02 Procurement Planning and Budget Linkagegppb

Capacity Development Division*

PROCUREMENT PLANNING Preparation of PPMP, APP and PMR

CAPACITY DEVELOPMENT DIVISIONGovernment Procurement Policy Board Technical Support Office (GPPB-TSO)

Capacity Development Division


Philippine Procurement ParadigmReview studiesConsolidate into APPDecide procurement methodApprove APPDetermine readinessPost/Advertise opportunityOpen and evaluate bidsPost-qualifyAward and enter into contractCost-benefit analysisFeasibility studyMarket studyPPMPOversee implementationInspect and accept deliveriesRelease paymentNeedsSatisfaction


Capacity Development Division*What is planning?Nature of PlanningProcurement Planning3.1 Importance of Planning3.2 Preparing the PPMP3.2.1 Identifying the need3.2.2 Developing project requirements3.2.3 Technical Specifications3.2.4 Costing (Determining the ABC)3.2.5 Procurement Timelines3.2.6 Procurement Methods3.2.7 PPMP format3.3 Consolidating PPMPs into APP3.3.1 Techniques in consolidating items in the APP3.4 Updating the PPMP and APP 4. Procurement Monitoring

OUTLINE


Capacity Development Division*PROCUREMENT PLANNINGPLANNING

- refers to predetermined course/s of action to achieve a desired end/goal.

PROCUREMENT PLANNING

It is the governments fiduciary responsibility

protect the taxpayers interestssafeguard the resources allotted to each department


Capacity Development Division*WHY PROCUREMENT PLANNINGProcurement Planning ensures that the overall goal of a particular project will be effectively and efficiently achieved.

Precludes occasions for unnecessary government purchases and circumventions of the prescribed procurement procedures

advance deliveries suki system unwarranted resort to alternative methods procurement

However, it must be done within budgetary context


Capacity Development Division*SECTION 7.1 OF IRR

Within approved budget of procuring entityJudiciously doneConsistent with government fiscal measuresConsidered crucial to the efficient discharge of governmental functionsRequired for the day-to-day operationsIn pursuit of the principal mandate of the procuring entity concerned


Capacity Development Division*PROCUREMENT PLANNING

Involves 2 levels:Procuring entitys over-all strategic planProject and/or operational plans


Capacity Development Division*SECTION 7.2 OF IRR

No procurement unless in accordance with the Annual Procurement Plan (APP)

Approval of Head of Procuring Entity (HOPE) or designated second-ranking official


Capacity Development Division*PROJECT PROCUREMENT MANAGEMENT PLAN (PPMP)A guide document in the procurement and contract implementation process, as well as a vital reference in procurement monitoring.

Tool allowing the PE the flexibility to optimize the utilization of scarce resources.

Minimize the practice of doing short-cuts

Prepared by the end-user unit during the budget preparation to support the cost estimates in the budget proposal.


Capacity Development Division*PROJECT PROCUREMENT MANAGEMENT PLAN (PPMP)


Capacity Development Division*PPMP FORMAT


Capacity Development Division*Developing Project RequirementsIdentify the need of the PMO/End-user unitIdentify alternative solutions/ products/ servicesCompare the alternatives (consider qualitative and quantitative factors)

Choose the Best Alternative - the one that is most beneficial to the Procuring Entity

DEVELOPING PROJECT REQUIREMENTS


Capacity Development Division*Important Consideration

Suggested basis for identifying needs:

Core functions of the end-user unit in the organization, i.e Accounting, Legal etc.Historical data/Foreseen contingencies;Identified purpose/goals/MFOs;P.Es Strategic Plans;Current supply inventory;Other maintenance and operating needs.

IDENTIFYING THE NEED


Capacity Development Division*TECHNICAL SPECIFICATIONS, SCOPE OF WORK, AND TERMS OF REFERENCEIn developing the project requirements and TS/SOW/TOR, the Procuring Entity may engage the services of technical experts, whether in-house or consultants, to ensure that the requirements and the TS/SOW/TOR are adequate to achieve the objectives of the particular procurement.

