Govt tender process to be simplified for SMEs, more weight given to sustainability

A new category called Tender Lite will allow more suppliers to participate in tenders with value higher than $90,000 but below $1 million. ST PHOTO: LIM YAOHUI

SINGAPORE - Small and medium-sized enterprises (SMEs) will be able to bid for government contracts under a new category by end-2023 that comes with simpler and fewer conditions.

The new category, called Tender Lite, will allow more suppliers to participate in tenders with value higher than $90,000 but below $1 million. It is projected to cover more than 70 per cent of all government tenders that are currently awarded to SMEs.

“First, by simplifying government rules and processes, we enable businesses to save time and money when they transact with the Government. Second, by helping businesses build capabilities to enhance their competitiveness and access new opportunities, both locally and abroad,” said Senior Minister of State for Finance and Transport Chee Hong Tat in Parliament on Friday.

About 80 per cent of government contracts are awarded to SMEs annually, he said, adding that this helps the businesses build track records and develop capabilities to tap new growth areas.

Another change – businesses no longer need to resubmit the same financial statements and company profile when responding to different government quotations and tenders.

As part of improvements to GeBIZ, the government-wide procurement system, a supplier file repository will be introduced by the year end, said Mr Chee. About 3,000 firms stand to benefit from this.

The additions are part of changes to the government procurement process that the Ministry of Finance (MOF) will be rolling out, which also includes introducing sustainability considerations for large construction and information and communication technologies (ICT) tenders by 2024.

Up to 5 per cent of evaluation points for tenders will be allocated to sustainability-related considerations from next year. This will apply to construction projects with an estimated minimum value of $50 million and ICT projects of at least about $10 million.

The aim is to include environmental sustainability requirements and evaluation criteria in all government procurement within the next five years, Mr Chee said.

To drive businesses’ sustainability reporting, he said public consultations will be held later this year.

“Businesses that can provide good sustainability-related information can gain competitive advantage, expand into markets, and potentially access cheaper funds through green financing,” Mr Chee noted.

He also urged companies to step up digitalisation as the government will use the electronic invoice submission channel, or InvoiceNow, for all its vendors in the next few years.

The e-invoicing network was launched in 2019 by the Infocomm Media Development Authority.

So far, about 55,000 businesses have adopted InvoiceNow, which is supported by 200 service providers.

In response to MPs Liang Eng Hwa (Bukit Panjang) and Saktiandi Supaat (Bishan-Toa Payoh GRC), who asked how the Government ensures fiscal sustainability, Mr Chee pointed to measures like audits and regular reviews.

The current government expenditure is about 18 per cent of gross domestic product (GDP). Even as expenditure exceeds 20 per cent of GDP by 2030, Singapore’s government expenditure as a percentage of GDP is still significantly lower than most developed countries, Mr Chee said.

He noted that MOF conducts regular reviews of ministries’ budgets to identify areas for improvement and ensures every ministry uses its allocated resources efficiently and effectively.

For example, some $1 billion in savings was achieved in 2022 for major government infrastructure projects by using stringent cost-effectiveness evaluations, he said.

Other forms of savings include integrating different projects, like the upcoming East Coast Integrated Depot, as well as combining tenders for office supplies and catering services of various agencies.

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