Disclose public procurement and open contract information (ID0111)

What is the public problem that the commitment will address? Indonesia already issued the Public Information Disclosure Law (Undang-Undang Keterbukaan Informasi Publik - UU KIP) Number 14 of 2008, which gives the public the right to access government-managed information. UU KIP also requires the government to disclose various government’s information. However, after almost ten years of UU KIP implementation, only a few government agencies have the same perspective regarding public information disclosure, including government procurement of goods and services (Pengadaan Barang dan Jasa Pemerintah - PBJP). Many government agencies consider this information, especially contract documents should be excluded or cannot be accessed by the public. The Indonesians also find it challenging to monitor government projects because access to PBJP information is not provided. The lack of community participation in overseeing the PBJP project is one of the factors causing this sector to become highly prone to corruption. Throughout 2019, 64% of corruption cases handled by law enforcer were related to the procurement of goods and services. During COVID-19 pandemic, information disclosure regarding government procurement of goods and services in handling the pandemic is also limited. Even though the public procurement has become very urgent during pandemic, this activity should not neglect the principles of transparency, accountability, and require intense supervision to prevent abuse and corruption. 6 The idea of disclosing the government procurement of goods and services contract is a continuation of the 2018-2020 OGI NAP, particularly in terms of increasing the transparency of the PBJP process which targets all publications of procurement documents in the form of open data. However, until mid-2020, the target in the previous NAP has not been fully achieved. In addition, the Central Information Commission has not finalised the draft of Information Commission Regulation on Public Information Service Standard which regulates the information disclosure of goods and service procurement sector. What is the commitment Encouraging Information Disclosure related to Government Goods and Services Procurement Activities How will the commitment contribute to solving the public problem? Clear regulations will provide legal certainty and eliminate multiple interpretations of information disclosure in the process of goods and services procurement for public institutions. Besides, community monitoring in the procurement of government goods and service, both in general and during an emergency, will be more effective if complete and open procurement information is available, such as job specifications, work volume, and job descriptions. The open contract documents allow communities to access available information and provide input to government and monitor project implementation. Information disclosure can result in the procurement of quality goods and services and promote budget efficiency. Furthermore, the Government and CSOs can use this data to further analyse the effectiveness and potential for fraud in procurement. Why is this commitment relevant to OGP values? This commitment is in line with Open Government values, namely transparency and accountability. The existence of information related to procurement of goods and service activities shows the transparency of government activities. Furthermore, this transparency will encourage government accountability due to public oversight. Why is this commitment relevant This commitment supports the Priority Activity in the 2020-2024 RPJMN, namely Improving the Quality of Public 7 to Indonesian Medium-Term National Development Plan (RPJMN) and SDGs? Communications, especially the Priority Program "Strengthening public information and communication governance at the central and regional levels", namely the Compilation of Public Information Openness Index and Priority Activity namely Institutional Arrangements and Business Processes, especially the Priority Program "Implementation of Integrated Electronic Procurement System ", namely the Development of Centralized Electronic Procurement System. This commitment is also in line with the target of Sustainable Development Goals (SDGs) No. 16, namely "Strengthening an Inclusive and Peaceful Society for Sustainable Development, Providing Access to Justice for All, and Building Effective, Accountable and Inclusive Institutions at All Levels", especially at Target 16.6: "Develop effective, accountable and transparent institutions at all levels", and Target 16.10: "Ensure public access to information and protect fundamental freedoms, per national regulations and international agreements". Additional Information - Milestone Activity with a verifiable deliverable Start Date End Date 1. Issuance of revised Information Commission Regulation on Public Information Service Standards. one part of which regulates the disclosure of information on the January 2021 December 2022 8 procurement of goods and services 2. The issuance of Information Disclosure Index with one of the indicators related to the disclosure of information on the procurement of goods and services January 2021 December 2022 3. The information disclosure on government procurement of goods and services, including procurement during emergencies by optimising the national procurement portal or information system developed by the National Public Procurement Agency January 2021 December 2022

Action Plan Review

Commitment 1: Open Contracting in Government Procurement [1]

For a complete description of the commitment, see Commitment 1 in Indonesia’s 2020-2022 action plan.

