Price, quality and reliability are considered: MOF

We agree with Mr Anthony Lee (TODAY “ Use Average Procurement Price”, Aug 25) that both price and quality should be considered in awarding public sector contracts. However, Mr Lee’s suggestion that contracts be awarded to bids which are priced closest to the average may not achieve the intended purpose of maximising value-for-money. For example, a company’s product or service may be of a higher quality despite being priced lower than the average of bids received. In such an instance, awarding to the company would then achieve the outcome of paying a lower than average price, and at the same time, obtaining a better product or service.
 
Government quotations and tenders are evaluated and awarded on the basis of best value-for-money. This means that when evaluating bids, government agencies are expected to take into account price along with other factors such as quality and reliability of the product or service.

Lim Bee Khim (Ms)
Director (Corporate Communications)
Ministry of Finance