The role of contractual arrangements in improving health sector ...

Bahrain
The competitive bidding process used was successful in keeping the cost of the contracts low
(controlling bidding price).
Contract management and implementation issues
Linking contracts to tangible results
Although detailed specifications and requirements were built into the equipment
maintenance contract, no tangible achievement outcomes were specified in either case study.
There was no performance bonus included in the contracts which could motivate contractors
to improve their outputs.
Duration of contract
Both contracts were of short duration (2 years), which will help avoid monopoly with
regard to future contracts. However, in the contractual arrangements for incineration of
medical waste, a 10-year contract was signed because of the huge investment made by the
contractor for equipment [12].
Payment of contractors
Delayed/slow payment to contractor is a serious risk and can easily lead to the
breakdown of the contracting process. Experience in the Bangladesh Integrated Nutrition
Project showed that the delayed payment to contractor lead to the suspension of services for a
few weeks. As a result of this issue some nongovernmental organizations decided not to
participate in subsequent phases of the project [3]. In both case studies in Bahrain, one of the
main motives for private for-profit organizations to participate in bidding process was the
assurance of payment from the government. In the equipment maintenance contract the
payment was made in regular quarterly instalments in arrears, while under the cleaning
services contract the payment was made monthly in arrears.
Field supervision and monitoring
Field supervision was built up in both contracts. Monitoring of contractor performance
was carried out by contractor field supervisors. The equipment maintenance contract placed
responsibility on the contractor to require their engineers/technicians to report to the
respective department engineers in the Medical Equipment Directorate in all maintenance
matters, but there was no clear mechanism for contactor performance monitoring. It is
relatively easy to monitor service quality for non-clinical services without a sophisticated
information system. Although the outputs and standard of services expected from the
contractors were specified in the contracts, no clear performance indicators were built into the
contract.
61