Who's afraid of the procurement law?

THE PUBLIC PROCUREMENT legislation has had a long, torturous birth – if birth is the appropriate word, given the current non-functionality of vast swathes of its provisions.

From the high-profile scandals that underlined its necessity over the decades (think Piarco, Udecott) to the act’s byzantine progress through Parliament under the previous administration, it seems that, outside of the Central Tenders Board Act, the idea of having a law that subjects the award of state contracts to scrutiny and transparency has been difficult to get off the ground.

Now, a few months shy of the fifth anniversary of the current administration, comes word that there are matters in relation to the new Public Procurement Act that will engage the attention of Parliament. Hardly surprising, but still disappointing.

Why does everything in relation to this legislation take so long?

The last administration held back passing the law, awaiting the outcome of protracted committee deliberations. Then came the matter of getting the Public Service prepared. Senior figures in the civil service warned the legislation’s changes were sweeping and they were not yet ready. Now, it seems, it has been discovered that the act applies to so-called government-to-government arrangements and that it includes the matter of the disposal of property, not just the award of contracts. These are surprising bugbears at this stage, given that these matters were reportedly considered, at great length, by Parliament, its committees, and even the court.

And yet the signs that the legislation is dead in the water have been there for a while now, notwithstanding the appointment of a procurement regulator. The partial proclamation of the law, the continued award of major contracts under old rules, and the uncertainties over what exactly the Office of the Procurement Regulator has been able to achieve in its nascent incarnation have prepared us for this current state of affairs.

As has, most recently, the very public divergence of views between the regulator, Moonilal Lalchan, and Finance Minister Colm Imbert over the timeline of implementation for proposed regulations. If these two officials could not find themselves on the same page in relation to such a crucial matter, then the prospects for the full implementation of the law are dismal.

It will now fall to Parliament to determine whether amendments will go against the spirit of the law.

We are of the view that while there are legitimate reasons for withholding government-to-government arrangements from onerous scrutiny, the solution is not to remove them from regulation completely. For example, if these contracts involve local content, there is no reason why that aspect of the overall project should not be transparent. Certainly, some states would be willing to comply with local laws and procurement best practices.

Without making any suggestion of wrongdoing, the legitimate fear is that government-to-government contracts open the door to untraceable kickbacks. That's a heavy price to pay for cheap loans.

Meanwhile, we take what little consolation we can from Lalchan’s view that the law will have retroactive application to contracts being awarded now.

That’s comforting, but only if we assume the legislation will actually be implemented. Thus far, the signs are not promising.