Public procurement in Russia

IT Public Procurement (Russia)

• IT public procurement in Russia

Procurement of state-owned companies

• Procurement of state-owned companies

2023

Decrease in the volume of government contracts by 10.7% to 10.6 trillion rubles

In 2023, the total amount of concluded state contracts in Russia decreased by 10.66% compared to 2022 and amounted to approximately 10.6 trillion rubles. Such data at the end of February 2024 was published by the electronic trading platform Roseltorg.

According to RBC, referring to the statistics of Roseltorg, in 2023 the number of published procedures rose by 4.92% compared to the previous year. The number of applications submitted from bidders increased by 5.81%, reaching 5.7 million. In addition, the number of contracts increased by 4.61% - 2.4 million were concluded.

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It is noted that in 2023, the interest of commercial customers in conducting their purchases on electronic trading platforms approximately doubled. At the same time, the number of suppliers rose by one and a half times. State customers have become more active in purchasing goods, works and services from small and medium-sized businesses. In this area, the total number of purchases rose by about 6.36% to 1.4 million procedures, while the number of procedures completed increased by 6.42%, amounting to approximately 1.2 million. The share of failed procedures - both in the segment of small and medium-sized businesses and in the market as a whole - in 2023 amounted to less than 1%.

Most often, customers from the public sector in 2023 were interested in medicines and materials (460.2 thousand purchases), food products (288.2 thousand procedures), as well as computer, electronic and optical equipment (149.3 thousand procedures). In terms of the number of procedures, in addition to Moscow and St. Petersburg, the Krasnoyarsk Territory, Moscow and Novosibirsk regions are in the lead. At the same time, the Krasnoyarsk Territory, the Moscow Region and the Krasnodar Territory took first places in the number of contracts concluded. By the number of customers, the Belgorod region, the Republic of Bashkortostan and Khakassia are among the leaders.^[1]

State corporations in Russia increased by 13.5% the purchase of goods and services from small businesses

According to the results of 2023, state corporations in Russia increased by 13.5% the purchase of goods and services from small and medium-sized businesses (SMEs) compared to the previous year - up to 8 trillion rubles. First Deputy Prime Minister of the Russian Federation Andrei Belousov cited such data in mid-February 2024. Read more here.

2022

Increase in the number of crimes in the field of public procurement by 2 times

In 2022, more than 1,100 criminal offenses in the field of public procurement were committed in Russia, which is about twice as much as a year earlier. Such data on October 23, 2023 was presented by Dmitry Matveev, Deputy Head of the Office for Combating Corruption Crimes in the Field of Use and Distribution of Budget Funds of the Main Directorate of Economic Security and Anti-Corruption of the Ministry of Internal Affairs of the Russian Federation, at a meeting on the prevention and prevention of corruption offenses in the field of public procurement in the Federation Council.

According to Matveev, it is necessary to establish centralized regional public procurement and strengthen responsibility for embezzlement of budget funds to minimize the risks of corruption crimes.

During the year, 1,100 crimes in the field of public procurement were committed in Russia

Let's review this question: who buys and what levels of procurement to delegate to whom, and not to each institution. I propose centralized purchases of goods of the same name, for example. If we buy medical equipment, approximately each hospital annually drops schedules, what to buy and where. The same ultrasound devices, tomographs - they can be centrally bought either by regions or by united districts. All this could just minimize both the risks and the amount of expenditure - the control is strengthened, - he stressed (quoted by Interfax).

In June 2023, the head of the De Jure bar bureau, Nikita Filippov, in a conversation with Rossiyskaya Gazeta, noted that recently the number of criminal cases related to overpricing in public procurement has increased. According to him, the sphere of public procurement is constantly in the zone of special control of law enforcement agencies and has long become toxic for business. In the first six months of 2023, the Federal Antimonopoly Service (FAS) revealed 15,815 violations during public procurement.^[2]

Growth in purchases from small businesses by 13% to 4.3 trillion rubles

Small businesses and socially oriented non-profit organizations (SMP and SONKO) in Russia concluded 2.1 million state contracts for 4.3 trillion rubles in 2022, which is 13% more than a year earlier. This is stated in the report of the Ministry of Finance of the Russian Federation published at the end of May 2023 on the results of monitoring the procurement of goods, works, services carried out in accordance with the law "On the contract system" (44-FZ).

