Finance Ministry should set up Public Procurement Commission – AG Report

Nov 12, 2013 Sports

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In the wake of several violations of the Procurement Act 2003, the Auditor General (AG) in his 2012 report has strongly recommended to the Ministry of Finance to establish the Public Procurement Commission (PPC).
The Procurement Act makes provision for the regulation of the procurement of goods, services and the execution of works, the promotion of competition among suppliers and contractors and the promotion of fairness and transparency in the procurement process.

One matter that has not been arrested by the Finance Ministry as yet is the fact that the National Procurement and Tender Board was operating without “its full complement” which is in violation of the Act.
The Act also outlines that the National Procurement and Tender Administration (NPTA) will be managed by the National Board and will report to the Minister of Finance.
The Board is therefore responsible for the efficient management of the administration and it is in this vein, that the Attorney General highlighted this worrying condition which continues to prevail.
The AG report stated that the Act authorizes the Minister of Finance to appoint persons to serve on the National Board.
According to the Act, this Board shall consist of seven members, not more than five from the Public Service and not more than three from the Private Sector. It also makes provision for two members of the Board to serve on a full time basis, with the Minister appointing one of the two full time members as Chairman.
However, at the time of reporting, the Board had five members from the Public Service and one from the Private Sector. Another member from the Private Sector was still to be appointed to the Board. As a result, the Board has been operating without its full complement.
The Ministry of Finance in response to this stated that “consultations are currently taking place with representatives of the private sector organizations with a view to appointing a private sector representative to fill the vacant position on the Board.”
Nevertheless, the AG insisted that the Ministry makes every effort to appoint this individual as soon as possible as to ensure that the National Board operates at its full complement.
The AG report also noted that at the time of reporting, the National Board had still not created any District Boards for procurement by the Neighbourhood Democratic Councils (NDC).
It then referred to Section 21 (a) of the Act, which states that the National Board may, at its discretion, create District Tender Boards for procurement by NDCs comprising of part-time members of which, two members are appointed by the Regional Board and one member appointed by the relevant NDC from among persons with qualifications not dissimilar from those required for appointment to the National Board. “At the time of reporting, the National Board had still not created any District Boards.”
The Ministry said that the process is being stalled because advice is still being sought from the Attorney General, Anil Nandlall, with regard to the way forward with this issue.
Meanwhile, the AG report strictly advised that the Ministry followed up with Nandlall to ensure the establishment of the Boards which is in keeping with the Act.
More importantly, the AG’s report made reference to the Procurement Commission which still has not been established.
The Auditor General further urged the Ministry to establish the commission regardless of the explanation it provided. At the time of reporting, the PPC and its Secretariat had not been established and no new regulations to supplement the Act had been issued. In addition, the threshold values for the various Tender Boards had remained unchanged since 2004.
While the Ministry did not provide any reason to justify the non-establishment of the commission, it outlined the responsibilities of the National Board and spoke on the issue of “no regulations.”
With respect to the making of Regulations, the Ministry added that the National Procurement and Tender Board has examined and reviewed certain aspects of the Procurement Act and its Regulations. It has identified and reported on areas to be addressed through the Regulations to make the procurement system more effective.
In addition, the Ministry said that a consultancy firm was contracted to draft Regulations under the Act regarding the adjudication of debarment proceedings and examine and make recommendations on revisions to the Regulations, with a view to increasing the threshold limits. The firm has completed draft Regulations covering the above-mentioned areas. The draft Regulations are currently being examined before they are approved and brought into effect.
Nevertheless, it was still advised that the Ministry continues in its efforts to make certain that a Commission is in place.  In the absence of the Commission, the AG noted other violations of the Procurement Act.
The Auditor General said that it is a requirement under Section 11 (1) of the Act for each procuring body to publish notice of procurement contracts awarded within seven days of awarding such contracts.
The Procurement Regulations on the other hand, require each procuring entity to provide within five days of publishing notice of the award, a report to the Administration of all contracts awarded in excess of US$200,000. On receipt of the report, the NPTA shall publish the information on its website.
However, it was here that the violations were discovered. In particular, procuring agencies were not reporting to the National Board all contracts awarded in excess of $200,000, thereby restricting the National Board from publishing on its website all contracts awarded.
In spite of this, the National Board published on its website, all contracts awarded over $15 million during the period under review.
However, the Ministry indicated that it had informed the relevant agencies to report to the NPTAB, all the contracts exceeding $200,000, awarded by those entities.
They expressed as well that only contracts for which Cabinet has given its no-objection are published on the NPTA’s website and contracts involving national security are not posted on the website.
The Auditor General in the face of this explanation still urged that all procuring entities and NPTA comply strictly with the requirements of the Procurement Act.

 

 

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