Billions without any real competition: what the public procurement audit revealed
This is set out in the Audit Office’s report on the findings of its analysis of the Ministry of Economy’s annual report on the public procurement system for 2025.
What the audit of public procurement revealed
The Audit Office analysed the Ministry of Economy’s annual report on the functioning of the public procurement system in 2025.
The auditors noted that the Ministry of Economy submitted the report on time and published it on its website. However, according to the Court of Auditors’ findings, the structure and content of the document do not fully comply with the Public Procurement Act.
The main problem is that the report does not contain an analysis of all public procurement carried out in 2025. The Ministry of Economy analysed mainly data from the electronic procurement system, namely Prozorro, but not the full picture of expenditure of public funds.
The Audit Office explicitly stated that an annual report lacking data on the total number and value of all public procurements effectively loses its analytical value.
How many procurements took place outside Prozorro
According to the annual report itself, 3.10 million procurements out of over 3.51 million – that is, 88.35 per cent – were carried out without using the electronic procurement system. Their estimated value amounted to over 257.76 billion UAH, or 27.70 per cent of the total estimated value.
This means that, in terms of numbers, the majority of procurements took place outside Prozorro. They did not go through the usual competitive procedure within the electronic system.
Separately, the auditors noted that the report does not contain complete information on procurements of up to 50,000 UAH, which were carried out without the electronic system, nor on some defence procurements.
The Accounting Chamber noted that the Ministry of Economy had not included in the report details of 65,500 defence procurements carried out using the electronic procurement system. At the same time, according to data from open sources, in 2025 defence sector contracting authorities published details of around 270,000 procurements in the Electronic Procurement System (EPS), of which 236,000 were marked as completed, totalling nearly 280 billion UAH.
Why competition was largely a formality
The most telling figure relates to open tenders with specific conditions.
In 2025, 179,260 such tenders were held with an expected value of 555.36 billion UAH. However, 146,600 of them – that is, 81.78 per cent – took place with only one participant.
The expected value of such procurements was 437.39 billion hryvnias. This represents 78.76 per cent of the total expected value of open tenders with special conditions.
Formally, such procedures are considered a competitive method of procurement. However, if only one participant takes part in the tender, there is effectively no real competition on price or terms.
The Accounting Chamber noted that in 2025, contracts worth 639.37 billion hryvnias were concluded for procurements conducted in what was essentially a non-competitive manner. This represents 70.55% of the value of all contracts concluded for procurements in 2025.
If we take into account non-competitive gas procurements worth 192.03 billion hryvnias, the total value of such contracts rises to 831.40 billion hryvnias. Their share then amounts to 75.70 per cent of the value of all procurement contracts in 2025.
Public procurement involves taxpayers’ money. It is through this process that the state, local authorities, hospitals, schools, military organisations and municipal enterprises purchase goods, works and services.
If the official report does not cover all procurements, the public does not see the full picture of how public funds are being spent. If the majority of contracts are awarded without genuine competition, this reduces the chances of achieving savings and increases the risks of inefficient spending.
The Audit Office has concluded that the extremely low level of competition indicates that the public procurement system was ineffective in 2025 as a mechanism for spending public funds.
What else did the auditors find?
The report also notes that information on the level of competition and the number of complaints is based solely on data from the electronic procurement system. Therefore, according to the auditors’ conclusion, these indicators do not reflect the true state of all public procurement.
The Audit Office also pointed out that the Ministry of Economy failed to include important information in its annual report regarding problems in the formulation and implementation of procurement policy.
These include the lack of an approved operational plan for implementing the strategy for 2026, the failure to carry out or the postponement of a third of the Ministry of Economy’s planned measures, as well as the failure of the state-owned enterprise ‘Prozorro’ to complete 6 out of 10 tasks aimed at improving the electronic procurement system.
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