According to Interfax with reference to this report, in 2022 72.6 thousand state customers or 67% reached the minimum recommended share of concluded contracts with small enterprises, which is 25%. By 2022, customers had to make 15% of purchases from small businesses.

SMP and SONKO concluded 2.1 million state contracts worth 4.3 trillion rubles in 2022

At the end of 2022, about 1.3 million contests were announced, in which only small businesses could participate. The amount of these contracts amounted to 1.7 trillion rubles. However, under these contracts, transactions successfully passed only 686 thousand times. The NSR should have been attracted to another 28.5 thousand tenders for 4.6 trillion rubles. In this segment, it was possible to conclude 11 thousand contracts for 1.5 trillion rubles. Also in 2022, more than 460 thousand contracts fell through small businesses. This figure for the year increased by 4%.

According to the Ministry of Finance, Roossian state customers signed contracts in 2022 totaling 11.1 trillion rubles, which is 18% more than in 2021. In total, according to the ministry, in 2022, state customers issued 3.2 million contracts (taking into account contracts concluded based on the results of purchases carried out in 2021). This is 3.7% less than in 2021 - 3.3 million contracts. At the same time, the volume of concluded contracts increased by 18%, to 11.1 trillion rubles from 9.4 trillion rubles a year earlier.

In 2022, the number of contracts with a single supplier signed as a result of failed purchases decreased by 14%. In total, state customers concluded about 816.5 thousand such contracts. Their volume amounted to 5.2 trillion rubles against 4.4 trillion rubles in 2021.^[3]

The Government of the Russian Federation closes public procurement for suppliers who refused to fulfill government contracts due to sanctions

At the end of May 2022, it became known about the decision of the Government of the Russian Federation to close public procurement for suppliers who refused to fulfill government contracts due to sanctions.

The government has provided for a solution that will reduce the risk of non-fulfillment of state contracts due to external sanctions imposed on state customers, the government's website said in a statement quoted by Interfax. - Thus, companies included in the register of unscrupulous suppliers (RNP) will not be able to participate in public procurement due to the refusal to fulfill the contract due to the fact that the customer fell under the sanctions of foreign countries.

The Government of the Russian Federation closes public procurement for suppliers who refused to fulfill government contracts due to sanctions

Thus, a mandatory requirement for the supplier's participation in any procurement under the 44-FZ will be the lack of information about him in the register of unscrupulous suppliers due to his refusal to fulfill the contract due to the sanctions imposed on the customer. Such a requirement during the procurement will be established by the customer starting from July 1, 2022.

The implementation of the changes, according to the Ministry of Finance of the Russian Federation (developed an appropriate government decree), will help ensure the guarantee of the execution of the contract even if sanctions are imposed on the customer, and, as a result, will ensure the needs of the customer.

In March 2022, the Government of the Russian Federation adopted a resolution according to which contractors for state contracts should not be included in the RNP for their failure to fulfill their obligations under contracts due to sanctions. In particular, this document supplemented the rules for maintaining the RNP with a provision according to which the Federal Antimonopoly Service (FAS) will decide to refuse to include information about the supplier in the register if such a supplier provides information that he could not fulfill his obligations under the state contract in connection with the introduction of political or economic sanctions, restrictive measures against Russia, Russian companies or citizens of the Russian Federation.^[4]

2021

The volume of public procurement on all electronic platforms in Russia increased by 10.3%, to 10.2 trillion rubles

The volume of state and municipal purchases at all electronic sites in Russia in 2021 increased by 10.3% compared to 2020 and reached 10.2 trillion rubles. Such data were published on February 21, 2022 in the press service of the federal electronic trading operator Roseltorg (Single electronic trading platform JSC).

We are talking about procedures within the framework of the 44-FZ "On the contract system in the field of procurement of goods, works, services to meet state and municipal needs." In terms of the volume of procedures published by state customers within the framework of the 44-FZ, Roseltorg took first place with 510 thousand procedures in the amount of 2.9 trillion rubles. According to the company, the most in demand were purchases of medicines and materials for medical purposes, finished products (this class includes musical instruments, sports goods, jewelry, medical equipment, etc.), computer equipment.

The volume of public procurement at all electronic platforms in Russia in 2021 increased by 10.3%

From the point of view of the initial (maximum) contract price, Roseltorg estimated its share of more than 28% throughout the government trading market.

