According to the report released yesterday by the Institute for Public Policy Research (IPPR), there is generally low compliance with the Public Procurement Act by the State-owned enterprises.
IPPR believes this phenomenon is largely due to limited procurement proficient personnel at public entities, limited understanding of the Act, lack of information technology facilities, lack of implementation of compliance measures and sporadic releasing of funds, among other challenges.
In a combined report for the financial years 2017/18, 2018/19 and 2019/20, tabled in parliament in October, there are 192 procuring public entities, but the Procurement Tracker Namibia until now worked with a figure of just over 170 procuring public entities, based on a document available through the Procurement Policy Unit’s (PPU) website.
The IPPR report lists the problems affecting the functioning and efficiency of the public procurement system: “Limited capacity at the Central Procurement Board of Namibia (CPBN) due to stringent employment requirements has affected the operational efficiency of the board. The secretariat to the review panel has no standing structure and is composed of staff seconded from the finance ministry. Lack of a staff structure presents a risk of institutional memory and capacity loss to the secretariat and review panel in general due to staff turnover”.
It added the periodic release of funds to public entities by treasury has affected planning, and it has introduced uncertainties in the execution of public procurement by these public entities.
Also, there is a reported lack of procurement structures in some public entities as required in the Act, leading to over-spending and unaccounted expenditures by these entities.
“Some public entities have not developed annual procurement plans, citing budget cuts as a reason – and some do not have internal procurement structures as mandated by the law. Poor contract management by public entities resulting in lost value due to lack of enforcement of remedial measures in the event of a breach of contract by contractors or suppliers,” reads the report while outlining the challenges.
Furthermore, the report offered some recommendations that the PPU should develop all standard bidding documents and improve existing bidding documents to enable public entities to carry out various procurements as is allowed in terms of the Act.
In this regard, the PPU was advised to prioritise the development of a comprehensive monitoring framework to form the basis of future reports on the Namibian public procurement system and possible changes to this system.
“Public entities need to be capacitated further to ensure full compliance with the provisions of the Act, including the development of procurement plans, development of internal procurement structures, maintenance of procurement records. As part of the effort to enhance Namibia’s public procurement system, the PPU should continuously engage stakeholders in public procurement to understand the prevailing challenges and devise actions to address them, including proposals to amend the existing legislation,” urged IPPR.
Finance minister Iipumbu Shiimi during his 2021 mid-year budget speech said the Public Procurement Amendment Bill has progressed and is currently at the legal drafting stage, with anticipation to table the bill in the National Assembly during the next session.
“Steps have been taken to address critical capacity challenges identified in both the Procurement Policy Unit and the Central Procurement Board as well as to exempt key public procurement with adequate capacity to manage their procurement functions,” said Shiimi.