Transparency in Public Procurement (PT0008)

COMMITMENT #8: STRENGTHENING TRANSPARENCY IN PUBLIC PROCUREMENT
Commitment Start and End Date: January 2019 – August 2020
Lead implementing agency/actor National Network for Open Administration working group
Commitment description
What is the public problem that the commitment will address? In Portugal we have made important progress in the public procurement area, namely with the creation of the BASE Portal , containing information on all contracts entered under the Public Procurement Code (CCP) and also with the Observatory of Public Works . Nonetheless, perceptions of corruption in this field remain very high: according to the Special Eurobarometer on Corruption (OCT17), 92% consider that there is widespread corruption in Portugal, 55% of Portuguese respondents consider that public officials who award public tenders are corrupt, and 21% believe that corruption prevented his or her company from winning a public tender or awarding a public contract in the last 3 years.
This is to a large extent due to the widespread use of the Direct Award procedure, but also to the opacity of the public procurement cycle which neither the Public Administration nor the BASE Portal is able to fully respond to. What is the commitment? Enhancing transparency in public procurement through:
A. Publishing open data on the entire public procurement cycle;
B. Reducing drastically the use of Direct Award Contracts, to promote competition and to ensure best value for money acquisitions;
C. Developing and implementing civic monitoring mechanisms.How will the commitment contribute to solve the public problem? A. The following actions will contribute to ensure the dissemination of timely, accessible and usable data at all stages of the procurement cycle, thus improving the transparency and quality of e-procurement systems:
• Adopting the Open Contracting Data Standards (OCDS) , ensuring that all contracts are open by default;
• Elaborating a Manual and Guide to Procedures for the Publication of Contracts in the BASE portal which strengthens the principle of all contracts being open and public by default, and clarifies in more detail which are the exception cases;
• Following and adopting the recommendations/determinations of the European Commission on Public Procurement and e-Procurement ;
• Reinforcing the principle of freedom of choice of electronic platforms;
B. Publishing and making public the following additional information, for instance, will contribute to reduce the use of Direct Award Contracts:
• Detailed justification for choosing this type of procedure in "Clear Portuguese" – in a language accessible to the common citizen, avoiding legal jargon whenever possible;
• Identification by the competing entities of its business structure, with the disclosure of the effective beneficiaries;
In addition, complementary measures should be undertaken:
• Authors of any type of advice/technical support in the formulation of the Public Procurement Procedure should be identified, and prohibited to take part in any of the awarding stages;
• Identification of the jury of the contracting proceedings. All top decision makers from the Contracting Authorities are excluded from any awarding decisions;
C. Confidence in procurement is not achieved without the active participation of all stakeholders. Creating clear and useful channels for communication between governments and social groups, professionals, associations and communities affected by a specific procurement process helps to ensure that participation is translated into good government action, so we must focus on the development of tools and methodologies that encourage civic participation and monitoring.
This can be done through the application of tools of recognized impact, such as the Integrity Pacts developed by Transparency International, but also through initiatives that use open public procurement data for the involvement of citizens, companies and organizations.Why is this commitment relevant to OGP values? The commitment is aligned with the axes:
- Transparency: it translates into enhanced transparency on one of the nuclear activities and with greater economic and social impact undertaken by the government, and corresponding accountability;
- Public participation: public and open public procurement information catalyses the participation of non-governmental stakeholders (CSOs, journalists, academics and business) through the use of such data in a multiplicity of circumstances of high social value - research journalism, scientific research, market research, etc – and also allows for such feedback to be properly integrated into public policies, increasing confidence levels for public decision-makers;
- Use of ICT and digital inclusion: it contemplates adoption of OCDS, one of the most powerful benchmarking and social innovation tools.
Furthermore, this commitment promotes the accountability of the public sector, by supporting the conditions of integrity in the day-to-day exercise of public administration. On the other hand, open data accessible to a broader group of stakeholders within government, including policy makers, administrators and regulators, functions such as monitoring and auditing are reinforced.Additional information
Milestone Activity with a verifiable deliverable Start Date: End Date:
Implementation of the OCDS in the BASE Portal and the Public Procurement Observatory.
January 2019 August 2020Make all contracts open by default and public through their availability in the BASE Portal.
January 2019 August 2020Make eProcurement platforms truly empowering of free competition and competitiveness.
January 2019 August 2020Publication and public disclosure of all procedural documents relating to all phases of contracts signed by Direct Award:
1. Justification of the choice of this type of procedure in "Clear Portuguese";
2. Issuance of a compulsory declaration of the competing entity identifying its business structure, with disclosure of the effective beneficiaries under the terms of Law no. 83/2017, of August 18th;
3. Prohibition of participation in the procedure to the authors of any type of advice or technical support in the formulation of the procedure;
4. Typification of the behaviors that result in the impediment of the competitors;
5. The decision to hire or to participate in the jury of the Direct Award procedure must be barred to the holders of the competent body.
January 2019 August 2020Develop and apply tools to encourage civic participation and civic monitoring (e.g., Integrity Pacts, hackatons, etc.).
January 2019 August 2020Contact information
Name of responsible person from implementing agency AMA – Cláudia Barroso and Tiago Mendonça
Title, Department International Relations Unit
- Head of Unit
- Senior International Relations Officer
Email and Phone eri@ama.pt
21 721 55 45

