Wednesday, December 4, 2013

Written: Baseer Ahmad Omaid

Why efficient procurement matters for good governance:

Procurement performance matters; it is vital for development and poverty reduction, especially for a highly underdeveloped country like Afghanistan. Delay in procurement contracts will in turn affect service delivery by halting the development projects intended to provide goods and service to the people. Hence, delay in procurement of development projects threatens governance by reducing the legitimacy of the government in the eyes of the citizens. 

Afghanistan’s procurement process lacks clarity; it is very complex and indeed not context-specific. There is a need to review the law and make it more comprehensible to everyone, especially to civil servants working in procurement departments of government institutions.

The Afghan Procurement Law: 

The Public Procurement Law was enacted through Presidential Decree Number 59 on the 21st of July in 2008. The law was meant to regulate both domestic and foreign procurement of goods, works and services for administrations, institutions and mixed companies.

National Procurement Conference:

Kabul hosted National Procurement Conference on the 5th of November this year. The conference was hosted by Ministry of Finance; delegates from various government institutions, donor representatives and civil society members attended the event. The aim of the conference was to identify gaps in the Afghan procurement law and process, and to seek recommendations and views to address the inherent flaws in both the law and process. Apart from the vagueness and complexity of the Afghan procurement law number of other issues and challenges were discussed in the conference, which will be explored below. The blog post will also provide some recommendations as entry point to addressing these challenges.

Where the Problem Lies:

The interferences of multiple oversight institutions were mentioned in the conference as one the key barriers towards efficient procurement performance. At the moment there are multiple legal and oversight institutions responsible for overseeing the government procurement process (i.e. Attorney General’s Office, High Office of Oversight and Anti-corruption etc.). Both interference and the multiplicity of institutions carrying out overlapping and conflicting duties are the biggest challenges to the procurement process in Afghanistan. The civil servants I interviewed at different procurement departments of Afghan government complain about the inspectors of various oversight institutions claiming to be the true representative of an Afghan institution mandated for overseeing the procurement process. However, the numbers of inspectors according to civil servants are too many representing different oversight institutions with overlapping mandates.

Another issue that affects the Afghan procurement performance is the lack of donor engagement and Afghan development partners’ inability to align and harmonize their procurement systems with that of the Afghan government. The Afghan development partners are at times blamed for creating parallel structures and systems and for a lack of coordination among them. In the procurement area they are criticized mostly by the Afghan procurement officials for not following a single and well-understood procurement system, but having different and times conflicting procurement procedures. This in turn complicates the process and results in delays in procurement contracting that ultimately affects service delivery. In the same vein, the development partners are also blamed for unhealthy bureaucracy. The no-objection-letter (NoL) of the donor agencies was cited to have caused huge delays in the procurement of development projects. Since the development partners overwhelmingly fund the development programs and projects of the Afghan government, they should be required to harmonize their systems with the system of the Afghan government and with the other development partners.

What are the ways forward?

The overarching objective of both the Afghan government and the international community should be to communicate and coordinate more frequently, and to search for an ideal balance between facilitating the procurement process and ensuring transparency of the process. To that end, the following steps can be useful to both avoiding delays in the process and ensuring transparency.

  1. Revise the Law: The current procurement law is 105 pages with 175 additional pages of guidelines; including the circulars and other technical documents, it exceeds 500 pages. For civil servants to read, understand and analyze the current law is asking for too much. Similarly, the current law is vague, overwhelmingly complex and incomprehensible. There is a need to revise and simplify the law and make it more comprehensible.
  2. Harmonization: The development partners should harmonize their procurement procedures in order to further simplify and facilitate the process.
  3. Building capacity at all levels: Most of the Afghan civil servants working in the procurement chain need to be given regular trainings on procurement procedures, laws and approaches tailored to Afghan context. Likewise there is a need to inject the international best practices in the overall curriculum of the training. The trainings should include all civil servants and contracted staff at all levels that are involved in the procurement chain. 
  4. Define limits to oversight institutions: All the legal and judicial institutions that are responsible for overseeing the procurement process should be required to adhere to their area and scope of work(mandate), and should not transgress their limits when they are overseeing the procurement process of the government institutions. Similarly, there is a greater need for inspectors, auditors and attorneys of different oversight institutions to have technical knowledge of the procurement law and procedures. At the moment there are multiple institutions (Attorney General’s Office, High Office of Oversight and Anti-corruption etc.) that are responsible for overseeing the process; there is an immense need to set limits to their operations and functions as oversight institution especially in regards to procurement.
When we are talking about Procurement performance, we eventually mean services to the people, and poverty reduction means. Procurement matters for good governance, as a better, more efficient and transparent procurement process means getting children educated, providing healthcare, building infrastructure, etc. Therefore, both the Afghan government and international partners need to engineer a strategy that could make this process more efficient and more risk-averse. The international partners are part of this process; they are part of the problem, and they need to be part of the solution too. 

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