Editor's Note: In recent years, China has been strengthening the institutional framework for government procurement information disclosure, with an increasingly solid legal foundation. The "Notice on Carrying out the Work of Disclosing Government Procurement Intentions" (Caiku [2020] No. 10) issued by the Ministry of Finance has attracted much attention. However, against what institutional background is China's government procurement intention disclosure carried out? What practical challenges does it face in practice? To address the cognitive gaps and operational doubts in the industry, this newspaper invited industry experts to answer these questions one by one.


Host:
Yang Wenjun, Reporter, China Government Procurement News


Guests:
- Wang Conghu, Executive Director of the Public Resources Trading Research Center, Renmin University of China
- Huang Gangping, Director of the Government Procurement Supervision and Management Division, Finance Department of Guangxi Zhuang Autonomous Region
- Xu Zhou, Deputy Director of Shanghai Government Procurement Center
- Li Gang, Government Procurement Office, General Office of Xinhua News Agency
- Zhang Fan, General Manager of Sichuan International Tendering Co., Ltd.
- Jing Xuzhong, General Manager of Key Account Business, Lenovo (Shanghai) Co., Ltd.


Host: It has been over a month since the issuance of the "Notice on Carrying out the Work of Disclosing Government Procurement Intentions" (Caiku [2020] No. 10), and many pilot units have already started gearing up. However, many staff in charge still have doubts, even misunderstandings and improper operations in terms of cognition and implementation. It is a great honor to invite all experts here to discuss, analyze and answer questions on the topic of government procurement intention disclosure.


◎ Institutional Basis for China's Government Procurement Intention Disclosure


Host: As we all know, disclosing government procurement intentions is an international common practice. Then, against what institutional background is China's government procurement intention disclosure carried out?


Wang Conghu: Since the beginning of China's centralized government procurement, great importance has been attached to building an information disclosure system. Moreover, the purpose of implementing centralized procurement is to ensure that government procurement is conducted in the sunshine and to guarantee its openness and transparency. Of course, the openness and transparency of government procurement essentially mean the openness and transparency of government procurement information. For this reason, both the "Government Procurement Law of the People's Republic of China" and the "Regulations on the Implementation of the Government Procurement Law of the People's Republic of China" have clear provisions on government procurement information disclosure. As early as September 11, 2004, the Ministry of Finance also promulgated and implemented the "Measures for the Administration of Government Procurement Information Announcements" (Decree No. 19 of the Ministry of Finance). With the gradual improvement of the government procurement system, society has put forward higher requirements for openness and transparency. To adapt to the new situation, from the end of 2019 to the beginning of 2020, the Ministry of Finance continued to promote government procurement information disclosure, and successively issued the "Measures for the Administration of Government Procurement Information Release" (Decree No. 101 of the Ministry of Finance), the "Notice of the Ministry of Finance on Carrying out the Work of Disclosing Government Procurement Intentions" (Caiku [2020] No. 10), the "Notice of the Ministry of Finance on Issuing the 'Format Specifications for Government Procurement Announcement and Publicity Information (2020 Edition)'" (Caibanku [2020] No. 50), and the "2019 Third-Party Evaluation Results on Government Procurement Transparency".

At present, the content of China's government procurement information disclosure is very comprehensive, including government procurement project information such as public bidding announcements, pre-qualification announcements, single-source procurement public notices, winning (transaction) result announcements, and government procurement contract announcements; as well as government procurement supervision information such as complaint handling results, supervision and inspection results, and assessment results of centralized procurement agencies. Now, government procurement intention disclosure has been added to this list.


Li Gang: China's government procurement information disclosure operates at two levels. On one hand, in a broad sense, Article 14 of the "Budget Law of the People's Republic of China" stipulates that the budget, budget adjustments, final accounts, and reports on the implementation of the budget approved by the people's congress at the corresponding level or its standing committee shall be made public to the society by the financial department of the government at the corresponding level within 20 days after approval, with explanations on important matters such as the arrangement and implementation of fiscal transfer payments by the government at the corresponding level and the situation of borrowing debts. Governments, departments, and units at all levels shall promptly make public the situation of government procurement. In practice, budget units disclose general government procurement information (goods, services, projects) in their departmental budgets, with varying channels and depths of disclosure. The disclosure of government procurement intentions is also a specific implementation of Article 14 of the "Budget Law" at the budget unit level. On the other hand, in a narrow sense, government procurement information disclosure refers to the disclosure of single or one-off procurement information by the procuring entity, i.e., disclosure in accordance with the requirements of relevant laws and regulations on government procurement. Thus, China's government procurement information disclosure is statutory, mandatory, and carried out in a gradual manner.


◎ Understanding Government Procurement Intention Disclosure


Host: How to define government procurement intention disclosure? What content does it include?


Wang Conghu: The procurement of goods, projects, and services that fall within the centralized procurement catalog or exceed the procurement threshold in accordance with the project implementation shall disclose government procurement intentions. The content of government procurement intention disclosure shall include the name of the procurement project, an overview of procurement needs, budget amount, expected procurement time, etc. Among them, the overview of procurement needs shall include the name of the procurement object, the main functions or objectives to be achieved by the procurement object, the quantity of the procurement object, and the requirements for quality, service, safety, time limit, etc., that the procurement object needs to meet. All the above contents shall be referred to as government procurement intention disclosure.

