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Public Procurement – Buying? Purchasing? Trade-offs?
Ideally, most persons identify the act of “procurement” as simply ‘the use of money (cash or credit) for the purchasing of an item/s or service. Categorically speaking, this understanding is correct; however there is also a deeper meaning attached to this discipline which has evolved over time and transcended to a more complex term. Therefore, procurement can now be further re-defined in this modern era as:
“The strategic acquisition of goods (tangible items), consulting and non-consulting services or works (i.e. building construction, electrical engineering, road maintenance etc.”
Furthermore, the concept of ‘public procurement’ is the strategic acquisition of these goods, services or works for the benefit of the general public i.e. (Jamaican Citizens, Taxpayers) which is provided to them through a budgetary allocation (money) from the government. According to a study conducted in Jamaica by the Organization for Economic Co-operation and Development (OECD, 2017) “the size of public procurement as a share of total government expenditure is approximately 16.7%.” In other words, approximately $120 Billion Jamaican Dollars was allocated directly for public procurement related expenses. Additionally, let me hasten to also mention there are other public budgetary expenditures that indirectly involve procurement, therefore this figure isn’t conclusive.
Undoubtedly, the volume of procurement conducted by the Government of Jamaica isn’t your routine purchase at the grocery store or adhoc doctors visit. Rather, this process encompasses large sums of taxpayers money and usually involves a competitive bidding process wherein procurement practitioners and policy makers are held accountable and must ensure value for money being spent. Public Procurement is involved in key areas of decision making, thereby making it a strategic acquisition process.
Jamaica’s Public Procurement System: “Re-Shaping the Dialogue of Government Business”
Over the past decade, Jamaica has objectively made significant progress in modernizing and streamlining its public procurement process from a mere subtle “back office” administrative task to a complex “procedural based” expertise field which is now at the forefront in Ministries, Agencies and Departments (MDA’s) strategic objectives and goals. Noteworthy of mentioning is the mandatory compilation and submission of a Procurement Plan to the Ministry of Finance and Public Service which indicates how the budget should be allocated for each MDA through-out the particular financial year.
Succinctly, the path to modernization started in November 2010, the Ministry of Finance and Public Service issued its Public Sector Procurement Policy which served as a primary indication to reform the procurement system and align it with international best practices and promote fair competition for government contracts. Subsequently, GOJ issued a Revised Handbook of Public Sector Procurement Procedures in March 2014, containing three (3) in-depth volumes on public procurement procedures and practices for government entities. In 2015, the electronic procurement platform was launched for GOJ entities which served as a ‘paradigm shift’ away from the old tendering box system to a fully integrated online user interface between procuring entities and bidders (i.e. suppliers of goods, services and works). Finally, the most significant “re-shaping” of the dialogue was the passage of the Public Procurement Act (2015) and Public Procurement Regulations (2018) which now has a legal binding implication on all parties involve in the procurement process to include but not limited to: procurement methodologies and approval thresholds, specific award of contract criteria’s, specialized procurement units, appeal bodies, penalties (i.e. judicial fines and prison sentencing).
As a Senior Public Procurement Practitioner within the health sector and having worked with more experienced practitioners who taught me much of what I know today; I’ve seen a greater demand for the expertise of persons within my field as a necessity in managing risks, prioritizing institutional expenditure and also protecting the institutional image and guiding the governance framework. Similarly, there is also an expectation of managing the procurement plan that practitioners are held to by their organizations. In fact, the nature of the demands of the policy makers can be deemed onerous and seemingly impossible at times, however as “facilitators” in this process we often times find ways to make it work with as little resources and time as possible.
‘Public Procurement: The dichotomy between Good Governance and Political Corruption’
The scourge of “corruption” and “mismanagement of public funds” has plagued both sides of the political divide since post-independent Jamaica. Since recently, with the formation of the new corruption “watchdog”, The Integrity Commission and other prosecutorial and accountability bodies such as; the Director of Public Prosecution Office, The Auditor General’s Office and the Public Administration and Appropriations Committee (PAAC) there has been a greater focus on corruption in the public sector system. Interestingly, in many of these investigations and reports, there have been noted breaches of the procurement procedure. These findings have brought into sharp focus the role of procurement in decision making and whether it is being by-passed or manipulated for the benefit of political gain.
I firmly believe that a strong, independent and impartial public procurement system is essential to maintaining the dichotomy between governance and the political landscape. The “Politics-Administration Dichotomy” as perpetuated by former U.S. President Woodrow Wilson in his essay “The Study of Administration” (1887) is the best example of how the public sector should be separated from political influence. Wilson noted that
“The field of administration is a field of business. It is removed from the hurry and strife of politics… Administration lies outside the proper sphere of politics… Although politics sets the tasks for administration, it should not be suffered to manipulate its offices.”
This profound statement is the essence of what a transparent, accountable and efficient public administration system should resemble, especially a public procurement system wherein the involvement of political influence and actors have often times lead to corrupt practices. It may seem like an idealist concept to have a separation between administration and the political landscape, however the reality is, in Jamaica there have been too many instances of various political actors directly or indirectly affecting the administrative process. Let me hasten to say that within the field of public procurement, there is a tendency to interfere or influence the procurement process. The complex management of the procurement process can be subjected to political interference from the bidding process, tender evaluation, contract award and monitoring etc.
The fundamental essence of improving our governance structure and strengthening our public procurement system is to identify the systematic gaps that exists within our public sector and develop pragmatic approaches in filling those gaps. Frankly speaking there is no shortage in legislation, ethical and monitoring bodies to prevent corruption, however what needs continued emphasis is the separation of powers, responsibilities and building capacity of institutions to act within the confides of the law and as best as possible resist corrupt practices.