The double standard
Shamsul Huq Zahid | Wednesday, 25 June 2008
Finance and Planning Adviser Mirza Azizul Islam did not make any attempt to hide his annoyance at the delay in public procurement and implementation of projects co-financed by donors who have their own procurement rules.
Dr. Azizul Islam, speaking at workshop organized jointly by the government and a number of aid agencies Monday last, advised the donors, who have the habit of advising the aid recipient countries all the time, to harmonise their procurement rules to help expedite procurement and implementation of projects co-financed by them.
Such a piece of advice is unlikely to go well with the donors who had created unrelenting pressure on the government in the past to enact a procurement law and rules under it to ensure 'transparency and accountability' in public procurement. It, surely, becomes hard for the donors to digest the criticism that the procurement programme of the government is suffering due to the lack of harmonization of their own procurement rules.
Despite opposition from the vested quarters, political or otherwise, the immediate past political government enacted the Public Procurement Act (PPA) in 2006 and the present caretaker government framed rules under the Act only recently. The biggest multilateral donor--the World Bank (WB) -- provided a substantial amount of fund to the government of Bangladesh under the Public Procurement Reforms programme.
One may feel tempted to ask: why should not the donors follow the procurement rules applicable to government agencies to avoid any delay?
There is a catch here. Donors are not willing to follow the procurement rules applicable to domestic public agencies since the same are quite tough. To exercise freedom in procurement, the donors, allegedly, got the PPA-2006 amended through a Presidential Ordinance by putting pressure on the government. Under the amended law, the donors, when the need arises, remain free to follow their own procurement rules.
A separate provision was added to the clause 03 (applicability of the law) of the PPA, which says that whatever may be written above, in case of donor-funded projects, if any dispute arises over the issue of procurement, the agreements signed between the government and the donors would prevail. The basic objective behind getting the amendment incorporated was to allow the donors follow their own procurement rules, not the ones framed under the PPA.
It is most unlikely that the final draft of the PPA- 2006 was adopted without consulting the major multilateral donors. Yet for reasons best known to them, the donors have got the law amended in the absence of the national parliament to bypass the rigours of the Act that they had pleaded all the time for government bodies.
While succumbing to the donors' pressure the government should have foreseen the troubles by letting them a freehand over procurement in co-financed projects.
The actions of the donors as far as the procurement made under the aided projects would only help strengthen the old suspicion about the actual inflow of donors' fund. There are allegations that donors tend to plough back a large part of the funds they offer to the developing countries such as Bangladesh through procurement and appointment of consultants.
Anyone, both within and outside the government, believing in transparency and accountability, had wanted tough procurement law to stop misappropriation of government funds through procurement of goods and services. The secretary of the implementation, monitoring and evaluation division (IMED) speaking at the same function last Monday informed the audience that nearly a quarter of the procurement expenditures used to be lost because of lack of transparency and accountability.
The donors, particularly the WB, did a commendable job by getting the PPA approved by the last political government which had dragged its feet on this issue for a long time. The Bank even made the availability of the third tranche of its development support credit (DSC) conditional to the adoption of the Act. The tranche was disbursed only when a bill to this effect was placed before the parliament.
The reason for delaying the passage of the law concerned was not difficult to understand. For, a host of people, including politicians, bureaucrats, suppliers, contractors and, even in some cases, officials representing the donors-involved in the procurement process were beneficiaries of non-transparent procurement process.
However, cancellation of aid money by the WB for alleged violation of procurement norms in a couple of projects had sent a strong message to the then government which thought it was high time to get the law adopted.
But by forcing a sort of waiver in the PPA, the donors have irked the government and put their own integrity under question as far as their own procurement under aided projects in Bangladesh is concerned.
[email protected]
Dr. Azizul Islam, speaking at workshop organized jointly by the government and a number of aid agencies Monday last, advised the donors, who have the habit of advising the aid recipient countries all the time, to harmonise their procurement rules to help expedite procurement and implementation of projects co-financed by them.
Such a piece of advice is unlikely to go well with the donors who had created unrelenting pressure on the government in the past to enact a procurement law and rules under it to ensure 'transparency and accountability' in public procurement. It, surely, becomes hard for the donors to digest the criticism that the procurement programme of the government is suffering due to the lack of harmonization of their own procurement rules.
Despite opposition from the vested quarters, political or otherwise, the immediate past political government enacted the Public Procurement Act (PPA) in 2006 and the present caretaker government framed rules under the Act only recently. The biggest multilateral donor--the World Bank (WB) -- provided a substantial amount of fund to the government of Bangladesh under the Public Procurement Reforms programme.
One may feel tempted to ask: why should not the donors follow the procurement rules applicable to government agencies to avoid any delay?
There is a catch here. Donors are not willing to follow the procurement rules applicable to domestic public agencies since the same are quite tough. To exercise freedom in procurement, the donors, allegedly, got the PPA-2006 amended through a Presidential Ordinance by putting pressure on the government. Under the amended law, the donors, when the need arises, remain free to follow their own procurement rules.
A separate provision was added to the clause 03 (applicability of the law) of the PPA, which says that whatever may be written above, in case of donor-funded projects, if any dispute arises over the issue of procurement, the agreements signed between the government and the donors would prevail. The basic objective behind getting the amendment incorporated was to allow the donors follow their own procurement rules, not the ones framed under the PPA.
It is most unlikely that the final draft of the PPA- 2006 was adopted without consulting the major multilateral donors. Yet for reasons best known to them, the donors have got the law amended in the absence of the national parliament to bypass the rigours of the Act that they had pleaded all the time for government bodies.
While succumbing to the donors' pressure the government should have foreseen the troubles by letting them a freehand over procurement in co-financed projects.
The actions of the donors as far as the procurement made under the aided projects would only help strengthen the old suspicion about the actual inflow of donors' fund. There are allegations that donors tend to plough back a large part of the funds they offer to the developing countries such as Bangladesh through procurement and appointment of consultants.
Anyone, both within and outside the government, believing in transparency and accountability, had wanted tough procurement law to stop misappropriation of government funds through procurement of goods and services. The secretary of the implementation, monitoring and evaluation division (IMED) speaking at the same function last Monday informed the audience that nearly a quarter of the procurement expenditures used to be lost because of lack of transparency and accountability.
The donors, particularly the WB, did a commendable job by getting the PPA approved by the last political government which had dragged its feet on this issue for a long time. The Bank even made the availability of the third tranche of its development support credit (DSC) conditional to the adoption of the Act. The tranche was disbursed only when a bill to this effect was placed before the parliament.
The reason for delaying the passage of the law concerned was not difficult to understand. For, a host of people, including politicians, bureaucrats, suppliers, contractors and, even in some cases, officials representing the donors-involved in the procurement process were beneficiaries of non-transparent procurement process.
However, cancellation of aid money by the WB for alleged violation of procurement norms in a couple of projects had sent a strong message to the then government which thought it was high time to get the law adopted.
But by forcing a sort of waiver in the PPA, the donors have irked the government and put their own integrity under question as far as their own procurement under aided projects in Bangladesh is concerned.
[email protected]