National Regulation of Public Procurement
Key features of public procurement system
- One of the largest public procurement markets
- Detailed vendor evaluation methodology and rating system
- Priority of catalogs of goods, work and services
- For many tenders there are no restrictions (preferences) on participation for large companies and SMEs
- Government contract prices are generally higher than market prices
International Agreements
- WTO Agreement on Government Procurement (GPA)
- Trans-Pacific Partnership (Chapter 15, Government Procurement)
National Law
- Public Accounting Act 35 of 1947
- Public Property Act No. 73 of 1948
- Cabinet Order on Budgets, the Settlement of Accounts, and Accounting 165 of 1947
- Ministry of Finance Ordinance No. 52 of 1962 on Contract Management Regulations
Local Law
- Local Autonomy Act No. 67 of 1967
- Enforcement Decree of the Local Autonomy Act
General procedural regulation:
- Antimonopoly Act No. 54 of 1947
- Act on Prevention of Delay in Payment under Government Contracts No. 256 of 1949
- Act on Access to Information Held by Administrative Organs No. 42 of 1999
- Act for Promoting Public Tendering and Contracting for Public Works No. 127 of 2000
- Regulations on Public Procurement in Japan.
- Act on Promotion of Procurement of Eco-Friendly Goods and Services by the State and Other Entities 100 of 2000.
SAI Japan Cases
Execution Status of Budget, Etc., Regarding Measures for COVID-19
The document is an audit report for fiscal year 2021 conducted by the Japan Board of Audit. It covers various areas of public expenditure and projects, providing analysis and evaluation of their effectiveness and legality.
Audit Criteria:
The main audit criteria were legality of expenditures, compliance with budgets and policy frameworks, and assessment of performance and value for money and included the inspections of:
- Accuracy: whether the final accounts accurately reflect the financial status such as the execution of the budgets.
- Regularity: whether the financial management is properly conducted in conformity with the approved budgets, laws and regulations.
- Economy: whether the implementation of projects and programs or budget execution is administered with the minimum cost.
- Efficiency: whether the projects and programs gain the maximum results with the given cost or have the best cost-efficient outcome.
• Effectiveness: whether the projects and programs achieve the intended results and produce the expected effects.
The audit identified key problems in the management of public resources and suggested steps to address them. The main emphasis is on the need to improve planning, control and accountability in public agencies to ensure more efficient and cost-effective use of public funds. These measures imply greater accountability and transparency in public procurement and financial management processes.
The results of the audit emphasize the need:
- to improve the public procurement system;
- to strengthen control and transparency of spending;
- to streamline state programs to improve their efficiency.
1. Data management in emergencies
- Problem: poor storage conditions and obsolescence of electronic data necessary for the emergency priority work.
- Solution: regular update and storage of electronic data, distribution of mobile routers and assignment of email accounts for disaster recovery system.
2. Effectiveness of Contracts in Research Projects
- Problem: the National Institute for Environmental Studies conducted biochemical tests through contractors with underperforming contracts.
• Solution: establishing specific measures to enable an economical payment that appropriately reflects actual performance of the contract and employee training