Procurement News – Europe

Many developing countries can improve public services through fair and open procurement practices, says WBG report

November 20 in Daily News by eisc No Comments

WASHINGTON, November 18, 2015 – Private companies continue to face considerable obstacles, linked to transparency, efficiency and other ills of government procurement systems around the world, a new World Bank Group report finds.

Such obstacles negatively affect the ability of small and medium sized private sector firms to do business with governments, says the Benchmarking Public Procurement (BPP) 2016 Report, which assesses public procurement regulatory systems in 77 economies.

The public procurement market, globally, is estimated at around US$9.5 trillion each year. Of this, developing countries spend an estimated $820 billion a year worth of citizens funds, about 50 percent or more of their total government expenditure, on procuring goods and services that range from food grains for welfare programs for the poor to wiring for electrical grids that power homes and businesses.

“Public procurement is critical in improving lives and livelihoods when carried out in an efficient and transparent manner. Public procurement, if it is well done, can be a powerful catalyst for improving economic performance and can play a strategic role in delivering more effective public services,” said Augusto Lopez-Claros, Director of the World Bank’s Global Indicators Group, which produces the report.

Of the economies covered by the report, the vast majority around the world are using online platforms to advertise their purchases of goods and services, but often the websites provide little information to prospective suppliers. Furthermore, less than half of them allow bidders to submit their bids electronically. 

“Procurement practices that are transparent and efficient benefit all stakeholders. Governments get the best value for money, the private sector thrives and creates jobs, and citizens receive better quality public services. This can help reduce poverty and promote all-round prosperity,” said Federica Saliola, lead author of the report.

The Benchmarking Public Procurement (BPP) 2016 Report was launched at an event hosted by the U.S. Chamber of Commerce in Washington D.C.

About Benchmarking Public Procurement

Launched in 2013 at the request of the G20 Anti-Corruption Working Group, Benchmarking Public Procurement provides comparable data on regulatory environments that affect the ability of private companies to do business with governments in 77 economies. Benchmarking Public Procurement builds on internationally accepted good practices and principles and captures elements that matter to private suppliers around two thematic areas:

The Public procurement life cycle topic which covers the four phases of public procurement ranging from preparing and submitting a bid to the system for managing contracts.
The Complaint and reporting mechanisms topic which covers the ease of challenging a public procurement tender through a complaint system as well as reporting misconduct and conflicts of interest.

This year’s report marks the 2nd edition of the Benchmarking Public Procurement report series. For more information about the project and to access the accompanying datasets, please visit

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Irish NDFA begins €1 billion procurement process

November 20 in Daily News by eisc No Comments

The National Development Finance Agency is to begin a procurement process for infrastructure projects with a combined value of around €1 billion.

The agency is part of the National Treasury Management Agency, which manages the national debt and runs NAMA.

The projects include 1,500 social housing units at a cost of €300m, and €200m worth of investment in third level institutions.

A €150m investment in community nursing units and healthcare, and €150m for courthouses and justice projects are also included.

The agency will also provide financial advice to the Grangegorman Development Agency and Department of Education on a €150m student accommodation project at the proposed Grangegorman campus for Dublin Institute of Technology.

The NDFA said it is looking to attract interest from both domestic and international investors and contracts for the various projects.

The agency said it has been actively promoting the Irish Public-Private Partnership market with the aim of attracting interest from both domestic and international investors.

It has already bought or advised on projects with a value of €1.8 billion over the last 18 months. These include ten schools, seven courthouses, 14 primary care health centres and three major road projects – the M11 Gorey, M25 Cork and N17 Galway-Oranmore.

“Ireland is now firmly back on the radar of major international investors and their huge appetite for Irish infrastructure projects augurs well for our pipeline,” commented NDFA Director Brian Murphy.

Mr Murphy said this is good news for Irish taxpayers as it will make it easier to deliver projects that will bring real benefits to Ireland and to fund these projects on very attractive terms.

“We are very excited about the projects in our pipeline and we look forward to delivering high-quality social housing units, educational buildings, healthcare and courthouses over the coming years. These projects will help to address the serious infrastructure deficit which the country faces in these sectors,” he added.

He also said that costs will be monitored “stringently” as potential capacity constraints arise in the construction industry.

“These potential constraints are another positive sign of Ireland’s strong economic recovery but we are confident we can address them effectively,” he said.

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UK SMEs with weak security risk procurement exclusion – survey

November 16 in Daily News by eisc No Comments

SMEs need to take cyber security seriously or face being frozen out of the procurement process, according to a new survey from management consultants KPMG.

