Month: October 2019

PFM reform is one of the umbrella processes intended to transform our public administration, help effective spending which would maximise the value-for-money, but also indirectly aid in the fight against corruption, as the areas most susceptible to corruption tend to be the ones where public funding intersects with private interests. The key Government strategic document in this area is the 2016-2020 PFM Reform Programme.

During Programme implementation thus far, most progress has been achieved in relation to capacity building activities (mainly training) and regulatory changes.
The longest delays occurred in relation to the following: establishment of the e-registry of state property and delivery of relevant training; development of a detailed programme budgeting implementation and revision plan; improvements to the overview of projects included in the Capital Budget, and establishment of the e-procurement system. Most of these delays were caused by the timeline for contracting and implementation of IPA-funded projects.

This Report aims to provide an independent review of the achievement of the key objectives and bring to attention the activities that, although originally not foreseen, impacted the implementation of the reform, but also to cross-refer the official reports on the progress of the reform.

Previous report is available here.

The obligation to consolidate the procurement of ten goods and services was introduced in the Montenegrin public procurement system in January 2018, with the commencement of implementation of the Decree on Centralisation of Public Procurement of Goods and Services. However, centralisation is still not sufficiently established in the Montenegrin public procurement system.

There are numerous problems; there is also room for improvement, particularly in terms of transparent spending on centralised procurement. Planning and reporting on such procurements are largely decentralised, and the multitude of data hinders access to reliable and detailed figures on centralised spending.

The Property Administration, which is responsible for implementation of centralised procurement, compensated for the delays by launching urgent procurement and shortening the tender submission deadlines, contrary to the Law.

Centralised procurement is not planned sufficiently thoroughly and timely, which causes problems in practice and leaves the administration without some of the essential tools for its work and operation. The procurement of some items that are constantly needed poses a particular problem, as they get delayed due to the untimely actions of the Property Administration and the institutions responsible for the remedies to bidders.

This analysis presents the course of the 18-month process of centralisation of public procurement to date and includes recommendations for improvement which stem from the trials and errors experienced in that process.

For the procurement centralisation to bring about key effects of centralisation, such as enhanced administrative efficiency, professionalism and capacities, security and simplicity, as well as savings and better prices for large-scale procurement, the Property Administration and the concerned contracting authorities need to plan such procurement better and enable a single procurement procedure to provide the maximum quantity of the same or similar items for the state administration. It is of particular importance to improve the transparency of this segment of public spending and enable the interested public to monitor the details concerning the spending on centralised procurement.