EDITORIAL COMMENT: Plug loopholes in tender process

18 Nov, 2021 - 00:11 0 Views
EDITORIAL COMMENT: Plug loopholes in tender process

The Herald

The fact that there are still some loopholes in the public sector tender process, despite the major changes in recent years, shows that some more fine-tuning is required along with a better system of dealing with emergency orders.

The Zimbabwe Anti-Corruption Commission has received a number of complaints of businesses that win a tender, but fail to deliver and then go on to tender for yet another contract.

Much of this should have been eliminated with the new process now in place.

In theory the Procurement Regulatory Authority of Zimbabwe (PRAZ) was set up to stop this sort of thing and to separate the setting of standards that had to be met from the process of awarding a tender.

This is standard best practice, the regulator and the operating authority being quite different people who have very little to do with each other.

The process of bidding for Government contracts does start with PRAZ.

Companies are expected to apply to get onto the list of approved bidders for the sort of item they are in business to sell.

PRAZ then checks out the companies, ensuring that they have a physical address and have the facilities and equipment they need to do their business.

This was to prevent middlemen and briefcase companies bidding for contracts.

The checks that public sector entities such as ministries, councils and the like are supposed to do, go further with bidders having to show tax clearance and proof of registration.

One obvious problem is that things might change rather quickly. A lot of certificates and listings and the like are issued for a year.

Companies can change ownership, or the top-notch mechanics responsible for doing work under guarantee might resign.

This might be picked up in an annual renewal but it might not be picked up immediately. And then we will, in the nature of things, have those who managed to fool the regulator or fool the awarder of contracts.

So the ZACC submission that a modest legal change is needed to set up a blacklist of companies that do not fulfil a tender, or which produce sub-standard goods or work, needs to be taken seriously.

To avoid subjectivity, a careful set of standards needs to be promulgated. This would avoid the problem of a buying department grabbing the cheapest tender and finding out they have bought garbage, which is all anyone would sell at the price tendered. This can be a real problem.

The obvious administrator of the list is PRAZ, who can first cancel a registered supplier and can then issue a warning note.

The second requirement would seem to be more staff for PRAZ, so that the initial vetting can be done in greater detail where necessary and certainly to investigate complaints from buying departments that they are not getting value for money.

The third requirement is for the buying units to take more care when they are adjudicating tenders.

The system is supposed to eliminate the worst cheating at source, but that does not mean that every product or every service offered is going to be what the buying unit wants or needs.

There are various international and national standards for many products now, and obviously conformity with these standards can be a tender condition.

But the buying unit can ask to see examples of products supplied or work done, and can ask where appropriate to see a sample of what is going to be supplied.

That coupled with a system that blacklists those who make guarantees that their product meets such and such a standard when it is clearly sub-par would create a transparent system to eliminate the cheating businesses as early as possible.

ZACC were also worried that some emergency orders were not properly adjudicated during the worst days of the Covid-19 pandemic. Again the system is not so much at fault as the actual ordering.

In the theory if someone needed to buy some drug or piece of equipment urgently, the potential suppliers should be already registered with PRAZ, and have been vetted. Emergency tenders can then be floated, with all businesses registered to supply that sort of item getting an email of the tender and a very short period set for the responses. The buying unit can work flat out, over the weekend if necessary, to adjudicate these responses.

If the system works all the necessary work can be done in a few days and still follow laid down processes.

There will be human problems. Operational staff might be very impatient and want the order tomorrow.

 There might be no registered supplier, but that does not mean that the process has to be abandoned, only that the supplier has to submit an urgent application for registration while the tender responses are being adjudicated and PRAZ needs to have an emergency system for rapid vetting.

So while ZACC are correct in wanting a blacklist, this has to be backed up by a determination by all buying units to do their job properly, and raise red flags a lot earlier, and for PRAZ do examine its vetting system after a year or so of it being in operation to see if the vetting net is of a fine-enough mesh.

The mesh needs, and this is important, to also ensure that all businesses that are properly run and which follow the rules to be able to do business with the public sector. And that requires clear and objective rules, and not some subjective dislike of a particular supplier.

As with so much, there is not a single one-off answer. It is all very well to catch thieves later, but it is better still to have decent locks on the door in the first place.

The present system is fairly new and a lot better than what it replaced. But it needs to be administered at both the regulatory level and the buying level properly, and loopholes blocked.

The theory behind the system is good, but it does entail everyone knowing precisely what to do and then doing it, even in a disaster.

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