Energoatom plans e-procurement
Energoatom has signed a memorandum on the creation of a "transparent and efficient public procurement system" in Ukraine by turning its existing approach into an electronic trading format, the state-owned nuclear power plant operator said yesterday.
The initiative is being led by a group called Transparency Procurement, which has experience of introducing an e-procurement system in Georgia.
The document was signed last week by Energoatom president Yuri Nedashkovsky and the group's representatives, Alexander Starodubtsev, Tato Urdzhumelashvili, David Margania and David Kiziria. Urdzhumelashvili has been chair of the Agency for Competition and Public Procurement in Georgia since 2009.
Energoatom representatives at the ceremony included technical director Alexander Shavlakov, executive director for legal issues and support for procurement procedures Natalia Musevich, director of interaction with state authorities and legislative work Oleg Polishchuk, and chairman of the exchange trading committee Victor Chebrov.
The reform is mainly aimed at the "eradication and prevention of systemic corruption, and also at increasing competition by making it easier for businesses to gain access to government procurement," Energoatom said.
Ukraine's government is creating the legal and institutional framework necessary to support its public procurement process in line with international norms and standards in this area, it added.
"However, as practice shows, formal correspondence with Ukrainian legislation does not [of itself] ensure transparent, effective and fair procurement procedures, and does not contribute to solving the main problem in public procurement - how to eradicate systemic corruption," it said.
Experience of other countries indicates that an electronic public procurement system enables cost savings of at least 10% in its first year of operation, it said. In Ukraine, this figure could increase significantly "by eliminating the causes of systemic corruption."
Nedashkovsky said that "excessive bureaucracy" in the procurement process often has "negative consequences". He added, "In our seemingly open bidding process, we are getting prices that are far from the market rate. In some cases, a tender has had the exact opposite effect it should, namely to reduce prices under the pressures of an auction."
The coordinators of Transparent Procurement said the e-system will help eradicate and prevent systemic corruption; create transparency in procurement procedures; evaluate tenders in a non-discriminatory and objective way; enable straightforward application procedures and the gradual transition to a paperless process; and help with the full reporting and analysis of all government procurement.
In its work on problems with public procurement in Georgia, the group found that corruption was the worst issue to have to deal with. It was decided therefore that the establishment of anti-corruption measures were crucial to stamp out systemic abuse of the procurement procedures.
"Our system is objective and protects its members, because it is completely open and designed for its users and regulators," Margania said. "It also eliminated the need for the ten-point evaluation of proposals from suppliers and this contributed to the independence of the selection result. And most importantly, the system provides statistical information. You can easily keep track of where any funds go when prices appear unusually high or low."
Georgia's introduction of an e-procurement system has had an impact not only on the country's finances, but also on its politics since the system does not depend on the government of the day or any change of government. The "non-politicized" system is designed to protect its users, he added.
Georgia's e-procurement system has already produced savings of 12%, which is equivalent to more than $500 million, Kiziria said. "For Ukraine, that's a relatively small number, but not for Georgia […] We shan't blindly try and repeat the Georgian experience in Ukraine, but rather shall adapt it to meet the actual situation here."
Nedashkovskiy added that the memorandum is "a real step forward".
"If it can bring about legislative change, I'm sure that it will at least partially ease the burden [of corruption] we face every day in the procurement sector."
Energoatom said the concept of reforming the public procurement procedure includes a number of "interrelated legal, institutional and organizational measures aimed at maximizing the rapid introduction of electronic tenders and reverse auctions in public procurement, in close coordination with anti-corruption policy, the development of competition and the transfer of state procedures to electronic services."
In a reverse auction, the roles of buyer and seller are reversed. In an ordinary auction - also known as a forward auction - buyers compete to obtain a product or service by offering increasingly higher prices.
Researched and written
by World Nuclear News
