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Patricia Baquero, Sr. Procurement Specialist February 27, 2008

Designing and Implementing an Output-Based Aid (OBA) Project in the Bank: Understanding the Procurement Process. Patricia Baquero, Sr. Procurement Specialist February 27, 2008. Guidance Note for Procurement Staff on Procurement Issues in OBA Projects Financed by the World Bank.

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Patricia Baquero, Sr. Procurement Specialist February 27, 2008

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  1. Designing and Implementing an Output-Based Aid (OBA) Project in the Bank: Understanding the Procurement Process Patricia Baquero, Sr. Procurement Specialist February 27, 2008

  2. Guidance Note for Procurement Staff on Procurement Issues in OBA Projects Financed by the World Bank • Developed jointly by GPOBA, FEU & OPCPR • Incorporates lessons learned from procurement assessments conducted under OBA pilot regional operations & peer reviewer comments • Provides guidance to PS/PAS on how to ensure compliance with the Procurement Guidelines • Also provides checklist for procurement capacity assessment of incumbent service providers • Includes flowchart showing different scenarios and actions required by PS/PAS

  3. Key Issues in Guidance Note 1/3 • OBA subsidy levels determined through • Competitive process to select a service provider (SP), or • Establishment of standard costs or agreement on a unit cost schedule (verified by independent consultants) • Usual award criteria for competitive selection of SP • Least subsidy required per pre-determined output, • Greatest coverage per fixed offered subsidy, • Least connection cost per fixed offered subsidy, or • Combinations of the above • Payment of the OBA Subsidy • On output delivery - upon independent verification of pre-defined output(s) • In pre-agreed amount for the specified service –regardless of actual cost

  4. Key Issues in Guidance Note 2/3 • Types of operations with Bank-financed OBA components • Projects where there is no existing service provider [Para. 3.13 (a) of Procurement Guidelines] • SP to be selected under “an ICB process acceptable to the Bank” (meeting procurement principles; not necessarily Bank ICB process and may include NCB if conditions grant it) • SP so selected is free to use own procedures to procure inputs (goods, works & services) required to produce the outputs on which basis the OBA disbursement will be made • Projects where there is already an existing (incumbent) service provider [Para. 3.13 (b) of Procurement Guidelines]

  5. Key Issues in Guidance Note 3/3 • Projects where there is already an existing (incumbent) service provider • If SP selected under an ICB process acceptable to the Bank, SP free to use own procedures to procure inputs required to produce outputs • If SP not selected under an ICB process acceptable to the Bank, SP shall procure inputs using Bank ICB procedures • If SP not selected under an ICB process acceptable to the Bank but • Incumbent SP is privately- or independent government-owned, • Incumbent SP is engaged in expansion of an existing system, and • Upon assessment, SP procurement systems & capacity are deemed acceptable and adequate, then Incumbent SP free to use its own procedures to procure inputs required to produce outputs, and Bank may conduct post-reviews to ensure assessed conditions remain unchanged (per OPCS OM of Nov. 7, 2005)

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