Bidders for government contracts related to construction and supply have been forced to abandon online bidding for two weeks and the problem is likely to persist.

The Public Procurement Monitoring Office said that the online system no longer works as it is working to upgrade the software to help determine the capacity of bidders to take up additional projects.

The eighth amendment to the public procurement regulations allowed the government agencies to accept bids up to seven times a bidder’s average annual turnover in the past three fiscal years.

This provision forced the Public Procurement Monitoring Office to upgrade its software to see if any bidder lacks the capacity to work in additional projects.

“We are working to add templates to the software to determine the capacity of bidders since August 1,” said Yagyaraj Koirala, spokesperson for the Public Procurement Monitoring Office. “It is expected to take 2-3 weeks to upgrade the software to accommodate the new needs as provisioned in the amended regulation.”

The procurement monitoring office has asked the bidders to use ‘uploadable template’ for bids, using pen for filling in details on paper and putting the information into the system.

“Despite the need to update information manually, it is still an e-procurement system. But, this is time consuming,” said Koirala. Under the automated online system, contractors could take part in biding from anywhere by filling information online.

Despite the requirement to conduct manual updating of information, the contractors are not worried at the moment as the government agencies don’t call many tenders early in the new fiscal year. The current fiscal year began in mid-July.

“There are not many tenders opened at the moment and the absence of online system has not been a big trouble for us at the moment,” said Rabi Singh, president of the Federation of Contractors’ Association of Nepal, a grouping of the contractors. He, however, asked the government for an early update of the software.

According to the procurement monitoring office, a Bangladeshi consulting firm hired by this office three years ago has been working on upgrading the system. After the monitoring office launched the e-procurement system in 2011, this is the first time that online bidding has been obstructed for so long, according to Koirala.

As per the government’s rules, every public entity should mandatorily use the national electronic government procurement (e-GP) system for its procurement of both goods and services above Rs6 million. The threshold is Rs2 million in the case of consultancy services.

Although the government initially started e-procurement for contracts worth above Rs20 million, the threshold was reduced to ensure that almost all government bidding is done through the e-GP system.

The system of e-procurement was adopted not only to reduce the time and cost for using paper but also to minimise corruption. Before the e-procurement system was adopted, incidents of collusion and confrontation among bidders were rife as bidders knew the competitor and they either colluded or confronted for winning the bid. But Public Procurement Monitoring officials said that the e-procurement system has reduced such incidents to a large extent.

Meanwhile, the procurement monitoring office has initiated preparations to introduce new and updated software. “It will not be simply addition of templates to the existing software but new software with more features and higher capacity,” said Koirala. “We have already started paperwork and we will soon submit it to the Prime Minister’s Office.”