Mar 04, 2016 News
—Urges for implementation of Debarment Committee
Guyana’s procurement system is not only plagued by a culture of corrupt practices, but also the acceptance
of slapdash work provided by contractors. It is a culture that local financial analysts say the new Government must wage a war against.
Former Auditor General Anand Goolsarran asserts that Government must seek to implement a debarment committee, which will blacklist companies who take on big projects and in turn provide sloppy work.
He says that it is one of the sure ways to ensure that companies bring themselves in line with international best practices and that the country gets value for money. Debarment mechanisms are practiced by various Caribbean countries such as Jamaica and international agencies like the International Monetary Fund (IMF). Guyana’s laws also provide for the installation of a debarment committee but under the previous Government, this was never given priority.
Kaieteur News understands that the new Government has already taken steps to put this committee in place, and it is expected to come on stream this year.
Goolsarran said that Guyana’s weak public procurement system led to the loss of millions of dollars annually. He said that it is a broken system which often sees contractors providing shoddy work with little or no consequences, while stressing that the time is now to show that Government means business.
In fact, he contends that the weak systems of the National Procurement and Tender Administration Board (NPTAB) need to be addressed by the new administration once and for all, as they are costing the country approximately $28B annually.
Goolsarran said that it is critical for the Ministry of Finance to review the operations of NPTAB, given the fact
that the agency has been cited by the Auditor General for numerous cases of financial discrepancies.
He emphasized that about 70 percent of the national budget relates to public procurement and this translates to approximately $140 million.
The former Auditor General then pointed to credible allegations of corrupt behaviour in public procurement. These included sole sourcing of drug contracts, contract splitting, inflated engineer’s estimates, evaluation bias on behalf of favoured contractors, the use of inexperienced contractors, the absence of competitive bidding in some cases and overpayment to contractors.
Goolsarran said that at least $28 billion or US$140M is lost annually by looking at those areas. His estimation was garnered from an overview of the Auditor General’s reports on the country’s accounts over the past few years.
But the Granger administration made it known recently that it is on a mission to change this ‘wild west’ situation in Guyana’s procurement system.
At a national consultation on Caricom Single Market and Economy (CSME) Public Procurement System requirements which was held recently, Finance Minister Winston Jordan outlined that a number of changes are in the pipeline.
Present at the event, which was held at the Cara Lodge Hotel, were distinguished representatives of the Private Sector in Guyana, specifically suppliers of goods and services, as well as contractors and consultants.
Jordan said that he was advised that those persons have been singled out as having the capabilities to compete within Caricom for large procurement activity on equal terms with your Regional Counterparts.
The Finance Minister first explained that the Caricom Single Market and Economy – commonly known as the CSME – was born out of what is known as the Grand Anse Declaration and a work programme for the advancement of the integration movement. At that time, he noted that the Heads of Government were determined to work towards creating a Single Market and Economy.
He said that CSME enabled the achievement of sustained economic development based on international competitiveness, coordinated economic and foreign policies, functional cooperation and enhanced trade and economic relations with third states.
Jordan said that it is with the objectives of deepening regional economic integration and achieving international competitiveness, that the consultation was being held. He said that there is also a wider objective; one of encouraging competitive activity to produce a greater variety and quantity of services to trade with other countries.
“In other words it also provides a forum for creating regional contracting and consulting entities that can compete internationally. Within Caricom Member States, governments are generally the largest procurers of goods and services. The collective volume and value of Public Procurement in the Caribbean Region is considerable. It is logical, therefore, that the focus should be on public procurement,” expressed Jordan.
He added that Article 79 of the treaty states that “the member states shall establish and maintain a regime for the free movement of goods and services within the Caricom Single Market and Economy” towards the objective of “full integration of national markets into a single unified and open area.” He said that this is specifically towards the achievement of a functioning, fully-integrated regional public procurement market.
He noted that the overall objectives of the CSME Public Procurement System are the creation of the conditions necessary for full integration of the national procurement markets of member states into a single unified and open area for Public Procurement to bolster the CSME; the creation of the necessary competitive and non-discriminatory conditions to facilitate achievement of value for tax payer’s money; the provision of opportunities for access to a single market with regional sales opportunities; and strengthening the competitiveness of the regional supplier base and encourage the rational use of resources.
The Finance Minister said that this process began in January 2012
“Since then a number of initiatives have been undertaken. The first project was to provide the Caricom Secretariat and its member states with the recommendations on the required IT infrastructure for establishment of a fully functioning Regional Integration Electronic Public Procurement System. The region has begun to move towards e-procurement regimes. Jamaica is already well established in this regard. But Guyana has been slow to embrace E-procurement, a situation this Government has taken steps to remedy.”
The Finance Minister said that under the Public Procurement Modernization Project, for which funding has been provided by the Inter-American Development Bank under a Technical Cooperation Agreement called Public Procurement Modernization and Financial Management Strengthening in Guyana, Component One will provide support to improve efficiency and value for money in public procurement through strategic planning and introduction of e-government procurement. This project he said will be rolled out this year.
He said that the successor initiative by the CSME is Development and Implementation of the Infrastructure and Instruments for an Integrated CSME Procurement Regime.
Jordan said that the deliverables include the Procurement Bill and Regulations, Procurement SOP’s Software and Hardware Installation, Development of Training modules and the ability to roll out these modules online. He said that more will be said on these issues at a later time.
The Finance Minister said that it is clear therefore that the CSME is well underway in the delivery of a Caricom Public Procurement System.
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