Planning as a basis for effective financial support of public procurement

We are strongly against the IMCP dependence on the allocated budget funds. This approach allows customers to plan the purchase of goods that are not conditioned by rationing, the cost of which is significantly higher than the market, since it is calculated without considering the functioning market conjuncture. The current regulatory legal acts, which have a significant number of reference norms in terms of IMCP planning and determining, do not provide for a full and comprehensive regulation of the identified problem. At the same time, procurement planning should depend on the budget process since the purchase can be carried out only if there is financial support. It is necessary to reconsider the essence of the “non-fulfillment of the budget” concept and exclude the cases of justified cancellation of the purchase or refusal of the customer to carry out previously planned purchases, including non-use of savings received in the procurement process.

Our position fully coincides with the previously expressed point of view of R.K. Arykbayev, who rejects the direct dependence of the IMCP calculation on the size of the budget allocated to the customer for public procurement. The price is an economic instrument of monetary expression of the product value; it is a subjective cost instrument of the customer, by means of which the necessary level of satisfaction of public needs is achieved. At the same time, IMCP is designed to ensure an adequate ratio of the minimum acceptable level for performers of the product real consumer value with a clear functional relationship with its quality parameters, concerning the risks associated with contracts execution and the costs of conducting competitive procedures (Arykbaev, 2010:28).

This confirms that in order to increase the efficiency of financial support for public procurement, it is necessary to create a unified digital price monitoring system that provides for an analysis of market prices and conjuncture, both in the functioning market and based on the results of fulfilled contractual obligations within the framework of public procurement. The formation of a single digital database of prices (actual, reference, statistical, etc.) with the possibility of automatic use of various coefficients (territorial, functional, etc.), including the dynamics of prices for the period, allows to reasonably set IMCP. This contributes to the correct forecast of the customer's needs and calculation of the necessary financing.

When establishing an IMCP, customers need to maintain balance that ensures the ratio of the price of products acceptable for the business entity, its consumer value and quality with the risks associated with contractual obligation fulfillment, as well as costs of the customer for the purchase.

Results

Planning helps both the customer and the business entity in solving problems by concentrating resources (material, financial, production, labor, etc.) in priority areas.

The importance of planning lies in the fact that it is designed to ensure the effectiveness of management at all stages of public procurement, including management decision-making. Public procurement planning with all its elements is designed to ensure, first of all, the goal setting, without which the management and financial support of procurement will become spontaneous and unpredictable, and budget expenditures are accepted without focusing on results. Planning begins after determining and identifying the customer's need for a specific good, calculated in strict accordance with the applicable regulatory legal acts.

Procurement planning is an indicator of functioning of a well-established system for converting state resources in the form of budgetary funds into public interest in the form of public demand for goods, works, and/or services.

It is proposed to identify the following main elements of public procurement planning: goal setting, depth of planning, consideration and coordination of public and private interests, adaptation, and freedom of discretion.

It is necessary to determine the following priority elements of public procurement planning: goal setting, result and cut-off horizon (by analogy with state budget planning). It is possible to implement this through prospective procurement planning introduction, which will provide an opportunity to control all stages of procurement, including the quality of the fulfilled contractual obligation and payment of its result.

The prospective procurement planning is proposed to be understood as an independent document approved after allocation of budget funds is completed; it ensures implementation of management decisions within the framework of goal setting and synchronization of public and private interests for medium-term (3-5 years) and long-term (over 5 years) periods.

Thus, prospective procurement planning is synchronization of public and private interests, integrated into the system of budget process and into the resource supply of a country, or a separate entity. Since the purchase of goods, works, and services at the expense of budgetary funds indirectly affects the economy, public procurement becomes a reference point for entrepreneurs to form proposals and mobilize efforts (purchases should be economically interesting, but moderately profitable, that is, without excess profits).

Prospective procurement planning should not only be associated with all stages of the budget process, but also legally included into the context of drawing up a cash plan when forming a forecast of transfers from the budget to pay for fulfilled contractual obligations in relation to the term and amount of monetary obligations payment. Prospective procurement planning should be based on objective and reasonable needs; the cost is calculated based on the cost of ownership or life cycle of products. Planning expenses for the future period with subsequent payment of fulfilled contractual obligations undergoes through all stages of the budget process. Planning helps in solving the most difficult task, that is, reducing the human factor in the process of financial support for public procurement.

Conclusions

Prospective procurement planning will allow accumulating all the necessary needs of customers, including the costs of their purchase, and creating the basis for a new innovative formation, lean concept of financial support for public procurement.

Despite the insufficiency of research into the essence of “digitalization”, we believe that applying “digital” technologies in the process of budget planning and prospective procurement planning can ensure transparency of budget spending, as well as public control over the process of purchasing and paying for goods, works, and/or services at the expense of budget funds. That is why Chapter 18 “Information support of the budget process” was introduced in the draft Budget Code of the Russian

Federation; it consists of five articles (170-174.1) and aims at ensuring transparency of budgetary relations. At the same time, Article 174 “Public Information Resources” provides additional requirements for the integrated portal of the budget system functioning: composition of information, procedure for providing, etc.

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