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Úvodná stránka > English > Statistics > 2004

Information on general statistical evaluation of public procurement process for 2004

Public procurement is the area which is from year to year increasingly monitored by media and also by general public, and which ranks among the areas monitored within the European Communities. Public procurement process leads to savings of finance. Public funds constituting a part of the State budget expenditures are used through its application.

Information on general statistical evaluation of public procurement process for 2004 (hereinafter referred to as “Information”) was elaborated for the first time on the basis of the notices unpublished and published in the Journal of Public Procurement (hereinafter referred to as the “Journal”) in compliance with the Decree of the Office for Public Procurement No 575/2003 Coll. concerning contents and models of notices used in public procurement (hereinafter referred to as the “Decree”), which were elaborated by professionally qualified persons. Such notices contained data on the concluded and signed contracts on the basis of over-limit and under-limit methods of public procurement in 2004.

This material does not contain details on the procurement of low-value objects, the so called sub-threshold procurement with higher cost and sub-threshold procurement with lower cost, i.e. procurement of goods and services with anticipated cost not exceeding SKK 500 thousand excluding VAT and works not exceeding SKK 2 mil. excluding VAT.
The aforesaid contractual values involve the value of all contracts, excluding partial contracts, concluded on the basis of framework contracts according to Article 66 (2) (a) of the Act. Partial contracts have been evaluated and listed separately. All values for 2004 are indicated in SKK excluding VAT.

In total 11 104 notices involving 932 notices of tender cancellation, 6 852 notices of public procurement result and 320 notices of the conclusion of partial contracts based on valid framework contracts (10 172 in total) have been processed. This number of notices represents 1 408 procuring entities, which is by 136 more than in 2003.

The analysis shows that procuring entities concluded contracts of total value amounting to SKK 71.1 bil., and through the application of the Act on public procurement the procuring entities contributed to a decrease in public expenditures amounting to more than SKK 5.14 bil.
The proportion of public procurement in GDP was 5.37 %.

In 2004 the total number of completed public procurement methods – notices of public procurement results represented 10 172. As compared to the year 2003, the number of completed methods has increased by 1354; out of which 6038 methods resulted in the conclusion of 7149 contracts in accordance with the Commercial Code and Civil Code, 814 methods resulted in the conclusion of 1083 framework contracts in accordance with Article 10 (5) of the Act. 3320 notices were serviced according to Article 66 (2) (a) which resulted in the conclusion of 3322 partial contracts based on valid framework contracts.

Total average level of a saving achieved for 2004 – a difference of the highest offer price was shown at the amount of 7.2 %, which corresponds also to the difference between the anticipated and contractual value equal to 7.3 %.

A public tender was the most often used method of public procurement applied by the procuring entities in 4473 (57.5 %) cases, out of which 3648 (46.9 %) tenders were completed and 825 (10.6 %) tenders were cancelled. The situation when each fifth public tender is cancelled continues to exist. Approximately 30 % of cancelled public tenders continued by a negotiated tender without a prior notification in accordance with Article 66 (1) (e) of the Act, which represents 8.7 % of negotiated tenders without a prior notification.
The second most applied method was a negotiated tender without a prior notification which was used by the procuring entities in 2812 cases.

The number of applied restricted tender was 393 (5.1 %), out of which 312 tenders resulted in the signing of a contract and 81 tenders were cancelled.

The number of negotiated tenders with a prior notification was 88 (1.1 %). Only 66 tenders were completed and 22 tenders were cancelled.

A design contest was applied in minimum cases, in the number of 18 (0.2 %), out of which 14 were completed and 4 contests were cancelled

A most frequently used justification for the application of a negotiated tender without a prior notification by a procuring entity in accordance with Article 66 (1) of the Act (1062 cases) was the fact that the subject of procurement was obtained on the basis of the contractor’s exclusive rights.

