1. Eduardo@Talero.name –4-21-05 1 Reducing Corruption through Electronic Procurement Eduardo Talero Washington, April 21, 2005

2. Eduardo@Talero.name –4-21-05 2 OVERVIEW What is e-procurement? What is the e-procurement cost/benefit function? How can e-procurement reduce corruption? What are the key points to remember?

3. Eduardo@Talero.name –4-21-05 3 e-GP: FULL SYSTEM SUPPLIERSSUPPLIERS BUYERSBUYERS User Support Facilities Transaction Facilities Disclosure Facilities Systems Integration Facilities Procurement Authority LegislatureExecutivePublic

4. Eduardo@Talero.name –4-21-05 4 e-GP DISCLOSURE FACILITIES BUSINESS OPPORTUNITIES CONTRACT AWARDS LAWS / REGULATIONS BIDDING DOCUMENTS Disclosure Facilities SUPPLIER ROSTER SUPPLIERSSUPPLIERS BUYERSBUYERS Procurement Authority LegislatureExecutivePublic CODING SCHEME STATISTICAL DATA BASE

5. Eduardo@Talero.name –4-21-05 5 VOLUME COST E-Purchasing High Online Auctions  Bidding  Reverse Bidding Online Shopping High Low e-GP: TRANSACTION FACILITIES E-Tendering Framework Contracts

6. Eduardo@Talero.name –4-21-05 6 e-GP: USER SUPPORT FACILITIES Supplier Registration & Alerts Solicitation Preparation Support Bid Preparation Support Bid Evaluation Support Research Support Reference Prices Electronic Payments SUPPLIERSSUPPLIERS BUYERSBUYERS Procurement Authority LegislatureExecutivePublic

7. Eduardo@Talero.name –4-21-05 7 E-Government e-GP: INTEGRATION FACILITIES Integrated Fiscal Management Requisitioning Contract Management Inventory Control Asset Management SUPPLIERSSUPPLIERS BUYERSBUYERS Procurement Authority LegislatureExecutivePublic

8. Eduardo@Talero.name –4-21-05 8 OVERVIEW What is e-procurement? What is the e-procurement cost/benefit function? How can e-procurement help reduce corruption? What are the key points to remember?

9. Eduardo@Talero.name –4-21-05 9 User Support Facilities Transaction Facilities Disclosure Facilities Integration Facilities SYNERGY ECONOMY EFFICIENCY TRANSPA- RENCY THE e-GP COST-BENEFIT FUNCTION IMPACT e-GP SYSTEM INPUTS Governance Leadership/ Human Resources Institutional Change Technology Financing

10. Eduardo@Talero.name –4-21-05 10 Leadership and policy reform Declares e-GP system official publication vehicle Mandates publication through the system of business opportunities, bidding documents, questions and answers, contract awards. Establishes publication time standards to be enforced by the system. Declares non-compliant transactions invalid. Makes management responsible for accuracy of information. Example: Chile: Jan.,2003 Executive Order

11. Eduardo@Talero.name –4-21-05 11 e-GP COST – BENEFIT RATIO Full e-GP System Financing: US$ 2.5 – 3.5 million/Country Over 8% of GDP 10-20% Transaction cost reduction Non-Financial Inputs EFFICIENCY TRANSPA- RENCY ECONOMY 10% cost reduction (0.8% of GDP) SYNERGY E-Government Fiscal Management Systems Integration

12. Eduardo@Talero.name –4-21-05 12 OVERVIEW What is e-procurement? What is the e-procurement cost/benefit function? How can e-procurement help reduce corruption? What are the key points to remember?

13. Eduardo@Talero.name –4-21-05 13 HOW CAN E-PROCUREMENT HELP REDUCE CORRUPTION? Illuminating the playing field Facilitating entry Standardizing communications Keeping score Leveling the playing field Enforcing the rules

14. Eduardo@Talero.name –4-21-05 14 e-GP: TRANSPARENCY BENEFITS OVER 8% OF GDP HEALTH SERVICE RECIPIENTS PUBLIC TRANSPORT USERS STUDENT POPULATION MOTORISTS ETC. MID SIZE BUSINESSES LARGE SUPPLIERS SMALL SERVICE FIRMS ALL GOVERNMENT

15. Eduardo@Talero.name –4-21-05 15 e-GP: TRANSPARENCY BENEFITS OVER 8% OF GDP HEALTH SERVICE RECIPIENTS PUBLIC TRANSPORT USERS STUDENT POPULATION MOTORISTS ETC. MID SIZE BUSINESSES LARGE SUPPLIERS SMALL SERVICE FIRMS ALL GOVERNMENT

16. Eduardo@Talero.name –4-21-05 16 How can e-procurement help reduce corruption? Illuminating the playing field Facilitating entry Standardizing communications Keeping score Leveling the playing field Enforcing the rules

17. Eduardo@Talero.name –4-21-05 17 How can e-procurement help reduce corruption? Illuminating the playing field Facilitating entry Standardizing communications Keeping score Leveling the playing field Enforcing the rules

18. Eduardo@Talero.name –4-21-05 18 e-GPSTANDARDIZES COMMUNICATIONS SUPPLIERSSUPPLIERS BUYERSBUYERS Clarification questions Proposals Bidding documents Clarifications Request for documents Clarification questions Payment Purchase plans RFQs & RFPs Notice of Award Clarifications

19. Eduardo@Talero.name –4-21-05 19 How can e-procurement help reduce corruption? Illuminating the playing field Facilitating entry Standardizing communications Keeping score Leveling the playing field Enforcing the rules

20. Eduardo@Talero.name –4-21-05 20 How can e-procurement help reduce corruption? Illuminating the playing field Facilitating entry Standardizing communications Keeping score Leveling the playing field Enforcing the rules

21. Eduardo@Talero.name –4-21-05 21 Policy Reform + Institutional Reform + Human resource development STAGED DEVELOPMENT OF e-GP SYSTEM INTEGRATION FACILITIES TRANSACTION FACILITIES DISCLOSURE FACILITIES E-catalog Purchases Reverse Bidding E-Tendering

22. Eduardo@Talero.name –4-21-05 22 How can e-procurement help reduce corruption? Illuminating the playing field Facilitating entry Standardizing communications Keeping score Leveling the playing field Enforcing the rules

23. Eduardo@Talero.name –4-21-05 23 OVERVIEW What is e-procurement? What is the e-procurement cost/benefit function? How can e-procurement help reduce corruption? What are the key points to remember?

24. Eduardo@Talero.name –4-21-05 24 E-GP AND CORRUPTION: KEY POINTS TO REMEMBER Political leadership and policy reform are critical Success not possible without culture change Gradual development is possible and desirable Modest start yields large transparency benefits Overall impact can be major Every country case is different