Controversial tender reform approved

The new law allows ministries not to issue tenders for procurement with state companies below the value of NIS 4 million.

By SHARON WROBEL
The cabinet on Sunday approved an amendment to the Mandatory Tenders Law that allows ministries not to issue tenders for procurement with state companies below the value of NIS 4 million. The reform was passed by the government following its support by Attorney-General Menahem Mazuz. The Federation of Israeli Chambers of Commerce slammed the new amendment, which it said will exempt ministries from having to issue tenders for procurement contracts. "Raising the financial standard bar, which requires issuing a tender, from NIS 700,000 to NIS 4m. will create a situation in which a major part of the government acquisitions will be carried out without any form of tender process," said Uriel Lynn, president of the Federation of Israeli Chambers of Commerce. "This creates a grave situation in light of the fact that the government is still the largest acquirer in Israel's economy." Lynn demanded that everyone be given an equal opportunity to take part in tender processes, referring in particular to small and medium-sized businesses, who will not only be discriminated against by the new recommendations, but who will also be hurt by them. In addition, the amendment recommendations require each ministry to appoint a tender exemptions committee, which will be enabled to approve contracts with private companies up to a maximum value of NIS 2.5 million, instead of the NIS 700,000 currently. The amendment is intended to increase efficiency and enhance the ministries' abilities to function more swiftly without the need of obtaining the accountant-general's approval of each and every contract, while continuing to hold tenders as the optimal way to close contracts.