Procurement risk in public sector procurement in Bangladesh: a case study of large projects at Roads & Highways Department (RHD) of Bangladesh

Abstract

Public procurement is an inevitable part of the present economic reality globally. A chunk of public funds through the Annual Development Programme (ADP) is being disbursed by various public sectors in Bangladesh to achieve the prescribed vision of 2041. The significant amount of goods and services being procured for national development is very much imperative nowadays. Flawless public procurement management and its efficient maneuvering are crucial for ensuring value for money. As such, the public procurement practices among the public sector to implement infrastructural development projects are a growing concern for stakeholders as they are an integral part of public service delivery for the nation. Conventional procurement practices are riddled with enormous risk at different stages of the procurement process, which is to be handled efficiently as part of inclusive governance, which ultimately serves the equality, equity, and effectiveness of the utilization of payers’ money. The Roads & Highways Department (RHD) is undertaking and implementing several projects to construct and maintain road and bridge projects. But in terms of cost, time, and quality, these projects still face severe criticism, as most of the large projects are not being implemented as planned, which affects RHD’s capacity to achieve its goals and objectives. From numerous sources, it has been detected that the procurement risk might act as a prime catalyst for further uncertainties like time and cost overruns, schedule delays, disputes, arbitration, finances, etc., not to be limited to. As there is a plethora of uncertainty and risks that are very obvious and gradually increasing, before floating the procurement process, potential risk assessment, categorization, and its mitigation plan should be hugely emphasized and need to be explored minutely to establish responsible and ethical procurement practices, especially for a large project of RHD that might be complying with the procurement code of ethics. The current study rigorously examines the measurement of procurement risk and its mitigation strategies in the practical execution of large projects and also evaluates the integrity risk in public procurement within the Roads and Highways Department of Bangladesh.