Procurement is becoming more and more mysterious

The decrease in the transparency of public procurement excluded the possibility of their meaningful analysis, a study by SKB Kontur showed. The data of the third quarter indicate a reduction in the number of tenders and participants in the procurement of both the state and state-owned companies. The result can be caused by two fundamentally different reasons – the transfer of part of the purchases to the sector invisible to the state or the decrease in business interest in government orders due to the tightening of requirements in it and the expansion of non-competitive procurement practices. Statistics do not make it possible to determine what exactly is happening in these markets: the principle of digitalization of procurement to increase its transparency and efficiency after the start of the Russian military operation in Ukraine has essentially been cancelled.

Analysts of SKB “Kontur” after processing the data of the Unified Information System in the field of procurement (UIS) for the third quarter ascertain the continuation of the period of turbulence and uncertainty for the business participating in government orders and supplies for state-owned companies. Customers are less likely to post data on procurement procedures, and suppliers are less likely to participate in them. The number of state purchases (according to the law on the contract system, FZ-44) decreased by 4.6% compared to last year, from 758.4 thousand to 722.9 thousand, while the volume immediately grew by 29%, from 2 .8 trillion to 3.7 trillion rubles. As a result, the trend towards consolidation of purchases continued in the state order – the average price of one purchase increased by a third, to 3.9 million rubles. This process is accompanied by a decrease in the level of competition – the number of suppliers who signed contracts decreased by 29%.

At the same time, similar trends are developing in the procurement segment of state-owned companies. Compared to the third quarter of 2021, the number of placed purchases decreased by 14%, from 440.5 thousand to 375.9 thousand. The fall is more serious than in the second quarter: then the number of placed tenders decreased by 12%. In terms of value, the amount of placed trades fell by half at once. The result is explained by anti-sanction concessions for state-owned companies: due to the risk of “secondary sanctions”, state JSCs were able to classify procurement data and not publish data about them in the EIS. The measures made these purchases invisible to the state and, accordingly, analysts. In numerical terms, the scale of the fall could also be more impressive, but customers began to split up large purchases and publish more low-cost tenders, the SKB Kontur notes.

Thus, the average price of a published purchase decreased by one and a half times – from 9.8 million to 6.7 million rubles. The practice of splitting tenders, meanwhile, is also necessary to attract suppliers by reducing their risks when participating in larger tenders. So far, state JSCs have faced an outflow of counterparties – their number has decreased by a quarter, from 19.5 thousand to 14.4 thousand.

The reduction in the number of suppliers can also be explained by a decrease in business interest in government orders. On the one hand, some companies are experiencing difficulties due to problems with logistics and settlements and have not been able to change the old supply chains. Under conditions of uncertainty, companies cannot guarantee the fulfillment of obligations at a fixed price and refuse to participate in government auctions. “Amid the crisis, many suppliers refuse to conclude long-term and large-volume contracts, as prices for goods, works and services are constantly changing,” says Vasily Danilchik, an expert at Kontur.Torgov. On the other hand, entrepreneurs are discouraged by the excessive tightening of the rules for participation in public procurement, despite the increased uncertainty in the markets. Thus, the risks of getting into the register of unscrupulous suppliers in the event of significant breaches of the contract after the unilateral refusal of customers from the contract have increased.

The decrease in the attractiveness of the state order due to the dominance of single suppliers and excessive requirements was previously stated in the Chamber of Commerce and Industry. The FAS is also concerned about the loss of competition in the sector and the danger of market redistribution. Meanwhile, the Ministry of Finance considers these measures necessary in the face of sanctions. The regulator also de facto abandoned the principle of efficiency and transparency of public spending within the framework of the state order and intends to expand the closed circuit of the UIS, while the agency itself and controllers will keep the data for purchases (see Kommersant dated September 23). Now invisible purchases from a single supplier are promised to be returned to the EIS circuit by April 2023, before that it is impossible to estimate their volume.

Recall that the transfer of public procurement and procurement of state companies in electronic form was one of the largest reforms of the government of Dmitry Medvedev in 2015-2018. The process met with considerable resistance – the publication on the network of all data on the spending of taxpayers’ money by the state made public both direct corrupt practices and the traditions of luxury consumption of representatives of the state apparatus and the management of state corporations that had developed by that time, and also often allowed, under public pressure, to stop the most inefficient and non-target government spending. At the same time, the “counter-sanctions” motivation, which now often explains the need to close data on transactions in the public sector from citizens, became a reality for government orders even after the “Crimean” sanctions of 2014 — in 2015–2016, the White House actively developed the “black box” mechanism designed to to protect counterparties of the state and its companies under the Crimean contracts from the risks of secondary sanctions. At that time, officials claimed that a method of such protection had been found and implemented, but in the case of the current, much larger sanctions against the Russian economy by most developed countries in connection with the military operation in Ukraine, it apparently turned out to be unsuitable, and the return to non-public spending of state funds remained the only way to protect markets from external pressure.

Diana Galieva, Oleg Sapozhkov