Procurement strategy needed – expert
The absence of a national procurement strategy could defeat the purpose of the Public Procurement Act 2003 (Act 663), amended in 2016, Simon Annan, Co-Founder of Smartbid, an e-procurement firm, has said.
“As it stands now, the law says that if you are procuring at a certain threshold, you have to apply any of the methods. So, either you go national competitive bidding or international. But if we had a procurement strategy which says that a certain type of item should be procured from local companies it will go a long way to support local companies. That is what we are asking for,” he told the B&FT in Accra, on the side-lines of a SmartBid Business SME Summit.
Mr. Annan, who doubles as Ghana Deputy Chair of the Chartered Institute of Procurement and Supply, Africa (CIPS), believes that the law needs to be backed by a national plan to foster competition, improve administrative efficiency in the tender process in a transparent and accountable manner.
The procurement strategy, he said, “will actually back the law because the law is the framework, so we need a plan to back whatever is in the law.”
“If the sector minister says that 70 percent of procurement goes to local companies, what is the strategy backing that? “If you say you are building factories, what is the strategy to buy from local companies?” he asked.
He added: “If you delink procurement from industrialisation, then we should forget about our one factory, one district initiative. A national procurement strategy is key and that is what we expect the new minister to do.”
Apart from the national procurement strategy, Mr. Annan wants severe punishment for people who flout the law.
“The law is good; the only thing we don’t have, as a country, is enforcing the law and applying some penalties to persons who flout the law. We have seen entities flout the law but we haven’t seen anybody jailed.
If somebody flouts the law and benefits from the procurement activity to the tune of two-three million and you just ask the person to pay 30,000, there is a problem,” he said.
The new Public Procurement Act was passed in 2016 as part of efforts to strengthen the regulations regarding the purchase of public goods and services in a manner that promotes efficiency, fair competition and accountability in the use of the public purse.
Under the new procurement legislation, contract value thresholds for goods has been increased from GH¢25,000 to GH¢100,000 while that for works and technical services has been raised from GH¢50,000 to GH¢200,000 and GH¢25,000 to GH¢50,000 respectively.