Fix procurement

Sri Lanka’s tender process has long been a concern for anti-corruption activists and watchdogs. The tender process to award massive projects, as well as procurement of crucial items such as coal, LPG, and fuel, have been frequently questioned for lacking due process and transparency. The latest controversy has risen over the power sector in Sri Lanka and how power projects are tendered, as well as procurement of emergency power. The situation has become so dire that key members of the diplomatic community have raised questions over transparency. Sri Lanka’s investment climate is also unlikely to improve unless the tender process is cleaned up, and it would have the added benefit of saving public funds. 

Despite the lapse of four years, the Government has failed to improve Sri Lanka’s business environment exponentially. While red tape and bureaucratic issues have been taken up, the larger problem of corruption remains largely unaddressed. Public attention is usually consumed by corruption allegations directed at politicians, and while such claims do need to be investigated, it is also important for the Government to fix operational systems that are undermined by collusion and vested interests to root out corruption. Without such a step, any other Government measures will have mixed results. 

The National Procurement Commission (NPC), which was established following the passage of the 19th Amendment in 2015, compiled and released fresh regulations to upgrade Sri Lanka’s tender process last year. Unfortunately, the report, which was presented to the Presidential Secretariat last year, has not yet been tabled in Parliament. Unless the present legislators move on this soon, it is likely to get lost in the election morass towards end 2019. 

 The new guidelines have been upgraded from the previous regulations introduced 12 years ago, and include several progressive measures, including a framework agreement, new information systems, and provisions for the Government to implement an electronic procurement system. 

The guidelines also infuse value engineering processes as practiced in developed countries, which enable the Government to reduce cost overruns in crucial infrastructure projects. Commission members estimate that value engineering could save the Government a minimum of 10% on all construction-related contracts. The guidelines also include technical auditing of tenders.

They also give powers to the National Procurement Commission to vet officials appointed to tender boards. If suppliers highlight conflict of interest on an appointment, the Commission would also have the opportunity to raise this with other Government parties such as the Attorney General. 

To ensure high levels of transparency once the new procurement guidelines become law, bidders will be given a comprehensive debrief three days after a tender is closed. Aggrieved parties can present themselves before the procurement appeal board six days after a decision is made, and if they are unsatisfied with the response, can appeal to the Supreme Court. After the tender is awarded, any member of the public can obtain the full tender evaluation committee report. 

Such a broad-based effort to clean up procurement is crucial to Sri Lanka achieving its good governance ambitions. It is now imperative that these guidelines get the support of stakeholders, particularly the private sector, to be passed into law. Business chambers and associations have a crucial role to play in drawing public attention to the importance of these guidelines, as they create a transparent and accountable level playing field that could fill legal gaps that allow for corruption.