The State government has framed and notified rules for Public Private Partnership (PPP) projects of more than Rs. 25 lakh value to ensure clarity and transparency at every stage.

The rules, notified and effective from November 26, are aimed at eliminating delay in entering into a partnership, avoiding troubleshooting and audit objections at later stage, say official sources. Prior to the Tamil Nadu Transparency in Tenders Act, 1998, the government used to enter into an agreement with a private firm for a PPP project such as New Tirupur Area Development project, after negotiations.

Infrastructural developments and policy changes at the national level necessitated a process by which a private partner was selected. The procedure was found to be complicated because the agreement was for a long-term basis. The government had two options: one to add a few rules here and there keeping the substance of the original Act intact and the other was to define procedures in detail as there were variables to be factored in.

Importantly, the draft concession agreement reached between the government and the private partner has to be agreed upon upfront after the framing of the new rules. “We have had cases in which the selected partner had drafted the concession agreement after the company was awarded the tender. This is changing the rules of the game and designing the agreement to suit the needs of the private partner,” said a senior official.

The new rules would ensure that the private partner would not deviate from the concession agreement at a later stage and there were clear guidelines for every department on how to go about it as the methodology had been laid down now, he explained. There could be four stages like Request for Expression of Interest (REOI), Request for Qualification (RFQ), Request for Technical Proposal (RTP) and finally Request for Proposal (RFP).

For projects worth over Rs. 10 crore, two-stage open competitive tendering had been laid out, the official said. As the private players also needed time to prepare for bidding, the government had granted eight weeks for each stage. The preparation stage could take some time, but after awarding the tender, the departments need not regularise processes later. The rules were intended for greater transparency, quicker processing and clarity in governance, official sources said.

The Tamil Nadu Transparency in Tenders (Public Private Partnership Procurement) Rules 2012 can be accessed at http://www.tn.gov.in/gosdb/gorders/finance/fin_e_409_2012.pdf