In a poll of UK procurement managers, nearly all (94 per cent) agreed that the cyber security standards of their supplier are important when awarding a contract to an SME. Yet nearly 70 per cent of the 175 respondents say SMEs could do more to protect their valuable client data.

The vast majority (86 per cent) of the UK procurement managers at large organisations across several sectors that took part in the survey said they would consider removing an SME supplier if they suffered a data breach.

Two-thirds of procurement managers ask their suppliers to demonstrate cyber accreditations, such as the UK Government’s Cyber Essentials or the credit card industry’s PCI DDS scheme. SMEs are increasingly being asked to self-fund their own accreditations.

“Cyber security is not just a technical issue anymore,” said George Quigley, Partner in KPMG’s cyber security practice, “it has become a business critical issue for the UK’s SMEs. Larger companies are placing an increased emphasis on the cyber security of their suppliers and increasingly the onus is on SMEs to show that they are tackling this issue head on.”

“Unfortunately, many SME still take a blasé approach towards cyber security and mistakenly don’t see themselves as targets of cyber criminals,” he added. “Unless these organisations take a more mature approach towards cyber security now, they face the risk of being frozen out of lucrative supplier contracts.”

In order for businesses to be awarded some public sector contracts they already have to demonstrate a certain level of cyber maturity and this is increasingly becoming the norm in the private sector as well, according to KPMG.

Companies are also embedding cyber security in their supplier contracts, with about half (47 per cent) of existing contracts already stating that suppliers are contractually obliged to tell if they have been hacked.

“This means that if a SME supplier is breached and doesn’t deal with it appropriately, they could be looking at the termination of an existing supplier contract,” Quigley added.

UK corporations have good business reasons to be concerned about the security practices of their suppliers. A string of high profile breaches in the US last year, including the high profile Target and Home Depot hacks, were subsequently traced back to lax security controls at third-party providers.

In the case of Target, a breach at its heating and air conditioning subcontractor was blamed for the subsequent hack of the retail chain. Hackers tricked workers at a Pennsylvania air conditioning firm to open a malware-laced email attachment, the first stage in a multi-stage hack that ultimately allowed crooks to plants malware on point-of-sale terminals at Target.

The similar Home Depot hack – which exposed 56 million customer credit and debit card accounts – was facilitated by credentials stolen from an unnamed third-party vendor.

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Ukraine joins WTO government procurement agreement — Ukrinform News

November 13 in Daily News by eisc No Comments

Deputy Economic Development and Trade Minister of Ukraine Maksym Nefyodov posted this on Facebook.

“Ukraine’s bid to join the GPA has been unanimously approved by the parties to the agreement! This is clearly the diplomatic victory of Ukraine, opening the mutual access to the markets of government procurement,” he wrote.

Nefyodov listed the economic benefits to Ukraine, “Our market has been already opened to foreigners for many years. In any case, the foreign companies may open branches in Ukraine and to work through them.”

“At the same time, the markets of other countries were closed for our manufacturers, and it was difficult to expect that the average domestic company would open the branch in New Zealand or Norway,” he wrote.

It should be noted that the agreement opens the access of Ukraine to the government procurement markets in 43 countries, including the USA, Canada, Japan, and the European Union.

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Living wage for public contract bidders – BBC News

November 13 in Daily News by eisc No Comments

Firms bidding for public sector contracts will be expected to pay employees the living wage under new rules which have come into force.
They will also ban the exploitative use of zero hours contracts.
The new statutory guidance for the public sector is part of the Scottish government’s commitment to fair work procurement practices.
Companies will also be required to commit to giving workers an “active voice” in the workplace.
Infrastructure Secretary Keith Brown said the guidance sees the government “nail its colours to the mast”.
He said: “Our model of procurement, putting the social, economic and environmental aspects of sustainability at the heart of all we do, remains the foundation of our approach.
“Employers must now recognise – as many already do – that if you want to do business with the public sector in Scotland, you have to be a responsible employer and value your workers. You have to do your bit to make Scotland a fairer and more equal society.”
The Living Wage is an hourly rate set independently and updated annually by the Living Wage Foundation.
The government pays its own workers the living wage of at least £7.85 an hour and has a voluntary accreditation scheme for other employers.
The living wage is more than a pound an hour higher than the current national minimum wage, which is currently set at £6.70 for over-21s.
While the minimum wage is a legal requirement, the living wage is designed to reflect the actual cost of living and is paid voluntarily by some employers.
In July, Chancellor George Osborne announced plans to replace the minimum wage for over-25s with a National Living Wage of £7.20 an hour from next April.
The chancellor said he wanted the National Living Wage to rise to £9 by 2020.
The introduction of the new guidance on public sector procurement was welcomed by trade unions.

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