Know The Public Services Procurement Challenges

The least expensive tender isn't necessarily the very ideal.  But officials move alone for fear of bringing an inquiry. In under two weeks, India is going to have brand new Central authorities.  Fulfilling with the electorate's expectations for public providers that are corruption-free and goodwill likely probably be among the main challenges of the government.

E-governance, an essential instrument by which public services could be made better, will demand large scale procurement of services by private industry IT service suppliers. However, this comes up from a civil agency mindset which has come to be more and more reluctant to take decisions on issues with monetary implications, given that the current spate of trials and inquiries.  Without measures, an implementation might be slow.

In principle, the people liability must aim at achieving'best value for money' to the general public.  Really the age-old canon of propriety is an officer must exercise in using public capital, the amount of prudence and care he would!

It has been taken to imply that'best value' is what can be secured at the lowest price.  However, 'worth' comprises benefits that are subjective and both non-profit. 

Obviously, unlike a private business or person, the very ideal value, at the context of public procurement of services, should take into consideration theories of equity' (in the sense of honest chance for unique vendors ) and probity.  Both of these requirements are equally imperative and required.  Therefore'value' has to be achieved without forfeiting probity or equity.

Cheapest perhaps not the finest 

The key way of ensuring equity and probity is via procedural defences. Back in India, these guards are mostly utilized in executive orders and directions (e.g. that the General Financial Rules or GFR from the Central government).

Regardless of the occurrence of powerful and ever-tighter procedural safeguards, corruption is believed to have improved in the past couple of decades.

Though some instances of corruption have included violations of procedural standards, many (particularly those not discovered ) haven't.

On the flip side, some jobs generally regarded as powerful and well-executed such as the Delhi Metro seen some procedural offences which -- had they happened in another organisation -- may have drawn odium.

Compounding this dilemma is a recent occurrence in which problems probity' or'equity' of conclusions are contested on the grounds of hindsight with data unavailable to this decision-makers if decisions were created.

The issue is no more 'have we obtained the finest possible service or product in the best possible cost under our situation' but instead that is the very defensible choice from the court of law enforcement and the courtroom (media-led) public ruling'.

That is producing big delays and lots of sub-optimal options.

Tendering for solutions 

One difficulty is the procurement processes are largely created for civil works and products that are usually procured by deciding on the cheapest tender that meets the minimal quality specified. Adaptation to solutions has been random.  A distinction in providers is that a lot of this value comes from proficiency and the high quality of the service supplier rather than from the proposal's price.

Service grade isn't easy to define at a 'pass-fail' way as is generally performed for works and goods; a pass-fail program generates the 'cheapest quality over the prescribed minimal'.

You can consider this analogy of recruitment a mentor for one's kid by establishing the minimum qualification of a Degree then picking the applicant requesting the cheapest tuition fee: you are very likely to acquire a mentor who scored only the pass mark and that might not be proficient at teaching. The provisions of the GFR on support procurement are basic.  They don't offer adequate advice to officers that want bonafide to perform a procurement. A collection of behavioural modifications are essential to enhance efficiency (with respect to the rate of processing along with the getting of greatest value) while maintaining safeguards for equity and probity. The GFR ought to be amended to specifically allow the use of new processes that are currently utilized from the public business everywhere in the world as well as in India, particularly for externally-aided jobs.

The first is that the procedure quality-cum-cost based choice' (QCBS) where analysis of tenders is performed through marks for marks and quality for the price given by the bidder along with the winner determined throughout the combined marks.  Absence of guidelines raises the odds of corruption and mistake.  Officers resort to pristine tenders that could lead to low cost but the caliber of support to prevent these dangers. Guidelines must be issued specifying key actions to guarantee fairness (e.g. picking the marking strategy before launching bids, not opening cost bids until the technical analysis is completed etc ).  For types of job or bids, open and transparent consultations must be demanded before finalising standards, minimising surprises and challenges.

Fixed price Process 

Another approach that ought to be released is'Frozen Price Choice' (FCS).  For kinds of work that may be quantified the FCS system gets rid of the complications of cost comparison.

The tendering authority (possibly with the assistance of specialised advisors ) adopts a quote (like milestones and time of repayment ) of what is the affordable price.  This becomes this contract's price.

Bids are encouraged demonstrating the fixed price and assessed only in their technical merits with no evaluation or discussion of cost since the cost is fixed ahead of time.

Irrespective of which company is chosen, the sum payable stays the same.  A gross profit of, say, 10 per cent for contingencies that are physical/extra work might be permitted.  The range for corruption during pricing varies is removed as well as the decision-maker can't result in a loss or benefit to the authorities.  The choice is absolutely totally free of anxiety about allegations of inducing'loss' or ''infructuous cost' in the auditing angle or'weight reduction without attention'. The sole issue is equity if no loss is demanded, one of the exemptions that are vulnerable to controversy.  

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