8. Strengthening transparency in public procurement

Language of the commitment as it appears in the action plan: ^[54]

“In Portugal we have made important progress in the public procurement area, namely with the creation of the BASE Portal, containing information on all contracts entered under the Public Procurement Code (CCP) and also with the Observatory of Public Works. Nonetheless, perceptions of corruption in this field remain very high: according to the Special Eurobarometer on Corruption4 (OCT17), 92% consider that there is widespread corruption in Portugal, 55% of Portuguese respondents consider that public officials who award public tenders are corrupt, and 21% believe that corruption prevented his or her company from winning a public tender or awarding a public contract in the last 3 years.

This is to a large extent due to the widespread use of the Direct Award procedure, but also to the opacity of the public procurement cycle which neither the Public Administration nor the BASE Portal is able to fully respond to.

Enhancing transparency in public procurement through:

1. Publishing open data on the entire public procurement cycle;
2. Reducing drastically the use of Direct Award Contracts, to promote competition and to ensure best value for money acquisitions;
3. Developing and implementing civic monitoring mechanisms.”

Milestones:

8.1. Implementation of the OCDS in the BASE Portal and the Public Procurement Observatory;

8,2. Make all contracts open by default and public through their availability in the BASE Portal;

8.3. Make eProcurement platforms truly empowering of free competition and competitiveness;

8.4. Publication and public disclosure of all procedural documents relating to all phases of contracts signed by Direct Award;

8.5. Develop and apply tools to encourage civic participation and civic monitoring

Start Date: January 2019

End Date: August 2020

Editorial Note: For the full text of this commitment, see: “I National Action Plan for Open Administration Portugal”, National Network for Open Administration, https://ogp.eportugal.gov.pt/documents/48760/55198/I_National_Action_Plan_Open_Administration_Portugal_EN+%28DEC18%29.pdf/20545478-eb59-7b0e-90bf-c3b99267d4ff, p. 35.

Context and Objectives

In recent years, Portugal has made considerable effort to promote transparency in public procurement processes. The creation of the BASE portal in 2008, ^[55] compiling information on all public contracts signed, or the publication of Fighting Bid-Rigging in Public Procurement by the Competition’s Authority ^[56] are important examples of this effort. However, perceptions of corruption and, specifically, corruption in public procurement remain high, as noted in the action plan. The socio-economic impact of public procurement processes in Portugal is significant. Around 50 percent of EU structural funds received by the country are spent on public procurement processes, representing nearly 20 percent of all public spending and 10 percent of Portugal’s GDP. ^[57]

