Development of Contractor Quality Assurance System in Indonesian Public Works Procurement Reform

The present conditions of Indonesian public works indicate poor project performance, which is due to corruption, poor risk control, adversarial relationship, and low capacity of the parties involved in the project. There is a great need to improve public works project performance, so that the public works can adequately contribute to the country’s socio-economic development. Current conditions indicate that public clients should encourage the lowest price awarded contractor to meet minimum requirements of contract specification, since unqualified awarded contractors have poor risk control ability, making it hard to achieve project minimum requirement. Therefore, public clients should open accessibility and give more opportunity to the “qualified participants” in public works procurement. This calls for a contractor quality assurance
mechanism. This paper discusses the utilization of an integrated past performance information system so as to ensure that awarded contractor will provide best performance and take responsibility for risk control in the
conduct of public works projects. By implementation of the proposed system, public clients might derive some advantages in the projects performance enhancement, such as improved accountability through transparent qualification evaluation, avoidance of employing contractors beyond the limits of their capacity, and increased trust and confidence in the communication among stakeholders.