Slovak Republic
Information on statistical evaluation
of public procurement processes in 2001

In compliance with Art. 39 par. 4 of Act No. 263/1999 Coll. of Laws on Public Procurement and on Amendment of Certain Acts (hereinafter referred to as "the Act"), the Office for Public Procurement (hereinafter referred to as "the Office") has carried out a second statistical survey of the public procurement methods used in 2001.

Contrary to the statistical statement for 2000, the data on recording framework contracts according to Art. 6 par. 2 of the Act was included in the statistical statement for 2001. For public procurement methods resulting in the conclusion of framework contracts, procuring entities indicated only the number of framework contracts without prices (expected and contracted) in the statistical statement for 2001. Prices were subsequently indicated after conclusion of subcontracts in notices of results of negotiated procedures without prior notification.

There has been a variation in the range of procuring entities that are reporting units, mainly business entities, over the monitored period; it is therefore difficult to define them fully. On the basis of the records on procuring entities, the Office sent the approved statistical forms along with methodological guidelines to 6,752 entities.

Statistical processing was carried out on 5,938 returned statistical statements, where 4,780 procuring entities returned negative statements; these procuring entities had concluded contracts that are not subject to the application of this Act. Only 1,158 returned statements have been evaluated, i.e. 238 statements more than last year, and only 19.50% of all returned statements. The data analysed in the statistical evaluation have been processed on the basis of these statistical statements.

In 2001, using the methods and procedures given in the Act, the procuring entities completed a total of 5,699 public procurement methods leading to the conclusion of contracts. Of this number, 5,323 were contracts concluded in accordance with the Commercial Code, and 376 were framework contracts according to Art. 6 par. 2 of the Act.

Up to the end of the monitored period, 1,007 methods had been cancelled, and 710 public procurement methods were in an incomplete state.

The objective of public procurement is to find the contracting party with whom the procuring entity will conclude the most advantageous contract. The analysis shows that procuring entities concluded contracts for a total amount of EUR 1.3 billion. The procuring entities prepared funds of EUR 1.38 billion for procuring the required subject matters of public procurement processes.

The results obtained were partially affected by amending the statistical statement, since information on framework contracts did not contain expected and contractual prices.

The average savings of funds assigned for public procurement was approximately 6.00%, and in comparison with 2000 this figure was 1.21% lower. The highest savings of funds was reached by natural monopolies (10.55%), and the lowest by state budgetary organisations and organisations established by budgetary organisations (1.55%). Public procurement represents 5.78% of gross domestic product.

On the basis of an evaluation according to the subject matter of public procurement, we can state that the lowest savings were for procuring supplies - 3.07%, and the highest savings were for procuring works - 7.38%. The situation in 2000 was similar; savings for procuring supplies were 3.5% and works 10.8%.

On the basis of the evaluation according to the used public procurement methods, we can state that the situation was the same as for the previous year, when the most frequently used non-tendering procurement method - negotiated procedure without prior notification was used in 50.12% of cases. Even though the statistical reports do not give any reasons for the use of a particular method, experience shows that procuring entities mainly apply this method when:

- they are under time pressure due to late assignment of funds from the state budget;

- they discover later the need to ensure a subject matter of public procurement above the framework of planned needs;

- the Office directed cancellation of the former public procurement method (in 275 cases);

- they conclude a subcontract on the basis of a valid framework contract;

- they conclude contracts with suppliers who were contracting parties in previous years. These are mainly procuring entities operating as natural monopolies on the market concluding contracts with foreign parties on the basis of experience gained over previous years, or with domestic parties who are producers of supplies necessary for their activities;

- they conclude contracts with exclusive importers of goods.

In comparison with the use of the other public procurement methods used last year, open tendering procedures organised were used in 44.35% cases, which is 5.77% less than the use of negotiated procedure without prior notification. Other methods were used in a negligible number of cases.

In 2001, procuring entities ensured supplies at an average contractual price of EUR 144.4 thousand, services at an average contractual price of EUR 183.5 thousand, and works at an average contractual price of EUR 397.3 thousand.

The number of contracts concluded with tenderers based abroad also increased considerably to 265 contracts. This figure is 157 contracts more than in 2000, when only 108 contracts were concluded. In 2000, foreign winners represented only 2.61% of the total number of the 4,145 completed public procurement methods, while in 2001 this proportion increased to 4.97% from a total number of 5,323 completed public procurement methods.

Procuring entities concluded contracts with foreign parties using above-the-threshold and under-the-threshold public procurement methods for a total amount of EUR 97, 287 thousand. The largest number of these contracts was concluded with tenderers based in the Czech Republic (41.51%). This result can be explained mainly by business relationships during previous times, and some of these relationships still exist. Contracts with foreign parties were concluded mainly through negotiated procedure without prior notification (88.7%) and mostly for the delivery of supplies (71.32%). The most frequently indicated reasons for using negotiated procedures without prior notification were as follows: availability of procurement subject matter from only one source (27.65%), and time pressure resulting in the fact that no other procuring method could be used (15.32%). The most number of contracts with tenderers based abroad were concluded by procuring entities operating as natural monopolies on the market; these accounted for 180 contracts (67.9%) and a total amount of EUR 50, 514   thousand.

In 2000, as many as 66.67% of contracts were concluded with suppliers from the CEFTA countries, of which the highest portion of contracts were concluded with the Czech Republic, while 30.55% of contracts were concluded with winners from the EU countries.

In 2001 the EU countries concluded 45.65% of contracts and the CEFTA countries concluded almost the same number at 43.77%.

In compliance with Art. 39 par. 2 of the Act, procuring entities are obliged to provide the Office no later than the end of January a report on each contract concluded in the previous year on the basis of above-the-threshold public procurement methods. The analysis shows that procuring entities concluded 322 contracts on the basis of above-the-threshold public procurement methods. In 2000 this figure was 151 contracts. Procuring entities most frequently used negotiated procedures without prior notification as an above-the-threshold method, i.e. in 170 cases (52.80%), and open tendering procedure in 145 cases (45.03%). Other public procurement methods were used in a negligible number of cases. Procuring entities using this method most often were state budgetary organisations and organisations established by them, representing 211 cases (65.53%). In comparison with 2000 when only 6% of tenderers based aboard were successful, in 2001 this figure was 13.35% of successful tenderers, i.e. 43 cases of the total number of contracts concluded on the basis of above-the-threshold methods.

In cases of above-the-threshold public procurement methods, no procuring entity applied measures supporting less-developed regions (Art. 79 of the Act).

In 2001 for public procurement of works, procuring entities indicated the application of measures supporting less-developed regions with the aim of speeding up their development and reducing differences between them, mainly by creating new job opportunities (Art. 78 of the Act) in 30 notices of invitation to public procurement methods.

In spite of some shortcomings in public procurement processes during the previous period, we can state that the application of the Act in 2001 contributed to a reduction of more than EUR 81, 852   thousand in assumed expenses and to an improvement in the economic environment, because procuring entities require entrepreneurs to fulfil their obligations to the State, municipalities, insurance companies or funds as a condition for participation in public procurement.

With regard to the obligation stipulated by the Act that procuring entities are obliged to arrange public procurement through professionally qualified persons from 2002, we can expect this situation will improve in the following period - not only concerning the obligation to report but also the application of the Act.

1 EUR: cca 44,30 SKK (July 2002)