The State Logistics Operator has classified data on food procurement for the first time
9 October 2024 12:20
on 1 October 2024, the State Logistics Operator (DOT), a state-owned enterprise under the Ministry of Defence of Ukraine, signed a contract to supply food to the military in Rivne region worth UAH 301.4 million. Another contract worth UAH 606.8 million is expected to be signed shortly to supply food to Lviv region. The total value of these tenders is UAH 908 million, as reported in the Prozorro system.
According to Nashi Hroshi, for the first time since the start of the DOT’s work under Arsen Zhumadilov, all data on the winners of the tender and the prices of products were hidden. This time, the tenders were held through the so-called “dynamic procurement system”, a procedure introduced in early 2024 for military-related procurement. It allows not disclosing information about contractors for security reasons. For example, this scheme is used for the purchase of drones, but even there, the Ministry of Defence reports the number and price of purchased units.
In the case of food procurement, the Ministry of Defence, represented by the State Defence Enterprise, used open tenders, where all data on suppliers and food prices were available. This decision was made after the scandals of 2023, when it became clear that food for the Armed Forces was purchased at much higher prices than in retail chains – the Verkhovna Rada passed a law obliging the military departments to return to open tenders in Prozorro.
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However, a new procedure has now been chosen, which involves pre-qualification of participants and a subsequent stage of closed price offers. The pre-qualification stage was still transparent, meaning that it was known which companies were allowed to bid (including well-known food market players such as Fabrika Smaku and Yug Prod Trade).
At the final stage, prices and winners remained hidden.
The Ministry of Defence, the State Logistics Operator and its head Arsen Zhumadilov have not yet commented on the situation.
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State Logistics Operator and food supply in the Armed Forces of Ukraine
In December 2023, the Ministry of Defence introduced a new structure that will be responsible for supplying the Armed Forces of Ukraine – the State Logistics Operator (SLO). Previously, procurement and control of the procurement process and quality were concentrated directly in one department of the Ministry of Defence. The new team at the Ministry of Defence, headed by Rustem Umerov, decided to disband this department after a series of audits and divide its functions between different structures.
This new operator performs all functions related to the provision of military products, including market analysis, price research, cooperation with manufacturers and decision-making on tender purchases.
From the very beginning of its work, the operator faced the threat of disruption of food supplies to the Armed Forces. Thus, the operator announced tenders through the Prozorro system several times, but cancelled them. The DOT claimed that suppliers were deliberately disrupting the bidding process and called them the “food mafia”.
As a result, on 15 March, the State Logistics Operator signed the first contracts for food supplies to the Armed Forces without the Prozorro system. on 28 March, the DOT reported on the first deliveries under the contracts, and on 6 April, it reported on the progress of the supplies.
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