Every month with be Public Procurement Month in Serbia

Aside from Law on Public Procurement and procedures being conducted electronically on the Public Procurement Portal, after a year of using the new procurement system, Serbia is still far from its goals. The average number of bids at tenders in Serbia is only 2.5, which puts us behind BiH, with 2.54 recorded bids, behind Slovenia (2.9) and Croatia (3.5), not to mention the average score for the European Union – 5.4. The new law has contributed to a certain development of the procedure, but there is still more room for improvement. In practice, shortcomings were noticed, and a dialogue was initiated in order to eliminate them. This will be a process that will never cease. Until changes are made. Changes were necessary since the first Law on Public Procurement from 2002, and then the regulation was changed in 2008, 2012 and 2019. We reached 2021, exactly one year after the implementation of the new Law on Public Procurement and the Portal, that was harmonized with EU directives. And where are we?

A survey organized by NALED, with the support of the Swedish International Development Cooperation Agency (SIDA), shows that one in four bidders doesn’t trust that public procurement procedures are fair, and almost half of them don’t fulfill the proposed requirements, which explains why most of bidders haven’t participated in any procurement in the past three years. Better control, transparency and application of criteria other than price, would motivate them to be more active. The purchasers are not very satisfied either, because the quality criteria are not being used, considering that there’s no model they could use as a reference, which makes procurements that more risky. They pointed out they are not trained enough to organize evaluation in this manner.

According to the previous Law on Public Procurement, for one announced tender, state institutions performed another 2.3 procurements for which procedures were not obligatory, while after the enactment of the new Law, one open call was accompanied by 46 exemptions from this legal framework, which is an increase of - 2,000%. According to the official data of the Public Procurement Office, in the first six months of last year, 124,281 contracts were concluded by the previous Law, while the exceptions which that Law allowed enabled another 285,219 procurements.

During the first six months of Law application, open calls have been published in 10,741 cases and 495,719 procurements have been exempted from the regulations. Since the new law, 70% of tenders have been suspended because there were no bids. The numbers are clear, the law has not met the expectations.

The public procurement procedure did change, and now bidders don’t have to participate in tenders through filling paperwork or by physical presence, it can all be done electronically. However, this brought problems to the bidders, who haven’t had time to prepare. The pandemic made the situation even worse. Sometimes, neither the purchasers nor the bidders know how to register on the Portal, so they often give up on application. That is why the number of tenders has dropped.

This procedure used to be formal, and now it’s a lot simpler, there is no need of physical collection of documents and checks, everything is proven through one e-statement submitted by the bidders. Although it is easy to make (for those who know how), that one e-statement is what creates the problem. It is necessary for the bidder to be and in order for that to happen, additional education is needed. Another problem happens once the bidders submit incorrect information in the e-statement, and the contracting authorities do not want to initiate procedures, because they register this mistake as a false statement. The thing that worries is that many don’t participate in public procurement because they believe that the winner is already decided in advance.

There is room for further improvement of the Public Procurement Portal. It is necessary for the Portal to include all types of procurement such as secret and urgent ones, as well as all stages of the procedure, and currently it does not include the phases od planning and enforcement of contracts.

July was the month of public procurement, and the Month of Public Procurement campaign was launched by NALED and the Association "Serbian Bidders", on the occasion of one year since the law and the  Public Procurement Portal were set in motion. The campaign was organized with the support of the United States Agency for International Development (USAID) within the project "Public-Private Dialogue for Development".

And dialogue started. In Serbia, every month will be a month of public procurement, until the regulations are better and until we reach the average bid number of 3.5. The next goal will be to reach the European Union average, which may be attainable if the procedures on the Portal are improved and simplified, and the lack of transparency is addresses, in order for bidders to participate in public procurement procedures much more.

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