Public procurement changes run into opposition<\/p>\n
Dadan Wijaksana, The Jakarta Post, Jakarta<\/p>\n
The government is reviewing a presidential decree on public
\nprocurements to reduce corruption, but the effort has met with
\nstiff resistance from various sides, including business
\nassociations.<\/p>\n
In preparation since 2000, the revisions to the decree were
\nrecently finalized by a review team comprising various state
\ndepartments and institutions. The draft decree giving effect to
\nthe changes is scheduled to come into effect next year.<\/p>\n
While the draft decree has yet to be approved by President
\nMegawati Soekarnoputri, criticism has already been voiced by
\nbusiness associations, including the Indonesian Chamber of
\nCommerce and Industry (Kadin), and the National Construction
\nServices Development Institute (LPJKN).<\/p>\n
Kadin and the LPJKN raised objections to the fact that under
\nthe revised decree, contractors will be allowed to win
\nprocurement projects without having to be accredited with either
\nKadin or its affiliated associations.<\/p>\n
Presidential Decree No. 18\/2000 stipulates that only companies
\naccredited by Kadin and its affiliated associations can
\nparticipate in a tender process.<\/p>\n
\"Under the draft decree, accreditation is not important. This
\nis, of course, not true as in the current era of free competition
\ncompanies need to have certificates setting out their
\nqualifications,\" LPJKN chairman Sulistijo recently said.<\/p>\n
The two influential private sector organizations also said
\nthat the absence of such accreditation could open the way to
\nbackdoor deals, as the authority to determine the winner of a
\ntender would entirely lie with the head of the project.<\/p>\n
Responding to this, the National Development Planning Board
\n(Bappenas), which coordinated the work of the review team, said
\nthe main aim of the revision was to avoid or reduce backdoor
\ndeals in the first place.<\/p>\n
\"Eliminating the certification requirement means a shorter
\nbureaucratic chain for businessmen who wish to participate in
\ntenders,\" a source at Bappenas told The Jakarta Post, adding that
\nthe certification process was prone to abuses and bribery.<\/p>\n
Bappenas executive secretary Koensatwanto Inpasihardjo said in
\na press statement that the revision was expected to gradually
\nturn the nation into an efficient economy rather than a high-cost
\neconomy as it was today.<\/p>\n
The revised decree was formulated in response to widespread
\nleakage at almost every stage of the procurement process.<\/p>\n
Various international institutions -- including the World Bank
\nand the Asian Development Bank -- have frequently stated that
\ncorruption in equipment procurement in government institutions
\nwas one of the areas most tainted by corruption in Indonesia.<\/p>\n
The World Bank even suggested that leakage in the procurement
\nprocess could reach up to 50 percent of all funds allocated for
\nprocurements.<\/p>\n
Key points in revision of Presidential Decree No. 18\/2000<\/p>\n
* Elimination of need for accreditation with Kadin or its
\naffiliated associations.
\n* For projects valued below Rp 50 billion, companies do not have
\nto undergo a pre-qualification process.
\n* Fewer documents required.
\n* Medium and large-scale enterprises are prohibited from
\nparticipating in tenders for projects reserved for small
\nbusinesses, that is, projects worth less than Rp 50 billion.
\n* Provides a legal basis for the establishment of an agency
\ntasked with monitoring tender processes, and improving the
\nquality of the regulations related to procurement.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/public-procurement-changes-run-into-opposition-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}