eGP Vision

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e-GP Vision
National Seminar on National e-Procurement
Strategy Challenges in Implementation Co-sponso
rs The DG(SD) and the World BankNew Delhi,
November 28-29, 2006

• Dr S C PandeyOfficer on Special Duty (Policy and
  Coordination)
• D/o Expenditure, M/o Finance

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Mission Objective

• Mandatory publication of tenders on website is
  already in force.
• Mandatory e-procurement w.e.f. January 1, 2007,
  based on Ministry-specific thresholds.
• Assessment of e-GP readiness is going on.
• A likely scenario is that e-procurement becomes
  mandatory for all items covered by Rate
  Contracts. The DDOs should be able to place
  supply order on DGSDs website.

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Manual on Goods Procurement (Para 6.23)

• Purchase of goods through electronic mode of
  interface with tenderers and IT enabled
  management of the entire procurement process
  (notice inviting tenders, supply of tender
  documents, receipt of bids, evaluation of bids,
  award of contract, and execution of contract
  through systematic enforcement of its various
  clauses and tracking of claims, counter-claims
  and payments) is gradually gaining popularity.

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Manual on Goods Procurement (Para 6.23)

• In order to cut down transaction costs and
  improve efficiency and transparency, the
  Government aims to make it mandatory for all the
  Ministries/Departments including the Central
  Public Sector Undertakings under their
  administrative control to conduct all their
  procurements electronically beyond 31st December,
  2006. The Ministries/Departments have been
  advised to fix appropriate cut-off points in
  terms of the size of procurement to switch over
  to e-procurement.

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Manual on Goods Procurement (Para 6.23)

• The Director General (Supplies Disposal) has
  made significant progress in this direction and
  the National Informatics Centre is engaged in
  pilot projects to design a secure IT solution
  addressing concerns like encryption / decryption
  of bids, digital signatures, secure payment
  gateways, date/time stamp for activities, access
  control etc. The Ministries/Departments have
  already been directed to publicize all their
  tenders on their websites as the first step
  towards full-fledged e-procurement.

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Manual on Goods Procurement (Para 6.23)

• The Ministries/Departments are advised to
  proactively engage themselves in articulating
  user needs in the development of IT systems for
  e-procurement. The system should be secure,
  capable of maintaining complete confidentiality
  at appropriate stages of the bidding process, so
  that the tenderers feel confidence in
  electronically transmitting their queries and
  bids.

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Normal modes of Procurement

• Direct procurement of goods and services being
  replaced by works and services contracts, turnkey
  projects
• Items of bulk supplies having a wide and deep
  market (a) Long term supply contracts/MFPA with
  manufacturers and retail chains (b) Spot
  purchases
• High value office equipment, vehicles Rate
  contracts
• Proprietary items and specialized equipment
  direct tender inquiry

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Unbundling the problem

• Defence (a) Food Beverages (b) Common
  engineering stores (c) Common user vehicles (d)
  Special equipment and high value systems
• Railway stores (a) Common user items (b) Special
  stores
• Special equipment Hospitals, scientific
  departments
• Office equipment
• Hospital supplies of medicines and consumables,
  hospital equipment
• Stationery and other consumables Pre-printed and
  security printing
• Vehicles

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Concerns to be addressed

• Regulatory risks in a system of centralized
  regulatory framework but decentralized actual
  procurement.
• As Government moves to e-procurement, businesses
  too would have to get ready for the transition.
  This process should not end up eliminating the
  e-illiterates, and thereby stifling competition.
• The transition process should be user-friendly
  for staff.

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CPO-led model of e-procurement

• Exact model to be prescribed is still being
  chiseled.
• The Manual on Goods lays down the basic approach
  Bring as many common user items under rate
  contracts as feasible.
• Civil Ministries with smaller procurement budgets
  and inadequate capacity and resources need the
  support of CPOs.
• So one model could be where CPOs lead the process

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Re-engineering Central Purchase Organizations

• Rate Contracts / MFPAs
• Vendor database and rating services
• Order Placement Services
• Contract Management services
• Payment Gateway Services
• Follow up on complaints
• On-line tracking of consignments
• Consumer information on new products and
  comparison of features/specifications

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CPO portals need substantial refinement to be
really user-friendly

• Indenters should be able to query/access
• Wild card search for goods with rate contract /
  MFPA in force.
• List of dealers for particular goods at
  particular station.
• Electronic mailing lists for particular goods at
  particular station.
• Comparison of features/specifications

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Other models

• Another model that can possibly work for items of
  bulk consumption could be thrown up by the new
  age retailers offering web-based services to
  their clients, with preferred treatment to bulk
  consumers like Government agencies.
• This appears cost-effective but it will take time
  to materialize.

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Transparency and other gains

• e-procurement will facilitate transparency.
• Disclosures of what is purchased by whom, from
  whom, at what rates and when would be easier to
  administer.
• Specifications could be researched and
  requirements may be altered.

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Thank you for your kind attention