New Procurement System: Innovative Ways to Improve Public Procurement

public procurement system

What is public procurement? The public procurement process is a system used by the federal government to purchase goods and services—basically anything from billion-dollar weapons systems and satellites to human resources. The goal in public sector procurement process is to increase competition by offering fair access to prospective bidders, which are the businesses providing the needed goods and services. It is through this environment of fair access and healthy competition that the government awards contracts to deserving businesses. The effectiveness of public procurement system is dependent on the public procurement law or a public procurement act in force, the efficiency of the procurement regulating bodies, and the professionalism of the procurement officers.

However, public procurement is a government activity most vulnerable to fraud, corruption, waste, and misdirection of funds, especially due to its size and scope, complex process, huge financial flows, and close interaction between the private and public sectors. Public procurement USA in particular, currently suffers from fewer controls, insufficient funding and staffing, and insufficient data to access contractors’ performance and prices. Here are recommendations to prevent abuse, fraud, and waste in public procurement.

Government Agencies Database

1. Streamline the government’s contractor database

The system that’s currently being used is a multiple contractor database. Contracting officials have access to at least two dozen databases where they can track registered businesses. The problem is, every database uses a different interface, which makes it hard to obtain a single complete profile of individual companies and compare them against each other. Aside from complexity of the existing system, there is also lack of quality data. The solution is a single streamlined government-wide database with a user-friendly interface and contains comprehensive, updated profiles on all registered businesses. The database should contain data on all pre and post-award winning contracts, prices, and contract evaluations. Although upfront costs of converting the old system into a new one would be huge, the advantage is that the cost of maintaining a single database is significantly lower and more efficient than maintaining 24 all at once.

2. Create a unique identifying code for every contractor in the databasepublic procurement process

Codes currently in use to identify a contractor are the Dun and Bradstreet Numbers (DUNS), Central Contractor Registration (CCR), and Commercial and Government Entity (CAGE). However, these aren’t helpful in quickly identifying a specific contractor since companies can obtain multiple codes. A solution would be to create a “Related Business Enterprise” database where every contractor is provided with one Contractor Control Number. If a company has more than one code in use, it is required to file all of them under the Related Business Enterprise using that single Contractor Control Number.

3. Create a single, comprehensive online training manual for contracting officers

A single, streamlined contractor database should come with a single, comprehensive, and easy-to-use online training manual. What makes contractors inefficient is not the lack of a system, but the lack of knowledge in using available resources. Equip them with the know-how of handling the database and they’d be more efficient in maximizing use of the resources.

4. Publish performance data on contractors

Contracting officers need to access quality, complete information on the bidders and compare them against each other to come up with the best options. To make wise comparisons, they need to look into how these individual companies have performed in the past. If every company’s performance is registered in the single database, that makes it easier for contracting officers to make informed comparisons. Details like findings of fault, fraud, or liability should also be included, as well as disputes and settlements to identify contractors who have major issues and those who have paid fines to cover their faults.

5. Create an automated system that discloses information in the database

Today, information is only disclosed when the interested party files for a request and invokes the Freedom of Information Act. And only then would a time-consuming review ensue. Information would only be released to the requesting party after a favorable result from the reviews. An automated system that discloses information can help avoid the hassle of lengthy and costly review processes, plus the accumulation of numerous information requests.

6. Create a budget dashboard

Much like a dashboard acts as a control or overview area not just in vehicles but in blogs, so should a budget dashboard be for contractor information presented to the public. An online budget dashboard allows the public to review the actual number or contracts and their values so they can gauge if the competition is fair and whether their taxpayers’ money is being spent appropriately. The data should be easy to download and share.

To effectively address current problems and make good use of taxpayers’ money, the government should be open to seeking innovative ways to improve public procurement.

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