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recommended that the State Procurement Board (SPB) be overhauled to stamp out corruption and increase tenders awarded to local businesspeople.
The committee, chaired by Goromonzi North MP Cde Paddy Zhanda (Zanu-PF) has just concluded an inquiry into allegations of corruption levelled against the board by contractors and procuring entities. The committee also investigated allegations that the board is failing to make follow-ups on the performance of contractors.
In the course of the committee’s inquiry, public hearings were held in Bulawayo and Harare.
The committee received oral evidence from the SPB chairperson, Mr Charles Kuwaza, and a written submission from Finance Minister Tendai Biti.
It also studied procurement policies and procedures in other countries and those applied by multi-lateral agencies.
In a report presented to Parliament last week, the committee noted that the State tender system favoured contractors resident in Harare as tenders were advertised in Harare papers.
“Stakeholders cited the challenge arising from the centralisation of the SPB offices in Harare. Contractors outside the main cities also have challenges in collecting tender documents and submitting bids. To them the tender process is both costly and time-consuming as it demands that one travels to Harare, in some cases resulting in disqualifications arising from the late submission of documents,” reads the report.
The committee agreed with stakeholders’ proposal for the decentralisation of the SPB offices beginning with the major towns.
Stakeholders also proposed that the SPB should establish a website from which forms could be downloaded and documents submitted electronically for the board’s consideration.
The Parliamentary Committee also noted that the SPB was composed of people who lacked technical know-how on projects.
“Tenders are often awarded to the lowest bidders. In awarding the tenders, the SPB often disregarded the recommendations of the professional team resulting in failure by the contractors to perform,” reads the report.
The committee submitted that the SPB should take recommendations of experts seriously to ensure value for money in the implementation of projects.
It was the committee’s conviction that the staff complement of 30 people was too small to process tenders on time as last year, the small group was required to process 1 955 large volumes of tenders. About 50 people were needed.
The committee felt that delays in awarding tenders prejudiced taxpayers through escalation of costs.
“The committee proposes a review of the procedures and introduction of measures that will enhance integrity, transparency and accountability in the process,” reads the report.
To increase efficiency, the committee recommended that tenders below $100 000 be awarded through procuring agencies with decisions being reviewed by the SPB.
Procuring entities within the SPB would be responsible for tenders whose value exceeded $100 000. The threshold has been increased from $50 000.
Criticism was levelled at the SPB in particular and the State in general, for awarding tenders to foreign contractors who ignored local procurement and at times did not subcontract local firms.
It was recommended that: “New regulations should provide for standard conditions in all contracts and penalties for late completion or non-performance against contracted obligations.”
The Parliamentary Portfolio Committee on Budget, Finance and Investment Promotion also noted that State procurement covered up to 40 percent of the national budget as well as the procurement needs of local authorities, State-owned corporations and parastatals as well as public utilities.
It further noted that State procurement involves at least 20 percent of the Gross Domestic Product and therefore its expenditure was an issue of considerable concern.
“The Committee is convinced that the present procurement system has shortcomings cited in this report. This justifies the need for an urgent review of the State Procurement Act and its attendant regulations. As the Ministry of Finance conducts this review, it is the Committee’s fervent hope that the Ministry will incorporate the recommendations,” read the report.
The SPB is embroiled in court battles with contractors who have failed to fulfill contracts or who are contesting the way tenders have been awarded.
Of note is the case in which a Bulawayo company is accusing the board of flouting procedures in awarding a tender for electrification of Mtshabezi-Umzingwane water project.
The court case has reportedly stalled the completion of the project, largely viewed as the short term solution for Bulawayo’s water problems.
Online Reporter