Award of contract without tendering: Prime Minister urged to reject PPRA board recommendations

The recommendation of Public Procurement Regulatory Authority (PPRA) Board to amend the rule which restricts award of contract without tendering needs to be turned down. Transparency International Pakistan Chairman Syed Adil Gilani in a letter sent to the Prime Minister on April 4 has requested him that as and when the recommendation is received by him for approval it may be returned without approval.
He has pointed out that under Article 5 of PPRA Ordinance 2002, the Board of PPRA is authorised only to take action for improving governance, management, transparency, accountability and quality of public procurement of goods, services and works in the public sector, and not to make rules which may allow award of contracts without tendering under the pretext of bilateral agreements, etc.
Earlier, Adil had written a letter on March 28 to Secretary, Finance, and PPRA Chairman Waqar Masood Khan regarding exemption under PPRA Rules for award of contracts 'without inviting public tenders'. There was, however, no response from him "which may be due to the reason that the complaints are genuine."
The Transparency International Pakistan chief stated that all loans by government and by every lender/donor/financial institution are always subject to open competitive bidding for all procurements. All loans are paid by public, the tax payers of Pakistan and shall be spent in most economical manner, Transparency International Pakistan said.
It was further clarified that according to PPRA Ordinance Article 19 all PPRA Board members (even the private members) are deemed to be public servants within the meaning of Section 21 of Pakistan Penal Code. Though the PPRA Board is allowed to recommend to the federal government that procurement of an object, or class of objects, be exempted from the operation of this ordinance or any rule or regulation but under Article 21 of PPRA Ordinance 2002 it shall only be if such exemption is in the national interest.
PPRA was created under World Bank recommendations for:
-- Enactment of a modern, transparent and competitive public procurement law based on UNCITRAL model law for procurement, and;
-- Creation of a small, independent procurement regulatory agency, with functions defined by the procurement law (which are mainly confined to policy, documentation and development of rules, etc, and not to include line clearance functions for awarding of contracts).
The amendments were primarily aimed at allowing exemption under PPRA Rules for award of contracts worth $124 million for safe city and 1100 MW Kohala Hydropower Project to Chinese contractors, without inviting public tenders. Transparency International Pakistan had requested the PPRA Chairman to examine reports which were published and complaints and deny or clarify each of these allegations.
This is required due to the reason that if these reports and allegations are true, the exemptions granted, or the implementation method of application of Rule 5 which may allow contracts to be awarded at thrice the market cost, as has been alleged in the reports, will be against PPRA Ordinance, UNCAC ratified by Pakistan in August 2007, and against all loan agreements of bilateral treaties by government and IFIs.