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Ajay Sawhney, former Secretary IT&C & K.Bikshapathi, former Project Manager.

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Presentation on theme: "Ajay Sawhney, former Secretary IT&C & K.Bikshapathi, former Project Manager."— Presentation transcript:

1 Ajay Sawhney, former Secretary IT&C & K.Bikshapathi, former Project Manager

2 Agenda for Presentation Public Procurement Implementation strategy & timeframe Public Private Partnership Benefits Critical Success Factors

3 Public Procurement – Quantum & Practices States annual procurement US$ 2 billion to 3 billion Category of procurements Works & Turnkey Contracts : 80- 90% Goods & Products : 10-15% Services (consultancy, facility management, security services etc) : 5% Procurement Practices Centralised Procurement ( Corporate) Distributed Procurement ( Delegation of powers)

4 Implementation Approach Political decision (2001) IT&C Dept & High level Steering Committee Training of Chief Information Officers (CIOs) Appointment of consultants (2001) RFP - business model & scope of eGP services (2002) Selection of Service Provider Pilot – Go Live in 4 Depts/Agencies (2003) Evaluation of Pilot Scaling up & rollout to other Depts/Agencies (2004)

5 Strategic Alternatives Platform Model Centalized platform - decentralised procurement Exchange Model Join Existing Exchange Build New Exchange Services Model Monolithic approach Incremental approach Business Model Owned or PPP Revenue Model Fixed or Variable cost Payable by Bidder or Buyer

6 Public Private Partnership Model No capital cost to the Government State-of-the-art technology High quality resources Improved risk allocation – risk borne by the entity best able to handle that risk Combining accountability with efficiency Services governed by Service Level Agreements

7 Role of Partner Service Provider Implementation of the E-Procurement functionality across all departments Customizing software Setup and management of hardware and software for the Portal Training Helpdesk services Operations & Maintenance

8 Project Rollout Status Depts/Organizations Added Each Year Financial Year 2004-05 2005-062006-2007 Total Departments9 43 16 Public Sector Companies 7 69 22 Universities0 14 5 Municipal Corporations 020804 14 Municipalities142734 75 Autonomous Bodies 0 2 1 3 Total324852 135

9 eProcurement Status (March 2008) 20 Govt Departments 26 Public sector Units 104 Municipalities 10 Universities 500 Locations across the state 2000 govt users 11000 vendors Turn over 2003-04: US$ 400 Million ( 564 Nos) 2004-05: US$ 3200 Million ( 2215 Nos) 2005-06: US$ 3300 Million ( 9981 Nos) 2006-07: US$ 2300 Million (16046 Nos) 2007-08: US$ 3400 Million (10054 Nos) 38860 transactions US$ 13 Billion

10 Range of Procurement Goods (all types), IT Infrastructure, Medicines, Services Works contracts, EPC - Turnkey contracts Highest value US $ 700m Irrigation project Lowest US $ 1200 drain in a municipality 65 bidders for a single tender 550 tenders closed on a single day (Sept 2008)

11 Benefits Demonstrated Cost savings to the tune of US$ 650 m (5% of procurement costs) due to competitive bids Improved efficiency (120 days to 32 days) Transparency Elimination of Contractor Cartels Empowerment of Bidders Remote submission of bids Reduced bidding & incidental costs No more dependence on departmental officials

12 Cost Savings- Analysis Case 1:COT YearNo. of tendersECV(Cr)TCV (Cr)% 2001-02188755.29735.57(-)2.65 2002-03125558.36510.07(-) 8.65 2003-041601101.69884.21(-) 19.74 2004-0594755.56667.09(-) 12.02 TypeNo. of tenders ECV (Cr)TCV (Cr)% eProcurement(2003-04)107733.55549.93(-)25 Conventional(2003-04)53368.14334.78(-) 9 eProcurement(2004-05) 90 725.52 638.29 (-)12.02% Conventional(2004-05) 5 30.04 28.80 (-) 4.12% Comparison between the two systems COT derived additional savings due to eProcurement Estimated/ Tender Contract Value

13 Transparency Automatic e-mail to Bidders on tender publication Bid documents available online in public domain. Corrigendum in public domain No interface with departments upto tender opening Support documents are open to competitive bidders soon after tender opening Tender evaluation status automatically notified to bidders Procurement status in Public domain Effective tool for RTI Act

14 Critical Success Factors Support of top political leadership CIOs from each domain as project leaders High-level Project Implementation Committee Timely policy intervention Significant process re-engineering/ standardisation Active involvement of stakeholders Workshops/training Public Private Partnership Model Active helpdesk

15 Thank you

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