Seven years later, public bids law takes effect

Seven years after the auditor general’s office flagged up concerns about political interference in the public sector contract bidding process, legislation aimed at improving public bids is due to come into effect.

The Procurement Law of 2016 is scheduled to take effect May 1, according to government records.

The 2011 audit revealed Cayman was “wasting millions of dollars” each year on the purchase of goods and services. The territory has since rewritten its rules for public procurement in a bill that was approved in 2016.

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The recent audit of consultant spending has flagged up a number of areas in government where procurement rules around contracts need to be improved.

The Procurement Law (2016) sets up an entirely new process for public bids for anything from purchasing supplies to the construction of public buildings, focusing on a tendering process at the “department level” – meaning a lower-level committee process will first review the proposals. Those committee reviews will then be passed on to a yet-to-be-formed entity called the Public Procurement Committee for a secondary review.

Although the local political leadership and Cayman’s deputy governor will have a hand in appointing members of the new Public Procurement Committee, the law will place layers between their direct involvement in public bids by having senior civil servants appoint members of the initial bid committee.

The three-person “departmental” bid committee will review offers for any project and then pass its recommendations to the procurement committee, which will review it and either concur or disagree with the initial decision.

A code of conduct for procurement principles states: “There shall be no corruption or collusion with suppliers or other persons involved in a procurement project.”

In addition, the government entity handling the project bids is forbidden from “splitting” the project to avoid minimum bid amount requirements set under the legislation, unless it can show there is a proper business case for doing so.

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