Digital Agency Information Systems procurement Reform Study Meeting (1st)

Overview

Date and Time: Tuesday, June 21, 2022, from 3:30 p.m. to 5:00 p.m.
Location: Conference Room 1 of the All Japan Town and Village
Agenda:
1. Opening
2. Proceedings
  1. Background and Objectives of the Study Group
  2. Issues and topics derived from the discussions on procurement to date
  3. How to proceed with the investigation at the Review Meeting
  4. Free discussion
  5. Future flow of the review meeting
3. Adjournment

Materials

Relevant policies

Ensuring fairness and transparency in procurement / procurement reform to utilize new technologies

Summary of proceedings

Date

From 3:30 pm to 5:00 pm on Tuesday, June 21, 2022

Location

Conference Room 1 of the National Town and Village

Members in attendance

Member Kajikawa, Member Arikawa, Member Kawazawa, Member Kimura, Member Sakashita, Member Sumiya

Summary of proceedings

After the Secretariat explained the background and purpose of the Study Group and how to proceed with the survey, the discussion took place. The main opinions from each member are as follows.

Of a whole

Since there are many matters to be considered, it is necessary to prioritize and discuss them based on the difficulty of realization. It is necessary to prioritize and discuss those with high importance and feasibility.
The government's information systems procurement has been examined and investigated by various organizations since the 1998 s. I would like to summarize the contents of the discussions held in the past, the extraction of Issue, and how the investigation has been utilized.
We would like to discuss the KPIs and outcomes we want to achieve through the Public procurement Reform. For example, from the perspective of engaging diverse procurement participants, it is necessary to collect data on whether diversity is actually increasing. In addition, from the perspective of the efficiency of tax use, it is necessary to accurately grasp the amount of money. We would like to collect and disclose such data as public property and build a system that can be discussed based on it through the Review Meeting.
We believe that the perspective of the abilities of both the orderer and the order-receiving side is important. We would like to discuss a mechanism to evaluate the fairness of orders. In the future, in light of the fact that IT procurement will become more specialized and complex as technology progresses, we would like to discuss an environment in which procurement skills are always reskilling and a system in which knowledge is mutually exchanged.
Each issue has been discussed in a wide range of ways. Bearing in mind which issues are feasible, I would like to advance discussions one by one in the short term from where they are feasible, while maintaining new initiatives as Issue in the medium term.

Issue A: Review of the procurement Process and strengthening of the system

Although it is difficult to make the budget system flexible in Issue, it may be possible to clarify the existing procedures such as advance payment and approximate payment at an early stage.
There is room for innovation within the framework of the current law in the form of concluding basic contracts for the entire project and making individual contracts into multi-stage contracts such as discretionary contracts. On the other hand, in the case of long-term projects, ensuring fairness and competitiveness is a concern, and transparency and information disclosure are important.
As for the flexibility of the budget system, the reliable implementation of BPR will be an issue.
As for contract-related procurement, we would like to refer to the example of local government as a leading initiative. As for start-up support, it is possible to refer to examples such as successful discretionary contracts in local government. In addition, the government combines multi-stage contracts into one contract, but there are an increasing number of cases in which private sector companies respond by concluding individual contracts while concluding basic contracts for the development of information systems, which we believe will be useful.
If Digital Agency can be made into a basic contract and each ministry and agency can make an individual contract, the content of the contract will be more high-quality, and it will be easier for each ministry and agency to work on it. On the other hand, it is assumed that the meaning of the basic contract may disappear depending on the scope of discretion of the individual contract. In addition, it is not only about information systems, but also about public procurement in general, and I think that it will have a large impact.
Standardization in the procurement provision will lead to increased transparency. In addition, electronic contracts, etc. will be made more transparent by using a fixed model.
Regarding the public budget, although flexible budget execution is also important, flexibility should be examined from the viewpoint of budget control by the people. We would like to discuss public contracts by paying attention to the major premise that even if efficiency and economic efficiency are impaired, fairness and transparency must not be impaired.

Issue B: Participation of a wide variety of vendors, selection of appropriate vendors

In addition to the introduction of the mechanism, the digital marketplace needs to be translated by a person who can stand between start-ups and government officials and understand both what kind of practice there is in public institutions and how start-up solutions are put into the field.
Since the Digital Marketplace is a system that only needs to be ordered, it cannot cover large-scale procurement. Regarding other procurement systems, we would like to discuss what kind of procurement portal is necessary and how to position the Digital Marketplace in it, based on the understanding of UI/UX, which is the ease of administrative procedures from the viewpoint of both the ordering side and the commissioning side.
If a wide range of companies participate, fairness and competitiveness will be enhanced, while the number of procurement contracts is expected to increase due to the segmentation of the procurement unit. At present, the percentage of electronic contracts concluded within the government is small, but shouldn't the entire process from procurement to contract be fully computerized and integrated?
Just setting up a platform does not necessarily mean that venture companies will go to see public notice and notification of public offering by the government. For example, by using a corporation number, if you know which company has what kind of technology, you can encourage the participation of venture companies by recommending that they may be able to accept such work. Without such a mechanism, you cannot create opportunities.
In the future, as loose coupling is required, it is common in other countries to operate procurement in a modular and interoperable form. Under the premise that loose coupling is unavoidable in Japan, we believe that a system that pursues the simplicity of the principles and processes in operation will be necessary.
Regarding the transparency of procurement information, I would like to standardize and disclose procurement information so that Civic Tech and others can utilize it. Foreign countries are actively disclosing information using data standards for procurement information and reviewing measures, and I would like to refer to them.

Issue C: Clarification of processes and improvement of transparency, etc.

Although the degree of efforts for one party bidding differs among the Cabinet Office and each Ministry, efforts have been accumulated. Isn't it important to build information systems into existing administrative reform efforts?
I feel it will be a Issue in the future to what extent the Cabinet Office and each Ministry can improve the contents of the specifications, such as API and loose coupling.

Other

● According to Ministry of Finance's Balance of Payments Statistics, more than half of the country's trade surplus is repatriated overseas through the use of overseas cloud services, so it is necessary to discuss the development of the domestic digital industry.

End