According to Article 66 (2) of the Act the procuring entities sent notifications of the conclusion of partial contracts on the basis of a framework contract, and 3320 such notifications were delivered.
As regards the type of procuring entities, the utilities (entities operating in the water, energy, transport and telecommunication sectors) represented the most active group which completed 1994 (29.1 %) public procurement methods based on which they concluded 2222 contracts.
Central state administration, on the second place, completed 1827 (26.7 %) methods and concluded 2173 contracts.
The next procuring entities completed 1682 (24.5 %) methods representing 2351 contracts.
The fourth group is represented by local governments with the number of 1318 (19.2 %) methods and 1453 contracts.
The least numerous group is represented by other entities which applied the Act only in 31 cases and concluded 33 contracts.

As regards the subject of procurement, public procurement was most often used for the procurement of goods, in 3121 cases (45.5 %) of the value amounting to SKK 21.4 bil. The highest number, 405 (43.4 %) of cancelled tenders also involved procurement of goods, out of which in 380 cases (93.8 %) the procurement of goods through a public tender was cancelled. Based on the findings of audit and objection proceedings it can be concluded that this was mainly caused by incompetently prepared tender documents, in particular in the part “method of criteria evaluation”.
Contracts for services covered 31.2 % (2136) of the value amounting to SKK 19.3 bil., and works represent 23.3 % (1549) of the value amounting to SKK 30.4 bil.

With respect to the utilisation of EU funds the evaluation of public procurement based on notices delivered to the Office is as follows: 52 cancelled and 253 completed methods in which 259 contracts of the value amounting to SKK 6 283 243 thousand were signed.
The value of 31 concluded partial contracts was SKK 8 004 thousand.

In 2004 in 332 cases the tenderers having their registered office abroad succeeded with whom 338 contracts of total contractual value SKK 4 092 513 thousand were concluded; a saving achieved represents 4.8 %. As compared to the previous year, the total number of contracts decreased by approximately 10 %, the contractual value is lower by approximately 50 %.

A negotiated tender without a prior notification represents a method of public procurement through which the procuring entities concluded with foreign tenderers the largest number of contracts, in 259 cases.
The subject of procurement was most frequently obtained on the basis of the contractor’s exclusive rights, namely in 167 cases.
Another subsequent reason is represented by the conclusion of a partial contract on the basis of a valid framework contract, namely in 109 cases.

Such sequence in the evaluation of successful tenderers having their registered office abroad according to the subject of procurement remained the same. Goods were procured most frequently representing 58.8 % (195) share in all subjects, while services represent 34.3 % and works 6.9 % share.

The Czech Republic is the country whose tenderers are most often successful in public procurement. In 2004 they succeeded in 207 (62.2 %) methods, concluded 211 contracts of the value amounting to SKK 2 640 086 thousand (64.51 %). The sequence of countries on the two first places remained the same as in 2003. The tenderers from Germany took the second place; they completed 33 (9.9 %) methods. The third place belongs to the tenderers from Austria with 18 (5.4 %) completed methods.
Fourth position with equal number, 10 (3.0 %) completed methods, is represented by two countries, the United Kingdom and Poland.

The list of successful tenderers having their registered office abroad according to individual integration groups of countries in 2004 was as follows: 312 methods of the value amounting to SKK 3.93 bil. were completed with EU countries, out of which 227 methods were completed with the tenderers from the new EU countries, out of which 62.2 % falls on the Czech Republic. European Free Trade Association (EFTA) and other countries completed only 20 methods in total.

Over-limit methods of public procurement are closely monitored by the European Commission (hereinafter referred to as the “Commission”). After accession of the Slovak Republic in the European Union (hereinafter referred to as the “EU”) the procuring entities became obliged to publish over-limit procurements in the Official Journal.
In the following chapter the over-limit methods are evaluated for the whole year 2004 without specifying them as those before and after the accession of the Slovak Republic in the EU.

It follows from the analysis that the procuring entities completed 301 over-limit methods and concluded with tenderers 523 contracts of the value amounting to SKK 23 310 033 thousand.

Based on valid framework contracts 21 partial contracts of the value amounting to SKK 1 801 978 thousand have been concluded.

As compared to 2003, the number of 301 of completed over-limit methods increased by more than 10 % including 79 framework contracts (26.2 %).

Over-limit methods covered 4.0 % out of the total number of contracts (6852) concluded in 2004.
In order to obtain a contractual partner, the procuring entities used most often a public tender in 152 (50.5 %) methods, which represents a positive change in comparison with the year 2003.

