Dear Editor,
Few other issues expose the shortcomings of governance and politics in Guyana than that of public procurement. Take, for one, the management of our public finances. According to assessments by the country’s Auditor General and the World Bank, public procurement remains a model of inefficiency, irregularities and fraud. One major problem involves the number of cases where only one or two persons (instead of the statutory bid evaluation committees) within ministries and regional administrations decide who gets contracts (see Reports of the Auditor General, 2007-2009). Causing alarm also is the large volume of single source or direct contracts being awarded despite the fact that the law makes competitive tendering obligatory. In this particular regard, the World Bank reports that between May and December 2006, 261 contracts out of 803 (32.6%) were single-source (Guyana Integrated Fiduciary Assessment, 2007. Volume III: Procurement System Assessment Report. p8). Add to the mix the number of contract awards that deliberately bypass the supervision of the National Tender Board either through contract splitting or outright disregard, and a serious breakdown in the system may be occurring.
Secondly, if one examines the public procurement system from the standpoint of transparency and public access to information, one encounters an official culture of secrecy and elusiveness. The public procurement legislation of 2003 requires the government to publish on a website information on all contracts above G$200,000 awarded by the central and regional governments. By law, therefore, citizens should be able to know such details as the names of awardees, the dollar value of awards, the nature of the goods, services or works procured, and the names and number of bidders. Since 2006, the central government (mainly ministries) alone has awarded over 12,000 contracts. Only 280 of these are available for public scrutiny on the website of the National Procurement and Tender Administration (NPTA), the central procurement authority in Guyana. In monetary terms, this amounts to approximately 10% of the approximately G$173 billion the government spent from its capital budget between 2007 and 2010. As regards the thousands of contracts awarded annually by the ten regional administrations and also required by law to be publicly disclosed, absolutely none is available for public scrutiny. The same 2007 World Bank study had cause to lament that “In addition to logistical restrictions to disseminate information to the general public, it has also been noted that no priority attention is paid by the higher management of the GOG in disseminating procurement-related information. Although the Ministry of Local Government concurred to make the minutes of bid opening and the awarded Contract Records available for the purposes of this exercise, it required the approval of the MOF, which was not granted.
The same situation existed with some of the ministerial tender boards.”
A bigger question then looms. Would any freedom of information legislation be meaningful in such an environment?
Thirdly, examine procurement as a vehicle to promote equality and social justice, and one sees no inclination by government towards this approach. It is now a well-established practice by governments worldwide to use their power as the largest purchaser in the market to advance a variety of socio-economic outcomes.
Public procurement has become much more complex than ‘the purchase of pens and paper clips’ and is now seen also as a potentially powerful vehicle for advancing diverse social goals (McCrudden, C Buying Social Justice: Equality, Government Procurement, and Legal Change. – Oxford and New York: Oxford University Press, 2007). The US, in this regard, has long led the way. Under its affirmative action policy, for example, minority groups bid for contracts that are set aside only for them. Canada, Malaysia, South Africa and Northern Ireland are among a host of countries that likewise use public procurement to achieve a more just society.
In Guyana, several important social goals recommend themselves. First, of course, is the promotion of equality of opportunity in business and employment for all racial groups including Amerindians.
A second and closely-linked goal is to help spur development in depressed communities. Thirdly, we can use procurement to develop women-owned businesses or businesses that employ a large number of women. Procurement can also be used as a mechanism to help people with special needs as well as laid-off sugar and bauxite workers.
Public procurement as a source of racial animosity in Guyana need not be elaborated here. Suffice to say that the conceptualization of both the Public Procurement Commission and the 2003 procurement law was premised on the belief that good governance measures (such as independent oversight, and increased transparency and accountability) could reduce the political contentiousness that surrounds the matter. This hypothesis has not been fully tested as the system has not been allowed to work as planned. Nevertheless, it is contended here that even a well-run system could not adequately ease the political acrimony over the distributive imbalances that public procurement in Guyana generates. Indeed, the limited data on the NPTA website suggest that one ethnic group dominates as bidders and awardees.
While the natural predisposition or interest of any ethnic group towards a particular occupation should not be restrained, efforts to encourage the participation of other ethnic groups must be a legitimate goal of a serious government. In this regard, the philosophy underpinning the recommendations of the Disciplined Services Commission (with respect to the racial composition of the armed forces) should be replicated here.
We reiterate, therefore, that given Guyana’s social, political and economic makeup, the public procurement system must not only be firmly rooted in good administrative and financial management, it must also be designed to contribute to achieving a fair and just society through targeted approaches.
A new and enlightened design must remove or reduce already-existing negative consequences (such as the racial and community imbalances in the distribution of public funds) as well as create fresh positive outcomes (such as increasing the number of women-dominated businesses).
In this and other regards, the expected very new Guyana government has its work cut out for it.
Yours faithfully,
Sherwood Lowe
