← Policy & Regulation: Pricing and Tariff Control (all topics)
Public procurement - empanelment & rate contracts
What it is
Government agencies pre-qualify a panel of consultants or suppliers and set standard rates, then award work from the panel without a fresh tender each time
Empanelment is periodic and competitive; awards within it are administrative
Impact on industries
- Converts repeated bidding into a standing relationship, cutting business development cost and giving predictable work flow
- The panel itself is a barrier - a non-empanelled firm cannot compete for that work regardless of capability or price
- Rates are fixed for the contract period, so cost inflation erodes margin with no mechanism to reprice
- Panel membership is periodically re-tendered, so a standing revenue stream can disappear at renewal