Boosting transparency of procurement and building citizen trust by using open contracting tools

Paraguay has been hit hard by the coronavirus. The country witnessed demonstrations against perceived fraud, corruption, and a lack of accountability in addressing the health crisis, which put thousands of lives at risk.

Pablo Seitz, director of Paraguay’s National Public Procurement Agency (DNCP), explains what it felt like to suddenly be in the spotlight as the pandemic hit. “Everyone was suddenly looking at public contracts. People who had never heard anything about public procurement were visiting our website to find out what was happening with their money. While this generated a lot of pressure, it also put us in the position to become more efficient, speed up processes, and enhance the integrity of the entire system,” he explained.

Paraguay has a long history of implementing open contracting reforms with a robust open data and publication infrastructure. Open data has helped Paraguay’s National Public Procurement Agency (DNCP) create an early warning system with real-time monitoring of all emergency procurement processes.

Establishing prices and terms

Just 27 days after the start of the lockdown, the DNCP authorized the use of framework agreements¹ in procurement processes. This allowed the DNCP to enter an agreement with potential suppliers by pre-establishing prices and terms. Agencies were now able to purchase goods quickly without having to launch a call for tenders, while maintaining transparency. Before the health crisis, agencies had 10 days to inform the DNCP that a direct award had been signed following the emergency procedures. The new regulation forced agencies to publish the tender specifications as well as all of the details required by the Public Procurement Information System (SICP) at least 2 days before the tender opening date.

“The public started to detect irregularities early on and these were reported in the media. They helped us monitor public procurement. In some cases, the scrutiny led to resignations of the highest authorities involved,” explains Vazquez.

Open data analysis and citizen oversight have given rise to new monitoring tools and helped to detect irregularities which were previously hidden among the mass of information available about procurement processes.

Setting up the notification system

The national procurement agency has set up a system of notifications to ensure that COVID-related calls for tenders are compliant. For example, the alert system checks the contract amounts and ensures compliance with the publicity periods specified. As soon as a tender is published which contains provisions contrary to the regulations, a notification is automatically sent to the head of the inspectorate’s cell phone indicating that a contract has been published that contains something contrary to the regulation.

The notification system is also useful for suppliers. Whenever an agency starts a procurement process to buy supplies for the pandemic, suppliers receive an alert from the system, including in cases of direct procurement where processes are shorter due to the urgency of the pandemic.²

These measures have helped lower costs for the state and improved service delivery while increasing trust of citizens in the process of public contracting.

References

OCP: https://open-contracting.org/2021/05/03/calling-for-accountability-how-paraguays-open-emergency-procurement-can-help-restore-public-trust/

¹A framework agreement is a form of procurement used to create an “umbrella” agreement with supplier(s). The framework sets out the terms and conditions under which goods, and lots or services can be purchased throughout the period of the agreement.

²https://open-contracting.org/2021/05/03/calling-for-accountability-how-paraguays-open-emergency-procurement-can-help-restore-public-trust/