Reducing Corruption through Electronic Procurement Eduardo Talero Washington, April 21, 2005

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Reducing Corruption through Electronic
Procurement Eduardo Talero Washington,
April 21, 2005
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OVERVIEW

• What is e-procurement?
• What is the e-procurement cost/benefit function?
• How can e-procurement reduce corruption?
• What are the key points to remember?

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e-GP FULL SYSTEM
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e-GP DISCLOSURE FACILITIES
Disclosure Facilities
CODING SCHEME
SUPPLIER ROSTER
STATISTICAL DATA BASE
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e-GP TRANSACTION FACILITIES
COST


High
E-Tendering

Online Auctions


Bidding





Reverse Bidding
E-Purchasing


Online Shopping
Low



Low
High
VOLUME
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e-GP USER SUPPORT FACILITIES
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E-Government
Integrated Fiscal Management
Requisitioning
Contract Management
Inventory Control
Asset Management
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OVERVIEW

• What is e-procurement?
• What is the e-procurement cost/benefit function?
• How can e-procurement help reduce corruption?
• What are the key points to remember?

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THE e-GP COST-BENEFIT FUNCTION
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Leadership and policy reform
Example Chile Jan.,2003 Executive Order

• Declares e-GP system official publication vehicle
• Mandates publication through the system of
  business opportunities, bidding documents,
  questions and answers, contract awards.
• Establishes publication time standards to be
  enforced by the system.
• Declares non-compliant transactions invalid.
• Makes management responsible for accuracy of
  information.

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e-GP COST BENEFIT RATIO
Non-Financial Inputs
Over 8 of GDP
10-20 Transaction cost reduction
Financing US 2.5 3.5 million/Country
10 cost reduction (0.8 of GDP)
ECONOMY

• E-Government
• Fiscal Management
• Systems Integration

Full e-GP System
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OVERVIEW

• What is e-procurement?
• What is the e-procurement cost/benefit function?
• How can e-procurement help reduce corruption?
• What are the key points to remember?

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HOW CAN E-PROCUREMENT HELP REDUCE CORRUPTION?

• Illuminating the playing field
• Facilitating entry
• Standardizing communications
• Keeping score
• Leveling the playing field
• Enforcing the rules

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e-GP TRANSPARENCY BENEFITS

• HEALTH SERVICE RECIPIENTS
• PUBLIC TRANSPORT USERS
• STUDENT POPULATION
• MOTORISTS
• ETC.

OVER 8 OF GDP

• ALL GOVERNMENT

• MID SIZE BUSINESSES
• LARGE SUPPLIERS
• SMALL SERVICE FIRMS

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e-GP TRANSPARENCY BENEFITS

• HEALTH SERVICE RECIPIENTS
• PUBLIC TRANSPORT USERS
• STUDENT POPULATION
• MOTORISTS
• ETC.

OVER 8 OF GDP

• ALL GOVERNMENT

• MID SIZE BUSINESSES
• LARGE SUPPLIERS
• SMALL SERVICE FIRMS

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How can e-procurement help reduce corruption?

• Illuminating the playing field
• Facilitating entry
• Standardizing communications
• Keeping score
• Leveling the playing field
• Enforcing the rules

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How can e-procurement help reduce corruption?

• Illuminating the playing field
• Facilitating entry
• Standardizing communications
• Keeping score
• Leveling the playing field
• Enforcing the rules

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e-GPSTANDARDIZES COMMUNICATIONS
S U P P L I E R S
B U Y E R S
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How can e-procurement help reduce corruption?

• Illuminating the playing field
• Facilitating entry
• Standardizing communications
• Keeping score
• Leveling the playing field
• Enforcing the rules

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How can e-procurement help reduce corruption?

• Illuminating the playing field
• Facilitating entry
• Standardizing communications
• Keeping score
• Leveling the playing field
• Enforcing the rules

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STAGED DEVELOPMENT OF e-GP SYSTEM
INTEGRATION FACILITIES
TRANSACTION FACILITIES
DISCLOSURE FACILITIES
Policy Reform Institutional Reform Human
resource development
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How can e-procurement help reduce corruption?

• Illuminating the playing field
• Facilitating entry
• Standardizing communications
• Keeping score
• Leveling the playing field
• Enforcing the rules

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OVERVIEW

• What is e-procurement?
• What is the e-procurement cost/benefit function?
• How can e-procurement help reduce corruption?
• What are the key points to remember?

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E-GP AND CORRUPTION KEY POINTS TO REMEMBER

• Political leadership and policy reform are
  critical
• Success not possible without culture change
• Gradual development is possible and desirable
• Modest start yields large transparency benefits
• Overall impact can be major
• Every country case is different