Public Procurement Experience of

Pakistan

(2ND South Asian Regional Public Procurement Conference)

By

Alam Zeb Khan

(Director General)

Public Procurement Regulatory Authority

Sequence of Presentation

1. Need for Procurement Reforms in Pakistan

2. Public Procurement Legal Framework of Pakistan

3. Performance of PPRA since its establishment

4. Capacity Building Initiatives of PPRA

5. Reforms Agenda of PPRA

Need for Procurement Reforms

in Pakistan

Need for Procurement Reforms in

Pakistan

Previous Procurement Regimes

1. General Financial Rules (1951/1979) (Stores etc)

2. Purchase Manual of Deptt of Supplies and Disposals

3. Delegation of Powers to Ministries (Overlapping)

4. Autonomous Bodies had their own Rules

5. Various Circulars of Ministry of Finance

Need for Procurement Reforms in

PakistanWorld Bank’s Study of 1997-98

In 1997 – 98, the World Bank auditors reviewed 4524contracts and found deficiencies in 3700 contracts.

Need for Procurement Reforms in

Pakistan

Findings of W.B CPA Report 2000

1.Outdated rules and regulations

2.Public procurement suffered from inefficiency, and poormanagement.

3.Inadequately trained and poorly paid public sectorprocurement professionals

4.Complicated and non-transparent procurement proceduresdiscouraged sound planning, thorough evaluation

Need for Procurement Reforms in

PakistanWord Bank Recommendations

1. Enacting a public procurement law based onUNCITRAL Model Law;

2. Creating a small, professionally staffed, independentregulatory agency

3. The regulatory body to be mainly confined topolicy, documentation, development of rules, etc.

4. Not to involve in line clearance functions for awardof contracts

Public Procurement Legal

Framework of Pakistan

Public Procurement Legal Framework of

Pakistan• Pakistan is a Federation consisting of the four

federating units; in addition to two other regions:

1. Punjab

2. Sindh,

3. Khyber Pakhtunkhwa

4. Balochistan

5. Azad Jammu and Kashmir

6. Gilgit-Baltistan

Public Procurement Legal

Framework of Pakistan

• PPRA Ordinance 2002

• Public Procurement Rules 2004

• Following Four Regulations issued so far:

1.PPRA Regulations 2008

2.PPRA Regulation 2009

3.Consultancy Services Regulations 2010

4.PPRA Regulation 2011

Public Procurement legal

Framework of Pakistan

Composition of the PPRA Board:

(1) Secretary, Finance Division (Chairperson)

(2) Secretary, Ministry of Industries and Production

(3) Secretary, Defence Production Division

(4) Secretary, Ministry of Water and Power

(5) Secretary, Ministry of Housing and Works

(6) Secretary, Ministry of Communications

(7) Three Members from private sector

(8) Managing Director

Public procurement legal framework

of Pakistan

• PPRA Ordinance 2002 and the Public procurement

Rules 2004 are applicable to all procuring agencies of

the Federal Government.

• Open Competitive Bidding is the principle/default

method of procurement

• All procurements above the minimum threshold of

Rs. 100000 (about US$1000) are advertised.

Performance of PPRA

Performance of PPRA

Administrative setup of PPRA

• PPRA is a very lean organization

• Total number of employees is 50

• 8 officers, and 42 staff

• Total budget for current year is Rs. 43M

Performance of PPRA173755 tenders monitored/uploaded on PPRA website during the

Financial Years 2004-2013

Financial

YearOrganizations

Tender

Uploaded

Average

Daily

Tenders

PP Rules

Violations% Violations

2004-05 255 11905 32 11311 95.01

2005-06 274 17124 47 12782 74.64

2006-07 293 20226 55 13657 67.52

2007-08 295 17078 47 9917 58.07

2008-09 290 17913 49 4720 26.35

2009-10 350 18404 50 3883 21.10

2010-11 385 20880 57 2738 13.11

2011-12 582 24104 66 2506 10.40

2012-13 677 26121 71 5721 21.90

Total 3401 173755 474 67235 38.70

Performance of PPRA

0

5000

10000

15000

20000

25000

30000

Tender Notices Uploaded2004-05 to 2012-13

Performance of PPRA

0

2000

4000

6000

8000

10000

12000

14000

2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

PP Rule Violations2004-05 to 2012-13

Performance of PPRA

• Uploading of PP Rules Violations on PPRA websitestarted in May 2012.

• Compliance of PP Rules has increased from 1% inMay 2012 to 10% at the moment .

• Procurement Plans of 205 Procurement Agencies havebeen uploaded during the current financial year asagainst 9 last year.

2012 2013

9 205

Performance of PPRA

0

50

100

150

200

250

2010-11 2011-12 2012-13

Complaints Lodged with PPRA

Capacity Building Initiatives of

PPRA

Capacity Building Initiatives of PPRA

• Training of the Government officials in procurement

started in 2006 under a 3 years World Bank Capacity

Building Project.

• In 2009, PPRA training activities were formalized

through the establishment of National Institute of

Procurement (NIP)

• Presently PPRA imparting training through its own

resources.

Capacity Building Initiatives of PPRA

• 4501 Officials trained in Public Procurement during the Financial Years 2006-2013.

Financial YearTraining

ProgrammesNo. Participants

2006-07 22 807

2007-08 33 977

2008-09 32 881

2009-10 35 762

2010-11 19 343

2011-12 19 326

2012-13 22 405

Total 182 4501

0

5

10

15

20

25

30

35

2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

Training Programmes

0

100

200

300

400

500

600

700

800

900

1000

2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

No. of Participants

Capacity building initiatives of PPRA

Learning Management System

• Present training capacity of PPRA is 480 per year

• Through development of LMS PPRA will be able to

train around 3000 persons per annum, through

online/virtual system

Challenges Faced By PPRA

• Shortage of office space.

• Shortage of Human Resource.

• Capacity Building of Human Resource.

• Lack of power to take action on PP Rules

Violations.

• Budgetary constraints

Reforms Agenda of PPRA

Reforms Agenda of PPRA

• Advisory Group on Public Procurement (AGPP)

• Preparation of National Procurement Strategy 2013-16

• Revision and improvement of Public Procurement

Rules, 2004

• Improvement and / or preparation of Public Procurement

Regulations

Reforms Agenda of PPRA

• Review of the SBD for Civil Works

• Preparation of SBDs for Goods

• Preparation of SBDs for Services

• Procurement Code of Ethic

Reforms Agenda of PPRA

• Establishment of PPRA Monitoring andEvaluation System

• Revamping of the PPRA website

• Development of HR-Pay Role Module

• Accounting Software developed

Reforms Agenda of PPRA

• The PPRA Service Regulations 2013 approved by the

PPRA Board on 30th September, 2013

• Market based Pay Package approved by the PPRA

Board, subject to fulfilment of certain formalities.

• For financial autonomy, PPRA Financial

Regulations/Accounting Procedure at a very

advanced stage.

Thanks