The press service of the company also reported that the volume of corporate procurement, which is carried out under the 223-FZ "On the procurement of goods, works, services by certain types of legal entities" placed on all Russian electronic trading platforms for 2021, amounted to 10.2 trillion rubles, an increase of 20.1% compared to 2020

At the end of 2021, more than 3 million users were registered in the unified information system in the field of procurement and more than 75 billion transactions were carried out. The following indicators are also recorded:

• more than 3 million notices worth more than 27 trillion rubles;
• about 5 million contracts and contracts worth more than 29 trillion rubles;
• 370 thousand downloads of the EIS mobile application.^[5]

HSE: average kickbacks in public procurement - 22.5%

The average size of kickbacks in public procurement in the Russian Federation is 22.5%, according to a study conducted by the Institute of State and Municipal Administration of the Higher School of Economics on the basis of an anonymous survey of Russian companies. The data were released on December 20, 2021.

The total amount of bribes in public procurement is estimated at 6.6 trillion rubles. This is comparable to 35.3% of the revenue side of the budget, or 6.2% of GDP. The size of the bribe varies from 3% to 65% of the contract value. Most often, shares of 3%, 5%, 10%, 15% and 20% were called. 14% of respondents indicated a zero amount.

The total amount of bribes in public procurement in Russia is estimated at 6.6 trillion rubles

At the same time, 71% of companies said that they faced corruption during the passage of competitive procedures. Despite the general condemnation of corruption (83% of suppliers), they admitted that they contacted kickbacks for a state contract due to high competition in the market.

As experts explained to RBC, the executors have to go to violate the law and collusion with customers against the background of high competition for many tenders in government orders, as well as due to problems with various restrictions on many purchases, which are very difficult to get around without kickbacks after receiving payment for fulfilling the order or prepayment, according to the contract.

According to experts, a high level of corruption in public procurement also occurs due to frequent non-competitive purchases from government agencies, where there is only actually the only supplier, and the rest are rejected on formal grounds at the competition stage.

The final assessment of the amount of corruption payments was made on the basis of "a multifactorial analysis of respondents' responses depending on the procurement industry, region of activity, organizational and legal form of procurement participants," taking into account statistical data on the volume of purchases, the report says. As one of the authors of the study, Deputy Director of the Institute of State and Municipal Administration of the Higher School of Economics Konstantin Golovshchinsky explained to RBC, the respondents in total remembered about 2.3 thousand examples from practice, in which they named the average kickback size (including zero). This became a sample for calculations.^[6]

Mishustin allowed Rosgvardia and FSO to classify their public procurement

Prime Minister Mikhail Mishustin signed a government decree that allowed the Russian Guard and the FSO to classify their public procurement. The corresponding document on November 2, 2021 was published on the portal of legal information.

In addition, the purchases of the Ministry of Defense, the FSB and the Foreign Intelligence Service will be hidden. The order will enter into force on January 1, 2022. Before the entry into force of the order, the departments classify only those purchases that are necessary for the needs of defense and security.

Mikhail Mishustin signed a government decree, which allowed the Russian Guard and the FSO to classify their public procurement

Rosgvardia proposed to classify its public procurement, justifying this by the fact that the troops of the National Guard of the Russian Federation "are a state military organization designed to ensure state and public security, protect human and civil rights and freedoms." In the same year, the FSO also proposed to hide its purchases due to "an increase in the number of threats, including of a terrorist nature, against state security facilities."

The Ministry of Defense proposed to classify almost all information on the defense sphere: according to the relevant draft order, exceptions are planned to be made for information on violations of human rights and freedoms, emergencies and for information on environmental pollution. The entire list of information that is going to be classified as official secrets will be compiled by the ministry on its own. The president will approve the list.

The FSO also proposed to classify its public procurement. The service explained this need by the fact that foreign intelligence is interested in information , as well as  "due to the increase in the number of threats, including of a terrorist nature."

At the end of October 2021, the Government of the Russian Federation established three degrees of secrecy: information of particular importance, top secret and secret.

Order of the Government of the Russian Federation No. 3095-r dated 30.10.2021

The Moscow government decided to reduce the terms of payment under state contracts

The decision to reduce the terms of payment under state contracts was made by Decree of the Government of Moscow No. 1388-PP of September 7, 2021. Separate changes to the second "optimization" package of amendments to the law on the contract system (44-FZ) are being implemented in the capital earlier than in other regions of the country. This was made possible by the digital procurement management platform. This was announced on September 13, 2021 by the Moscow City Department for Competition Policy, according to the deputy mayor of the capital for economic policy and property and land relations Vladimir Efimov.

