Civil Service Bureau revealed by Audit Commission to not obtain tenders

Audit Commission reports non-compliance over bulk buying of commemorative gold medals

PUBLISHED : Thursday, 15 November, 2012, 12:00am
UPDATED : Thursday, 15 November, 2012, 4:12am

For the second time this year government agencies have been criticised by the audit watchdog for avoiding public tenders by breaking down their purchases into sums below HK$1.43 million.

The Civil Service Bureau was singled out for rebuke this time. In the previous audit report, issued in April, the Correctional Services Department was flagged up for the practice.

Bureaus and departments that seek to buy goods and services worth HK$1 million to HK$1.43 million should do so through quotations sourced by the Government Logistics Department, according to regulations.

Any purchases of more than HK$1.43 million require a tender, which is more time-consuming.

The Audit Commission yesterday reported "cases of non-compliance" in which the bureau made repeated purchases of less than HK$1.43 million based on quotations instead of undertaking a tender for bulk buying.

The logistics department bought commemorative gold medals for the bureau seven times through quotations between February 2009 and November 2010, the audit report showed.

The purchases - which would have cost HK$9.32 million in one go - were split into bills of HK$1.05 million to HK$1.429 million.

"According to [Government Stores and Procurement Regulations] 220, tender procedures should have been adopted," the report said.

A tender exercise would achieve the best value for money and maintain open and fair competition, it said, although the procedures involved would take on average 211 days - or seven months - compared with just 87 days to obtain quotations.

The logistics department said measures were in place to detect repeated requests for purchases of a similar nature. Officers would find out if the acquirer had made similar purchases in the past year and whether it planned to do so in the year ahead.

The bureau said it had bought the gold medals through quotations only as a temporary arrangement.

"Because of fluctuations in gold prices during these years, suppliers were reluctant to submit offers valid for longer than 30 days, but an open tender would require a validity period of at least three months," it said.

In April, the Correctional Services Department drew flak for making 28 direct purchases to buy 42,900 sandals from the same supplier, spending HK$1.01 million in all.