It should be noted that government procurement intentions should be as clear and complete as possible to facilitate suppliers in preparing for participation in procurement activities in advance. Government procurement intentions are only for reference for suppliers to understand the preliminary procurement arrangements of various units. The actual procurement needs, budget amount, and implementation time of the procurement project shall be subject to the procurement announcements and procurement documents finally released by the budget units.


Host: What is the significance of government procurement intention disclosure?


Xu Zhou: Disclosing government procurement intentions reflects both the strengthening of process control and result orientation in government procurement. Based on my years of experience, many government procurement projects actually have no competitiveness when they enter the procurement stage. The competition for these projects often does not occur in the procurement stage, let alone the evaluation stage, but is basically completed in the stage of determining needs. For most suppliers, when they see the bidding announcement to participate in the bidding, they may have already "lost at the starting line". Disclosing government procurement intentions is a very good mechanism. It can better ensure fair opportunities for suppliers, and at the same time, it is a kind of supervision over the process of determining needs by the procuring entity, which can effectively promote fair competition. In addition, disclosing government procurement intentions helps the procuring entity to broaden its horizons, determine procurement needs more scientifically and comprehensively by gaining a wider understanding of market information, so as to better achieve procurement results of good quality at a good price and value for money.


Huang Gangping: Disclosing government procurement intentions facilitates suppliers to learn in advance about the budget management arrangements for government procurement information, optimizes the business environment, further improves the transparency of government procurement, enhances procurement performance, and prevents and curbs corruption.

It can be said that disclosing government procurement intentions is a profound reform of the government procurement system. It is conducive to promoting the implementation of procurement budgets, strengthening supervision over various procurement units, providing more fair, just, and equal opportunities for various suppliers, and better meeting the procurement needs of the procuring entities.


Jing Xuzhong: For suppliers, disclosing government procurement intentions is definitely a good thing. One of the most important tasks of our sales staff is to collect needs, but in reality, it is difficult to achieve full coverage. After the disclosure of government procurement intentions, we can obtain various procurement demand information faster and more easily.


◎ Implementation of Government Procurement Intention Disclosure


Host: What measures have various units taken regarding government procurement intention disclosure?


Li Gang: I understand that most central budget units have also successively received documents from the Ministry of Finance. They mainly carry out relevant work in strict accordance with the requirements of the notice without putting forward new requirements. Some central budget units have already started participating in the relevant system testing work of the Ministry of Finance. The Beijing Municipal Finance Bureau has studied and formulated a pilot plan, is upgrading the system, and will issue relevant implementation opinions after completion.


Huang Gangping: In accordance with the unified requirements of the Ministry of Finance, the Finance Department of Guangxi Zhuang Autonomous Region has promptly studied and deployed, and actively promoted the work of disclosing government procurement intentions across the region in combination with the actual situation of the autonomous region. On one hand, we respect grassroots initiatives and follow the principle of "pilot first, step-by-step implementation". At present, Guigang City in Guangxi has taken the lead in implementing the pilot work of disclosing government procurement intentions in the region since January 1, 2020. The first batch of pilot units are 5 municipal-level budget units, including the Municipal Development and Reform Commission, Public Security Bureau, Housing and Urban-Rural Development Bureau, Urban Management Supervision Bureau, and Industrial Park Management Committee. On the basis of the pilot work in Guigang City, the Finance Department of Guangxi will select some budget units at the autonomous region level (such as Guangxi University, Guangxi Medical University) and some budget units at the prefecture-level (such as Guigang City) to be included in the pilot scope of disclosing government procurement intentions at the autonomous region level in 2020, and select some budget units at the city level in Yulin City and Baise City to be included in the pilot scope in 2021. It is ensured that all budget units at the autonomous region level will fully implement the disclosure of government procurement intentions starting from January 1, 2021, and all budget units across the region will achieve full coverage of government procurement intention disclosure starting from January 1, 2022. On the other hand, we strive for practical results and carefully organize the implementation of government procurement intention disclosure. We are actively studying and formulating a specific implementation plan for the work of disclosing government procurement intentions in the autonomous region, clarifying the release channels and timing, determining the threshold for disclosing procurement projects, unifying the format of government procurement intention disclosure and the requirements for procurement demand content, etc., with a focus on strengthening work guidance for budget units at the city and county levels.


Zhang Fan: After the issuance of the "Notice of the Ministry of Finance on Carrying out the Work of Disclosing Government Procurement Intentions" (Caiku [2020] No. 10), Sichuan Province also issued a notice to carry out the pilot work of disclosing government procurement intentions in provincial units in advance. Our company is organizing professionals to carefully study relevant policies, investigate the opinions and suggestions of procuring entities and relevant experts, and while practicing, exploring and summarizing, strive to accurately grasp policy requirements in practice to provide more professional services for procuring entities and suppliers.


