Impact of the 'public procurement rules 2008' on the implementation of construction projects : a case study on the public works department

Abstract

Procurement means the purchasing or hiring of Goods, or acquisition of Goods through purchasing and hiring, and the execution of Works and performance of Services by any contractual means. Public procurement means procurement using public funds. Public sector organizations acquire goods, services and works from third parties through the process of public procurement. The system or process of public procurement in Bangladesh has evolved, modified and developed over time. It was the British Government that introduced public procurement procedure to this country by issuing General Financial Rules. Till 2003, General Financial Rules (GFR) had governed public procurement procedures and practices in Bangladesh. GFR had gone through some minor revisions several times within this period. Practically, any standard legal framework for public procurement was not available. With a view to streamlining the public procurement process and financial delegation, government undertook an array of reforms. This led to the making and issuance of Public Procurement Regulations 2003 issued in October 2003. To expedite the implementation of regulations, the Parliament enacted the Public Procurement Act 2006. Under the primary legislation PPA 2006, the Public Procurement Rules 2008 was framed and issued, which replaced the Public Procurement Regulations 2003. Whether development or revenue budget, most of the funds allocated for Annual Development Program in Bangladesh is being spent through Public Procurement. In this context, the focus of this research is procurement of works only, which includes construction, maintenance and repair or rehabilitation of buildings, roads, bridges and other infrastructures. The effect of implementing PPR 2008 is put to question and the answer has been brought to light in this research. The objective of the study is to find out the impact of Public Procurement Rules 2008 on the procurement of works; how the performance of construction projects has been affected after the transformations in the public procurement system. A case study on the Public Works Department (PWD) was performed to come to the truth. Questionnaire survey has been conducted in PWD to gather primary data. In addition, Key Informant Interviews have been conducted to collect invaluable opinions of some senior officers and concerned contractors; their perception regarding the impact of PPR 2008, the reasons behind and suitable suggestions to overcome the negative impacts. To assess the impact on construction project management and implementation, three performance indicators have been set- total procurement time, quality of work and total cost of the procurement. This study gives the impression that PPA-2006 & PPR 2008 have positive impact on the procurement of works in respect of total time required in its execution. In fact the rules helped in reducing time for processing of tenders / bids and also its completion. PPA-2006 & PPR 2008 have very little in improving quality of construction works. It has rather caused in many occasions, deteriorating the quality of works. The promulgation of the rules & regulations has yet to yield in any positive result on the total cost of procurement. In many cases quality has been shadowed for having cost reduction.