In order to bring about good governance, transparency, accountability and improvement in public procurement of goods, works and services, the federal government has issued Public Procurement Rules - 2004 which will apply to new tenders worth Rs 300 billion in fiscal 2004-05.
A gazette notification issued by the Federal Finance Ministry states that these rules supersede all other procurement rules, and are to be strictly adhered to by all federal government departments/ authorities as well public sector corporations having the federal government management.
The rules governing open competition apply to all procurements of over Rs 40,000 and cover all aspects intending such as technical, financial, rejection of bids, scrapping of tenders as well as re-bidding invitations.
The major improvements in the new rules are that open competitive bidding is the principal method of procurement of goods, services and works, and that all tenders of more than Rs 40,000 shall be advertised on the Public Procurement Regulatory Authority (PPRA) website except when the proposed procurement is related to national security.
All tenders shall include ''Integrity Pact'', public announcement of the results of bid evaluation in the form of a report giving justification for acceptance or rejection of bids at least 10 days prior to the award of procurement contract.
The procuring agency shall constitute a committee comprising odd number of persons, with necessary powers and authorisations, to address the complaints of bidders that may occur prior to the entry into force of the procurement contract, and the bidder with the lowest evaluated bid, if not in conflict with any other law, rules, regulations or policy of the federal government, shall be awarded the procurement contract.
The Public Procurement Regulatory Authority is an autonomous body endowed with the responsibility of prescribing regulations and procedures for public procurements by federal government-owned public sector organisations with a view to improving governance, management, transparency, accountability, and quality of public procurement of goods, works and services. It is also endowed with the responsibility of monitoring procurement by public sector agencies/organisations, and has been delegated necessary powers under the Public Procurement Regulatory Authority Ordinance - 2002.
According to the new rules, all procurement by any department/ authority of the federal government, ie Wapda, PTCL, PQA, PNSC, CDA, MES, PIA, PWD, etc shall be based on the new rules, a breach of any of the 51 articles of the "Public Procurement Rules, 2004" after June 8, 2004 would be deemed "mis-procurement" under Rule No. 50.