All MSMEs Can Benefit from New Public Procurement Regime

All micro, small and medium-sized enterprises (MSMEs), regardless of the industry, will be able to benefit from the Government’s new public procurement regime, which came into force on April 1.

This assurance comes from Minister without Portfolio in the Ministry of Economic Growth and Job Creation, Senator the Hon. Pearnel Charles Jr., who noted that there is no restriction to any particular type of MSME.

“Once your (annual turnover is) under $425 million, you can benefit from that (regime),” he said.

The new regime, the revised Public Procurement Act, seeks to regulate the procurement of goods, works and services by entities of Government.

Senator Charles Jr. was responding to questions raised at Friday’s (November 1) sitting of the Senate during the debate on two Resolutions which operationalise certain provisions of the Public Procurement Act.

The Resolutions, which were piloted by Senator Charles Jr, are the Public Procurement (Domestic Margin of Preference) Order, 2019, which is the preferential treatment of Jamaican suppliers in accessing Government procurement contracts in specific circumstances; and the Public Procurement (Set Aside) Order, 2019, which reserves a portion of the annual procurement budget for MSMEs.

“These Orders and the Act will assist in enabling greater participation of the MSMEs in the process of public procurement through these special and differential measures…including domestic margins of preference, offsets and set asides applied to give special consideration to a specific class of, and to provide incentives for the greater participation of disadvantaged economic actors,” he said.

Senator Charles Jr. noted that the application of special and differential treatment measures has the purpose of improving the distribution of wealth and income within Jamaica and to reduce the costs of public procurement, including the national development cost.

“Special and differential treatment measures may be applied to procurement proceeding to: encourage the participation of the Jamaican suppliers in the public procurement opportunities; to increase the capacity of the Jamaican suppliers to compete for the procurement contracts; and to develop Jamaican industries,” he said.

Senator Charles Jr., further explained that the Public Procurement (Domestic Margin of Preference) Order, 2019 is the application of a prescribed factor on the bid price of foreign bidders participating in the international competitive bidding procedures.

“The application of this factor allows a national bidder to earn a government contract, even if its bid price exceeds the bid of a foreign bidder, provided that the national bidder demonstrates a required percentage of domestic content,” he noted.

He said it is intended to mitigate the competitive disadvantages of the participating Jamaican suppliers… “and one of the goals is to really (provide) a viable, healthy, vibrant environment for our Jamaican industries to develop.”

Turning to the Public Procurement (Set Aside) Order , 2019, Senator Charles Jr. noted that it aims to create opportunities for specific groups of bidders who may be otherwise unable to earn government contracts or for those groups of bidders with undertakings in industries that are targeted for development.

Debate on the Resolutions was suspended for a date to be announced.