The second "optimization" package of amendments to the law on the contract system (44-FZ) was approved by the Government of the Russian Federation on July 1, 2021. The amendments provide for a phased reduction in payment terms for Russian customers - from January 1, 2022 and from January 1, 2023.

The Moscow procurement system is ready for early implementation of legislative changes. A single digital "ecosystem" of services for public procurement participants has been formed in the capital, which automates procurement processes, excludes errors and the human factor. All documents are registered instantly and available online.

According to the Decree of the Government of Moscow, the reduction in the terms of payment for public procurement will take place in stages. From October 1, 2021, payment will take no more than 10 working days from the date the customer signs the acceptance document for procurement contracts from small businesses, socially oriented non-profit organizations. For other contracts - no more than 15 working days. From January 1, 2022 - no more than 7 and 10 working days, respectively. Previously, payment terms were 15 working days for small businesses and 30 days for other contracts. Thus, the payment terms are halved, - said Vladimir Efimov.

He also noted that changes in contract templates in the Unified Automated Trading Information System of the city of Moscow will be available for use from September 20 and December 20, 2021, respectively.

Reducing the payment time for public procurement is a significant support measure for more than 230 thousand city suppliers. All of them will be able to receive funds for the supplied goods and completed work in a short time. In addition, the replenishment of the budget at the expense of regional taxes will occur faster, which will lead to an acceleration of the turnover of funds in the city's economy.

Together with the electronic execution of contracts, the reduction in payment terms forms an absolutely transparent and most efficient digital system of urban procurement, "added Ivan Shcherbakov, head of the Moscow City Department for Competitive Policy.

2020

Ministry of Finance: The volume of public procurement decreased by 6%

According to the Ministry of Finance of the Russian Federation, the volume of purchases of state-owned companies in 2020 amounted to 19.9 trillion rubles, which is 6% less than a year ago in 21 trillion rubles. The department announced this in September 2021.

State-owned companies in 2020 concluded 1.5 million contracts, more than half of which (941 thousand) fell on non-competitive purchases. The volume of the latter reached 13.8 trillion rubles, which corresponds to the 69th share among all public procurement. Accordingly, competitive purchases accounted for 561 thousand contracts (37%) for 6.2 trillion rubles (31%).

According to the report of the Ministry of Finance, almost all "non-competitive contracts" were concluded based on the results of purchases from a single supplier - 780 thousand contracts (52%) for 12.3 trillion rubles (62%). Another 333 thousand contracts (22%) for 4.2 trillion rubles (21%) were concluded based on the results of purchases carried out in "other" ways.

Ministry of Finance: The volume of public procurement at the end of 2020 decreased by 6%

At the same time, the Ministry of Finance emphasizes that for the most part, "other" methods of procurement are competitive. In 2020, as in 2019, the competitive form of their implementation prevails in purchases carried out by "other" methods of determining the supplier in quantitative and value terms: 57% in quantitative terms, 70% in value, the ministry said in a report.

A little more than half of all contracts (in value terms) provided for the involvement of suppliers of work, services in the field of construction (3.4 trillion rubles) and finance (7.4 trillion rubles)

Also, the report of the Ministry of Finance notes that in 2020 89 thousand contracts were terminated for a total of 832.9 billion rubles. In most cases (83 thousand contracts for 691 billion rubles) - by agreement of the parties. At the same time, part of all these contracts was concluded by state-owned companies based on the results of purchases announced back in 2019.^[7]

Reduction of public procurement costs in Russia by 10%, to 24.8 billion rubles

The costs of state customers for procurement in accordance with the provisions of the Law "On the Contract System" (44-FZ) at the end of 2020 reached 24.8 billion rubles, having decreased by 10% compared to 2019. This is evidenced by the data of the National Research University "Higher School of Economics" (HSE), which were published in August 2021.

The total transaction costs in the field of procurement of state-regulated companies and other 223-FZ entities for 2020 amounted to 10.4 billion rubles. In total, state customers conducted 2.18 million competitive procurement procedures (mainly in the form of an electronic auction). At the same time, the transaction costs of customers for holding one electronic auction are estimated at approximately 9 thousand rubles. Thus, in 2020, state customers spent about 19.6 billion rubles on competitive purchases.

