Protecting state contracts for small businesses from corruption

If only because of its enormous potential for job creation and  providing small businesses with a shot in the arm and giving rise to the creation of new ones, it has to be said that it took an inordinately long time to bring the 20% allocation of some state contracts to small businesses into effect. On Friday the media received what certainly sounded like an iron clad assurance from Dr. Lowell Porter, the Chief Executive  Officer of the Small Business Bureau  (SBB), the agency charged with overseeing the effective rolling out of the facility that come January 1 everything will be in place to receive bids from small businesses for government contracts valued at under thirty million dollars.

 We must make no mistake about it, this provision, if administered in the manner intended, could make a significant dent in our unemployment numbers. That apart, once it becomes generally known among small operators that there are jobs valued at nearly $30 million for which they can compete, you can bet your bottom dollar that they will seek to qualify in whatever ways are necessary to go after those jobs. In so doing, they will have to expand their own work forces and possibly have to collaborate with other small businesses in order to meet inventory requirements. The positive potential is not difficult to see. It could be, as they say, a big deal. Now that we know the timeline for the full implementation of the provision there are supporting initiatives that need to be taken. We doubt very much, for example, whether there exists a widespread understanding among the intended audience as to the qualification criteria for eligibility to tender for and secure state contracts. Presumably, many of the smaller businesses that will be seeking to get their feet wet, so to speak, may never before have tendered for a state contract of any kind. There is work to be done in this regard and government can do worse than roll out, immediately, an aggressive public education/information initiative designed to raise awareness of the 20% provision in a manner that supports the efforts of small businesses to position themselves to benefit from it.  

 The predominance of oil and gas as by far the biggest issue on the public discourse agenda has meant that the new concession to small businesses which, in the short term, is certainly no less significant, has not really been the subject of nearly enough public discourse.

There is, at this juncture, a compelling case for placing the 20% provision issue in the public domain, targeting small business owners and business aspirants. Part of the public education initiative can perhaps be a modest, concise, easy to read reference booklet that speaks to the rules and procedures relating to eligibility for qualification. The various other channels of communication, meanwhile, can be pressed into service in various awareness-raising ways. Here, it is both about public education and about encouraging small business owners to properly position themselves to secure small contracts.

Raising public awareness of the 20% provision over the short period leading to January 2019 is not, however, government’s biggest challenge here. The bigger challenge could well repose in the responsibility of protecting the 20% facility from a culture of corruption that would seek to misdirect the benefits of the scheme away from those who legitimately qualify and are deserving. One of the biggest loopholes for the manipulation of the scheme may well lie within the state tendering system itself, particularly at the levels of ministries and regions where the tender processes are less scrupulously superintended and arguably more vulnerable to manipulation.

It would indeed be a major tragedy for government as much as for the prospective beneficiaries if the 20% small business regime were to fall into the hands of corrupt officials who straightaway proceed to transform it into a  gravy train that exists simply to facilitate the apportioning of illegal and underserved gain. Here, it is not a question of casting aspersions on functionaries responsible for state tender administration. The reality is, however, that we have seen more than enough of misdirected well-intentioned initiatives. At any rate, however stringent the protective measures no one is about to bet against attempts at manipulation. The great ‘burden’ which the 20% concession imposes is that of a level of oversight which may well not be possible in the short term. That is not to say that strenuous efforts should not be made since what is at stake here is genuinely too big to fail.



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