State govt bows to contractor lobby, blacklist no bar in new tender rules

BENGALURU: The state government has quietly amended the Karnataka Transparency in Public Procurement (Amendment) Act, 2018, that serves as a bible to government purchases of goods and services through a tender process.

One of the major changes allows a blacklisted contractor to bid for a government business after a debar of three years. Experts see this as a mild punishment which will not act as a deterrent against fraudulent practices. Earlier, a tenderer who is debarred for corruption and fraudulent practices was permanently barred from participating in the tender again unless he/she comes out clean in the probe.

Though the amendment received the Governor’s assent in January, the government notified it only last week. Karnataka is the first state to adopt an e-procurement system to implement government projects.

E-procurement was seen as a step towards transparency in allotting government contracts. Over the years, the system has not proved to be of foolproof, with its gaping holes allowing corruption to thrive.

The latest amendment has also scrapped the system of publishing the tender notice in the state and the district tender bulletin which till now was mandatory. The tender bulletin officer has been replaced with the Karnataka Public Procurement Portal, essentially implying that publishing the tender on the public procurement portal will suffice.

The amendment also allows the company to participate in the tender even if it meets only half of the eligibility criteria, unlike the previously set standard of 75%. Additionally, an appeal period for an aggrieved tender has been reduced from 30 days to 15, which is said to be done to avoid a delay in going ahead with the project work.

“The latest amendments, specially scrapping the publication of tenders in state and district bulletins, will ease the e-procurement process. The reduction in appeal period too is useful as the government agency can carry out the work without waiting for 30 days,” said KT Nagaraj, BBMP chief engineer (projects).

Activists say the benign three-year debar period has been done with an idea to help the contractor lobby. “A contractor who is blacklisted on charges of corruption and fraud should not be allowed to participate in the tender until and unless they get clearance from the department concerned. Allowing them to participate after three years sends a wrong message,” said urban activist Sai Datta.

A retired government official who has served in the Public Works Department said that the government’s should first fix the system where government agencies illegally reduce the minimum tender notification period. “Though the minimum period for the tender notification is 60 days for projects above ?2 crore and 30 days for projects below ?2 crore, the same is not followed. They tweak the deadline to facilitate a few contractors. If this continues to happen, the whole purpose of e-procurement is lost,” the retired officer said.