Directive for caution over project purchases at ‘abnormal’ prices

The Cabinet Division has directed ministries not to show "abnormal" prices of goods and services in the procurement for government projects.

The directive headlined "Accepting Projects within Budget Allocation by Ministries and Departments" was sent to all secretaries of the government bodies on Monday.

The instruction came at a time when several departments have been embarrassed recently following media reports on unusual pricing of various products already purchased or to be purchased for various government projects.

Planning Minister MA Mannan also acknowledged the issue of overpricing in project procurement, and said necessary steps would be taken against such anomalies. Later, some projects were revised too. In a letter to secretaries, the Cabinet Division said it has been noticed that various ministries and departments are taking up projects outside their ceiling under the medium-term budget framework.

As a result, there is no consistency in the allocation of ongoing projects with government revenue. Besides, due to the undertaking of projects beyond the limit, it is also not possible to allocate as per the requirement.

The Cabinet Division requested the ministries and departments to be careful about six issues, saying that taking projects beyond estimates and projections is "not consistent" with sound financial management by the government.

One of the key instructions is, in the case of investment projects, feasibility must be performed in implementing projects worth more than Tk50 crore.

The other key points of focus are that extra care should be taken in project verification and selection so that showing abnormal prices of any product or commodity can be avoided. And, arrangements should be made to appoint consultants with government funds in the projects adopted on the government-to-government mechanism.