For more than 20 years, Kazakhstan has been implementing the state policy aimed to create the Common Information Space to reduce budgetary spending on the establishment and maintenance of public authorities information resources, as well as on the development of a unified communication environment. Kazakhstan's transition to a digital economy is following a “catch-up” development model which is based on the procurement of the off-the-shelf software and the predominant use of the services provided by third-party companies and experts in the field of information and communication technologies. Official statistics confirm the dependence of Kazakhstan's digital industry on foreign IT developments and experts. The Supreme Audit Chamber of the Republic of Kazakhstan (SAI Kazakhstan) audited the implementation of the program intended to facilitate public administration digitalization, including the procurement of equipment, other goods and services.

Audit Objectives:

To assess the effectiveness of the digitalization state policy and the efficiency of the state assets use in the field of informatization (including procurement of goods and services).

Key findings regarding public procurement:

1.         The audit found that artificial competition was created, while the procurement (tender) procedures were treated as a mere formality, which does not meet the principles of optimal and efficient spending.

2.         Inefficient spending on procurement of equipment rental services was partially attributed to the constantly changing needs of the government agencies.

3.         When conducting procurement (tender) procedures to select suppliers, unreasonable qualification requirements were set for suppliers in terms of work experience.

4.         In a number of cases, specific types of works to be performed within the framework of warranty maintenance and support of the informatization object were not defined..

The Supreme Audit Chamber of Kazakhstan conducted an audit of the efficiency of the use of public funds and state assets allocated from the national budget to support the socio-economic development of the region. The SAI underlines the high dependence of regional budget revenues on national subventions and transfers (from 88.6% to 94%).

Key findings regarding public procurement:

1. Overestimation of the cost of design and estimate documentation; fraudulent supporting documents or lack thereof, which was often caused by the lack of monitoring and proper control by some managers of the budget programs when planning and using the budgetary funds.

2. A systemic problem, typical for all public procurement organizers in construction, was that potential suppliers (or its employees) often provide procuring entities or public procurement organizers with expert, consulting and other services or services related to the preparation of public procurement, participate as a procuring entity, general designer or sub-designer in the development of feasibility studies and/or design (design and estimate) documentation.