Description should be:Generic and flexibleClear and unambiguousUpdated, where technology is taken into accountFits the actual requirements of the PMO/End-user


Capacity Development Division*HOW TO WRITE TECHNICAL SPECIFICATIONS?Functional Descriptiona pen is expected to write 1.5 km of straight, continuous linesPerformance Descriptionshould do so continuously and smoothly, without skipping, and with the color of the ink being consistentEnvironmental Interfaceon pad paper or bond paper, but not necessarily on wood or on a white boardDesignBallpoint, gel-tip, sign pen, technical pen, etc.



APPROVED BUDGET FOR THE CONTRACT (ABC)

The ABC reflected in the APP or PPMP shall be consistent with the appropriations for the project authorized in the GAA

End user to conduct market study

Market price, inflation and cost of money related to the procurement time table must also be considered.

In determining the ABC, the end-user unit, with the assistance of the TWG (when necessary), must consider the different cost components.


Capacity Development Division*Pre-Procurement ConferenceLCC Life Cycle Costing

Cost should consider all costs throughout the life-cycle acquisition cost, utility costs (energy/water consumption, maintenance), and disposal costs.

C to G vis--vis C to C

LIFE CYCLE COSTING



COST COMPONENTS IN DETERMINING ABC

Cost or market price of the product or service itself; Freight, insurance, taxes, and other incidental expenses (For goods only); Cost of money, to account for government agencies usually buying on credit terms;Inflationary factor (For goods only); Quantities, considering that buying in bulk usually means lower unit prices; Supply of spare parts and/or maintenance services, if part of the contract package (For goods only);




Cost for securing all types and forms of securities other than cash (e.g. premiums for surety bond, bank fees and other charges to be incurred by the bidder in obtaining bid, performance and warranty securities); and

Currency valuation adjustment for contracts with foreign component.Acquisition CostOperation CostReplacement/Repair CostDisposal Cost




If the sum of the different cost components is lower than the appropriation for the procurement, then the ABC should be equal to the sum of the cost components.

If the resulting sum is higher than the appropriation, it is advisable to review the technical specifications and the computation of the ABC. In any case, the ABC should not exceed the appropriation.


Capacity Development Division*PROCUREMENT MILESTONES


Capacity Development Division*Pre-Procurement ConferenceFactors to consider in identifying procurement timelines:Budget rules, i.e CSE every quarter;Nature of Procurement Projects, whether simple or complexFor shopping/small value procurement, give at least two weeks Foreseen/Unforeseen Contingencies, i.e frequent change in specifications, etc.Availability in the market.

PROCUREMENT MILESTONES


Capacity Development Division*Advertisement and PostingAs a general rule, all procurement should be through public bidding

The selection of the method of procurement is dependent on the presence or absence of specific conditions of other methods of procurement in Sections 48 to 54 of the revised IRR

METHOD OF PROCUREMENT


Capacity Development Division*Adveartisement and PostingPPMP vs PRPurchase Request (P.R) Request for purchase or requisition of supplies, materials and equipment or its equivalent shall be duly approved by proper authorities. (Source: Training Handbook on Government Expenditures)

In no way that the End-user Unit submit their P.R ahead of the approved PPMP item.



ANNUAL PROCUREMENT PLAN (APP)

Legal Basis: Section 7 of the IRR of RA 9184

Refers to the entirety of the procurement activities that will be undertaken by the procuring Entity within the calendar year using the prescribed format required by the GPPB.

Shall be consolidated by the BAC Secretariat from the PPMPs of end-user units. The BAC shall take into consideration the following factors:One year planning perspectiveEmergency or Contingency FundSchedule of Activities



No procurement shall be undertaken unless in accordance with APP

All procurement should be meticulously and judiciously planned by procuring entity

APP should be maintained and updated regularly

In the consolidation of PPMPs, the BAC may adopt a strategy through where similar items of procurement are packaged into one procurement undertaking.

A review and updating of the individual PPMPs and the APP shall be done regularly, at least once every 6 mos. or as often as necessary.

