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Procurement strategies to support quality infrastructure investment

Context

This area of work supports countries in the implementation of the third pillar on the OECD Recommendation on the Governance of Infrastructure (2020). It focuses on using open, neutral, competitive and transparent procurement processes for infrastructure from the choice of delivery mode to the definition of award criteria and contract management. It encourages developing the capacity of the procurement workforce to deliver value for money efficiently and effectively.

SUPPORT PROVIDED TO PROCUREMENT OFFICERS IN OECD COUNTRIES ON HOW TO HARNESS INFRASTRUCTURE PROCUREMENT TO ACHIEVE THE FOLLOWING POLICY OBJECTIVES (2020)

Procurement strategy in major infrastructure projects

The OECD has trialed a new evidence- based tool to inform procurement decisions on major projects called Support Tool for Effective Procurement Strategy or STEPS. STEPS can improve the efficiency and effectiveness of public procurement of infrastructure and beyond. The tool was applied to two major road projects in Norway, read the full OECD Public Governance Policy Paper.

Why is this important?

Procurement strategies based on strategic choices ensure infrastructure delivery in a way that maximises the value generated for society as a whole. For quality infrastructure investment, procurement processes should be directed towards generating broader value in terms of economic, environmental and social benefits. Procurement can also be used strategically for incentivising innovation, in particular in the transition towards low-carbon infrastructure and the adoption of digital technologies. In accommodating these policy goals, procurement processes should also safeguard transparency and objectivity.

•  The development of public procurement competencies can help deliver sustainable, innovative and quality infrastructure investments. It facilitates the acceleration of infrastructure investments that are crucial in the context of the Covid-19 crisis and expected to play an important role in the economic recovery.

•  Aligning procurement strategies for infrastructure with long-term national priorities can support quality infrastructure investments. Long-term priorities such as sustainability, upgrading the skills of the construction workforce, ensuring responsible business conduct and promoting innovation can be acted upon through strategic procurement. Strategic procurement can also address the quality of implementation of infrastructure projects and ensure ethical and inclusive supply chains and responsible business conduct.

•  Quality infrastructure investments also require transparent and effective management of procurement operations, including contract management. This can help generate a wealth of data for stakeholders and presents opportunities for meaningful use of such data. Implementing balanced contractual relationships is particularly important for holding contractors accountable for project specification and professional standards, when applicable, and designing a robust and transparent process for contract re-negotiations and dispute resolution to account for evolving conditions.

MECHANISMS USED BY OECD COUNTRIES TO IDENTIFY PROPOSALS OFFERING THE BEST VALUE FOR MONEY (2020)  

MECHANISMS EMPLOYED TO HOLD CONTRACTORS ACCOUNTABLE FOR PROJECT SPECIFICATIONS AND PROFESSIONAL STANDARDS IN OECD COUNTRIES (2020)