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Key arguments for centralised and decentralised public procurement systems
The key arguments put forward in support of centralised procurement include:
- better value-for-money (price and quality) of procured supplies, services and works through increased purchasing power of the centralised agency, including through reduced government overheads;
- increased concentration of procurement expertise, better delivery of training and more focused performance management of procurement staff; and
- greater standardisation of technical requirements, procurement contracts and transactions, management controls and reporting to support greater transparency of government operations.
The key arguments put forward in support of decentralised procurement include:
- reduced scope for large scale corruption and mistakes through affecting large volume purchases that result in overspending;
- closer matching of supplies, services and works delivered to the requirements of end-users (both government agencies and citizens); and
- greater possibility for small and medium enterprises to successfully compete for government tenders.
Adopted from OECD (2000), 'Centralised and Decentralised Public Procurement,' CCNM/SIGMA/PUMA (2000)108, 25 October 2000, OECD Publishing, Paris.
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