b>26 April, 2009 - Contractors and the government are at odds with each other over what should and should not go into the new procurement manual that the Cabinet approved in March this year.
Speaking to contractors this week in Thimphu, Lyonchhoen Jigmi Y Thinley said that the problem between the two parties was that they “did not trust each other at all”. He said that the rules in the manual were stringent because the government wants to prevent low quality work and corruption, and not because it wants to restrict or stifle the contractors. Lyonchhoen referred to the contractors’ objections about the manual saying: “I can’t solve the issues right away because I need expert opinion. But we need to work on how we could trust each other and work together better.”
Work on the revision of the procurement manual was on since 2005. The government even organised a comprehensive three-day meeting with contractors last year in Thimphu to address the issue. But, despite several concerns raised by contractors, they say the government had not even a single one of them in the revised manual.
“The manual is designed in such a way as to tighten the rope around our necks,” said a class A Thimphu contractor, adding that it favoured their clients, which was the government. He said that some of the rules were too stringent and unreasonable “which proves that the government viewed all contractors as crooks,” which, he said, was a fallacy.
There are several main areas of contention.
First is the period of defects liability, the time given in which contractors have to repair any defects that appear in their work after completion.
Contractors said that the government has “specified” the liability period to a minimum of 12 months, which, the contractors argue, is unreasonable, as it leaves room for the government to increase the period as it sees fit in the future. Contractors stressed that the liability period be fixed at one year as before. They contend that, if supervision by the government engineer was good and if they did their job properly, there would be little, if any, room for manipulation.
Second is the time given for cost escalation. The manual states that cost escalation claims would only be entertained for contract duration of more than 18 months. The reason is to discourage contractors from quoting unreasonably high. But contractors said that no one could foresee the price fluctuation in the market. Prices of raw material could skyrocket in a short time. “It’s more logical to entertain the escalation claims, depending on the degree and extent of rise in price, rather than setting a time limit,” a contractor said.
The third issue is a rule in the manual, which says that the lowest evaluated bidder would be penalised if he failed to sign the contract for various reasons. The job would be given to the second lowest bidder, but the lowest bidder would have to bear the difference in the bid amount. This, contractors say, is impractical and should be done away with.
Responding to these objections, Lyonchhoen said that he could not promise anything but told the contractors to keep following up with the government on these issues.
By Phuntsho Choden
phuntshochoden@kuensel.com.bt
