Public Procurement Act, 2023

The new Public Procurement Act, 2023 has now been passed in Lesotho. The Act makes room for the creation of institutions necessary to ensure the procurement system’s integrity and address potential violations in the tender industry in Lesotho.

Public procurement refers to the acquisition of goods and services by government in order to facilitate the efficient operationalisation of the state machinery. Public procurement, however, extends beyond transactions to acquire commodities to “the relationship between the state and its suppliers, and between the state and the commodity transaction”.

Procurement was regulated and governed by the Public Procurement Regulations, 2007, it’s 2018 Amendment and the Public Financial Management and Accountability Act, 2011. The Public Procurement Act, 2023 is meant to establish a public procurement authority, a body corporate, to regulate public procurement structures by providing procedures, processes and regulation of procurement of goods, works and services in order to optimise efficiency in public procurement and obtain value for money for the government. The Act outlines the Powers and functions of the Authority which include, amongst others, the disposal of unserviceable and obsolete public assets. Among its more prominent functions, the authority will formulate policy and standards for all aspects of public procurement. It will also develop and issue a procurement standard tender document, guidelines and procurement manual.

The authority will also conduct an annual audit on an overall function of a public procurement system and a profile of a procurement activity and present it to the Minister of Finance to table before parliament.

The Act applies to government ministries and agencies, diplomatic missions, local government authorities, state owned enterprises and the private sector entities carrying out activities on behalf of the government or which are funded by the public. The Act further provides the authority with power to institute a procurement contract performance audit and suspend the supplier or tenderer for engaging in public procurement misconduct. There is also provision for debarment of tenderers, suppliers, contractors or consultants for provision of false information in the tendering process, collusion between suppliers and public officers concerning formulation of tender documents. It also provides for debarment of tenderers for connivance to interfere with participation of a competing tenderer and misconduct relating to a submission of a tender including corruption, collusion, coercion, obstruction, price fixing, tender rigging, pattern of under-pricing of a tender, breach of confidentiality and any other relevant misconduct.

The Act encourages environmentally and socially responsible procurement and further provides for community participation procurement where there is a need to carry out small value construction works and supply of goods. There is also a provision on leasing and renting as opposed to purchasing some equipment if the leasing and renting is the most economic and viable option. The Act further introduces e-procurement to enable procurement entities to disseminate tender documents and receipts through electronic means and establishes the Central Tender Board for carrying out procurement of high value being large tenders in excess of M20 million for consultancy and other works and M50 million for other specified works.

There is establishment of a Bid Evaluation Committee, Tender Evaluation Committee, Procurement Tribunal and Procurement Committee which extends to the formalisation of the public procurement system and is likely to reduce corruption by government officials during awarding of tenders, development of standard tender documents will also play a significant role in plucking the gaps in the public procurement system. The Act also makes provision for a choice of procurement method, listing two methods namely, the open competitive tendering and the limited competitive tendering.

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