Assessment of Whether Governments' Period Contracts and Framework Agreements Favour Large, Full-Service Companies

Debated in Parliament on 2 Aug 2022.

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Gerald Giam asked whether whole-of-Government Period Contracts and Framework Agreements favour large, full-service multinational companies over local SMEs and independent contractors who may offer more competitive prices for partial services, and whether the Ministry conducts contractor concentration analysis and tracks the average share of the top vendor.
Lawrence Wong explained that these contracts are demand aggregation agreements intended to improve efficiency and value-for-money by appointing panels of vendors through competitive tenders, with panel size varying based on the procurement's nature.
He stated that agencies select vendors based on best meeting requirements at suitable pricing, not on targets for vendor share, making such targets not meaningful for MOF to set.
Wong noted that SMEs comprise about 75% of vendors on these panels and receive over 85% of procurements through these contracts, indicating the contracts are open to both large companies and SMEs.
The key criterion for awarding these contracts is a vendor's ability to deliver cost-effective services, not the size of the company.

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Gerald Giam Yean Song

Mr Gerald Giam Yean Song asked the Deputy Prime Minister and Minister for Finance whether whole-of-Government Period Contracts and Framework Agreements favour large multinational companies that can offer the full set of services in tender requirements at the expense of local small and medium enterprises and independent contractors who may potentially offer a smaller set of the services at more competitive prices.

Summary written by AI (learn more)

Gerald Giam asked whether whole-of-Government Period Contracts and Framework Agreements favour large, full-service multinational companies over local SMEs and independent contractors who may offer more competitive prices for partial services, and whether the Ministry conducts contractor concentration analysis and tracks the average share of the top vendor.
Lawrence Wong explained that these contracts are demand aggregation agreements intended to improve efficiency and value-for-money by appointing panels of vendors through competitive tenders, with panel size varying based on the procurement's nature.
He stated that agencies select vendors based on best meeting requirements at suitable pricing, not on targets for vendor share, making such targets not meaningful for MOF to set.
Wong noted that SMEs comprise about 75% of vendors on these panels and receive over 85% of procurements through these contracts, indicating the contracts are open to both large companies and SMEs.
The key criterion for awarding these contracts is a vendor's ability to deliver cost-effective services, not the size of the company.

Questions identified by AI (learn more)

Assessment of Whether Governments' Period Contracts and Framework Agreements Favour Large, Full-Service Companies

Debated in Parliament on 2 Aug 2022.

Summary written by AI (learn more)

Gerald Giam asked whether whole-of-Government Period Contracts and Framework Agreements favour large, full-service multinational companies over local SMEs and independent contractors who may offer more competitive prices for partial services, and whether the Ministry conducts contractor concentration analysis and tracks the average share of the top vendor.
Lawrence Wong explained that these contracts are demand aggregation agreements intended to improve efficiency and value-for-money by appointing panels of vendors through competitive tenders, with panel size varying based on the procurement's nature.
He stated that agencies select vendors based on best meeting requirements at suitable pricing, not on targets for vendor share, making such targets not meaningful for MOF to set.
Wong noted that SMEs comprise about 75% of vendors on these panels and receive over 85% of procurements through these contracts, indicating the contracts are open to both large companies and SMEs.
The key criterion for awarding these contracts is a vendor's ability to deliver cost-effective services, not the size of the company.

Questions identified by AI (learn more)

Full Transcript

Gerald Giam Yean Song

Summary written by AI (learn more)

Gerald Giam asked whether whole-of-Government Period Contracts and Framework Agreements favour large, full-service multinational companies over local SMEs and independent contractors who may offer more competitive prices for partial services, and whether the Ministry conducts contractor concentration analysis and tracks the average share of the top vendor.
Lawrence Wong explained that these contracts are demand aggregation agreements intended to improve efficiency and value-for-money by appointing panels of vendors through competitive tenders, with panel size varying based on the procurement's nature.
He stated that agencies select vendors based on best meeting requirements at suitable pricing, not on targets for vendor share, making such targets not meaningful for MOF to set.
Wong noted that SMEs comprise about 75% of vendors on these panels and receive over 85% of procurements through these contracts, indicating the contracts are open to both large companies and SMEs.
The key criterion for awarding these contracts is a vendor's ability to deliver cost-effective services, not the size of the company.

Questions identified by AI (learn more)

Gerald Giam Yean Song

Mr Gerald Giam Yean Song asked the Deputy Prime Minister and Minister for Finance (a) whether the Ministry conducts contractor concentration analysis for whole-of-Government Period Contracts and Framework Agreements called by various Government Procuring Entities; and (b) what is the average share of the top vendor that is within the appointed panel of vendors across all public sector agencies by its procurement value.

Lawrence Wong

Whole-of-Government (WOG) Period Contracts and Framework Agreements are demand aggregation (DA) contracts that cater for common buys across agencies, by appointing a panel of vendors that agencies can choose to buy from. The aim is to improve the efficiency of the bidding and evaluation process, and enhance value-for-money via DA.

The number of vendors on the panel of a WOG DA contract depends on the nature of the procurement contract. There are some panels with a single vendor as the vendor can sufficiently cater to agencies' needs for a particular product or service during the contract period, and there are also panels with more than 20 vendors appointed. Regardless of the number of vendors on the panel, all of them would have gone through a competitive tender process before being appointed to be the panel.

In choosing a vendor from the panel, agencies should award to the vendor that best meets their requirements at a suitable pricing. The share of contracts awarded to each vendor is not a criterion that the agency would consider when it selects its vendor. Hence, it is not meaningful for MOF to set targets for the share of procurement awarded to vendors participating in WOG DA contracts.

The WOG DA contracts are open to both large companies and SMEs in Singapore. The key consideration for being awarded DA contracts is not the size of the company, but their ability to deliver cost-effective services. Currently, SMEs make up approximately 75% of all vendors on the panels and are awarded more than 85% of the procurements through these contracts.

Assessment of Whether Governments' Period Contracts and Framework Agreements Favour Large, Full-Service Companies

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Questions Identified

Full Transcript

Gerald Giam Yean Song

Summary

Questions Identified

Assessment of Whether Governments' Period Contracts and Framework Agreements Favour Large, Full-Service Companies

Summary

Questions Identified

Full Transcript

Gerald Giam Yean Song

Summary

Questions Identified

Gerald Giam Yean Song

Lawrence Wong