The Public consultations on procurement of innovation, involving the representatives from the Verkhovna Rada of Ukraine, expert community, civic sector, and other interested persons were held on April 20 and 22.

The topic of innovation procurement is long overdue and it requires consideration. Thus, Global Innovation Index (GII) 2020 ranks economies in which innovations are supported at the state level. Switzerland, Sweden, the USA, the UK, and the Netherlands ranked in the top five, representing the countries with high level of economy and innovations implementation. Ukraine, in its turn, ranked 45th among 131 other countries featured in GII. Ukraine has lost three positions in the 2020 Bloomberg Innovation Index compared to last year, the results of the annual survey show that this year Ukraine placed 56th among 60 countries. The rankings show the urgency of issues and how important it is to solve the issues for development of innovations in Ukraine and, as a result, for development of economy as a whole.

Vitalii Hlizhynskyi, All-Ukrainian Initiative “Active Community” co-founder said that the goal of the Public consultations is to create a space, a ground for the participants to exchange ideas and to come up with innovation procurement proposals. The events are carried out by the Committee on Digital Transformation of Verkhovna Rada of Ukraine in partnership with the All-Ukrainian Initiative “Active Community” from the Institute “Respublica” within the framework of the program USAID RADA realized by the East Europe Foundation.

Viktoriia Podhorna, People’s Deputy of Ukraine, innovation procurement specialist, stated:

“Draft law ‘On Public Consultations’ will soon be reviewed in Parliament on second reading. Thus, it is important for us that the draft law is efficient and this is why we hold the Public consultations. We conduct them exactly at the beginning to take all your suggestions into account when composing the draft law. In Ukraine, the criterion of economical use of state funds is still applied, thus it is important to support medical inventions procurement, small and medium business. The procurement volume in Ukraine is currently at about 13%”.

“It is quite a lot to allow the innovation procurement. In the developed countries, the state was the main investor. For the EU, the goal is the economy development by means of innovative products procurement,” the Deputy shared.

The main award criterion in the EU: the best price-quality ratio

The parameters can be considered in three ways:

  1. Fixed price set by the procurer (the offers only compete in quality features, that can be proposed within the price range).
  2. The offers of competitors include both the price and the quality features;
  3. Not the contract price, rather the lifecycle cost is taken into the account.

Criteria to be considered in innovation procurement:

  1. Advance informing of the market participants

The state authorities inform the market participants in advance on the upcoming procurement to allow them to prepare and make the best offers.

  1. Preliminary consultations with the market participants

The goal of the mechanism employment: to confirm the requirements and the specifications, taking into account the actual market opportunities, better preparation of tender documentation as well informing on the purchasing plans and specifications. It is used in cases the procurer does not have the sufficient information on the innovations on the market.

  1. Innovative partnerships

The innovative partnerships are forged in case the technologies on the market do not satisfy the procurer’s requirements. The whole cycle from research and development to finished product delivery is performed within one contract, providing for effective cooperation of research and production entities.

  1. Pre-competitive procurement

Includes research and development services, production of the first test batch, never the commercial batch.

  1. Сompetitive dialogue

Is employed in cases when the procurer cannot lay down the specifications (based on the available standards) before the procurement procedure. The public procurer, first, describes its needs in a contract notice, sets the criteria for economic operators. Then, the specifications are clarified with the selected candidates, the contract award criteria are defined, the proposals are streamlined.

  1. Competitive procedure with negotiation

Used for the procurement of goods, works, services, requiring adaptation of design or innovation, or other features making the awarding of the contract impractical. Unlike the competitive dialogue procedure, minimum specifications and award criteria are determined in advance and are not discussed during the procedure.

The next section of the Public consultations required group work.

The participants had a chance to discuss the key features of innovations procurement, in particular:

  • Determining the issues in this area
  • The tools for innovations procurement relevant for Ukraine; irrelevant tools and the reasons for it
  • The roles that should exist in the innovation procurement process
  • The risks in case of implementing the European model in Ukraine (political, economic, social, ecology sphere)

IMPORTANT! Suggestions, notes, and comments made and discussed during the Pubic consultations will be taken into consideration in preparation of the draft law.

For reference. The events are carried out by the Committee on Digital Transformation of Verkhovna Rada of Ukraine in partnership with the All-Ukrainian Initiative “Active Community” from the Institute “Respublica” within the framework of the program USAID RADA realized by the East Europe Foundation.

Note. The “Active Community” mission is to achieve welfare by means of democratic development of communities in Ukraine. The goal for 2025 is to get at least 1% of citizens active and systematically involved in decision making and reform promotion for welfare in communities. The Initiative was organized within the framework of the Institute “Respublica” activities. We are working to promote conscious action of the citizens.

Author: Tetiana Kavunenko, Head of Press Office at Institute “Respublica” and All-Ukrainian initiative “Active Community”