During a consultation meeting with the Department of Procurement and Properties, yesterday, contractors said the Procurement Rules and Regulations 2023 could increase the risk of fostering corruption and distrust among contractors. Among several issues, they argue that accepting bids for evaluation when the quoted amount is within a plus-minus margin of the estimated cost undermines fair competition.
A section of Procurement Rules and Regulations (PRR) 2023 disqualifies a bid if the quoted amount is 20 per cent below or above the procurement agency estimate, before evaluation.
Contractors say there are risks of procurement agencies exposing estimated costs to few known contractors, leaving fair bidders at a disadvantage.
This might lead to disqualification despite submitting competitive and reasonable bids. The Rules and Regulations do not allow the procurement agencies to disclose the estimated amount.
Zeko, a contractor said, “Contractors are now focused solely on the 20 per cent plus-minus provision, fearing they’ll lose the project if they don’t meet it. This shift in focus has diverted attention from time and quality, leading to losses. We’re requesting the removal of this provision.”
Moreover, they say the Rules and Regulations do not provide procurement agencies with clear guidelines for setting contract durations and the basis for extending a contract.
Contractors added that contract duration and extension should be based on the scope of work and not financial obligations or the agency’s construction targets.
Additionally, contractors say it’s unfair that the procurement agencies exclude contractors who are in a dispute resolution process from bidding.
The Construction Association of Bhutan is urging authorities to review and simplify the rules to address these challenges.
“The rules need to be clear enough for even a layman to understand. They must also be relevant to the country’s economic situation. Some guidelines within the country are subject to interpretation, and there is a lack of uniformity,” said Trashi Wangyal, President of the Construction Association of Bhutan.
“When we import equipment from abroad, we don’t receive a guarantee. However, here they demand a 2-3 year guarantee, which is another major issue,” said Dorji, a contractor.
Meanwhile, the National Assembly approved the motion last week to address the challenges contractors and suppliers face under the 2023 Procurement Rules and Regulations.
The finance ministry adopted the Procurement Rules and Regulations 2023 following extensive consultations with public servants, private sector representatives, and experts.
Kinzang Lhadon
Edited by Sangay Chezom
