Lowest bids may carry hidden costs
It is time for the government to move away from the outdated practice of lowest bidding (L1) in public procurement and adopt the globally accepted Quality-cum-Cost-Based Selection (QCBS) method. This transition is particularly critical for infrastructure-related departments, as already envisaged in the General Financial Rules issued by the Ministry of Finance. Public procurement, especially in infrastructure projects, demands a careful balance between cost efficiency and quality outcomes.
Traditionally, many government departments have relied on awarding contracts to the lowest bidder. While this approach may appear economical in the short term, it often leads to significant long-term challenges. The most critical drawback of the L1 system is the compromise on quality. Contractors quoting the lowest price frequently cut corners in materials, te chnology, or workmanship. This results in substandard infrastructure that fails prematurely, leading to higher lifecycle costs due to frequent repairs, maintenance, or even complete replacement.
Moreover, the lowest bid often excludes essential components such as installation, maintenance, or after-sales support. These hidden........
