The Philippine Green Public Procurement Roadmap

1Policy BriefToday, Green Public Procurement (GPP) is the policy ofmarket factor. Government spending is necessary tomany governments as prominent market stakeholdersexecute manifold public services; and, governmentfocus on sustainable consumption that will influencespending is creating demand that influences supplies.the patterns of production. GPP is contributing toGreening governments’ demands and procuring itemssustainable development as a process of meetingwith green specifications are strong signals to thehuman development goals while sustaining the abilitysuppliers, vendors and merchants to venture into theof natural systems to continue to provide the naturalgreen enterprise. By going green, governments take onresources and ecosystem services upon which thea leading role to convert the market to a green market.economy and society depends. GPP is a market-basedTheseapproach: Governments have the privilege to regulatearound the world to pursue green purchasing. Therethe market where it’s necessary, to incentivize, tois no single recipe for GPP; the number of approachesinform and to guide the market players. Through publicaccount to the number of governments which areprocurement, governments are themselves importantpracticing GPP. The numerous experiences provideplayers in the market. The immense purchasing poweruseful lessons to shape a GPP system customized toof governments, which is almost 20% of Gross Domesticthe Philippine context.considerationshaveguidedgovernmentsProduct (GDP) in the Philippines, is an important1.1 The Philippine approach toward GPPThe Philippine approach to GPP is based on a well-established publicprocurement system which perfectly allows integrating the green practiceswithout inventing a parallel system of public procurement just for thegreen purpose. The existing principles and procedures are maintained bythe GPP aspirations.Over the past decade and following a fundamentalthrough the Department of Budget and Management-reform, the Philippine Government has established aProcurement Service (DBM-PS), and Non-Common-Usestate-of-the-art system of public procurement which isSupplies and Equipment (non-CSEs) directly purchasedtransparent and conducive for open competition. Rulesby the various government stakeholders. From there,and regulations provide a fair and level playing field forand following the same mechanisms that have guidedbusinesses. The introduction of GPP will be organicallyto select the first items for GPP, the scope will beintegrated into the existing framework; no separategradually enhanced. The purchasing mechanismstrack for green will be introduced; the vision is a publicstarting from the needs assessments over tendering toprocurement that is green throughout. A stepwise andthe contract awarding remain unchanged by GPP. Thecautious approach will accelerate green purchasingexisting procedure to describe the quality requirementsfrom first tranches of Common-Use Supplies andof demanded products and services provides theEquipment (CSEs), which are centrally purchasedavenue for the inclusion of green criteria through6The Philippine Green Public Procurement Roadmap

technical specifications that could be verified similarlycommitment to green procurement; Implementingto the existing practice for conventionally purchasedRules and Regulations (IRR) will be updated whereitems. The focus will be on simple and meaningfulnecessary, the generic procurement manuals willgreen specifications, expressed as core green criteria;be adjusted with the features of GPP; the biddingthe comprehensiveness can grow over time, but willdocuments will contain green technical specificationsnot be the ambition at the start. Along with the firstplus the required suppliers’ proofs for verification. Thephase of GPP and the first set of ten CSEs and tenwhole process will be supported by auxiliary measuresnon-CSEs, the implementation framework of publicof capacity building, training and awareness raisingprocurement will be adjusted to fit the new paradigm:to increase knowledge, skills and attitudes for GPP.a resolution by the Government Procurement PolicyThe implementation progress will be systematicallyBoard (GPPB) will refresh the existing governmentmonitored and evaluated.1.1.1 Principles of GPPGPP is only new in so far as how the quality of demandsthe lowest calculated and responsive bid in complianceis specified. The innovation is to include environmentallywith the specifications including the green criteria. Therelevant technical specifications in bidding documents;use of discriminatory criteria such as brands, labels orthis can happen in the form of replacements of orother suppliers’ requirements that could distort theas additions to the existing requirements. The basicopen competition are prohibited. Market readinessfunctionality of procured items remains untouched.and impact on local suppliers will determine the speedand scope of green purchasing. Local circumstancesThe roadmap defines GPP as an effective mechanismwill be respected with circumspect.of a transparent, accountable, efficient, equitable,economical and effective procurement system. GPPis a prudent approach that ensures value for moneyin terms of source, quantity, quality, price, time, anddelivery. Open competitive bidding ensures to identify1.1.2 GPP and development objectivesGPP contributes to the development objectives of thePhilippines; it supports the enforcement of sectorpolicies relevant for sustainable development such asenergy, water and material efficiency, waste reduction,pollution and emission prevention including climatechange mitigation, local and rural ctureand works, industry productivity, innovation andcompetitiveness, inclusive business models and greenjobs. A full-scale GPP system is a corner stone to achievethese priorities.ADVANCING GPP UNTIL 2022 AND BEYOND7

