‘Big guys’ barred from regional contracts
View(s):In a new move, the Government is barring large scale contractors from bidding for contracts estimated at up to Rs. 50 million and limiting these to only smaller contractors. The plan is aimed at helping regional contractors to prosper. Normally large contractors crowd out smaller ones even in their own regions resulting in smaller contractors losing out unfairly, industry sources said. Last month, the Finance Ministry issued a circular limiting the ‘invitation to bids’ for smaller construction contracts of upto Rs.50 million to regional contractors to “ensure that the contractors of each level will be able to participate in constructions of such limits under domestic funds.”
The circular said that although there are sufficient regional contractors who are capable of undertaking various construction and renovations contracts, “it has been reported that such contracts are awarded to the large scale national level contractors,” the September 30 circular from Treasury Secretary R.H.S. Samaratunga said. It said that the government wanted to promote contractors from regions by encouraging them to participate in small and medium scale constructions and renovations to increase employment opportunities in regions, development capacity of regional contractors, reduce income inequality, use local resources within the region and minimise delays in constructions.