Editorial | Fairness, oversight and transparency in public procurement

Absence of blacklisting of bidders for public tenders remains a major lacuna in the government procurement process.

It is incomprehensible how only three economic operators were blacklisted in the last five years, a situation that has rightly raised the concern of the Chamber of Commerce, Enterprise and Industry.

In its report on Public Procurement Reform published yesterday, the Chamber said enforcement of existing regulations must be strengthened.

This leader has on multiple occasions harped on the importance of a level playing field for businesses and public procurement is one such area where this has to be practised.

Operators that breach the law must not be allowed to bid for public contracts. This country has learned a hard lesson over the past few years that impunity is not an option.

Allowing companies in default to continue participating in public tendering processes puts businesses that operate in a correct manner at a disadvantage.

A big problem concerns legal breaches linked to tax and social security payments.

According to the Chamber, 85% of its members told the organisation’s working group that worked on the report that economic operators who have not paid all of their tax and NI contributions should not be allowed to participate in tenders.

The truth is that unpaid taxes already constitute grounds for blacklisting according to the law but the perception of the Chamber’s members was that operators in default on tax and social security payments still participated in tenders and are awarded public contracts.

The problem is that this is not just a perception. Economic operators are managing to obtain compliance certificates from public authorities after entering into settlement agreements on payment dues without effectively paying all tax dues.

To top it all, this exception is allowed by law and is a direct transposition of EU directives.

At the very least, however, the tax authorities must ensure that binding agreements are being adhered to scrupulously and this information must be shared with the department of contracts.

And in those cases where no such agreements exist, operators should be completely barred from participating in public procurement.

The bigger issue remains one of good governance across all sectors of the public service. The public procurement process is an important cog in the workings of government because it deals with taxpayer money, and services and goods that are procured to benefit the public.

Ensuring a robust and fair system must be everyone’s endeavour. The government must sit down with stakeholders to discuss a way forward.

There are also numerous recommendations and observations made by the National Audit Office over the years on measures to improve public procurement.

Within this context, direct orders must also be strictly regulated. While direct orders have value in instances that require speed, the government cannot have a system of direct orders that can be easily abused.

Fairness, oversight and transparent rules for all are the foundation blocks for a reform that befits a modern-day European country.

On a secondary note, the Chamber of Commerce must be commended for the raft of policy documents it has produced in which reforms and ideas are put on the national agenda. This pro-active approach by stakeholders like the Chamber is added value to society, the economy and the country.