Govt lifts the ‘fear’ on accepting single bids during public procurement tenders

The government has scrapped the “practice” followed by public authorities to reject a single bid during open tenders, stating that it should be considered valid subject to some conditions, according to new rules that will also have a bearing on the privatisation of State-run firms.

This is part of the new ‘General Instructions on Procurement and Project Management’ issued by the government on October 29, applicable to Central Government Ministries/ Departments, Attached/ Subordinate bodies including Autonomous Bodies or Central Public Sector Enterprises (CPSE). Hence, these instructions are expected to be followed during privatisation of CPSE’s also.

“It has become a practice among some procuring entities to routinely assume that open tenders which result in single bids are not acceptable and to go for re-tender as a ‘safe’ course of action. This is not correct,” says the General Instructions on Procurement and Project Management.

“Lack of competition shall not be determined solely on the basis of the number of bidders. Even when only one bid is submitted, the process should be considered valid provided the procurement was satisfactorily advertised and sufficient time was given for submission of bids, the qualification criteria were not unduly restrictive and prices are reasonable in comparison to market values,” the government said in the General Instructions.

Instructions containing ‘should’ are required to be followed in general. However, there may be circumstances where it may not be practical/ desirable to implement them. In such cases, the concerned officer/ agency may deviate by recording reasons in writing for not implementing the same, the General Instructions said.

Previously, a single bid was not accepted, according to the guidelines issued by the Central Vigilance Commission (CVC). In case, the second round of tendering also fetched a single bid, the authority floating the tender was allowed to take a call on the bid.

The new General Instructions says that re-bidding has “costs”.

“Firstly, the actual costs of re tendering. Secondly, the delay in execution of the work with consequent delay in the attainment of the purpose for which the procurement is being done and thirdly the possibility that the re-bid may result in a higher bid”, the General Instructions said.

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