Context and objectives:

From 2004 to 2019, 70% of Indonesian government corruption cases involved public procurement. [2] However, the public’s ability to monitor corruption is frequently limited by inconsistent access to public procurement information, [3] particularly during states of emergency. [4] In response, Indonesia Corruption Watch led development of this commitment to institute a revised Information Commission Regulation on Public Information Service Standards, continuing an incomplete commitment of the previous action plan. The current commitment also aims to institute online disclosure of procurement information during states of emergency, and to launch an annual Information Disclosure Index. This commitment aligns with the OGP value of transparency by offering public access to previously inaccessible procurement information.

Potential for results: Substantial

Public procurement accounts for almost half of Indonesian ministerial, institutional, and local government spending—but as much as $4 billion USD is lost annually through public procurement corruption. Bappenas believes that strengthening the procurement system is essential to the nation’s anticorruption efforts. [5] Likewise, the United Nations Office on Drugs and Crime has encouraged enhanced access to information and meaningful civil society participation. [6]

To date, limited transparency has been a weakness of the public procurement process in Indonesia. Despite the Access to Information Law, local and national government bodies, like the Ministry of Public Works, frequently fail to comply with requests to fully disclose public procurement information. [7] Government bodies’ lack of clarity on procurement information disclosure policy has also resulted in contradictory verdicts on public information requests between the Central Information Commission and the State Administrative Court (PTUN). [8] During states of emergency, like COVID-19, the government uses offline procurement processes that are not publicly accessible. Although the government typically conducts retrospective evaluations of emergency procurement, these evaluations are also not made publicly available. Obstacles to accessing public procurement information have limited accountability efforts by civil society and journalists. [9]

Under this commitment, Indonesia Corruption Watch anticipates that the revised Information Commission Regulation on Public Information Service Standards will open access to previously unreported public procurement information on planning for the tendering process, specifications of goods and services, recipients of government contracts, duration of contracts, methods of payment, quantity of money to be disbursed, and amendments to contracts. [10] The Open Contracting Partnership sees this regulation as potentially important leverage for civil society and journalists to secure the release of public procurement information from noncompliant government bodies. Additionally, the intended update to the national procurement portal would publish previously inaccessible emergency procurement information. Particularly during the COVID-19 pandemic, emergency procurement spending represents an increasingly significant component of government spending. [11] In terms of the Information Disclosure Index, members of the Freedom of Information Network Indonesia see the index as duplicative of the Public Institutions Ratings that have been published annually since 2010. Reportedly, these ratings have not impacted government bodies’ transparency, implying that the Information Disclosure Index may have limited potential impact. [12]

Opportunities, challenges, and recommendations during implementation:

Prompt passage of the revised Information Commission Regulation on Public Information Service Standards Indonesia is central to this commitment’s potential impact, but government bodies’ compliance with the regulation may be a challenge. Given issues with access to nonemergency procurement information, there are also concerns that the published emergency procurement information could have shortcomings in terms of data quality and open access. [13] As such, the following recommendations could enhance this commitment’s implementation:

Results Report

Commitment 1. Open Contracting in Government Procurement

● Verifiable: Yes

● Does it have an open government lens? Yes

● Potential for results: Substantial

● Completion: Substantial

● Did it open government? Marginal

Commitment 1. Open Contracting in Government Procurement

Context and Objectives:

To open public procurement, this commitment instituted a revised Information Commission Regulation on the Public Information Service Standards (Perki SLIP), continuing the previous action plan’s efforts. It also intended to institute online disclosure of procurement information during states of emergency and launch an annual Information Disclosure Index. This commitment was responding to a context in which public procurement plays a central role in government corruption. In 2019, 64 percent of corruption cases in Indonesia involved public procurement, ^[1] resulting in annual losses of up to four billion USD. ^[2] During the COVID-19 pandemic, compliance and accountability mechanisms loosened, while public procurement underwent a sharp increase, particularly in areas such as medical supplies and social protection programs. ^[3] This provided new opportunities for collusion, price markup, kickback, and fraud. ^[4] Meanwhile, the public’s ability to monitor corruption was limited. ^[5] Many officials were reluctant to disclose procurement information and uncertain of the implications of releasing what they considered sensitive information. Lack of clarity on disclosure obligations stemmed from diverging interpretations of overlapping Central Information Commission regulations and Procurement Policy Agency decrees, particularly Information Commission Regulations No. 1 of 2010 on Public Information Service Standards and No. 1 of 2017 on Classification of Public Information ^[6] as well as the Procurement Policy Agency (LKPP) Information Officer Information Officer (PPID) decrees No. 1 ^[7] and No. 3 ^[8] of 2019 on Determination of List of Public Information.

