Roughly a week ago, a muckraking blogger and a scholarly nepotist got together with some other eggheads and talked for nearly four hours about in-the-works reforms for Federal Law 94, which is a beastly piece of legislation regulating government tenders. The law is made up of 65 articles, and has been revised several times since being enacted in 2006. Aleksei Navalny, superstar Internet sensation, activist lawyer, and all-around promising “new liberal” political inspiration, faced off against Yaroslav Kuzminov, provost/president/”rektor” of the Higher School of Economics and husband to Elvira Nabiulina, head of the Ministry of Economic Development.
Along with the Federal Anti-monopoly Service and the Ministry of Finance, the MED has been brainstorming feverishly (in concert with the big brains at the Higher School) about how to respond to President Medvedev’s demands to fix Law 94. Medvedev sounded the alarm in his Address to the Federal Assembly last November, when (in his ‘eighth point’), he castigated the state procurement system for having cost the government over a trillion rubles in kickbacks. “Therefore it’s come time to begin work on a new edition [redaktsiia] of the law on state purchases that is thorougher and more modern.” A presidential order (poruchenie) followed on December 7, 2010. The demand for revisions to Law 94 is tucked away in Punkt 24, which is directed at no one in particular. Here’s what it says:
“Develop a concept of a new edition of the federal law on the state procurement of goods and services, taking into account lessons learned and corresponding to the tasks of modernization and developing innovation. Due by April 1, 2011.”
As of yesterday, MED-FAS negotiations are over. Artem’ev and his outfit won unambiguously. Nabiulina left the meeting on March 24th eating her own words, claiming incredulously that MED never wanted to cancel and rewrite Law 94. And what of MED’s big ticket new ideas? There was “preliminary assessment,” which would have allowed procurement officers to ban certain suppliers from participating in tenders, if the establishment proved under-qualified or was somehow sub-satisfactory. MED also promoted “competitive negotiation,” which is an alternative tendering method to competitive bidding. In competitive negotiation, the procurement officials reach out to a selected group of suppliers, detailing the scope, specifications, and terms and conditions of the tender. Negotiations are then carried out separately, ideally resulting in a contract awarded to the best combination of price, quality, and service. Both of these ideas were criticized for allowing bureaucrats to show favoritism in the tenders process, opening new avenues to bribery and corruption. FAS opposed both preliminary assessment and competitive negotiation. Presumably, this stuff won’t make it into the next version of Law 94.
So how did the debate itself actually go? Unfortunately, it was largely boring. Almost entirely lacking was a substantive discussion about the specifics of MED’s legal concept for a new Law 94. Preliminary assessment and competitive negotiation were mentioned in passing, but never with any explanation or defense. Kuzminov would say that some favor one and others favor another, which Navalny would follow by reminding everyone which he favored. Perhaps overcompensating for his youth, Navalny went to great efforts to remind his opponents that he is a “professional” and an expert, that he sleeps with Law 94 under his pillow, and speaks fluent lawyerese. The man who would ultimately win the real Law 94 battle, Igor’ Artem’ev, never set foot in Navalny’s debate room. He refused to participate, worried that the format was doomed to “unprofessionalism.” He was right.
So I wholeheartedly agree with Mulders that one needs to read the Russian papers in order to best understand events in Russia. And that’s why I was so disappointed in his conclusions about the Navalny-Kuzminov debate.
As a regurgitation of all the top zingers blurted out over the course of three-and-a-half hours, Mulders’ recap is excellent. But he mentions FAS only twice, and doesn’t mention Artem’ev even once. Now, granted, FAS wasn’t represented at the debate, so it might seem unfair to fault ‘Russia Watchers’ for leaving it out of the picture. But, in any discussion about the Medvedev-ordered revisions to Law 94, ignoring FAS is tantamount to leaving out half of the story. Now that FAS has come out on top of MED in the negotiations under Shuvalov, it’s worth more than half of the story.