This commitment plans to improve transparency in public procurement through the publication of open data on the entire procurement process, including contract specifications. This will include the pre-selection of candidates (if appropriate), jury minutes, and the evaluation of the selected proposal. Currently, the data available regarding each particular contract is often limited to a call for applications and the final contract signed by the public body and the contractor. The commitment also calls for significantly reducing the use of direct award processes. In 2017, 42 percent of public procurement spending was allocated via direct awards. ^[58] To reduce direct awards, this commitment suggests requiring detailed justifications from public entities for this procedure, and the identification of the business structure and effective beneficiaries of competing entities. Finally, the commitment proposes the implementation of civic monitoring mechanisms, by creating clear channels of communication between public organizations and civil society, in particular communities directly affected by a specific procurement process. ^[59] The action plan refers to the integrity pacts developed by Transparency International Portugal as a potential tool to achieve this goal. ^[60] Although the basic tools for public monitoring are currently available in the BASE portal, this effort could improve the status quo by guaranteeing that monitoring takes place throughout the full procurement process.

Analyzing the commitment against OGP values, the initiative has the potential to provide citizens with access to more and better information on the procurement process. In turn, the efforts to develop civic monitoring mechanisms have the potential to promote civic participation, although these mechanisms are not properly described in the plan.

Overall, the commitment is verifiable. Although milestones 8.3 and 8.5 are vaguely worded and represent aspirational goals rather than concrete activities, milestones 8.1, 8.2, and 8.4 are measurable. If fully implemented as written, this commitment could greatly improve transparency in Portugal’s public procurement process. For the first time, detailed information on all stages of Portugal’s public procurement process will be published in open data format. Also, the reduction of the use of direct award processes could help make the procurement process fairer and more competitive. Hence, if fully implemented as designed, the expected impact of the initiative is expected to be transformative.

However, two limitations are worth emphasizing. First, the milestones that focus on making the e-procurement platform empowering and developing civic monitoring tools (8.3 and 8.5) do not clearly describe what kind of instruments are expected to be developed. Second, the entity responsible for implementing the commitments – the Institute of Public Markets, Real Estate and Construction (IMPIC) – did not collaborate in the development of the initiative. According to some MSF members, including TI representatives who originally proposed the commitment, this lack of involvement created a missed opportunity. For instance, after the plan was approved, the MSF learned that milestone 8.1 was already scheduled to be implemented by IMPIC. ^[61]

Next steps

On the basis of the analysis above, the IRM researcher recommends the following steps:

• It is important to ensure that all organizations responsible for the implementation of an initiative take part in its development. This concern was also raised by TI Portugal. ^[62] In this particular instance, the commitment would have benefited from the direct input of IMPIC, the entity responsible for the BASE portal with extensive experience in this area. There is no need for the formal inclusion in the forum of all organizations with implicit responsibility in the various commitments. However, the MSF needs to ensure that all these entities are given enough time for inputs and communication in the co-creation process.
• In future action plans, consider attaching clearer targets to the commitment. The three broad lines of intervention proposed here could be three distinct commitments, eventually distributed across two or three action plans. A more targeted commitment would allow the various stakeholders to devote more attention to the details of each initiative, and potentially lead to more ambitious outcomes.
• If this topic is prioritized in future action plans, the government could consider focusing on the simplification of public procurement procedures to enhance transparency and promote the inclusion of smaller companies that currently lack the necessary resources to submit proposals. This suggestion came originally from IMPIC. ^[63]
• Consider developing an Application Programming Interface (API) to accompany the repository Base.gov. This interface would allow citizens to retrieve information provided by the website in bulk. This may be particularly useful for watchdog groups, academics or private sector organizations interested in using this data to conduct more systematic analyses.

8. Strengthening transparency in public procurement

Completion: Limited

The Institute for Public Markets, Real Estate and Construction (IMPIC) published a database (a .zip file) of public procurement in open contracting data standard format, as well as the Annual Report on Public Procurement in Portugal for 2018. IMPIC has published this report since 2010. There is no information on new tools to stimulate civic participation or monitoring, however, an integrity pact is currently being implemented by TI Portugal and the Directorate General for Cultural Heritage. [16] An assessment of this commitment conducted by TI Portugal indicates that the .zip file published is defective and cannot be consulted, and that there is no evidence of a criteria-based publication process or publication of procedural documents. [17]