The cost of public procurement in Russia at the end of 2020 decreased by 10%

According to the HSE, in the procurement segment of state-owned companies (223-FZ), customer procurement costs actually did not change and amounted to 10.4 billion rubles (10.8 billion rubles in 2019). At the same time, competitive purchases accounted for 6.7 billion rubles, and non-competitive purchases - 3.7 billion rubles.

The total volume of public procurement and procurement of state-owned companies in 2020 decreased to 29.1 trillion rubles from 32.2 trillion rubles in 2019. At the same time, the volume of public procurement slightly increased - to 8.9 trillion rubles from 8.4 trillion rubles, and the volume of purchases of state-owned companies decreased to 20.2 trillion rubles from 23.8 trillion rubles.

The researchers also note that the increase in the volume of public procurement occurred mainly due to an increase in the volume of contracts with only suppliers, the volume of which in 2020 increased by 579 billion rubles.

The savings indicator of public procurement at the end of 2020 increased more than the volume of public procurement itself and amounted to 417.9 billion rubles, which is 9% higher than the result of 2019.^[8]

Accounts Chamber: 74% of public procurement is carried out with a single applicant

According to data, in Accounts Chamber (JV) 2020, more than 74% of public procurement Russia in was carried out with a single applicant. In absolute terms, this corresponds to 6.6 trillion of the rubles total volume of state contracts concluded on the basis of 44-FZ, at 8.9 trillion rubles. Such data were published by the state audit body in July 2021.

Compared to 2017, the share of public procurement from one supplier increased by 17 percentage points. The joint venture linked a large volume of non-market departmental purchases with the consequence of the COVID-19 coronavirus pandemic, which was officially recognized as a force majeure circumstance, in connection with which purchases from a single supplier became possible, provided that the purchased goods, works or services are used to prevent or eliminate the consequences of the epidemic.

As the auditors noted, the reduction in purchases from one supplier is on the list of goals of the National Competition Development Plan for 2018-2020, but federal authorities, in fact, ignored the requirements. In past reports, the department indicated that most of the problem arises from informal ties between the customer and the supplier.

In general, the volume of state and corporate purchases remained in 2020 at the level of the last seven years - 27% of GDP. The assessment of the impact of procurement on the state and development of individual industries showed that the change in the total volume of procurement for certain industries and markets can significantly affect the economic condition of the entities.

Vladimir Lishenkov, general director of the RTS-tender electronic trading platform, noted that there is nothing good in the increase in the share of non-competitive purchases, but the situation is not very critical. According to him, a significant increase in purchases from a single supplier is really associated with a pandemic: customers needed a simple and convenient procurement format.^[9][10]

The share of purchases of Russian products in public procurement increased to 57% and amounted to 1.7 trillion rubles

RUSSIAN FEDERATION The share of Russian products in public procurement in 2020 increased to 57% from 49% in 2019. The money increased from 1.4 trillion to 1.7 trillion, rubles the Deputy Prime Minister said Iouri Borisov during a meeting of the president Russia Vladimir Putin with members held on January 28, 2021. governments

According to the data provided by Borisov, the total volume of public procurement in 2019 amounted to 8.2 trillion rubles, of which goods accounted for 3 trillion rubles, and in 2020 - 8.9 trillion rubles and 3 trillion rubles, respectively.

The Deputy Prime Minister said that thanks to the introduction of the law on quotas in 2021, the share of Russian goods and services in public procurement will increase by at least 7%.

Deputy Prime Minister Yury Borisov: The share of purchases of Russian products in public procurement increased to 57%

On January 1, 2021, a decree of the Government of the Russian Federation on quotas for the purchase of 107 types of domestic goods by state customers entered into force on January 1. The list includes various types of medical equipment and medical equipment, industrial products, light industry products, radio electronics. For items, the size of quotas is set at 1% to 95% of the annual procurement volume. The resolution approves the list of goods subject to quotas and the size of quotas for 2021-2023.

During the meeting, Vladimir Putin drew the attention of members of the Cabinet of Ministers to a number of points related to the use of the quota mechanism in public procurement and procurement of state-owned companies.

Quotas are big advantages for our manufacturers. But there are also threats - we must monitor the quality, price and competition in the domestic market, the head of state said.

According to Borisov, these issues are already being resolved. In particular, measures are being worked out for which unscrupulous Russian suppliers declaring and not fulfilling their obligations will be fined and blacklisted, deprive them of the possibility of support at the next stages, the Deputy Prime Minister emphasized.^[11]

Notes