The Government of Vanuatu has officially increased the threshold value for government contracts from VT10 million to VT30 million, following an amendment to the Government Contracts and Tenders Act passed during the first ordinary session of Parliament in 2025.
Finance and Economic Management Minister, Hon. Johnny Koanapo Rasu, said the decision was made in response to inflation and the rising cost of delivering government-funded projects.
“This change stems from long-standing discussions across various governments. With inflation pushing up the cost of materials and services, the VT10 million threshold no longer reflects the true value of small-scale works. Increasing it to VT30 million allows us to better implement key government policies and projects,” he explained.
Opposition Raises Corruption Concerns
However, the Opposition has raised serious concerns, warning that the increase could open the door to further corruption and poor oversight of public funds.
Leader of the Opposition, Hon. Ishmael Kalsakau, said the government must first conduct a thorough audit of current procurement systems.
“An audit is already underway to determine whether the current system is functioning properly. Without transparent processes, raising the threshold risks empowering ‘mini-kingdoms’ within ministries, where contracts are approved without proper oversight,” he stated.
He added that in many ministries, a lack of transparency has led to favoritism and mismanagement, with individuals benefitting at the expense of the public.
Support from Other MPs
Despite the opposition’s concerns, several MPs voiced support for the amendment. They argued that the current VT10 million limit was insufficient to cover logistics and material costs, often leaving projects incomplete due to funding gaps.
The government has acknowledged the concerns raised and expressed its willingness to work with the Opposition to ensure strong oversight and accountability moving forward—particularly in light of past incidents of contract mismanagement.
🔍 Quick Facts:
- Old Threshold: VT10 million
- New Threshold: VT30 million
- Reason for Change: Inflation and increased project costs
- Concerns Raised: Risk of corruption and lack of transparency
- Audit Underway: To assess procurement system performance
