The Tribune

In my last article I neglected to define what public procurement is. Public procurement refers to the purchase by governments and state-owned enterprises (SOEs) of goods, services and works. As public procurement accounts for a substantial portion of taxpayer monies, governments are expected to carry it out efficiently and using best international practices. This is critical for ensuring high quality service delivery and safeguarding the public interest.

I did, though, touch briefly on the government’s new e-procurement system, otherwise known as the e-Procurement Supplier Registry. This system is vital to achieving the Public Procurement Bill’s goals, as it was designed to bring greater efficiency and transparency to the public sector procurement process through all contracts being sourced online across all agencies. An economic and financing analysis performed by the Inter-American Development Bank (IDB), covering the period from 2015 to 2019, found that the government can save approximately $394,163 per hour if a procurement officer was to conduct 60 tendering process annually using the new system to evaluate bids. Can you imagine the savings if every government agency were to do so? The government would have to borrow much less in its annual budget.

Shedding traditional practices may be hard, however. During his budget debate contribution on Wednesday, June 2, Jeff Lloyd, minister of education, practically bragged that nearly $40m was spent by the government on school repairs and that an additional $20m will be added for their continuation. Were these contracts tendered via the e-procurement supplier registry or the print media? Who were these contractors? The public presently has no idea.

The government, though, should be congratulated for mandating the use of the e-Procurement Supplier Registry. I wish to thank the three hard working e-Procurement help desk representatives who provide support and have trained hundreds of vendors and buyers on the use of the system. Yet, despite their hard work, their salaries are still that of a minimum wage, and after five years they are still not permanent and pensionable. What a shame.

The e-procurement system, unfortunately, is now in danger of losing its true intent and value. Why?

• The employment of a local IT system development manager was critical for the future development of the system. The public financial management reform project’s leadership was warned it was not wise to have an international consultant residing in Cambodia acting as a systems administrator. They failed to take this advice. Hence there is no dedicated systems administrator assigned to manage its day-to-day operations, further exacerbating other issues.

• One of the most important issues is that the functionality of the system is presently not aligned with certain aspects of the Public Procurement Bill, as the Ministry of Finance has not engaged in any discussion with the developers. This process, and change to the system, would take up to five months to complete.

• The training site designed to train government purchasing officers has been non-operational since March, so training was halted. This will have a devastating effect on the government’s goal to have all agencies use the system by September. The training site has to also be aligned with the Bill, and without this taking place any training will be useless.

• The Public Hospitals Authority is requesting integration with their systems to avoid duplication of efforts.

• Connectivity with the Department of Inland Revenue (DIR) and National Insurance Board (NIB) systems needs to be established to obtain automatic details that verify bidders on contracts and whether they are tax compliant.

It is my understanding that the Ministry of Finance is scrambling to form a committee of seven to ten persons to out these fires, but is having trouble sourcing qualified or certified public procurement specialists. Two procurement consultants with the institutional knowledge and professional experience are no longer there, making it very difficult for these fires to be extinguished.

The Public Financial Management Project Implementation Unit (PIU), which is responsible for overseeing these reform activities, was established in 2017 and had a ten-strong staff including four component co-ordinators. Each of the latter was responsible for one of performance monitoring; national statistics; public financial management; and a public procurement system. One of its main purposes roles was to manage the $33m project loan from the IDB, and to provide the necessary resources to the above-mentioned co-ordinators.

However, the Public Financial Management Project Implementation Unit has suffered some major setbacks, with just one-and-a-half years remaining to completion of its task. Currently there is but one component co-ordinator left and two full-time staff.

An international procurement consultant employed by the Government of The Bahamas stated in his final report: “The fast turnaround of the public financial management/public management reform project PIU’s procurement specialist position, and the procurement priorities determined by the project manager not always in sync with the strategic plan and consultant’s recommendations, have also hindered the implementation of component four activities. These two factors have caused delay or cancellation of key component four activities or support activities.”

This statement is powerful yet the Ministry has failed to act. It is in the best interest of the Ministry of Finance to salvage what activities are left to complete the procurement reform, and assign it to a qualified local procurement consultant to co-ordinate its completion.

NB: Daniel Ferguson, a retired chief petty officer with the Royal Bahamas Defence Force (RBDF), is a former procurement officer in the Ministry Health and Ministry of Finance, and former component co-ordinator for the Inter-American Development Bank (IDB) sponsored public financial management reform project, in particular the public procurement reform. He led the drafting team for the development of the Public Procurement Bill 2021, and public procurement regulations. He is a chartered member of the Chartered Institute of Procurement and Supply, with over 25 years of experience in public procurement.