A $209 million contract to provide meals for Panama’s largest prisons received only one bid this week. The sole offer came from the same company that has held the exclusive service for the past 13 years, raising questions about competition in state public procurement.
The electronic bid submission for the six-year contract closed on Friday, December 5. Official records from the Ministry of Government (Mingob) showed just a single proposal entered into the system. It was submitted by Consorcio Alimentario Panamá, the consortium currently feeding inmates in six facilities across Panama Province.
Its proposal matched the government’s reference price exactly at $209.6 million. This figure includes a significant increase in the daily meal allowance per prisoner, jumping from $4.60 to $5.50. The new contract would extend the consortium’s control of prison food services to nearly two decades if awarded.
Process Criticized for Limiting Competition
Potential competitors had previously raised alarms about the bidding specifications. They argued the requirements created an unfair advantage for the incumbent provider. Fifteen companies initially participated in the qualification process, yet only one final bid materialized.
A major point of contention involved the experience criteria. The bidding rules stated that experience could only be accredited through a maximum of three past contracts. For the current provider, its 13 years of continuous service under a single, massive contract covering all six prisons counted as one experience point.
“In practice, this prevented any real competition,” said Yolanda Sandoval, editorial web director for the publication reporting the story. “It would be rare for another bidder to present a single contract covering so many facilities, putting them at a clear disadvantage against the historical operator.” [Translated from Spanish]
This structure effectively blocked new entrants. Other companies would likely need multiple smaller contracts to demonstrate equivalent experience, potentially failing to meet the “maximum of three” rule while trying to match the scope. The issue was formally challenged during the bidding phase but did not result in changed specifications.
Millions in Historical Spending and Contract Extensions
Financial records reveal the scale of the existing relationship. Over the last 13 years, the Panamanian state has paid Consorcio Alimentario Panamá more than $303.3 million for food services across seven penitentiary centers. This spending occurred through a series of contract addendums and price increases approved by the Government of Panama.
The new contract represents a continued financial commitment. The $209.6 million price tag covers three daily meals for an estimated inmate population for the next six years. Officials must now evaluate the sole bid to determine if it meets all technical and legal requirements before making an award.
Critics of the process point to a lack of market testing. With no competing bids, the state has no alternative pricing or service models for comparison. This situation is not uncommon in specialized service sectors but draws scrutiny for high-value contracts involving essential human services within the prison system.
The Ministry of Government has not yet issued a public statement regarding the single-bid outcome. Agency officials are expected to proceed with a review of the consortium’s submission in the coming weeks. The contract’s commencement depends on this administrative evaluation and the formal award process.
This latest development ensures the controversial contract will remain a topic of public debate. Observers are watching to see if procurement officials declare the tender successful or choose to annul it and redesign the bidding parameters to attract more competitors.