The Government has introduced stricter rules for managing public contracts, including tougher penalties for delays, closer monitoring of performance bonds and tighter controls on contract changes to improve accountability and ensure goods and services are delivered on time.
Senior Minister in the Office of the President with responsibility for Finance, Dr. Ashni Singh, disclosed the new directives in a live address on Monday, following a high-level meeting with Permanent Secretaries convened on the instruction of President Dr. Mohamed Irfaan Ali.
This meeting followed President Ali’s engagement last week with Permanent Secretaries, Regional Executive Officers, Accounting Officers and Cabinet Ministers, where the Head of State reiterated his administration’s expectations regarding accountability and implementation.
Dr. Singh said the President had made it clear that accounting officers must ensure strict compliance with public management standards as the government aggressively advances its development agenda.
“As you know, we have a very ambitious programme which we are implementing aggressively, and related issues of accountability and soundness and prudence of our management are critically important,” he emphasised.
He explained that contractors will now be held more strictly to the exact terms of their agreements, including the quantity and quality of goods supplied as well as stipulated delivery timelines.
“The Cabinet’s expectation is that all contracts for the provision of goods and services to Government will be implemented to the letter of the contract,” Dr. Singh stated.
Particular emphasis was placed on timely execution, with Permanent Secretaries instructed to ensure that contractors meet agreed deadlines.
Where delays occur, the government has directed that liquidated damages be imposed without exception.
Dr. Singh said this forms part of a wider effort to ensure stronger enforcement and discourage prolonged project delays.
“We emphasised that beyond the imposition of liquidated damages, immediate steps be taken to terminate contracts where there is continued failure to deliver,” he noted.
The Senior Minister also stressed the importance of performance bonds, warning that Permanent Secretaries will be held accountable if these financial safeguards are not in place or are allowed to lapse before contractual obligations are fulfilled.
He said the administration has also moved to tighten rules surrounding contract variations and contingencies.
“There has been in the past a practice that contingencies are allowed that gave some flexibility on contractual prices. We gave an instruction that these will no longer be allowed,” Dr. Singh disclosed.
This means that under the revised approach, any variation to an agreed contract price must return to the original approving authority for review and approval.
“These were some of the measures that were discussed amongst others aimed essentially at putting in place an administrative architecture to ensure that contractors are held to the terms and conditions of their contract that they discharge their obligations in a timely manner and to ensure that ministries, regions and Government departments put in place arrangements to ensure that this objective is realised,” he said.