ANNUAL PROCUREMENT PLAN (APP)


Capacity Development Division*PREPARATION OF APPPrepare Project Procurement Management Plan (PPMP)Submit to Budget Office for evaluationSubmit Budget Proposal to HOPEUpon approval of HOPE, Budget Office will forward PPMPs to BAC Secretariat for Consolidation and ReviewWhen GAA, Corporate Budget or Appropriation Ordinance becomes final, PPMPs will be finalized and submitted to BAC Secretariat for consolidation and approval of the HOPE.End-User UnitBudget OfficeAPPBAC Secretariat


Capacity Development Division*ANNUAL PROCUREMENT PLAN (APP)


Capacity Development Division*Eligibility DocumentsAPP being referred to in the IRR of RA 9184 is different from the APP-CSE

APP-CSE serves as basis of DBM PS in projecting its inventory requirements, scheduling of activities, and over-all management of the central procurement of common-use goods (DBM Circular Letter 2011-6 & 2011-6a)

Common-use supplies refers to those supplies and materials and equipment included in the price list of the PS which are necessary in the transaction of the official business of the procuring entity and consumed in its day-to-day operationsAPP vis-a-vis APP-CSE


Capacity Development Division*Eligibility Documents

In the case of foreign consultants, the foregoing eligibility requirements under Class A Documents may be substituted by the appropriate equivalent documents.

NPM 42-2013

APP-CSE


Capacity Development Division*Eligibility DocumentsSort the procurement activities by type of procurement: goods, civil works or consulting.

Check which can be merged into one procurement activity

i.e Civil works or consulting services are usually distinct entries in the APP, unless the PE finds merit in merging infrastructure project scopes (civil works) or deliverables (consultants).

3. Goods procurement can be separated into three categories: common-use supplies (CSE) for the Procurement Service (PS), common-use supplies (non-PS), other goods procurement

TIPS IN CONSOLIDATING PPMPS


Capacity Development Division*REVISIONS ON APPUpdate PPMPConsolidate PPMP to APPApprove Supplemental APPEnd-user UnitBAC SecretariatHOPE


Capacity Development Division*5 RIGHTS IN PUBLIC PROCUREMENTValue for Money


Capacity Development Division*Eligibility DocumentsAll CSE whether for procurement from PS or not shall be consolidated into an APP-CSE which shall be submitted to the Procurement Service

For the APP, CSE shall be separated whether to be bought from the PS and CSE which shall be bought outside the PS

All partitions shall again be separated into mode of procurement (public bidding or alternative methods)

All entries can then be grouped by source of funds

TIPS IN CONSOLIDATING PPMPS


Capacity Development Division*Tips in consolidating PPMPsTIPS IN CONSOLIDATING PPMPS


Capacity Development Division*EligibLE Bidders3.2. Annual Procurement Plan (APP) the requisite document that the agency must prepare to reflect the entire procurement activity (i.e., goods, services, civil works to be procured) that it plans to undertake within the calendar year. This document contains the following information:

3.2.1. Name of the procurement program/project;3.2.2. Project management office or end-user unit;3.2.3. General description of the procurement;3.2.4. Procurement method to be adopted;3.2.5. Time schedule for each procurement activity;3.2.6. Source of fund; and3.2.7. Approved Budget for the Contract.

COA GUIDE ON AUDIT OF PROCUREMENT


Capacity Development Division*EligibLE BiddersTo verify if the procuring entity has an Annual Procurement Plan (APP)

To verify if the APP is approved by the HOPE or by a second-ranking official designated by the HOPE to act on his behalf

3. To verify if the APP contains the following information:a. name of the procurement program/ project;b. project management office or end-user unit;c. general description of the procurement;d. procurement method to be adopted;e. time schedule for each procurement activity;f. source of fund; g. approved budget for the contract.

COA GAP CHECKLIST


Capacity Development Division*EligibLE Bidders

4. To verify if the APP is supported by PPMPs prepared by the respective end-user units

5. To verify if the items in the approved APP were included in the PPMPs

6. To verify if the APP matches the budget per GAA, corporate budget, appropriation ordinance, as the case may be

COA GAP CHECKLIST


Capacity Development Division*POSSIBLE CONSEQUENCESPossible COA AOMs/DisallowancesWastage of Government FundsSuspension of OfficialsPossible administrative/criminal liabilitiesProject DelaysProject Failures


Capacity Development Division*WHAT IS MONITORING?Defined as:

Tracking of inputs, activities, outputs, and outcomes of the procurement activity; and

Tracking results of current operations on a regular basis.


