Weak Results in the Implementation of Public Procurement

Public procurement system in Montenegro went through significant legal changes whereby new amendments do not contribute to the transparency, accountability and efficiency of this system, said Ana Đurnić at the conference “Challenges of Public Administration Reform in Montenegro”.

The conference was organized by SIGMA – a joint initiative of the European Commission and the Organization for Economic Co-operation and Development (OECD) in co-operation with the Ministry of Public Administration in Podgorica.

Even the process of preparation and adoption of legal solutions in this area is not always transparent, and the latest amendments to the Law on Public Procurement were adopted behind closed doors, without a public discussion or consultation with the European Commission.”

Đurnić reminded that the Strategy for the Development of Public Procurement System was adopted in the same way three years ago.

“Amendments to the Law on Public Procurement adopted in June 2017 introduced procedures that reduce the transparency of this part of public spending. The least transparent and least competitive procedure – direct agreement, was deleted from the Law on Public Procurement, but an adequate substitution was found, which is now called low value procurement, she added.

It is worth noting that most ministries and municipalities have not foreseen in their internal acts regulating low value procurement the obligation of publishing concluded contracts. This has been done only by the Ministry of Defence, Ministry of Economy and Ministry of Sustainable Development and Tourism, and the Capital City of Podgorica is the only municipality which has done it.

She concluded that instead of going towards greater transparency and competitiveness of this part of public procurement, legal solutions go in opposite direction.

In this regard, Đurnić presented data earlier analized by the Institute Alternative, showing that:

  • The average number of bidders per tender is steadily decreasing: from 4.34 in 2011 to 2 in 2017, according to preliminary analysis of the Public Procurement Administration;
  • In 2016, 52 companies received over a half of the public procurement budget in that year (almost 250 million euros);
  • During 2016, the Public Procurement Administration received only 2 reports on suspicious for corruption,
  • Public procurement continues to be high on the list of areas particularly prone to corruption, and 59% of citizens believe that corruption is present in this area.

The conference was held in order to present findings of the second comprehensive monitoring report on implementation of the European Principles of Public Administration in Montenegro. I

n its report, SIGMA recommended, inter alia, to reduce the number of contracting authorities through centralization of public procurement, and reiterated the importance of establishing an electronic public procurement system.

In the coming period, through the project “Money Watch – Civil Society Guarding the Budget”, implemented with the support of the European Union in cooperation with the Institute for Public Finance from Zagreb and the NGO “New Horizon” from Ulcinj, Institute Alternative will conduct an independent monitoring of the Public Finance Management Reform Program for the period 2016-2020, the important part of which is the public procurement system.

Independent monitoring of the important strategic document for public finance reform through this project will be complementary to the monitoring of this area conducted by other important actors – primarily the Government and the European Commission. Institute Alternative Team

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