Malta needs to revamp its tendering system to ensure the government doesn’t always prioritise the cheapest option when procuring goods and services, the Chamber of Commerce has proposed.
“There’s a problem in that the government tends to go for the cheapest option, rather than value for money,” Chamber president David Xuereb said in an interview on Lovin Daily this morning.
“When we spend our own money in our personal lives, we try to spend as little as possible but we also think about value for money and sometimes we take decisions to spend more than the cheapest possible to obtain more value.”
“Because of the manner in which tenders are issued and even more so the way they’re adjudicated, we tend to play it very safe, and the safest way to look at tenders is to simply look at the price, which is very dangerous.”
Xuereb said Malta should set clear criteria to define quality of services and goods, which government adjudicating panels will then utilise, along with the price of the services and goods offered, when assessing quotations.
The Chamber of Commerce, Malta’s largest business lobby group, recently launched a policy paper calling for a revamp in procurement procedure.
Amongst other proposals, the Chamber is urging the government to inform the market of its non-urgent tendering plans six months in advance, slash the maximum evaluation period from 90 days to one month, and impose penalties on contracting authorities who delay their decisions without good reason.
“If the government wanted value for money, it makes sense for it to have a primed pool of tenderers,” Xuereb explained. “Informing them six months in advance would prime as many tenderers as possible in good time, allowing them to compete against each other, and the government to choose the offer which represents best value for money.”
“Dreaming up a need, issuing a complex tender and then expecting everyone to respond within a month is unfair on both tenderers and taxpayers.”
“If you require furniture for your office, you’ll find very bad deals if you take a decision from one day to the next, but if you tell the market you intend to buy furniture six months from now you’re more likely to get the best possible deal.”
Xuereb also called for the blacklisting from public procurement of service providers who don’t pay their taxes, VAT and license fees.
“In the interest of good governance, proper spending, and ensuring a level playing field in business field, these tenderers should be blacklisted until they get their act in order,” he said.
“We can’t afford to have well-meaning businesses who pay their taxes, VAT, NI and license fees on time, with serious cash-flow consequences, compete with others who take a swifter route.”
“That’s not fair and must be completely abolished. Government’s responsibility should be to connect its information, within the scope of GDPR rules, to ensure businesses are compliant with their public financing obligations before they’re able to win a tender.”
Cover photo: Chamber of Commerce president David Xuereb with Prime Minister Robert Abela (Photo: Chamber of Commerce)
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