1. THE PHILIPPINE GOVERNMENT PROCUREMENT SYSTEM
An Overview

2. Problem Areas and Reform Measures
PROBLEMS
REFORMS
Confusion caused by fragmented legal system
Enactment of the Government Procurement Reform Act (GPRA)
Inconsistent policies, rules, and regulations due to lack of standards
Creation of the Government Procurement Policy Board (GPPB)
Lack of transparency
Use of PhilGEPS
Lack of check and balance
Participation of civil society
To address these problems, the Philippine government introduced the following reform measures:
First, enactment of an omnibus law, which is now known as the Government Procurement Reform Act.
Second, formation of the Government Procurement Policy Board or the GPPB, which we will discuss in detail later.
Third, making use of advances in information technology, establishment of the Philippine Government Electronic Procurement System to enhance transparency in the procurement process.
And lastly, and most importantly, the institutionalization of civil society participation in government procurement.
At this point, allow me to note that since these measures have been institutionalized in the procurement reform law, they may not be affected by any change in administration.

3. Enactment of GPRA over 100 procurement rules & regulations
Implementing Rules and Regulations
Executive Orders
Administrative Issuances
Memorandum Circulars
over 100 procurement rules & regulations
Government Procurement Reform Act
10 January 2003
Goods, Infrastructure,
Consulting Services
Coverage: NGAs and LGUs
Presently, all government procurement activities -- from office supplies, to textbooks, to medicines, to military arms -- are covered by Republic Act 9184 or the Government Procurement Reform Act.
The procurement reform law also applies to all forms of government entities – national (whether line agencies, government owned or controlled corporations, state universities and colleges) and sub-national or local governments.
It also subjects all branches of government – executive, legislative, judiciary, and other constitutional offices -- to the same set of procurement rules.
This is a stark contrast from the situation prior to its passage, when there was an estimated 100 procurement rules & regulations governing different types of bidding activities.

4. Application R.A. 9184 Applies to: National Government Agencies (NGAs)
State Universities and Colleges (SUCs)
Government Owned or Controlled Corporations (GOCCs)
Government Financial Institutions (GFIs)
Local Government Units (LGUs)
R.A governs the procurement of:
Infrastructure Projects
Goods (incl. Supplies, Materials, and Related Services)
Consulting Services

5. Scope and Coverage Section 4, Revised IRR
All fully domestically-funded procurement activities
All foreign-funded procurement activities, unless otherwise provided in a treaty or int’l/executive agreement
As may be agreed upon by the GOP and IFI in their treaty or int’l/executive agreement
Projects funded from foreign grants
Projects for International Competitive Bidding
Consulting Services for National Competitive Bidding
Definition of goods is structured broadly so as to exclude those falling under “infrastructure projects” or “consultancy services”
Lease of Office Space is embraced within the legal contemplation of “goods.”
GPPB Opinion dated 9/22/2005; query from NFA
Reinsurance services falls under the meaning of goods (under “general support services”)
GPPB Opinion dated 10/29/2003; query from GSIS
Loan Agreements are executive agreements or commitments
“Thus, for foreign funded procurement activities, the guidelines of the concerned International Financing Institution shall govern foreign assisted projects considering that loan agreements such as those entered into with IFIs fall within the phrase “international agreements or commitments” under Section 4 of R.A. 9184”
GPPB Opinion dated February 18, 2004; query from National Transmission Corp (TransCo); also
DOJ Opinion No. 46, series of 1987
IRR-A only covers fully domestically funded procurement activities, and cannot therefore be made to apply to foreign assisted projects.

6. Scope and Coverage GOP negotiating panels shall:
Adopt as default position, use of the IRR or selection through competitive bidding
Explain in writing if treaty or int’l/executive agreement states otherwise

7. Governing Principles Uniformly applicable to all government agencies
Transparency
Wider dissemination of bid opportunities
Competitiveness
Equal opportunity to all eligible bidders
Streamlined Process
Uniformly applicable to all government agencies
Effective and efficient method
System of Accountability
“Answerable”
Public Monitoring
Awareness and vigilance

8. Key Features of GPRA Covers procurement of all government agencies
General Rule is Public/Competitive Bidding
Alternative Methods of Procurement allowed in highly exceptional cases
Use of the Approved Budget for the Contract (ABC) as ceiling for the bid price
Use of transparent, objective, and non-discretionary criteria
Increased transparency in the procurement process
Professionalization of procurement officials
Inclusion of Penal and Civil Liabilities

9. Philippine Procurement Paradigm
Assess
Review studies
Consolidate into APP
Decide procurement method
Approve APP
Determine readiness
Post/Advertise opportunity
Open and evaluate bids
Post-qualify
Award and enter into contract
Procure
Identify
Cost-benefit analysis
Feasibility study
Market study
PPMP
Oversee implementation
Inspect and accept deliveries
Release payment
Implement
Needs
Satisfaction

10. Procurement Planning End User Budget Office BAC Sec / BAC
Approving Authority 1
Prepare PPMP
Evaluate PPMP and include in budget proposal
Review and consolidate into APP
Approve GAA/ Corporate Budget/ Ordinance 2
Revise PPMP
Finalize procurement mode
HOPE or 2nd in rank approves APP

11. Procurement Planning Actions Risks Identified
Needs Assessment, Planning, and Budgeting
Purchase is unnecessary
Necessary but overestimated
Unrealistic/Deficient budget
Not aligned with the overall program
Interference of high-level officials
Informal agreement on contract
Insufficient time frame
Definition of Technical Requirements and/or Specifications
Tailored for one company
Too vague
Not based on performance requirements
Choice of Procurement Procedure
Abuse of non-competitive procedures on the basis of legal exceptions through:
Contract splitting;
Abuse of extreme urgency;
Abuse of other exceptions based on a technicality or exclusive rights, etc.;
Untested continuation of existing contracts.
Source: Integrity in Public Procurement: Good Practice from A to Z published by the Organisation for Economic Co-operation and Development on 2007.

12. Procurement Methods
All Procurement shall be done through competitive bidding except as provided in R.A. 9184
Resort to alternative methods shall be made
Only in highly exceptional cases
To promote economy and efficiency
Justified by conditions specified in R.A and its IRR

13. Procurement Methods  Method Goods Infra Cons Competitive Bidding
Limited Source Bidding
Direct Contracting
Repeat Order
Shopping
Negotiated Procurement

14. Bidding Process Pre-Bid Conference Bid Submission Opening of
Pre-Procurement Conference
Advertisement and/or
Posting
Pre-Bid
Conference
Bid Submission
Opening of
Technical Proposal
(incl. eligibility docs)
Opening of
Financial Proposal
Contract Award
Bid Evaluation
Post-qualification 19 19

15. THANK YOU