1.2 Goals and positive impactThe ultimate goal is to establish a GPP program for all departments, bureaus, offices and agencies of the government,including the local government units. GPP will cover CSEs, which are centrally purchased through the DBM-PS andnon-CSEs directly purchased by the various government stakeholders. The implementation of GPP will become thenorm of public procurement in the medium to long term.Establishing GPP systematically will create a growing market for the green supplies and equipment in the Philippines.This will have positive impacts on the economy, society and environment:The government is the single largest buyer in the market; the demand for greenproducts will change the market towards green with positive effects to the jobs andincomes of the people.Procurement of green products will encourage and create markets for Philippinemanufacturers, particularly Small and Medium Sized Enterprises (SMEs), to producegreen products and use environmentally friendly processes.A transparent and fair process of GPP through the avenue of green technicalspecifications will support value for money in competitive procedures.The leading example of the government to go green will have a spill-over effect on theprivate sector and on private households to also give preference to green products.The increasing demand will increase the supplies of green products, which in turn willlevel the costs of green products and make them more affordable.The green quality of supplies and equipment will reduce the pressure on theenvironment over the life cycle of producing, using and disposing of the purchaseditems.In summary, GPP will be the main pillar of the country to achieve green growth through a switch to sustainableconsumption and production patterns.8The Philippine Green Public Procurement Roadmap

1.3 The intervention logic of theGPP RoadmapThe diagram summarizes how GPP as a part of public procurement works, based on good practices and lessonslearnt, thereby, building on existing legal and institutional conditions. Five strategies will deliver the expected resultsin terms of impact on the socio-economy lifestyle in the Philipines and its environment to reach the goals alignedwith national priorities for sustainable development.GOALSResponsible and strategic budget spending; sustainable consumption and competitiveand innovative industry and servicesPOSITIVE IMPACTOn economy (green growth, climate smart industries) society (jobs and qualification, SMEdevelopment, spill-over to private consumption) environment (resource efficiency, lesspollution, business resilience to climate change), compared to a business-as-usual scenarioSTRATEGIES FOR THE WAY FORWARD1. Policy commitment 2. GPP for CSE products 3. GPP for non-CSE products4. Communication and awareness 5. Monitoring and indicatorsSTATE OF PLAY IN THE PHILIPPINESGood legal and institutional conditions for GPP Building on and supporting of existing policiesExisting policy commitment and avenues for GPP advancement Issues and concerns; prudentspending, value for money, suppliers'readiness, verification of green supplies, awareness and attitudesRATIONALEManufacturers are willing to produce environment friendly products competitively, ifmarkets are willing to buy/procure green.GPP is part of public procurement and builds on the same procedures.Many good examples exist including lessons learnt to adopt.ADVANCING GPP UNTIL 2022 AND BEYOND9

2Overall Background2.2GPP is a good practice of public procurement. It evolved with the growing understanding andoperationalization of sustainable development since the Earth Summit in 1992. Governments are leadingby example and use their immense purchasing power to shape the patterns of growth, eventuallyachieving green growth. Best practices show the individual nature of national GPP programs and hasprovided inspiration for the Philippine GPP roadmap.2.1 Green Public Procurement in thecontext of public procurementPublic procurement is the mechanism to purchasespending1aggregatesgoods, services and works from vendors, merchants,consumption. Governments use public procurementspecialized companies or qualified bidders on behalfstrategically to drive economic growth, to provideof a public entity. Without public procurement, abusinessgovernment would not be able to fulfill its serviceconsequence, creates jobs and income for the people.functions to its citizens. In many sectors such as energy,Public procurement is a vital engine for the economictransport, waste management, social protection andsystem. As the biggest single buyer, governmentsthe provision of health or education services, publicare influencing demand and shaping the patternsentities are the principal buyers. Public procurementof growth. What goods, works and services areuses taxpayers’ money and governments are expecteddemanded determine the supply side. Governmentsto carry it out efficiently while considering its valuehave the privilege to lead by example and to transformfor money and high standards of conduct. The publicthe market. Including green considerations in publicprocurement process is the sequence of activitiesprocurement activities i

Green Public Procurement is a process whereby public authorities seek to procure goods, services and works with a reduced environmental impact throughout their life cycle when compared to goods, services and works with the same primary function that would otherwise be procured.