When all parties victorious
Other Voices
It was rumored that the Prime Minister intends to review the status of a number of bodies and councils or cancel some of them or relieve those responsible for them. As a contribution from us in this effort, we put at the disposal of His Highness these points.
There is no denying that waste and corruption in Kuwait are rampant in most ministries, in sectors and even in the most devout and religious entities that cause more corruption.
Despite everything that has been rumored or said, eliminating waste and reducing corruption is not impossible, when there is a desire and determination to do it. One of the doors of corruption that is easy to close, and which will have a significant positive return on the economy as a whole, is the part payment to contractors and suppliers (for work done or goods supplied) of goods and services to various government agencies.
One of the ministries expresses its desire to build or purchase a material or service, and then it submits an application to the Ministry of Finance to allocate the budget for the following year to implement the project. With the National Assembly accepting the budget of the concerned authority, the amount is at the disposal of the ministry to start soliciting offers and awarding the contract to a party to being the implementation of what is needed.
The process was moving smoothly for several decades, until ‘well-known entities’ realized that it was possible to make gains illegally from the situation. Collusion between these agencies and accountants and payment officials in most government agencies began to deliberately delay the part payments of contractors and suppliers on the pretext that there were no funds and then contacting the suppliers and contractors, offering to ‘expedite their payments’, in return for a specified sum of money, and with time it became customary. As a result, morality, honest contractor or merchant who rejected this method became the victims and subsequently the public money was wasted.
The merchant or a contractor who refused to pay money for ‘expediting the payment’ had to step aside and leave it for those who accepted the payment, to avoid going bankrupt as a result of delayed payment, as it happened with others.
As for the majority of contractors and suppliers, they had to raise the prices of their materials and services to cover either the cost of bribery to be paid, to expedite the payment, or to cover the cost of delay.
Resolving this corrupt situation is not difficult, and it will put an end to the black market for payments, and sabotage the homes of corrupt parasites. For example, the development and improvement of the payment mechanism is to amend the terms and conditions of tenders, so that there is a clear and irreversible commitment to pay the contractor or supplier payments within specified binding period of after 60 or 90 days, of the completion of the project and/or final hand over.
With this commitment in the contract, the supplier can arrange for his payments to others on this basis, and he can also discount this commitment with local banks, and obtain banking facilities, provided there are no violations recorded against him. All this will result in: A- The return of all honorable contractors and suppliers to the market which they have left for some or another reason, which means higher competition and better offers.
B- The lower cost of projects which will save public money.
C- Extending the supplier base for easy access to finance from banks, after the payments became guaranteed to be paid after a specified period which will ensure higher competition.
D- Low cost of risk pricing, low cost of financing, in addition to several other benefits.
In this way all parties benefit, and the parasites benefiting from the current devastating situation are completely eliminated.
We hope that the Minister of Finance will adopt this simple and effective proposal, and his success will inevitably go down as good deeds!