Why Contract Management for the Public Sector?
Contract Management in the Public Sector is a hot topic. There are a few Frameworks from Government entities globally, the OGC in the UK, some work out of Australia, pockets of best practice from the US and SA’s own National Treasury Framework. Each one has a common theme, improving supplier performance, governance of the funds entrusted to it, ensuring value for money and that Governments interest are protected.
Manual Systems and Processes in the Public Sector
Much work has been done in SA, particularly in KZN Province and now in Limpopo Province, on establishing manual processes for contract management. These include establishing contract registers, reviewing a sample of existing contracts, establishing standard contracts for a range of supplies and services, developing policy and procedure.
Previously contract management was not an identified discipline, and the results were similar to the private sector, a lack of focus to this important function had a serious detrimental impact, especially with the pressure most African Governments are under for service delivery, none more so than SA.
The impact of the work done on behalf of Treasury in these Provinces has been a highly valuable case study in the practical implementation of the theory of contract management, the risks and exposure from ignoring the functions, and the benefits that arise.
Realyst has been an active panellist on this project from inception.
The Value of the SA National Treasury Framework
The SA NTF for contract management is a very useful starting point for all state entities in reviewing what they need to do in order to comply with good practice. It follows an in depth examination of the links between CM, PFMA, MFMA, a guide to implementation and self-assessment tools.
By complying with the Framework, Government entities will ensure a contract management clean audit.
The Role of Systems in Public Sector Contract Management
Government policy is usually well defined, which enables systems to be aligned and capable of repetition, save that each entity will have different contract types and reporting requirements.
The SA NTF recognises the value of automating the processes underlying these policies, and the value systems can provide Government entities.
In our experience the focus points should be:
- Document controls, electronic copies and ease of retrieval
- Establishing contract registers, with defined data per contract type
- Reporting
Easing the legal burden through automated contract creation and improving drafting quality.