Capacity Development Division*MONITORING AND EVALUATIONIt is the BAC who shall be responsible for ensuring that the procuring entity abides by the standards set forth under R.A. 9184 and its IRR.

BAC is required to prepare a PROCUREMENT MONITORING REPORT (PMR) in the form prescribed by the GPPB.

The PMR shall cover all procurement activities specified in the APP, whether on-going and completed from holding of the pre-procurement conference to the issuance of the notice of award and approval of the contract, including the actual time for each major procurement activity.

The PMR shall be approved and submitted by the Head of the Procuring Entity (HOPE) the GPPB in printed and electronic format within 14 cd after the end of each semester. ( Executive Orders 662, 662-A and 662-B, series of 2007)


Capacity Development Division*WHY MONITOR?Compliance to R.A. 9184 and its IRR

PerformanceEfficiencyEffectiveness

Aid GPPB in crafting policies that address weaknesses and uphold strengths of the Philippine Procurement System


Capacity Development Division*MONITORING AND EVALUATIONMonitoring entails tracking of inputs, activities, outputs, and outcomes of the procurement activity

Ex-post evaluation examines the project outcomes and impacts. It is a determination of the benefits derived from the project, the attainment of specific targets for key indicators, and the sustainability of the project.


Capacity Development Division*PROCUREMENT MONITORING REPORT (PMR)


Capacity Development Division*COA GAP CHECKLISTTo verify if the BAC:a. prepared a procurement monitoring report in the form prescribed by the GPPB;b. covering all procurement activities specified in the Annual Procurement Plan (APP), whether on-going and completed, from the holding of the pre-procurement conference to the issuance of the notice of award and the approval of the contract, including the standard and actual time for each major procurement activity; c. submitted the monitoring report to the Head of the Procuring Entity (HOPE) for approval and submission to the GPPB in printed and electronic format within 14 days after the end of each semester


Capacity Development Division*COA GAP CHECKLIST2. To verify if the HOPE:a. approved the Procurement Monitoring Report and b. submitted it to the GPPB in printed and electronic format within 14 days after the end of each semester3. To verify if appropriate actions have been taken by the HOPE in case of instances of noncompliance committed by the BAC, BAC TWG, BAC Secretariat and/or bidders4. To verify what actions have been taken by the GPPB in regard to instances of noncompliance


Capacity Development Division*SUBMISSION & POSTING REQUIREMENTSAPPSubmission to the GPPB (AO 222) and posting in the procuring entity's website of its APP for CY 2012 (Section 1.1 of the IRR of EO 662), following the form and format downloadable from the GPPB website

PMRSubmission to the GPPB (Section 12.2 of IRR of RA 9184) and posting in the procuring entity's website of its approved Procurement Monitoring Report every semester, following the form and format downloadable from the GPPB website (Section 1.2 of the IRR of EO 662)

GPPB Website



THANK YOU!!Contact us at:

Unit 2506 Raffles Corporate CenterF. Ortigas Road, Ortigas CenterPasay City, Philippines 1605

TeleFax: (632)900-6741 to 44Email Address: [email protected]


applicability of Republic Act (RA) No. 9184 and its revised Implementing Rules and Regulations (IRR) in the engagement of Contract of Service Personnel on Job Order Basis

if the desired service would require adequate external technical and professional capability and expertise that are beyond the existing capacity of the procuring entity, then the rules and regulations on the procurement of consulting services under RA 9184 and its IRR shall be applicable.

Tax clearance of foreign consultant

A Delinquency Verification Certificate issued to Non-Resident Foreign Corporations (NRFC)/Non-Resident Aliens Not Engaged in Trade or Business (NRANETB) pursuant to BIR RR 3-2005, attesting to the fact that the taxpayer has no outstanding Final Assessment Notice and/or delinquent account may be submitted as a form of Tax Clearance required under Sec 34.2 of the IRR.

NPM 02-2013

02 Procurement Planning and Budget Linkagegppb

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