Procurement Capacity Development Guidelines OECD/DAC Procurement Task Force

The use of country systems for procurement is a key aspect of international efforts to increase aid effectiveness. To develop successfully, partner countries and their governments must be able to implement policies and manage public resources through their own institutions and systems for procurement. Bypassing country systems reduces the sustainability of development programs and undermines a partner countries capacity to manage its own development agenda. Disbursing aid through country systems builds partner country capacity to manage development resources and creates more sustainable development programs.

The OECD DAC Procurement Task Force Compendium Vol 2, the UNDP Procurement Capacity Development Guide and the OECD DAC Methodology for the Assessment of Procurement Systems, provides the underpinning frameworks, experience, knowledge and processes, to enable the preparation of the OECD/DAC Procurement Task Force - Procurement Capacity Development Guidelines.

The Objectives of the TOR to prepare the Guidelines

The main purpose of this assignment is to prepare a ‘Procurement Capacity Development Guidelines’ (CD 4 Procurement), this will draw on the Task Force Compendium Vol 2, the UNDP Procurement Capacity Development Guide and the OECD DAC Methodology for the Assessment of Procurement Systems and other relevant examples. The CD 4 Procurement guidelines will be a knowledge product which includes the process steps, sample TORs, CD 4 Procurement tools, template(s) for CD plans, and indicator frameworks. The CD 4 procurement guidelines will be generic, illustrated by case material so that the guidelines can be easily adapted for other countries. An important resource will be the country case studies drawn from the Compendium Vol. 2. In addition the guidelines will draw on relevant and current materials and examples from members of the Task Force. The objective of the TOR is:

To produce a ‘Procurement Capacity Development Guidelines’ (CD 4 Procurement)

The CD 4 Procurement will be a practical ‘how to’ guide that can be used to replicate the procurement capacity development and reform processes and allow the CD 4 Procurement process to be adapted and scaled up in different country and regional contexts.

The TOR will be posted on the Cusco Event website and PCDC. Feedback / Comments / Example Cases / Frameworks will be requested via the PCDC Forum and email.

This will allow an annotated Table of Contents to be prepred for the Task Force Editorial Team which will be posted on PCDC for information and comment.

The Terms of Reference can be found on the PCDC website via this link.

Other relevant material is located on the PCDC topic page on The Road to Busan.

Thanks for sharing the ToR

Immediate reaction as follows:

The ToR constitutes an excellent background document with all relevant (OECD/UNDP/WB) references. As a relative new reader, this is a very good introduction to the procurement/development agenda and it is great to note that the guidelines are being built on existing (MAPS/Vol II/UNDP guideline) work. Thus, from an editorial and structural point of view the ToR is well written, easy to read and understand.

While it is good that you are not reinventing the wheel, a concern would be that the PCDG perhaps would have difficulties bringing something substantially new on the table and by that help the agenda moving into ‘reform phase II’. Existing work seems to be normative in nature (i.e. how to set up the review and the project) with a focus on the instrumental functioning of a best practice procurement system (i.e. what to look at in the procurement function to improve the situation).

From the Cuzco presentations it is clear that countries have done a lot improving the formal aspects of their systems particularly related to the MAPS pillar I and II. The problems are linked to the procurement operation and integrity of the systems (MAPS pillar III and IV) and the associated lack of trust. Thus, in CD terms, the enabling level seems to have been focused on legislation and less on the more complex integrity (corruption) question. Rather than a repetitive highlight of pillar I and II it is important that the PCDG upfront and explicitly addresses the corruption challenge. Further, it would be critical that the guidelines take an even deeper look at the corruption root causes and address issues linked to good governance, e.g. need for timely and sufficient payment of government staff. The point of course being that unless you address root causes, the less the chances that functional improvements will have sustainable impact. Such points are made in the Volume II material, but if we are serious moving the agenda into phase II it is important that these points are highlighted and not drowning in general formulations.

Further, it is recommended that capacity development of the full supply chain is addressed. Commodities (particular pharmaceutical critical for achieving MDG 1, 4 and 5) are equal to money. In other words, perfect procurement systems may be established, but downstream distribution leakages continue to be a risk. Obviously, there are limitations to what can be embraced by the PCDG in terms of specific sector focus. Thus, an explicit focus on the cross cutting root cause problems (as argued above) could be one step in the right direction to include the downstream challenges as well.

Of course the PCDG need to be careful not to discourage functional CD initiatives by overwhelming the reader with impossible enabling challenges. Thus, the PCDG will need to find the right balance between functional recommendations and good guidance on how to initiate processes to address root cause problems.

