November 10: The Ministry of Urban Development has stopped all new procurement activities from consumer committees with immediate effect. The Ministry took a decision to this effect against the decision taken by Finance Minister Janardan Sharma two months ago to allow public construction works upto Rs 100 million through consumer committees, labour groups and cooperatives. 

The replacement bill presented by Minister Sharma in September reads ‘labor groups and cooperatives can participate in public construction works worth Rs 100 million through competition’. With the latest decision,  about 30 percent of the works being carried out by the bodies under the ministry has come to an end. 

Bishnu Prasad Sharma, spokesperson of the Ministry, said that 30 percent of the procurement and construction works of the Urban Development and Building Construction Department, Kathmandu Valley Development Authority, High Powered Committee for Integrated Development of the Bagmati Civilization , Urban Development Fund are being done through the consumer committees.

Minister Ram Kumari Jhankri said that it would be appropriate to stop all procurement immediately till a clear work procedure for the construction through the consumers’ committee is formulated. Citing lack of uniformity, lack of competition in construction work and difficulty in maintaining quality, the ministry has directed to halt public procurement through these committees.

The procurement through the consumer committees has been stopped by the ministry as per the suggestions provided by the reports prepared by the Auditor General and the Commission for the Investigation of Abuse of Authority.

The report of the Auditor General have suggested the government to focus on quality of construction works through competitive bidding and to monitor projects carried by consumer committees and operate and carry out maintenance of the completed projects  by the committees themselves. 

Similarly, the report further says that the activities carried out by the consume committees were not effective and promoted corruption. Spokesperson Sharma said that a clear work procedure is needed to make the programmes of the consumer committee effective, sustainable and employment oriented.

He said that a committee has been formed under the leadership of Ram Chandra Dangal, joint secretary at the ministry, to prepare the work procedure. The committee will submit a report with recommendations within a month and the ministry will then prepare the work procedure.

He said that such measures have been taken as irregularities have increased while the Public Procurement Act also has provision requiring work procedures. The Public Procurement Act includes various procurement methods for public works through the consumer committees. 

Ravi Singh, president of the Federation of Contractors Associations Nepal, said that the government has expressed concern over activities carried out by the consumer committee. "A lot of irregularities have been reported and limited people have been benefited instead. Irregularities must be stopped, it would make the structure vulnerable and irresponsible," he said.