Kathmandu, August 3

The government has amended the public procurement guidelines for the eighth time after some class ‘A’ contractors were found to be forming a syndicate in the bidding process for government tenders.

Earlier, the government had amended the guidelines for the sixth time on May 20 and included a provision that contractors who had been charged in corruption cases would not be allowed to participate in any government tender.

Immediately after the government had introduced this new regulation, contractors had warned that they would halt all construction activities of ongoing projects too if the government did not rescind the provision.

The government later caved in to the pressure of the contractors and on June 11 amended the guidelines for the seventh time stating that contractors who had been charged in corruption cases but were not blacklisted would be allowed to bid for government tenders.

The most recent or the eighth amendment to the public procurement guidelines states that Nepali contractors will now be able to participate in bid worth up to only Rs one billion. Previously, they were allowed to bid for projects worth up to Rs two billion.

With the new clause in place, Nepali contractors will now have to form a joint venture with a foreign contractor company for bids of above Rs one billion.

Dilli Raj Ghimire, secretary at the Office of the Prime Minister and Council of Ministers, said the recent amendment will help the government to get rid of the problems that have arisen due to the monopoly of some class ‘A’ contractors, whereby such contractors bag large size projects but do not perform as per the stipulated specifications. “Our aim is to make contractors accountable to complete their projects as per the agreement.”

The government has also included a clause whereby it will assess each bid placed by the contractors as per their capacity and their past performance.

Moreover, contractors will now be awarded the contract also based on their average turnover. As per the new rule, the government will now look into the bidding contractors’ turnover for the last 10 fiscal years and calculate the average turnover of the three years in which the bidding company had the highest turnovers.

And the contractor will be awarded contracts worth only seven times the calculated average turnover.