Public Procurement Experience of Pakistan (2ND South Asian Regional Public Procurement Conference)

1
Public Procurement Experience of Pakistan (2ND
South Asian Regional Public Procurement
Conference)

• By
• Alam Zeb Khan
• (Director General)
• Public Procurement Regulatory Authority

2
Sequence of Presentation

1. Need for Procurement Reforms in Pakistan
2. Public Procurement Legal Framework of Pakistan
3. Performance of PPRA since its establishment
4. Capacity Building Initiatives of PPRA
5. Reforms Agenda of PPRA

3

• Need for Procurement Reforms in Pakistan

4
Need for Procurement Reforms in Pakistan

• Previous Procurement Regimes
• General Financial Rules (1951/1979) (Stores etc)
• Purchase Manual of Deptt of Supplies and
  Disposals
• Delegation of Powers to Ministries (Overlapping)
• Autonomous Bodies had their own Rules
• Various Circulars of Ministry of Finance

5
Need for Procurement Reforms in Pakistan

• World Banks Study of 1997-98
• In 1997 98, the World Bank auditors reviewed
  4524 contracts and found deficiencies in 3700
  contracts.

6
Need for Procurement Reforms in Pakistan

• Findings of W.B CPA Report 2000
• Outdated rules and regulations
• Public procurement suffered from inefficiency,
  and poor management.
• Inadequately trained and poorly paid public
  sector procurement professionals
• Complicated and non-transparent procurement
  procedures discouraged sound planning, thorough
  evaluation

7
Need for Procurement Reforms in Pakistan

• Word Bank Recommendations
• Enacting a public procurement law based on
  UNCITRAL Model Law
• Creating a small, professionally staffed,
  independent regulatory agency
• The regulatory body to be mainly confined to
  policy, documentation, development of rules, etc.
• Not to involve in line clearance functions for
  award of contracts

8

• Public Procurement Legal Framework of Pakistan

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Public Procurement Legal Framework of Pakistan

• Pakistan is a Federation consisting of the four
  federating units in addition to two other
  regions
• Punjab
• Sindh,
• Khyber Pakhtunkhwa
• Balochistan
• Azad Jammu and Kashmir
• Gilgit-Baltistan

10
Public Procurement Legal Framework of Pakistan

• PPRA Ordinance 2002
• Public Procurement Rules 2004
• Following Four Regulations issued so far
• PPRA Regulations 2008
• PPRA Regulation 2009
• Consultancy Services Regulations 2010
• PPRA Regulation 2011

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Public Procurement legal Framework of Pakistan

• Composition of the PPRA Board
• Secretary, Finance Division (Chairperson)
• Secretary, Ministry of Industries and Production
• (3) Secretary, Defence Production Division
• (4) Secretary, Ministry of Water and Power
• (5) Secretary, Ministry of Housing and Works
• (6) Secretary, Ministry of Communications
• (7) Three Members from private sector
• (8) Managing Director

12
Public procurement legal framework of Pakistan

• PPRA Ordinance 2002 and the Public procurement
  Rules 2004 are applicable to all procuring
  agencies of the Federal Government.
• Open Competitive Bidding is the principle/default
  method of procurement
• All procurements above the minimum threshold of
  Rs. 100000 (about US1000) are advertised.

13

• Performance of PPRA

14
Performance of PPRA

• Administrative setup of PPRA
• PPRA is a very lean organization
• Total number of employees is 50
• 8 officers, and 42 staff
• Total budget for current year is Rs. 43M

15
Performance of PPRA
173755 tenders monitored/uploaded on PPRA
website during the Financial Years 2004-2013
Financial Year Organizations Tender Uploaded Average Daily Tenders PP Rules Violations Violations
2004-05 255 11905 32 11311 95.01
2005-06 274 17124 47 12782 74.64
2006-07 293 20226 55 13657 67.52
2007-08 295 17078 47 9917 58.07
2008-09 290 17913 49 4720 26.35
2009-10 350 18404 50 3883 21.10
2010-11 385 20880 57 2738 13.11
2011-12 582 24104 66 2506 10.40
2012-13 677 26121 71 5721 21.90
Total 3401 173755 474 67235 38.70
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Performance of PPRA
17
Performance of PPRA
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Performance of PPRA

• Uploading of PP Rules Violations on PPRA website
  started in May 2012.
• Compliance of PP Rules has increased from 1 in
  May 2012 to 10 at the moment .
• Procurement Plans of 205 Procurement Agencies
  have been uploaded during the current financial
  year as against 9 last year.

2012 2013
9 205
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Performance of PPRA
20

• Capacity Building Initiatives of PPRA

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Capacity Building Initiatives of PPRA

• Training of the Government officials in
  procurement started in 2006 under a 3 years World
  Bank Capacity Building Project.
• In 2009, PPRA training activities were formalized
  through the establishment of National Institute
  of Procurement (NIP)
• Presently PPRA imparting training through its own
  resources.

22
Capacity Building Initiatives of PPRA

• 4501 Officials trained in Public Procurement
  during the Financial Years 2006-2013.

Financial Year Training Programmes No. Participants
2006-07 22 807
2007-08 33 977
2008-09 32 881
2009-10 35 762
2010-11 19 343
2011-12 19 326
2012-13 22 405
Total 182 4501
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Capacity building initiatives of PPRA

• Learning Management System
• Present training capacity of PPRA is 480 per year
  
• Through development of LMS PPRA will be able to
  train around 3000 persons per annum, through
  online/virtual system

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Challenges Faced By PPRA

• Shortage of office space.
• Shortage of Human Resource.
• Capacity Building of Human Resource.
• Lack of power to take action on PP Rules
  Violations.
• Budgetary constraints

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• Reforms Agenda of PPRA

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Reforms Agenda of PPRA

• Advisory Group on Public Procurement (AGPP)
• Preparation of National Procurement Strategy
  2013-16
• Revision and improvement of Public Procurement
• Rules, 2004
• Improvement and / or preparation of Public
  Procurement Regulations

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Reforms Agenda of PPRA

• Review of the SBD for Civil Works
• Preparation of SBDs for Goods
• Preparation of SBDs for Services
• Procurement Code of Ethic

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Reforms Agenda of PPRA

• Establishment of PPRA Monitoring and Evaluation
  System
• Revamping of the PPRA website
• Development of HR-Pay Role Module
• Accounting Software developed

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Reforms Agenda of PPRA

• The PPRA Service Regulations 2013 approved by the
  PPRA Board on 30th September, 2013
• Market based Pay Package approved by the PPRA
  Board, subject to fulfilment of certain
  formalities.
• For financial autonomy, PPRA Financial
  Regulations/Accounting Procedure at a very
  advanced stage.

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• Thanks