Saving trillions of dong on state asset procurement.

(Baonghean.vn) - In 1997, the Ministry of Finance submitted to the Prime Minister a proposal to issue Decision No. 179/2007/QD-TTg dated November 26, 2007, allowing for the pilot implementation of centralized procurement of assets and goods from the state budget starting from 2008.

Although the pilot program was only implemented with the Ministry of Finance and 23 ministries, sectors, and localities that voluntarily registered to participate, during the 5 years of the pilot program (2008-2012), the difference between the estimated and actual amount spent on centralized asset procurement was over 467 billion VND (66.6 billion VND in 2008; 109.3 billion VND in 2009; 21.2 billion VND in 2010; 266.5 billion VND in 2011; and 5.3 billion VND in the first 6 months of 2012).

Centralized public procurement is an inevitable trend. Photo: Internet

This result shows that this method of procurement contributes effectively to combating waste. If it is replicated nationwide and expanded to include more goods and services subject to centralized procurement, this could save trillions of dong.

Recently, the Ministry of Finance summarized, evaluated, and drafted a Decision of the Prime Minister regulating the centralized procurement of state assets. In the draft submission, the Ministry of Finance calculated that implementing centralized procurement of state assets would help save budget expenditures by reducing purchase prices and costs associated with bidding procedures.

Specifically, if centralized procurement is implemented effectively, the savings could amount to approximately 15% of the total annual procurement value of around 200,000 billion VND/year (accounting for 20% of the total state budget). Thus, if centralized procurement of all goods and services is implemented as in some countries, the projected annual budget savings would be 30,000 billion VND/year.

Purchasing in bulk will help reduce purchase prices, minimize the number of procurement entities, and significantly reduce the cost of organizing tenders (currently, tens of thousands of entities annually conduct tender procedures for the same types of assets. With centralized procurement, only one or a few tenders will be conducted per year). This number will be reduced from tens of thousands to approximately 170 centralized procurement entities, including: 2 national-level centralized procurement units, 42 entities under ministries and central agencies, and 126 entities under provinces and centrally-administered cities.

This method also addresses the problem of over-procurement, exceeding quotas and actual needs, and inefficient or extravagant purchases. It limits negative practices and irregularities in public procurement because the procurement process is professionalized, transparent, and open.

Moreover, the centralized procurement method, when implemented professionally, will reduce the bureaucracy and staffing in public procurement.

TV (general)