Value for lots of money…

Finweek English Edition - - COVER STORY -

OB­VI­OUS LOOP­HOLES IN State bu­reau­cracy beg ques­tions about why Gov­ern­ment hasn’t been proac­tive about them. For ex­am­ple, the State’s three-quote sys­tem makes it easy for sup­pli­ers to get Gov­ern­ment to pay hugely in­flated prices for pro­cured goods. When of­fi­cials pro­cure goods or ser­vices for the State, they have to choose sup­pli­ers from the ex­ist­ing data­base. They must ran­domly se­lect three and choose the best quote from those.

But the sup­plier se­lected won’t nec­es­sar­ily of­fer op­ti­mal value for money. Why? Of­fi­cials might ran­domly draw three very ex­pen­sive, less skilled sup­pli­ers from the list. The sup­plier on the data­base who of­fers the cheap­est and best ser­vice can’t be used re­peat­edly and may not be used as a bench­mark. Sup­pli­ers have to be ro­tated so all sup­pli­ers on the data­base are given a turn. While this sys­tem also opens up the pos­si­bil­ity for col­lu­sion

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