A further piece of essential legislation to help protect the Turks and Caicos Islands poor commercial decisions by Government was the most significant agenda point at His Excellency the Governor’s Advisory Council meeting on Grand Turk today, Wed, 5 Sep 2012.
The draft Public Procurement Bill is one of a number of pieces of legislation being introduced as part of the body of legislative and regulatory changes designed to protect the public sector and its finances. This is one of the milestone related pieces of new legislation that will be made law before the election in November. It will also be considered by the Consultative Forum.
Following the enactment of the Public Finance Management Ordinance 2012 in March, it was concluded that a further specific procurement ordinance was necessary to reduce the opportunity to circumvent procurement procedures and ensure significantly improved management and accountability in all future procurement activities.
Itis intended that the following proposed improvements to the governance and accounting mechanisms will apply to TCI Government, public and statutory bodies, and include:
·The need for all public servants engaged in procurement to refer to this and related Ordinances, such as the Public Finance Management and Chief Financial Officer Ordinances when considering procurement matters.
·Creation of a statement of principles that public servants will be required to apply.
·Creation of a central contract management cell led by a Director of Contracts to oversee the process and provide advice as required
·Introduction of disciplinary and legal processes where Elected Members and/or Public Servants deliberately circumvent the provisions of the Ordinance
·The intentional splitting of a large procurement requirement into smaller lots to get round bidding requirements is a new offence
·Achieving Value for Money and encouraging competition are always to be prime considerations before procurement is undertaken.
·Introduction of reporting arrangements relating to contracts for capital projects with a life time value above that set by the Permanent Secretary Finance and all other contracts / amendments above the reporting threshold set by the Permanent Secretary Finance via the Gazette and/or Government web-site to provide transparent information to the general public.
·Setting out clear responsibilities of the Procurement Board (also known as the Tender Board)
·Defining the stages of the procurement process
It is recognised that previous TCI Governments, particularly during the period 2005-2009, negotiated poorly and mismanaged several important contracts. Notably:
·Contracts were entered into for exceptionally long periods with little or no financial benefit for the people of the TCI, with little or no opportunity to renegotiate or end the contracts without severe financial penalty to the public purse.
·There was no transfer of risk to the contractor either in terms of their expected performance or financial penalties for poor performance.
·Negotiations were often led by the proposed contractor and once a contract was signed, continuing contract monitoring is generally poor or more often non-existent.
·There have been instances where financial guarantees requested by proposed contractors have been agreed at the end of the evaluation of tender phase without Ministry of Finance knowledge or approval.
·It is apparent that Government procurement was so poorly coordinated and it is very unlikely that Value for Money is being achieved.
“Ensuring that public money is spent wisely and for the benefit of the taxpayers of the Turks and Caicos Islands is critical to the reforms that we are implementing to assist the incoming locally elected government with achieving better value for money in future procurements,” said Patrick Boyle, Chief Executive, TCI Government.
“It is clear that too many contractual decisions were taken in the past that did not sufficiently take into account the future longer term needs of the taxpayer. It was not right that some development agreements, for example, were signed for immediate short term gain, often for a duration of decades without any opportunity for renegotiation or sharing of success as that business grew. These days, procurement is a specialist role and this proposed law will make sure that this skill set is included at the heart of all future public sector commercial contracts.”
Feedback on the proposed legislation should be submitted togovernorgt@fco.gov.uk by 17.00hrs on Fri, 14 Sep 2012.
