Thursday, 5 May 2011

Concerns raised over new procurement law

via CAAI

Thursday, 05 May 2011 15:03Vong Sokheng and James O’Toole

The government’s draft law on procurement is set to go to the Council of Ministers next week, despite concern from civil society groups about whether the legislation will effectively promote transparency in bidding for public contracts.

Ou Bon Long, a secretary of state at the Ministry of Economy and Finance, said yesterday that his ministry “is preparing to send the draft law to the Council of Ministers next week”, adding that the law would support the government’s efforts in public financial reform. “We made this law with the aim to ensure transparency in the public bidding process,” he said.

The legislation addresses a process that has long been fertile ground for corruption, plagued by “cronyism” and a lack of transparency, said Chheng Kimlong, a lecturer in business and economics at the University of Cambodia. But some NGO officials fear that the draft law does not go far enough in promoting an open bidding process and needs to provide for greater oversight.

The draft law calls for public contracts to be awarded through “public, competitive bidding” with oversight from the Finance Ministry, though it is not clear how such transparency will be compelled and information from the bidding process made available.

A provision for independent groups to access to this information and monitor the procurement process could help address this issue, said San Chey, local fellow for the Affiliated Network for Social Accountability in East Asia and the Pacific.

“If there is a lack of participation by watchdogs within the bidding process, it will create opportunities for corruption … that will affect public services and create losses from the national budget,” he said.

The law does not apply to procurements deemed “politically sensitive” or otherwise exempted by order of the Council of Ministers or the Prime Minister, according to an unofficial translation of the draft. It also does not apply to the concession process and the sale of state properties, nor to procurement projects funded by donors that are subject to their own financing regulations.

The current guidelines for public procurement are set out in a government guidebook on project implementation, and by the respective regulations of ministries involved in such projects.

Sok Sam Oeun, executive director of the Cambodian Defenders Project, said local authorities should be given more of a role in procurement under the new legislation in order to reduce the bureaucracy involved and make the process easier for bidders.

“We demand that the government deliver power to local authorities, with the participation of NGO watchdogs, in order to ensure transparency when there is an opportunity for procurement,” he said.

Another worry for some observers is the fact that there has been little public consultation on the draft law. In addition to the criticisms from NGOs, Chheng Kimlong said there were “lots of concerns” from the private sector that could be addressed through a more inclusive drafting process.

Ou Bon Long said the Finance Ministry was willing to make changes to the law “when civil society groups are able to provide appropriate recommendations”.

United States embassy spokesman Mark Wenig said in an email yesterday the US was “encouraged” by the draft law, and that a more transparent procurement process “will benefit both bidders and procuring agencies, and increase Cambodia’s attractiveness as a destination for foreign investment”.

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