Solutions for a Sustainable Goods and Services Procurement Process

JAKARTA – The importance of stakeholders to formulate and cooperate together on an effective policy framework is crucial to the growth and sustainability of Indonesia's micro, small and medium scale businesses (UMKM).

Doing so also addresses the challenges faced by UMKMs, namely the integration and implementation of a sustainable goods and services procurement system, the lining up of related procurement policies by both the central and local governments, as well as the synchronization of central and regional procurement goods and services catalogues.

"All sides of our policy development process have their own features. For example, from the political economy side, the final say on regulatory decisions should not be determined only by one party. From the second, the business actor side, there needs to be better bridging between skill and willingness," said the Ministry of National Development Planning/Bappenas' Director of Industry, Tourism and Creative Economy Leonardo A.A. Teguh Sambodo during the SEED Policy Lab for Sustainable Procurement Hackathon/Co-Design online workshop on Monday (18/10).

Teguh underlined that developing this policy is crucial in pushing aspects such as ministerial and organizational collaboration as well as developing a proper database to map out the procurement process. One of the tools that will be used to carry out this policy development is the Budget Performance and Development Planning Collaboration Information System, or KRISNA, which is a real-time application that can be accessed easily online and uses centralized data integrated with the Ministry of Finance (Kemenkeu) and the Ministry of Administrative and Bureaucratic Reform (KemenPAN RB).

This system aims to ease the administration process and support the use of information and data by various ministries and institutions so that they are able to collaborate and exchange ideas more efficiently. The app will be a tool to help serve the planning integration and the budgeting and information distribution processes to assist related ministries and institutions.

"Through KRISNA, at least the government will have a hold on the related programs. It can also serve as a database to help smoothen collaboration efforts between ministries and institutions. On the other hand, KRISNA opens opportunities for feedback that can be used for internal evaluation. Cooperation between various institutions at KRISNA level will help improve literacy and at the same time encourage UMKMs to increase their capacities," Teguh noted.

Partnerships and collaboration between relevant stakeholders on capacity building is important to help develop UMKMs. A sustainable goods and services procurement scheme in Indonesia requires transparency and completeness, both from the database and from its working programs. However, most regional areas do not have facilitators that are as effective as some regions do, thereby underlining the need for collaborations.

"I hope that these concerns will be addressed and copied by other institutions, for their sake," Teguh said.

Meanwhile, Lingkar Temu Kabupaten Lestari secretariat and PLSP working team member Desriko Malayu Putra added easy access to obtain information from the program and the process itself is critical in making any policy efforts work.

"Also, factors such as an appropriate time mechanism between procurement programs, payment terms as well as the administrative application and reporting processes that understand UMKM needs are also key. What we need is an integrated system so that there will be no overlap or repetition of the procurement processes and there could be a proper product certification system for UMKMs," Desriko said.