In Mongolia, planning, budgeting and procurement processes still overemphasize acquisition cost in relation to operating and follow-up costs. The purchase price of supplies and works is usually the only criterion for decision making. Buyers often fail to internalize social and environmental cost in their calculations. As a consequence, the real cost of investments is often not known, which frequently leads to monetary losses, insufficient budgets for operation and maintenance, and adverse social and environmental effects. In order to address these shortcomings, Imagos compiled a handbook and trainer guidelines on the concept of life cycle cost (LCC) and sustainable public procurement (SPP). Imagos designed and delivered training to provincial assembly members and local public officials, to increase awareness and basic knowledge of the LCC approach during project planning, budgeting and tendering processes. The trainer guidelines empower local trainers to replicate the LCC trainings in all provinces without further external assistance.
Imagos’ support resulted in greater awareness among local policy makers of the importance and methods of life-cycle costing for making decisions on investments and procurements. Expected long-term outcomes involve more cost effective energy efficiency investments in public buildings and more transparent costing in procurement transactions, better planning and budgeting of operating, maintenance and capital replacement cost and better budget credibility and a reduced level of disrepair of public infrastructure.
