ProZorro is a Ukrainian electronic procurement system that has been designed to ensure transparency, fairness, and competition in the procurement process. The system was launched in 2015 and since then, it has become an integral part of the public procurement system in Ukraine. The Ministry of Defense of Ukraine has also started using ProZorro for its non-defense purchases. The system has enabled the Ministry to make its procurement process more transparent and efficient.
The information will not be published in full, but it will be enough for financial analytics.
Since April 23, information on non-defense purchases has become available in the Prozorro system. According to the innovations in the Law on Defense Procurement, now defense customers and military units will publish information on unit prices in their non-defense purchases.
“From our experience, only the fact that information about your purchases will be published in Prozorro is an incentive to take a more thorough approach to their implementation,” said Nadezhda Bigun, Deputy Minister of the Economy of Ukraine.
Customers must report on the purchase of food, clothing, fuel, etc. in the amount of UAH 200 thousand for goods and services, and UAH 1.5 million for work. At the same time, the reports themselves will contain a limited amount of information – the name of the customer, the subject of the purchase, and the price per unit.
In the case of procurement of food services, customers will be required to report the unit price of each product included in this service. To do this, they can upload a file with the corresponding calculations to the Prozorro system.
According to Nikolai Tkachenko, director of the Prozorro State Enterprise, defense customers may not publish data on the total amount and volume of purchases, delivery locations, and the name of the supplier, but the published information should be sufficient for price analytics.
The defense procurement bill was registered in Parliament on January 24, and two weeks later it was determined without delay and voted for the basis with a reduction in the preparation time for the second reading. It assumes that defense customers and military units must publish reports to the Prozorro system within 10 working days from the date of signing the contract. In addition, by June 22, they will have to report on all agreements concluded since February 24, 2022, that is, from the beginning of a full-scale invasion. The bill was registered in the parliament, which exposed corruption in the Ministry of Defense, and provoked a scandal around the Ministry of Defense.
The latest scandal over the purchase prices of food for military units has raised many burning questions about the risks of secrecy in defense contracts. Read more about this in the article by Vladimir Datsenko “What is secret in defense procurement that is not related to weapons?”
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The Ministry of Defense of Ukraine is responsible for the procurement of a wide range of goods and services, including weapons, ammunition, military vehicles, and equipment. In addition to these defense-related purchases, the Ministry also makes non-defense purchases, such as office supplies, IT equipment, and furniture. The non-defense purchases are essential for the smooth functioning of the Ministry’s administrative and support departments.
Before the introduction of ProZorro, the procurement process of the Ministry of Defense was marred by corruption and inefficiency. The lack of transparency in the procurement process led to the award of contracts to companies that did not meet the required standards. The Ministry was also accused of favoritism and nepotism in the award of contracts. The use of ProZorro has helped to address these issues by ensuring that the procurement process is open and transparent.
One of the key benefits of ProZorro is that it allows suppliers to bid for contracts online. This means that any supplier, regardless of their location, can participate in the procurement process. The system also ensures that the bidding process is fair and transparent. All bids are displayed online, and suppliers can see the status of their bids in real time. This transparency helps to prevent corruption and ensures that the best supplier is awarded the contract.
ProZorro also makes it easier for the Ministry of Defense to manage its procurement process. The system allows the Ministry to track the progress of procurement requests and monitor the performance of suppliers. The system also provides an electronic archive of all procurement documents, making it easier to retrieve information when required. This has helped to reduce the workload of the Ministry’s procurement staff and has made the procurement process more efficient.
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ProZorro has also led to cost savings for the Ministry of Defense. The transparency of the system has encouraged more suppliers to participate in the bidding process. This increased competition has led to lower prices for goods and services. In addition, the electronic nature of the system has reduced the amount of paperwork involved in the procurement process. This has led to a reduction in administrative costs and has made the procurement process more cost-effective.
Another essential benefit of ProZorro is that it provides data on the procurement process. The system generates reports on procurement activities, including the number of bids received, the number of contracts awarded, and the value of the arrangements. This data can be used to analyze the procurement process and identify areas for improvement. The data can also be used to monitor the performance of suppliers and to ensure that the procurement process is fair and transparent.