The procedures of over-limit methods were most often applied by the procuring entities from the Central State administration reaching the number of 147 (48.7 %) of completed methods within which they concluded 167 contracts.

Other procuring entities completed 81 (27.0 %) methods and concluded even 227 contracts in total.

In the third category of procuring entities, which often applied over-limit methods, utilities (entities operating in the water, energy, transport and telecommunication sectors) represented the number of 57 (18.9 %).
Local governments completed 15 (5.0 %) methods.

Over-limit methods were most frequently applied for the procurement of goods. 147 (48.8 %) methods have been completed and 357 contracts of the value amounting to SKK 9 218 510 thousand have been concluded.

Services were procured in 144 (47.8 %) cases with 156 concluded contracts.

Works were procured through this method in 10 cases amounting to the value of SKK 5 695 938 thousand.

24 methods have been completed with tenderers having their registered office abroad, which is 7.9 % out of the number of completed over-limit methods. Total contractual value was SKK 1 741 692 thousand, which represents 7.5 %. As compared to the previous year the value of concluded contracts was lower by 40 %.

Contracts for the supply of goods were most often concluded with foreign tenderers, and 13 (54.2 %) methods have been completed.
10 (41.7 %) methods for services and 1 (4.1 %) method for works have been completed.

The highest number, 13 (52.0 %) of contracts and also of the highest value SKK 912 917 thousand, have been concluded with tenderers from the Czech Republic.

Conclusion

The Information on general statistical evaluation of public procurement process based on the notices used in public procurement for the year 2004 shows that the number of active procuring entities which used over-limit and under-limit methods of public procurement has increased by approximately 11 %.

Methods and procedures of public procurement have been used by procuring entities defined by law, but also by entities that are not statutory procuring entities, but used lawful methods on the basis of the requirement of subsidy provider and utilisation of the EU funds.

The impact of decentralisation became evident also in 2004, namely by an increase in the number of procuring entities of the category – other procuring entities – whose number increased by 89.4 %, which was reflected also in the value of contracts which has increased by more than 300 %.

In 2004, 2 framework contracts of the value amounting to SKK 87 865 thousand were concluded through joint procurement by several procuring entities. One of them was for the supply of goods of the value SKK 42 500 thousand, and the other one for the provision of services of the value SKK 45 365 thousand.

The Act contributes to a more effective use of funds and to the improvement of business environment by an obligation of entrepreneurs towards procuring entities to prove that they have fulfilled their liabilities towards the State by proving that they have met the conditions for participation in public procurement. It encourages competition, and thus positively influences the development of business environment.

On the basis of the processing of statistics based on the delivered notices of the result it can be concluded that the procuring entities do not pay due attention to the application of the Act, and the quality of notices of the result is not satisfactory.
Similarly as in the case of statistical statements, the following should be underline, in particular:

• incomplete elaboration, respectively processing of the notices of the result;
• incorrect indication of the type of the procuring entity;
• failure to indicate the type of the procuring entity;
• discrepancy between the data in the notice of the result and the data indicated under the call for tender;
• insufficient data on the contracts concluded;
• indication of a unit cost instead of a contractual cost in total;
• failure to indicate anticipated cost in compliance with the Decree;
• the use of inappropriate type of form for over-limit and under-limit methods;
• forwarding the notices of the results after the time limit prescribed by the Act;
• high proportion of cancelled public tenders (825) 18.44 % out of the total number of announced public tenders (4473) in 2004.

Negative phenomena from the past continue to exist in insufficient preparation of the planning stage, which affects the quality of the public procurement process itself and contract performance.

With reference to the statistical results, the Office continuously undertakes supervision over public procurement and recommends that the bodies of internal audit of the procuring entity and other supervisory bodies should turn attention also to this area.

It was for the first time that the statistics for the year 2004 was elaborated on the basis of notices delivered to the Office. The procuring entity is responsible for the quality of notices, through professionally qualified persons who should concentrate on the quality of the notices which form the base for the statistics elaborated.
The value of a saving has been for the first time processed based on the highest offer price.