The Financial Express

Relevance of SPP to Bangladesh's development and environment  

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Relevance of SPP to Bangladesh's development and environment   

After contracts for official procurement in Bangladesh are awarded, they are reviewed at least annually on the basis of issues such as delivery, quality, cost, time and services. But the review is not made from the perspective of sustainability aspects, as agreed in the contract, e.g. percentage of recycled content, health and safety, working condition etc.

In fact, no sustainability risk assessment is undertaken in the country's current procurement process. Bids are evaluated just based on lowest evaluated price (LEP); before that, however, certain eligibility criteria relating to environmental and social thresholds are included into instructions to bidders and bid data sheet.

Such findings have been reflected in a dissertation covering 25 officials working on procurement matters at various tiers of Local Government Engineering Department (LGED), as part of Master's programme conducted by this author under International Training Centre (ITC) of International Labor Organisation (ILO) and University of Turin, Italy. It has focus on Public Procurement Management for Sustainable Development.

The participants pointed out that a few sustainability criteria are included in the current legal framework and they are applied in some procurement activities. However there is no defined policy, action plan, strategy or programme for implementing what is called 'Sustainable Public Procurement' or SPP at the LGED or CPTU (Central Procurement Technical Unit). The government of Bangladesh is yet to provide any tool on how to implement SPP.

This new concept has evolved in the advanced economies as authorities tried to overcome social and environmental challenges involving official purchases. Thus SPP has been a key issue that creates scope for promoting sustainable development in a country. Accordingly, in the developed countries, SPP has been a major component of public procurement rules. It is yet to emerge as a significant concern in developing countries like Bangladesh.

Also relevant literatures show, SPP enables governments to meet environmental goals such as reducing greenhouse gas emissions, improving energy and water efficiency and supporting recycling. Social benefits of SPP, according to research, include poverty reduction, improved equity and respect for core labour standards.

It is argued that SPP can generate income, reduce costs and support transfer of skills and technology. Sustainable development requires governments and organisations to consider social, economic and environmental aspects of their operations, with no single aspect dominating.

Applying the concept of sustainable development to public procurement, 'sustainable procurement' has been defined as "a process where public organisations meet their needs for goods, services, works and utilities in a way that achieves value for money on a whole life basis in terms of generating benefits not only to the organisation, but also to society and the economy, whilst minimising damage to the environment.'

The main motivations for adopting SPP in Bangladesh are compliance with social aspects such as labour legislation, employment promotion, occupational health and safety, and specific objectives for improvement and environmental protection.

SPP as a concept is new for the LGED, one of the prime procuring agency in the country, which has contributed to massive infrastructure building across the country since independence. Naturally, there are obstacles that impede adoption of SPP practices. Among them are lack of legislation or regulations; lack of information and knowledge about SPP; and the dominant practice that the main selection criterion is price. While planning the budget, what matters more is economic reasoning; social and environmental aspects are secondary.

The study of the LGED, one of the prime procuring agency in Bangladesh, shows a number of factors that can motivate the Division to take initiatives for implementing environmentally-focussed procurement.

Introduction of SPP is also an utmost necessity for Bangladesh in view of the country's pursuit of sustainable development in keeping with the UN Sustainable Development Goals.

According to the respondents to the study, the most feasible way to integrate environmental and social criteria in procurement process is to set "environmental performance of candidates as one of the contract award criteria".

They have also recommended that social inclusion, such as involvement of the civil society groups in the procurement process is a key issue for transparency of procurement. The groups may be allowed at pre-bid meetings and engaged in contract monitoring process.

However, potential barriers to integrate environmental criteria into the LGED's procurement processes have been identified as lack of information; lack of interest and technical capacities on environmental issues; and budgetary restrictions. The LGED authorities may be encouraged to exchange practical examples of environmental procurement with pioneer countries or institutions and hold workshops on dissemination of information.

Underlining the importance of formulating a 'Sustainable Procurement Policy', the respondents insisted that bid evaluation process should be based not only on price but also on life cycle cost (LCC). Reward and punishment upon delivery against agreed sustainability aspects of the contract should be put in place. They observed that political commitment to sustainable development is a important for introduction of SPP in the country.

Md. Abdus Sattar is Executive Engineer, Procurement, at LGED.

[email protected]



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