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Monday, September 10, 2012

Singapore sceptical of one bid received

Procurement controls tightened after investigation into foldable bikes: Khaw
"Whenever a quotation or a tender attracts a single bidder, my instinct is to ask 'why'. There must be many bicycle dealers out there.

"Although a single bid can be accepted under the public service procurement rules, I thought NParks could have recalled the quotation with a longer opening period to try and get more bids. With greater competition, I felt that NParks might have gotten a better deal."

Mr Khaw Boon Wan said in Parliament today that the Ministry of National Development has tightened its procurement controls and introduced new measures to enhance oversight, following the investigation into the purchase of 26 Brompton foldable bicycles - each costing S$2,200 - by NParks.

Among the changes announced last month is an extension to seven working days, instead of four, as the minimum opening period for quotations called by statutory boards to encourage participation from more suppliers, said Mr Khaw. Departments can also recall the quotations with a longer opening period if they feel it would help secure more competitive bids.

And the MND now requires any quotations resulting in single bids to be cleared in person by the CEO or Deputy CEOs. The Ministry has also updated its internal procurement guide to sensitise and guide all our officers in their purchases, said Mr Khaw.

I have discussed The dilemma of "only one bid received" in a prior post, and I encourage you to jump to that post for an expansive look at that issue. The lodestone for procurement is achieving fair and reasonable pricing through competitive sourcing, and when it is not obtained, effort must be made "to foster" it, in the words of the ABA Model Procurement Code, adopted on Guam.

And provides a digest of US GAO cases decided by the Comptroller General shedding further light on the topic, such as the following:

Pegasus Global Strategic Solutions, LLC
If noncompetitive procedures are used pursuant to 10 U.S.C. sect. 2304(c)(2), such as here, the agency is required to execute a written J&A with sufficient facts and rationale to support the use of the specific authority. Our review of the agency's decision to conduct a noncompetitive procurement focuses on the adequacy of the rationale and conclusions set forth in the J&A. However, noncompetitive procedures may not properly be used where the agency created the urgent need through a lack of advanced planning. In addition, the urgency justification cannot support the procurement of more than the minimum quantity needed to satisfy the immediate urgent requirement.

Although the cases digested at the referenced site go to the justification requirement for conducting a non-competitive source selection process, they are useful to illustrate the counter-balancing actions needed to be undertaken to assure fair value when utilizing efficiency shortcuts by design or default.

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