Initiative to encourage reducing goods that impact the environment

Seminar: Durability and environmental impact of a public procurement should be given equal weightage for selecting a tender, besides the price.

This was one of the recommendations of the Green Public Procurement (GPP) project in Bhutan, which shared 10 major findings of Bhutan’s procurement system on Thursday.

Green procurement is procuring goods that are less harmful to the environment and human health when compared with similar goods that serve the same purpose.

Citing an example, Senior Project Officer of GPP Bhutan Yeshey Penjor said contractors could use cement bricks instead of the red bricks for durability and less environmental impact. He said the production of red bricks was harmful to the environment as the kilns polluted the air.

“The producing red bricks is a long and difficult process,” he said. “Rather than relying on the lowest biding price we should go for value analysis of a material from the point of its production to disposal.”

GPP officials said “value for money” should be stressed. “If we buy a good that is quoted lowest, we will have to buy again and again,” Yeshey Penjor said, citing an example of buying a florescent bulb over ordinary bulb.

As a pilot project, the GPP Bhutan will assist some government agencies where green procurement system would be used. In the procurement, officials said, all these criteria would be used to select a bid.

“We want the government to follow green procurement because they are the biggest buyer,” he said. Procurement by the government accounts for 76 percent of the total procurement, he said.

So far, the GPP findings states the tenders are selected based on the lowest bidding price.

However, some participants at the seminar said environmental friendly goods were expensive. But officials said, the higher price could be compensated with less environmental impact and durability.

Participants, many of them procurement officers, said there was no proper guideline that enabled them to buy green goods from suppliers. One said procurement officers need specific rules if they are to choose green over other goods.

An official from the Construction Development Board said there is no definition of green in the procurement rules and that the term was subjective. He said the word green should be defined.

“For instance, if some contractor proposed for use of bamboo in a construction project, should we call it green?” he said. He said it was also risky for an agency to choose a green product because of the risk of failure.

According to the GPP’s findings, the government spent 61 percent of its total budget on public procurement from 2008 to 2013, which accounted for 21 percent of the country’s gross domestic product.

The findings suggest the government to promote sustainable development and achieve value for money across the life cycle of the works, goods and services procured.

Among the procurements made during the period, the research found that contract works awarded by the government accounted for Nu 42.4B (billion). Procurement of services such as consultancy works accounted for Nu 22B and goods worth Nu 16.6B were procured.

About 46 percent of public procurement was financed through external grants.

The report states that if donors and development partners can be persuaded to tie sustainability considerations to the deployment of their grants, this will serve as an important incentive for GPP implementation.

The project is now developing a handbook for procurement agencies and suppliers. It is also helping the Royal Institute of Management (RIM) develop a curriculum on green procurement.

Yeshey Penjor said even if the government adopts some of the recommendations, it would be an achievement for the project. “Green or sustainable public procurement can be one effective way governments can achieve economic growth that is also environmentally friendly and socially responsible.”

MB Subba