As he tabled the Public Procurement Bill, 2022, Prime Minister Philip “Brave” Davis said yesterday that the current law is “deficient” and “simply unworkable”.
Davis explained that the new bill is just one of several pieces of legislation his government found were rushed through the consultative and legislative processes and that will be retooled.
As for the new procurement bill, Davis said it now stacks up against similar legislation from other countries, especially in the way it includes language that brings equity to the types of people and companies who receive government contracts.
“… As I said at the launch of the new procurement portal on Monday, we believe that public procurement, when used correctly, is a tool to correct some of the historical inequalities in our system,” he said in the House of Assembly.
“In other words, there is space in every procurement framework for affirmative action.”
Davis highlighted some of the new language in the 2022 bill, pointing out that those changes increase transparency by expanding the number of procurement contracts that are subject to tender committee review; create greater administrative efficiency by increasing financial thresholds for committee review, board review, and Cabinet review; discourage and detect procurement process abuse encourage the development of micro, small and medium enterprises (MSMEs), women-owned businesses, youth-owned and family island businesses.
He said the new bill now also excludes areas that are not acquired through the procurement channels laid out in the legislation based on their nature.
“The other excluded areas are financial consultancy concerning public debt, audit services, contracts entered into by the government in support of or pursuant to an international treaty, accord or convention or other international multilateral agreement, an agreement between the government and an international funding agency, whose procurement rules are mandatorily applied to any procurement contracts partially or wholly funded by monies loaned or advanced pursuant to such agreement,” Davis said.
Monday, government launched its new eProcurement portal powered by Gobonfire, and Davis said yesterday that the new legislation will ensure that anyone who is interested in participating in procurement is registered by the Public Procurement Department in the electronic procurement system.
He also revealed that the current law largely excluded public entities.
Now, he said, the minister who oversees a public entity “may now apply all or parts of this act to public bodies by order”.
“In the interim, public bodies are still expected to publish their procurement guidelines and ensure that they comply with new principles for procurement outlined in Part II of the Second Schedule of the Act and any guidance issued by a domestic regulatory authority Section 8(3) of the Act enables the entry into Framework Agreements,” said Davis.
“A framework agreement is an agreement by a supplier to provide goods or services under a predetermined pricing structure and on specified terms and conditions within the period specified therein.
“This will allow a procuring entity to enter into an agreement comprising a long-term relationship with a provider or range of providers to place orders without going to tender each time.”
The prime minister said the new bill reduces the Procurement Board from nine members to seven to ensure administrative efficiency, though the board will still include members of government and civil society.
According to Davis, the government has decreased the value of contracts that need to be evaluated by a tender committee from each procuring entity from $50,000 to $25,000.
“The procuring entity may evaluate and award tenders for contracts below $25,000,” he said.
“All financial thresholds in the original Act have been revised to provide greater flexibility and transparency to ensure procuring entities can operate and enter into agreements efficiently and swiftly.
“The revised process is now as follows: Contracts that are more than $25,000 but less than $400,000 evaluate and recommend the award of the contract to the Minister responsible for the procuring entity. This was formerly $50,000 – $250,000.
“Contracts that are more than $400,000 but less than $2,500,000 are forwarded to the Tenders Board along with the tender committee’s recommendation for the Board’s approval.
“Contracts over $2,500,000 are forwarded by the tender committee to the board for their recommendation, and after that, the Board shall forward its recommendation to Cabinet for approval.”
Davis explained how the new legislation will carry out the so-called affirmative action in the procurement process.
He said this development preference is a margin or percentage that will act as a score for bids that fall into this category.
“The original act included a reference to an undefined ‘domestic preference’,” he said.
“This act defines a ‘development preference’ as a margin of preference outlined in bidding documents which may be applied to bids of MSMEs, women-owned businesses, and family island businesses.
“In other words, this preference is intended to facilitate and give a leg-up to businesses that the government is seeking to encourage.
“New definitions of ‘women-owned business, MSME, and family island business have been inserted. In particular, a ‘women-owned business’ is a business that is owned and controlled by women.”
He said government intends to receive comments from civil society on the new legislation, and said multilateral financial institutions were already consulted and their contributions incorporated into the bill.