Did It Open Government? Marginal:

On 30 June 2021, the Information Commission revised its regulation on public information service standards which clarified disclosure requirements of the prior overlapping Information Commission regulations and Procurement Policy Agency decrees. It replaced Information Commission Regulations No. 1 of 2010 and No. 1 of 2017, which are now no longer valid. The new regulation clearly states in Article 14 (2) that government procurement of goods and services is public information and provides a list of information that must be publicly accessible at each stage of public procurement in Article 15 (9). ^[9] It also provides the Information Commission with clear authority to determine the list of public procurement information. The new standards are enforceable by the Commission and are the legal basis for all government units’ public information lists. The new standards have been widely disseminated among national and local government agencies, ^[10] which will issue their own corresponding decrees. In response, the Procurement Policy Agency (LKPP) issued Information Officer (PPID) decrees No. 1 and 2 of 2022 on public information for the agency as well as exceptions to the information disclosure rule. [11] Indonesia Corruption Watch did not consider the new decrees entirely in line with the new standards, with some cases of extended waiting periods for release of information. ^[12]

Overall, the new standards are seen to have introduced a stronger legal basis for transparency in public procurement, ^[13] but the Open Contracting Partnership reported that there was not yet information on the new standards’ impact in practice. [14] The Open Contracting Partnership and Indonesia Corruption Watch describe the new standards as a critical element of opening access to public procurement information. By clearly stating the government’s disclosure obligations, Perki SLIP can be used to overcome the common excuse that public bodies had employed to deny the release of public procurement information. ^[15] To date, public bodies have not yet made major changes to the release of public procurement information, although the new standards lay positive legal groundwork.

Moving forward, as the new standards begin to shift government disclosure practices, civil society is well positioned to use newly accessible public procurement information to strengthen accountability. For example, since 2012, Indonesian Corruption Watch has maintained a digital portal for monitoring public procurement called opentender.net. The portal provides easily accessible, structured data on which firms have been successful in tenders. ^[16] Open Government Indonesia and Indonesia Corruption Watch reflect that Perki SLIP will help maximize utilization of this portal to monitor public procurement. ^[17]

The commitment’s other milestones achieved more limited impact. LKPP published narrow information on COVID-19-related procurement on the Electronic Procurement Portal (LPSE), but not on a separate dashboard. ^[18] This was meant to serve as a starting point for procurement information disclosure during all states of emergency. However, during the implementation period, other central and local government units were not yet providing necessary information, and there was no implementing regulation on what types of procurement information should be disclosed during states of emergency. ^[19]

The Information Commission published the Information Disclosure Index. The index does not include an indicator on transparency of procurement of goods and services, although this is covered by a sub-indicator under the “transparency” indicator. [20] Academics and experts were included in developing the methodology, but CSOs such as Indonesia Corruption Watch and the Freedom of Information Network Indonesia were not and as a result, no longer take part as assessors for the index. ^[21] At its inception, members of the Freedom of Information Network Indonesia saw the index as duplicative of the Commission’s Public Institution Ratings that have been published annually since 2010 and have not impacted government bodies’ transparency. ^[22]

Looking Ahead:

By instituting the new Perki SLIP, this commitment achieved the fruition of an effort that began in the previous action plan—establishing a solid legal basis for disclosure of public information during government procurement process. The next action plan continues this effort, with a commitment to implement the new standards. It also aims to encourage government bodies to publish public procurement information in more detail, including emergency procurement information, and expand community participation in monitoring public procurement and related complaint channels.