Changes in PPA/PPR and donors' concern
Tuesday, 2 June 2009
THE government is reportedly mulling a few changes in the Public Procurement Act (PPA) and the Public Procurement Rules (PPR) following complaints from various agencies under its control that proper compliance with certain provisions of the same, delays implementation of projects. The poor rate of implementation of the projects under the Annual Development Programme (ADP) during the first three quarters of the current fiscal might has strengthened their argument. But the World Bank (WB), which played an important role in the matter of adopting the PPA and PPR for the sake of transparency and accountability in the public sector procurement, has taken exception to the planned changes. The Bank, in a recent communication to the government, has requested that necessary consultations be initiated with all stakeholders, including the 'development partners,' on the proposed changes in the law and relevant rules. The fear is that a 'few of the proposed changes may have severe consequences on the implementation of a large number of projects' which have donor participation.
The WB has been pleading to the government for introducing an efficient and transparent system in public procurement since 1998. After a lot of foot dragging, the then government had put in place the public procurement guideline in 2003. But the guideline proved to be useless in stemming waste and irregularities in public procurement, worth more than $5.0 billion a year, because of its inherent weaknesses and resistance from the interested quarters who have a sizeable stake in such procurement of goods and services. Most government agencies managed to bypass the guideline under different pretexts. However, with pressure mounting from the Bank, the government adopted the PPA in 2006 and framed rules, making it mandatory for all concerned to follow transparent procedures in case of procurement of public goods and services. Despite the presence of a waiver clause in the PPR, the government agencies have been grumbling that certain provisions of the PPA and PPR are proving to be stumbling blocks to timely implementation of development projects.
The reasons being cited by the agencies involved in the execution of development projects and procurement of other goods and services for bringing about a few changes in the PPA and the PPR need to be taken into cognizance by higher authorities. But unilateral and hasty actions on this account may backfire ultimately. Since the donors have their stakes in the development programmes of the country, the government cannot ignore the need for organising consultations with them. One may like it or not, the fact remains that the country would remain partially dependent on external aid for its development activities for many more years because of its own resource constraints. Until then, the government would have to bear with 'suggestion' or 'condition', in whatever name one may like to call it, coming from the donors as far as development activities are concerned. Moreover, not all donors' suggestions are necessarily bad or designed to create problems for executing agencies of development projects. The WB suggestions relating to PPA and PPR were made with the pious intention of reducing corruption and irregularities in the government's procurement programmes involving billions of dollars. The government does need to keep in mind this important issue while trying to make changes in the PPA/PPR.
The WB has been pleading to the government for introducing an efficient and transparent system in public procurement since 1998. After a lot of foot dragging, the then government had put in place the public procurement guideline in 2003. But the guideline proved to be useless in stemming waste and irregularities in public procurement, worth more than $5.0 billion a year, because of its inherent weaknesses and resistance from the interested quarters who have a sizeable stake in such procurement of goods and services. Most government agencies managed to bypass the guideline under different pretexts. However, with pressure mounting from the Bank, the government adopted the PPA in 2006 and framed rules, making it mandatory for all concerned to follow transparent procedures in case of procurement of public goods and services. Despite the presence of a waiver clause in the PPR, the government agencies have been grumbling that certain provisions of the PPA and PPR are proving to be stumbling blocks to timely implementation of development projects.
The reasons being cited by the agencies involved in the execution of development projects and procurement of other goods and services for bringing about a few changes in the PPA and the PPR need to be taken into cognizance by higher authorities. But unilateral and hasty actions on this account may backfire ultimately. Since the donors have their stakes in the development programmes of the country, the government cannot ignore the need for organising consultations with them. One may like it or not, the fact remains that the country would remain partially dependent on external aid for its development activities for many more years because of its own resource constraints. Until then, the government would have to bear with 'suggestion' or 'condition', in whatever name one may like to call it, coming from the donors as far as development activities are concerned. Moreover, not all donors' suggestions are necessarily bad or designed to create problems for executing agencies of development projects. The WB suggestions relating to PPA and PPR were made with the pious intention of reducing corruption and irregularities in the government's procurement programmes involving billions of dollars. The government does need to keep in mind this important issue while trying to make changes in the PPA/PPR.