Trinidad and Tobago’s new procurement law aims to prevent collusion and corruption

The construction industry, along with other trade groups, has campaigned for years to reform procurement procedures, as a way of combatting corruption, ensuring greater transparency and achieving greater value for money. The long process of political discussions on the subject came to a conclusion in December 2014, when both houses of parliament passed the Public Procurement and Disposal of Public Property Bill.

Better Value

Attempts to introduce anti-corruption and procurement legislation have been made since 1997, so the approval of the law was a significant landmark. Bhoendradatt Tewarie, the head of the Ministry of Planning and Sustainable Development, welcomed the law as an effective way of dealing with corruption and the waste of public money. He noted it contained sanctions against bid rigging and collusion, and heavy fines for anyone involved in corrupt practices. The law also contains regulations on transparency, accountability, value for money and local content. Fines are in the range of TT$1m-10m ($154,200-1.54m), and judges are given the discretion to hand down prison sentences.

The Trinidad and Tobago Manufacturers’ Association welcomed the law, which “offers the hope that a new level of commitment will be demonstrated by our law and policymakers to implement a procurement framework that is transparent and lends itself to true accountability in the use of all our country’s valuable resources”.

Winston Riley, former president of the Join Consultative Council and current chairman of the Private Sector Civil Society Group on Public Procurement, two of the private sector lobby groups involved in the discussions, told OBG, “The biggest plus is that we have achieved most of what we wanted – about 80% of what we lobbied for – in the legislation.” However, he warned that corruption levels are still high, and much will depend on how rigorously the new law is applied.

Independent Scrutiny

Riley noted that under the new law, value for money is carefully defined and established as the overriding criterion for allocating public contracts. He highlighted the importance of the creation of an Independent Office of Regulation reporting only to parliament and appointed by the president after consultation with the prime minister and the leader of the opposition. The office would help promote best practices and review and scrutinise all procurement activity independent of the political administration. Riley also said that the procurement rules apply to the use of “public money”, and there is a wide definition of public money in the act that includes any monies received, spent or committed by a public body from which it can be inferred that the state accepts ultimate liability in the event of default.

Riley added that this meant that government-togovernment agreements for the procurement of goods, works or services will be governed by the act and will no longer escape the purview of parliament. Local content regulations would also apply – something that would help the domestic construction industry.

One cause for concern is the time it may take to fully implement the law. While the act received the approval of President Anthony Carmona in January 2015, it now falls to the Ministry of Finance and the Economy (MFE) to provide the necessary infrastructure and budgetary requirements to support the operationalisation of the act, something the Larry Howai, head of the MFE, initially suggested might take a year, but later indicated may be achieved by September 2015.

Corruption Perceptions

Looking forward, one way of assessing the impact of the law will be to monitor T&T’s position in the Corruption Perception Index (CPI), released annually by Transparency International. For 2014 CPI ranked T&T 85th out of 175 countries, with a score of 38 (the higher the score, the less corrupt a country is considered to be). T&T had slipped down the ranking compared to where it was five years earlier, with 79th out of 180 in 2009. The average score for the Americas in the 2014 report was 45th, while within the Caribbean, T&T scored higher in terms of corruption perception than Barbados (24th), St Vincent and the Grenadines (29th), and Dominica (39th).