Finally, the PCDG ToR may benefit from having a more explicit distinction between fragile/less developed states and more developed states and how Capacity Development projects should be approached depending on context. An example: while the MAPS provides an excellent overview of very detailed indicators for how a superior procurement system should work, country voices clearly indicates that the MAPS indicators are an overkill from an assessment point of view and quite discouraging for many less developed countries. A key tool which is considered 'less fit for purpose' in countries that in principle require the most attention, is problematic. I may have overlooked how this issue has been addressed in the background documents.

In general we would be happy to follow the development of this work and provide comments as the work progresses.

Thomas
(UNICEF)

Following feedback, the OECD DAC Task Force final draft of the TOR for the Procurement Capacity Development Guidelines has been produced and posted. The revised version reflects the discussions at the Procurement Task Force in Cusco and includes a greater emphasis on the second generation procurement reforms. The TOR allows for supply chain management to be included and the scope of work, this will be discussed further when the annotated table of contents is produced in July.

Further suggestions and comments on the TOR are welcome, together with examples of procurement assessment processes, plans, frameworks, country cases and good practice.

A Practical Guide to Transforming Procurement Systems:

Work is underway to prepare A Practical Guide to Transforming Procurement Systems, as part of the on-going work for the OECD DAC Procurement Task Force. It is intended to have this finalized in time for the HLF-4 in Busan at the end of November 2011. The target audience for the guide will be partner countries.

Progress on the guide will be posted on the Forum. At this formative stage if you would like to share examples of procurement assessment processes, procurement capacity development plans or case studies etc. that could be used to illustrate good practice please post the details on the forum and/or send details to Rasmus Jeppesen rasmus.jeppesen@undp.org

The guide will use the following outline:

1. Introduction and context
It will cover key concepts increasingly recognized over time that help establish a common understanding as to what procurement covers and its strategic importance to a governance system.

2. Conceptual Framework

This section will contain the conceptual understanding of Capacity Development (CD), an outline of current definitions and process aspects, and it will highlight the principles embedded in the concept upon which these Guidelines are built. As any CD process is inherently a change process, elements of change in the context of public procurement and the wider governance system in which procurement sits will also be explored.

3. Assessment:

3.1. Approach
This section will provide a step by step guide to designing and conducting a procurement assessment.

3.2. Country Context
This section will introduce approaches to analysing aspects of the overall country context that have an impact on the functioning and performance of the public procurement system, but that are outside the direct influence of the procurement authorities. The section will be illustrated with small country examples.

3.3. Country Procurement Systems
This section will provide guidance on how to assess a country procurement system through use of the MAPS tool, illustrated by approaches employed in a number of countries.

3.4. Entity and Sectors
This section will provide guidance on approaches to conducting an assessment at the sector or procuring entity level

3.5. Individuals
This section will include approaches to conducting assessments focused on individuals involved in procurement.

4. Strategic Planning

The findings of the capacity assessment inform the strategic planning process by identifying capacity assets, gaps, common issues and trends.

5. Implementation
Since implementation usually spans over a medium or long-term period, appropriate institutional management structures should be established. Possible options will be presented ranging from establishing high-level inter-governmental task forces or project management teams, to creating steering committees or sounding boards including the private sector and civil society for oversight.

A Practical Guide to Transforming Procurement Systems:

The first draft of the guide to transforming procurement systems is being finalized in advance of the OECD DAC Procurement Task Force Working Group meeting in early October. The target audience for the guide will be partner countries. A number of good resource materials, short case studies and tools have been included in the draft guide from different organizations and regions.

There is still scope to include further resource materials, short case studies, frameworks, papers and tools etc. from different partner countries or development partners. If you have any relevant materials that you think would add value kindly share the soft copy and/or link with Rasmus Jeppesen rasmus.jeppesen@undp.org or post a link below with a short description.

These could cover any or all of the following subjects:

• What is public procurement
• The strategic importance procurement to a governance system
• Conceptual frameworks the conceptual understanding of Capacity Development (CD)
• Change processes
• Elements of change in the context of public procurement
• Approaches to designing & conducting procurement assessments
• Approaches to analyzing aspects of the overall country context that have an impact on public procurement systems
• Country Procurement Systems capacity assessment tools or approaches
• Approaches to conducting an assessment at the sector or procuring entity level
• Strategic planning process by identifying capacity assets, gaps, common issues and trends
• Implementation - institutional arrangements and structures
• etc

This guide will be a substantive resource for Strengthening Country Systems so it would be good to be as comprehensive and inclusive as possible.