Host: What practical challenges will the disclosure of government procurement intentions face? Are there any good suggestions to address them?


Zhang Fan: Many people will ask: What are the connections and differences between government procurement intention disclosure and government procurement demand publicity, and will there be an "overlapping effect"? Personally, I believe that the significance of government procurement intention disclosure is to eliminate injustice caused by untimely and asymmetric information disclosure, thereby creating a better business environment for government procurement. Government procurement intention disclosure should be a broader form of disclosure, while government procurement demand publicity is relatively narrow. The former has a wider scope than the latter, and the latter should be the core content of the former. Although there is overlap between them, they are complementary and consistent. To avoid unnecessary waste of resources, relevant regulations should be further sorted out and improved in a more systematic and scientific manner in the next work. Moreover, the key depends on how the procuring entity handles it. The procuring entity should grasp the procurement needs from the source, conduct sufficient research, and make the needs concrete and detailed, so that government procurement intention disclosure can be targeted. In addition, attention should be paid to maintaining consistency with government procurement intention disclosure when publicizing government procurement demands.


Li Gang: The timing of disclosing government procurement intentions is a challenge. In terms of specific operations, it should first be clarified that the procurement projects for which intentions are disclosed starting from July 1 shall include projects in July. At the same time, disclosing government procurement intentions is a work requirement for administrative supervision units to gently urge budget units to disclose information through designated release platforms. In my personal opinion, this falls within the scope of budget management. Without involving major construction projects or confidential information, can we consider coordinating the information of budget publicity, government procurement intention disclosure, and government procurement demand publicity, and choosing an appropriate time to release them uniformly?

In addition, in disclosing government procurement intentions, the completeness, correctness, and depth of procurement demands are difficult points and also the trigger for doubts and complaints, which tests the comprehensive ability of the procuring entity. Technically, it is not easy to be accurate, in line with policy requirements, and consistent with subsequent procurement, because after the project approval, there is still a process of continuous improvement, and a little carelessness can make all previous efforts in vain.

In summary, personally, I believe that the timing of disclosing government procurement intentions and the correctness and completeness of government procurement demands depend on the proper handling by the procuring entity. For simple, general, standard projects with the lowest price as the criterion, they should be disclosed at one time; for complex, non-standard, non-general projects, they should be treated differently, and a one-size-fits-all approach should be avoided. The procuring entity should fully investigate the market, proceed steadily, and disclose procurement demands only after the project is mature.


Wang Conghu: Disclosing government procurement intentions tests the governance capacity of various budget units. Whether they can disclose in advance and ensure implementation, whether before or after the budget approval, is not a simple matter in practice. In addition, disclosing government procurement intentions may also provide opportunities for various suppliers to intervene in advance or even start public relations. Due to obtaining relevant information in advance, some potential suppliers with incorrect psychology and values may start to build relationships in advance, which may affect the normal government-business relations.


Jing Xuzhong: As a supplier, we are more concerned about whether the policy can be implemented, and we should not let optimizing the business environment become an empty slogan. In addition, many suppliers are still unclear about the differences between government procurement intention disclosure and government procurement demand publicity. Will this really cause some overlap and waste of resources?


◎ Suggestions for Government Procurement Intention Disclosure in Future Practice


Host: What suggestions do experts have for disclosing government procurement intentions or other aspects of information disclosure?


Xu Zhou: It is suggested that except for emergency procurement, confidential procurement, framework agreements, electronic marketplaces, and other simple procurement methods, other government procurement projects should disclose government procurement intentions as much as possible. For projects with disclosed government procurement intentions, the "bid waiting period" should be allowed to be reasonably shortened in the procurement stage to encourage the procuring entity to take the initiative to disclose government procurement intentions and improve procurement efficiency.


Huang Gangping: On one hand, strengthen training and learning to improve the ideological awareness and consciousness of disclosing government procurement intentions. Promote the work of disclosing government procurement intentions through various forms such as regular or irregular, online and offline, centralized training or decentralized learning. On the other hand, accelerate informatization construction to provide technical support for information disclosure. Government procurement intentions shall be disclosed in accordance with the law on the local branches of China Government Procurement Network or other media designated by the financial departments at or above the provincial level. The managers of the release media should proceed from the overall situation of promoting fair competition in government procurement, optimizing the business environment, and improving the transparency of government procurement, accelerate website construction to meet the requirements of government procurement information release, and provide technical support for information disclosure. Of course, strengthening supervision and management and increasing accountability are also issues that need attention in the implementation process in the future.


Jing Xuzhong: It is suggested that financial departments and procuring entities can clarify the implementation purpose of the "Notice of the Ministry of Finance on Carrying out the Work of Disclosing Government Procurement Intentions", otherwise it is easy to deviate from the original intention of the document. It is suggested that in the future, there can be some indicators to measure the work of disclosing government procurement intentions to ensure that the policy is implemented effectively. Of course, this requires a process. The implementation of any work and the achievement of goals cannot be done overnight; it should proceed step by step.


(Text / Yang Wenjun)