stakeholder
Public officials involved in
the public procurement
process
PPRC, PRB, CPA staff
Judges
Auditors
Public officials, who are
NOT procurement officers
and are not directly
involved in public
procurement
Managers of contracting
authorities
Contracting authorities staff

involved in supplementary
activities to public
procurement and contract
implementation
Economic operators
Wider public
Information needs
Points of concern in the
legal framework
Changes in the EU legal
framework
Answers to specific
questions
Proposed changes to the
legal framework
Proposed changes to the
legal framework
Court decisions
EU court decisions
Points of concern in the
legal framework
Audit findings
legal framework

legal framework
examples
Answers to specific
questions
examples
Answers to specific
questions
legal framework
examples
New features and changes
in the legislation
Strategy Statements
33

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)
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.
34

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:
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,
35

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.
36

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.
37

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:
38
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
39

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 disintermediation 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
40

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
41

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.
42

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)
b)
c)
d)
registration and pre-qualification of contractors,

downloading of bid documents and release of bid announcements,
competitive as well as alternate procedures,
receiving bidders clarifications and managing all communication and information
e)
f)
g)
h)
on line,
shortlisting, bid evaluation and bid comparisons,
online negotiations,
electronic auctions and reverse auctions,
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
m)
n)
o)
p)
certain benchmarks and norms,

comparisons of expenditures on procurement items
spend analysis
contract management options that allow monitoring of contracts concluded;
e-invoicing and e-payments etc.
43

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 eProcurement. 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.
44

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 individuals continuing professional development.
For the design of course content and the curriculum, PPRC shall consider collaboration
with KIPA and partnering with higher education institutions and specialized training
45

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 anticorruption bodies), civil society, media etc.
46

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.
47

7 NEXT STEPS FOR IMPLEMENTING THE
STRATEGY
The National Public Procurement Strategy for Kosovo elaborated above comprises of the
following strategic issues:
1.
2.
3.
4.
5.
6.
7.
8.
9.

Introduce green and socially responsible public procurement
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.
48

7.1 Action Plan
Actions

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
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.)
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.
Extend the centralized procedures and use of framework contracts if
proven to be more efficient.
Publish Contract notices and in case of complain, of all documents
related to the complaint up to the PRB decision
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)
Publish all PP related documents (CN, procurement plans, contracts,
etc) after further development of the regulations concerning
publication of these documents
Keep the documents for 5 years after the completion of the projects
Introduce a PIP (Public Investment Program) system,
Enhance centralized procurement
Elaborate and implement internal rules within the contracting
authorities
Offer guidance to contracting authorities, especially in the separation
of responsibilities
S/M/L4
Time Frame5
1st Semester
2015
2nd Semester
2015
2nd Semester
2015
In 2016
1st Semester
2015
In 2018
2nd Semester
2015
In 2016
M
M
S
In 2016
In 2016
2nd Semester
2015
1st Semester
2015
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.
49

Actions
S/M/L
Time Frame
1st Semester
2015
1st Semester
2015
1st Semester
2015
st
1 Semester
2015
Clarify the roles and responsibilities within the contracting

authorities (role of the procurement officer, evaluation committee,
contract implementation etc.)
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
Develop the PPRC website, with search functionality in FAQ /
interpretations
Establish a Public Procurement Expert Group to support the
economic operators
Develop the CPA website, with more info for EOs and CAs about
framework agreements
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.
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)
Clarify the responsibility of managers, ministers, mayors etc.
Plan most of the projects simultaneously with the elaboration of the

budget
Introduce green (GPP) and socially responsible public procurement (SRPP)
initiate and stimulate of debate regarding GPP and SRPP in the
country;
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
elaborate concrete advise, criteria and indicators to be used in public
tendering in view of promoting GPP and SRPP
foster public procurement planning, in order to timely integrate GPP
and SRPP criteria in to the procurement process
1st Semester
2015
st
1 Semester
2015
S
S
M
In 2016
S
L
1st Semester
2015
In 2018
In 2016
In 2016
In 2016
In 2016
50

Actions
Time Frame
Facilitate access to public procurement information, exploiting the

wide use of the internet
In 2016
Communicate guidance to the economic operators, while focused

guidance should be developed for SMEs
In 2016
Set-up a help-desk for SMEs
In 2016
In 2016
In 2016
2nd Semester
2015
In 2016
2nd Semester
2015
2nd Semester
2015
S/M/L
Educate Contracting Authorities in market analysis, and evaluation

of supplier strengths, with special focus on SMEs
Include the strategic issues around SMEs within the syllabus for the
training of Procurement Officers.
Plan and offer more specific trainings for all stakeholders
implement the Public Procurement training strategy
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.
Provide regular trainings for economic operators
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
Elaborate, under the guidance and management of PPRC, a thorough
L
In 2018
comparison between the existing PPL and the requirements of the
new EU Directives.
51

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.
52
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 eprocurement 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.
53

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
o Value for money
54
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
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.
55
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.
56

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Improving Administrative Capacities in the Area of Public Procurement in

Public Procurement Regulatory Commission

National Public Procurement Strategy 2015-2020

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

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

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

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

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

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

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

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

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

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

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

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

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

National Public Procurement Strategy 2015-2020

Strategys vision, mission and objectives...................................................................21

The NPPS vision................................................................................................21

The NPPS mission.............................................................................................21

The NPPS objectives..........................................................................................22

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

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

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

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

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

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

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

Further harmonization of the legal framework for procurement, especially in

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

ANNEX I: International comparisons of public procurement strategies and practice

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

National Public Procurement Strategy 2015-2020

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

National Public Procurement Strategy 2015-2020

Central Procurement Agency

Gross Domestic Product

Human Resource Management

Management Information System

Organization of Economic Cooperation and Development

Public Procurement Regulatory Commission

Procurement Review Body

Public Private Partnership

Request for Proposal

Request for Quotation

Green and sustainable public procurement

Socially responsible public procurement

National Public Procurement Strategy 2015-2020

National Public Procurement Strategy 2015-2020

1.1 Key objectives

Improve the Public Procurement system through on-going monitoring and

implement the necessary regulatory changes,

procurement, support of SMEs)

1.2 Recommended actions

Increase efficiency and transparency of the Public Procurement system

National Public Procurement Strategy 2015-2020

National Public Procurement Strategy 2015-2020

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

small contracting authorities.

the system is vulnerable to corrupt practices.

National Public Procurement Strategy 2015-2020

Low level of professionalism of procurement officers, combined with a significant

National Public Procurement Strategy 2015-2020