Interventions set out to promote youth and women-owned businesses

Prompt payments

According to the new regulations, payment shall not delay beyond 30 days for deals done by the youth, women or persons with disabilities.

Where an entity is unable to clear the payment, it is required to honour at least half the amount and explain to the enterprises in writing the reason for the delay.

Further, where delay of payments for tenders is likely to happen, a procuring entity is required to facilitate invoice discounting with a financier to advance credit to the affected business.

Financing

Public procuring entity to facilitate financing of enterprises owned by youth, women or persons with disabilities that have won tenders.

The institutions are expected to authenticate their notifications of tender awards and local purchase or service orders and subsequently enter into an agreement with the relevant financier with conditions that shall include paying the contracted enterprise through their account opened with the financier.

This will save local firms from elimination on account of a likely chance of facing liquidity challenges in the event of handling big tenders.

Monitoring

Public institutions, under the new regulation, are required to allocate at least 30 per cent of their procurement resources for the purposes buying goods, works and services from micro and small enterprises owned by youth, women and persons with disability.

On a quarterly basis, the institutions are required to file a report with the Public Procurement Authority to enhance compliance.

Scrapping of tender fee

All fees for tender documents that are obtained electronically has been removed. Additionally, no fee will be charged for invitations for expression of interest or invitations for pre-qualification.

For hard copies of tender documents, where a fee is charged, it must not exceed Sh1,000 and potential tenderers in such a case should be allowed to inspect the documents prior to purchasing.

The law says that a procuring entity shall only have regard to the costs related to printing, copying, and distribution or of converting the documents into electronic form.

Splitting of huge tenders

In order to welcome small firms into the big contracts party, the government now requires its procurement entities to split tenders into “practicable quantities” that SMEs can handle.

“For the purpose of ensuring maximum participation of citizen contractors, disadvantaged groups, small and micro- enterprises in public procurement, procuring entities may unbundle goods, works and services in practicable quantities,” Mr Rotich notes in the new regulations.