Critics argue the move will invite corruption, mismanagement
A new directive tabled to the Ministry of Justice seeks to grant government ministers the ability to bypass public procurement procedures and award contracts through direct selection, raising serious concerns about susceptibility to abuse and corruption.
The draft proposes to transfer the power of approval for direct contract awards from the Public Procurement and Property Authority (PPPA) to members of the cabinet.
– Advertisement –
The Authority has also introduced a draft directive to determine procurement procedures for state-owned enterprises (SOEs), which its officials validated this week. They claim the directive is meant to boost SOE market competency in line with a government reform program that looks to transform SOEs from developmental missions to fully commercial entities.
The ‘special procurement’ procedure (direct awarding) has routinely been utilized by the Authority, raising concerns about the basis for the privilege.
On Thursday, the Auditor General presented the findings of its assessment of the Authority to Parliament’s Public Expenditure Administration and Control Committee.
“Many public institutions have frequently been requesting the Authority for special procurement permits. The Authority approved the permit for some, and denied requests from others. There are no clear parameters. The Authority approved many special procurement permits. However, it did not justify the approvals,” reads the report from the Auditor General.
It accuses the Authority of failing to assess and validate why so many public institutions demand the permits.
“The Authority also did not check whether those procurements were conducted based on the proper public procurement standards,” reads the report.
– Advertisement –
Legislation dictates that all public procurement endeavors must go through the proper bid process, with direct awards (special procurement) permitted only in rare circumstances.
MPs also questioned Authority officials about the irregularities observed in special procurement permits.
Meseret Meskele, director-general of the Authority, attempted to justify the situation.
“We have been trying to provide special procurement permits equitably to all institutions. We also attempted to ask them to justify their reasoning behind their requests for the permit. However, since our manpower is lacking, we could not assess and validate the factors for all the permits we approved,” said Meseret.
The Director-General claims the proposed directive would provide a lasting solution by transferring the power to award special procurement permits to ministers.
However, many question the implications of empowering ministers to approve direct procurement awards. Critics argue the move would open the door wider for corruption and mismanagement.
The directive has been finalized and tabled to the Ministry of Justice for approval.
Auditors also found that a government electronic procurement (eGP) system has not been integrated with critical institutions.
For instance, the eGP system should be integrated with the Ministry of Revenue for tax and TIN number issues; and with the Ministry of Trade for license and renewal issues, among others. The eGP should also have been integrated with banks but, the audit found, has not.
The system also lacks links with regional administrations, according to auditors, while there are serious gaps in the legal framework behind eGP.
However, Meseret told MPs that all 169 public institutions operating under the federal budget are conducting procurements through eGP.
She says efforts are underway to integrate the eGP system with banks and insurance firms.
“Once the financial institutions integrate, we can access the eGP system online, track records and documents regarding bidders, such as their loan and collateral status, and any finance related documents,” said Meseret.
Once the eGP system is integrated with the relevant institutions online platforms, all documents, including audit reports, will be available online.
However, experts argue digitizing the eGP system alone cannot protect public procurement from corruption.
“As long as ministers and government officials have the legal power to order special procurement permits and enact direct procurement, it is difficult to minimize corruption. Integrating the eGP system to as many institutions serves only digitization, not corruption minimization,” said a lawyer familiar with the issue.
.
.
.
#Authority #Transfer #Direct #Procurement #Responsibilities #Cabinet
Source link
