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Absence of a specific contracting law that affects services: CAG | India News


NEW DELHI: Speaking on probity issues in public procurement and contract management in public-private partnership projects, Comptroller and Auditor General (CAG) GC Murmu told a meeting of the top secretaries of key ministries and heads of The PSUs that there is no legislation on public procurement at the Union level and the lack of uniformity in procurement are causing deficiencies in services and cost overruns.
The CAG was invited by Central Oversight Commissioner Sanjay Kothari to address a select group of senior bureaucrats and heads of public sector companies (PSU) on required reforms in public procurement and project management here on Friday. According to CVC, government purchases of goods and services make up about 20% of GDP, worth at least Rs 40 lakh crore a year.
“There are five major government bodies to verify the probity issue in procurement in India (including CAG, CVC, Competition Commission of India and CBI) … however as I mentioned above, due to lack of uniformity and the absence of clear and practical instructions there are many gray areas that lead to post-contract complications and arbitrations, etc., ”said the CAG.
Since public procurement constitutes around 20-30% of GDP, this makes the need for integrity not only an ethical requirement, but also an economic and social requirement, he said at the meeting.
The sources said the supreme auditor expressed concern about the lack of a uniform policy on all government procurement, while pointing to “inadequate preparatory work” on PPP projects.
“The main concerns are the inadequate preparatory work in relation to the framework for PPP projects, the identification of projects, the selection of private participants, the preparation of the strategic plan and project reports, the drafting of contracts,” he said. , adding that these issues often lead to transaction costs, years of delay in project implementation, inadequate quality, and large contingent liabilities with the government.
On Engineering, Procurement and Construction (EPC) contracts, the CAG said that one of the main problems is assessing capacity, especially the financial capacity of the potential contractor. “There is a lack of adequate eligibility conditions and a lack of uniformity across the board,” he said.

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