IMPACT OF REGIONAL PROCUREMENT REFORMS ON THE DEVELOPMENT OF A

NATIONAL PRIVATE SECTOR

Ms Carole Kariuki

Acting CEO of the Kenya Private Sector Alliance (KEPSA)

High Level Forum on Public Procurement Reforms in Africa -Tunis, 16 November 2009

History of Public Procurement Reforms in Kenya

1963 – 1969: British system, under the responsibility of Crown Agents

1969 – 1978: Circulars, under responsibility of Treasury/Government of Kenya (GoK)

1978 – 1998: first Supplies Manual; dictated the procurement function within gov’t but not local authorities; schools; institutions

1998: Country Procurement Assessment Report, 1998 – World Bank

History of Public Procurement Reforms in Kenya (continued)

World Bank Study: Public procurement regulations through

Exchequer & Audit (Public Procurement) Regulations, 2001 – abolished Central Tender Board (CTB)

Created Ministerial Tender Committees Broadened the scope of ‘public entities’ to

include schools; colleges; universities; cooperatives; and local authorities

But these were still only Regulations Public Procurement & Disposal Bill

drafted, and modified several times

History of Public Procurement Reforms in Kenya (continued)

Public Procurement and Disposal Act 2005:

Operational 1 January 2007 Main features – establishment of the Public

Procurement Oversight Authority and the Public Procurement Review Board (to preside over the bidding system)

Improvements – variations limited to 15% and problems of ‘air supply’ addressed by systems of committee decisions and guarantees

Regional/International Influence on National Procurement Reforms

‘Best practice’ developed using World Bank processes and funding; plus involvement of development partners

Public Procurement and Disposal Act based on standard procurement law (UNCITRAL)

Adopted by many African states ie Ghana; Tanzania; Uganda

Some regional variations

Benefits for the private sector

Openness Transparency A ‘level playing field’ Governance Reduction in corruption Expansion of business opportunities

Challenges

• Constraints on capacity (submission of tenders and tender documentation)

Need for training/capacity building Sensitising SMEs on ‘rights’ Empowering youth sector ie Kazi

Kwa Vijana programme

• WB concerns – still discriminatory regarding local preference schemes and reservations under $700,000

Development of an East African Procurement Law

East African Procurement Forums held in 2008 and 2009

Peer learning forum Sensitise local private sectors Towards the development of common

procurement law Procurement Manual for the East

African Community to be tabled by end 2009 – for adoption by mid 2010

Features/Benefits of Regional Procurement Manual

Will introduce regional preference schemes

Best And Final Offer (BAFO) in the case of a tie – a new approach

The Kenyan private sector will benefit through their competitive edge

5-year ‘tax equalisation’ period across the region will end at the same time

Larger market Sectors – transport; banking etc

In pursuit of an enabling business environment…..

Thank you

Any questions?

Carole Kariuki, Acting CEOKenya Private Sector Alliance (KEPSA)

P O Box 3556 – 00100Tel: +254 20 2730371/2Fax: +254 20 2730374

www.kepsa.or.ke