The $500,000 contract and sharing the wealth in challenging times

There is no doubt Samoa’s private sector is doing it tough with the crippling effects of the COVID-19 global pandemic wrecking havoc with the economy, resulting in unprecedented job losses and business closures.

A fortnight ago the findings of a United Nations survey revealed over two-thirds of Samoans report losing income and experiencing difficulties repaying their debts, as a result of the economic downturn caused by the pandemic.

And the survey data showed that not only 68 per cent of Samoans lost income due to the public health crisis, but a significant number were also forced to eat less.

It is during such periods of crisis when the Government’s fiscal policy becomes critically important, where the management of its spending as well as taxation is essential to driving its economic recovery agenda post-COVID-19.

Consequently, revelations by the Samoa Observer in the Saturday, August 22, 2020 edition of the Ministry of Health [MOH] paying a $500,000 tent rental invoice should be a cause for concern for everyone.

During a recession, which most economies including that of Samoa are currently experiencing due to the global pandemic, it would make sense for governments to lower taxes and increase spending in a bid to cushion its impact and support economic recovery.

But paying a single company half-a-million tala for the leasing of tents lacks rationale in these challenging times. The fact that the contract also bypassed the Tenders Board and the Cabinet is abuse of the Government’s procurement processes.

The warning of the M.O.H. Director General, Leausa Dr. Take Naseri, by the Minister of Finance and Tenders Board Chairman Sili Epa Tuioti is commendable. 

The Minister did not mince his words when he spoke of his disappointment at the contract bypassing the Tenders Board in an interview with the Samoa Observer.

“This [tent rental invoice] should have come before the Tenders Board and the relevant Ministry should have requested that this was [declared] under urgency matters and we would have made time to address and fast track the quick bidding to assure fairness across the business community,” Sili said.

We hope the Chief Executive Officers of other Government Ministries, corporations and authorities are also advised to avoid incurring bills of similar nature and to follow the official procurement processes.

The Ministry of Finance [MOF] Chief Executive Officer, Leasiosiofaasisina Oscar Malielegaoi, also made a good point that emphasised the need for other local companies to be given the opportunity to bid.

“The [rental was ongoing] and certainly the Ministry [of Health] should have submitted this before the Tenders Board [as] a request for quick bidding because they know which [companies] to seek quotes for the tents,” he told Samoa Observer.

“And this is to be fair to the other companies that can bid, instead of going to one company and obviously the best value will be questioned by the Board for Government services. 

“The Government’s tender process is quite clear and if they had requested, the Board would have met immediately to address this matter.

“But obviously they did not do that. Also they should have sought assistance from the Ministry of Finance.”

According to Simona Marinescu – the U.N. Resident Coordinator for the Cook Islands, Niue and Samoa – the U.N. survey shows that Samoa has been affected in a number of ways by the COVID-19 pandemic, and action should be taken to protect the vulnerable.

“Although we have avoided a health crisis, all indicators suggest that a protracted economic crisis is on the horizon. Poverty may rise and the hard work done in recent years to advance many of the sustainable development goals could be reversed, unless we take action now to protect the most vulnerable.”

We must not lose sight of the findings of the U.N. survey, which only polled 286 Samoans, though their plight could be representative of the challenges that the wider population is currently facing.

During these unpredictable times, it would work in the Government’s favour to ensure all companies are given the chance to bid for a contract, which is awarded through a public tender process overseen by the Tenders Board.

Creating a level playing field, when it comes to private sector members participating in a public tenders bid, will go a long way to ensuring all companies are given the chance to share in the nation’s wealth with the benefits trickling down to staff and ordinary citizens.

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