Para 4.8.2 - LTE Risk Mitigation | KartavyaDesk
Original Rule Text
Risk Mitigation 1. A major risk in this mode is that the demand may be artificially split to avoid OTE or higherlevel approvals The e-procurement portal may be programmed to raise an alert if the same item is repeatedly attempted to be procured through LTE. 2. There is a risk that LTE may not attract enough bids, and sometimes there may be a single acceptable offer. It could be due to tender documents not reaching the targeted bidders – intentionally or otherwise. It could also be due to bidders not getting adequate time to submit bids. This could also be due to an insufficient database of registered/known vendors. To ensure sufficient response, in addition to mails/emails to selected vendors, web-based publicity should be given for limited tenders, with suitable clarifications that unsolicited bids shall not be considered. Sufficient time should be allowed for the submission of bids, say two weeks. A shorter or longer period, if considered sufficient for the submission of bids, could be allowed if justified according to the urgency/ complexity of the requirement. Further, a limited or open tender that results in only one effective offer shall be treated as a single tender enquiry situation, with relevant powers of approval, etc. See para below for an insufficient database of vendors. 3. There is also a risk that the selection of vendors may not be transparent. At the evaluation stage, some invited bidders may be passed over on the grounds of being ineligible/unreliable. On the other hand, unsolicited bidders may also quote, causing a dilemma of transparency regarding the consideration of such offers. Maintenance of a panel of registered suppliers for each subject matter of procurement is a sine-qua-non for LTE (Ref Rule 150 GFR 2017 and para 3.8 of this manual). Such panels of vendors should be reviewed every year to ensure an adequate number of registered suppliers. The panel should not be changed after the LTE tender has been published. All past successful vendors/ bidders should invariably be invited. In case it is proposed to exclude
What This Means
Para 4.8.2 of the Manual for Procurement of Goods, 2017, focuses on mitigating risks associated with Limited Tender Enquiry (LTE). LTE is a method of procurement where quotations are invited from a limited number of suppliers. This rule highlights potential problems like artificially splitting demands to avoid higher-level approvals, insufficient bids, and lack of transparency in vendor selection. It aims to ensure fairness, competition, and value for money in government procurement processes.
The rule emphasizes the importance of using e-procurement portals to detect suspicious splitting of demands. It also stresses the need for wide publicity of limited tenders to attract sufficient bids, allowing adequate time for submission, and maintaining a regularly updated panel of registered vendors. The rule affects all government departments and agencies involved in procurement through LTE, as well as vendors who participate in these tenders. Compliance with this rule helps to prevent corruption, ensure efficient procurement, and maintain the integrity of the government's financial dealings.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- •Prevent artificial splitting of demands to avoid higher approvals.
- •Ensure sufficient response to LTE through web-based publicity and adequate bid submission time.
- •Treat single effective offers from LTE as single tender enquiries.
- •Maintain and regularly review a panel of registered suppliers for each procurement subject.
- •Ensure transparency in vendor selection and invite all past successful vendors.
Practical Example
The Ministry of Culture needs to procure 10 high-resolution scanners for digitizing historical documents. Instead of procuring all 10 scanners at once, which would require approval from a Joint Secretary, an officer attempts to split the requirement into two separate LTEs for 5 scanners each, falling within their approval limit. The e-procurement portal flags this repeated procurement of the same item. Furthermore, for one of the LTEs, only one vendor, 'ScanTech Solutions,' submits a bid. Following Para 4.8.2, this single bid is treated as a single tender enquiry, and the appropriate authority, based on the value of the procurement, must approve the purchase after due diligence. The Ministry also ensures that ScanTech Solutions, along with other previously successful scanner suppliers, are invited to future LTEs.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What is the main risk Para 4.8.2 aims to address?▼
What should be done if an LTE results in only one effective offer?▼
Why is maintaining a panel of registered suppliers important for LTE?▼
How much time should be allowed for bid submission in LTE?▼
What does the rule say about unsolicited bids?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Test Your Knowledge
Question 1 of 3
According to Para 4.8.2 of the Manual for Procurement of Goods, 2017, what measure should e-procurement portals implement to mitigate the risk of artificially splitting demands in Limited Tender Enquiry (LTE)?
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