Public Procurement and Contract Administration in Nigeria

PUBLIC PROCUREMENT AND CONTRACT ADMINISTRATION Overpurpose of Procurement Procurement is the merit of pi, works and utilitys at the best aggregate consume of tenure, in the proper nature and amount and at the proper term. It so encloses the merit of pi and utilitys at the proper situate and from the proper beginning. Dishonorable Procurement is the merit of pi, works and utilitys by Synod Ministries Departments and Agencies. In an exertion to cater harvest and enact war promises, synods all aggravate the cosmos-people are complicated in vast layer procurement of pi, works and utilitys. Public Procurement recital for bulky multiply of most countries GDP. The whole of amiable dishonorable procurement manner is increasingly substance purposeed as prize of recitalability and generally-knownness. The business of synod to individualize generally-knownness is so increasingly decorous a grave war effect. Dishonorable Procurement helps individualize the wise use of dishonorable resources. An fruitful Dishonorable Procurement Manner allure individualize at all edibless synod merit of pi, works, and utilitys are effected succeeding a opportunity due contemplate to: · Economy; · Efficiency; · Fairness; · Reliability; Transparency; and · Accountability and Ethical Standards. Economy: This allure individualize that the procuring substance allure the best prize for the prevalence expended. Prize may embody balance than worth. It embodys nature, and termly bestowal of the pi or utilitys. However, the decisive aim of a probe procurement is to allure the apex prize for prevalence. Efficiency: A amiable procurement must be seen to be unconditional. It should be destitute of bottlenecks and other devises of inefficiencies. A amiable procurement manner is destitute of protracted delays. It must be unartificial and fleet. Fairness: A amiable manner allure individualize candor to all bidders and allure be unfavorable, harmonious, and undeniable. It allure individualize flatten unimpeded basis to all curtailors, suppliers and consultants. Transparency: Amiable procurement manner fires and oceantains rules and procedures that are frank and plain. It is not solely unblemished, but it is seen to be unblemished. Accountability and Ethical Standards: A manner must individualize its practitioners refer the rules. It enforces the rules through a recurrexistence of sanctioning those who negligence, disrefer or incline the rules to devise undeniable advantages. The rules and procedures must be generally-known and plain The recurrexistence of firing affected dishonorable procurement manner in Nigeria launched succeeding a opportunity the choice of Obasanjo in 1999. It launched succeeding a opportunity the whole of Due recurrexistence station beneath the Presidency. The Due recurrexistence station was headed then by Mrs. Oby Ekwesili, the vulgar Vice President of Cosmos-people Bank in enlegation of African Region. The Due recurrexistence Station succeeded in careful totalityions of Naira according to the compel indemnify by the Agency. Dishonorable Procurement totality was passed by the two houses of the National Assembly and verified into law by the President in 2007. The Act cater for the whole of Dishonorable Procurement Consultation and Bureau for Dishonorable Procurement to beheaded by a Director General. Nigeria dishonorable procurement Act was assured in 2007. Overpurpose of Curtail Synod Curtail Synod on the other exertion encloses all those activities which are effected succeeding a opportunity aim of promoting the mitigate operation of curtails. Curtail Synod rouses from the term a curtail is verified to the term a curtail is shut. There are unanalogous devises in which a curtail can obstructs: A curtail can obstruct when an operational certificate has been effectd and the curtailor collects the decisive liquidation beneath the curtail. A curtail can obstruct if it is terminated and what is due to the either of the multiplyy (client or curtailor) has been remunerated. A curtail could be terminated due non deterrent by the curtailors, due to scantiness of the client to enact dutys beneath the curtail or due to events or betideing past the repress of the multiplyies to the curtail (intensity majeure). A curtail can be discharged when there is a argue. This can betide either amicably or through atonement through pacification and rule or through the pursue. The pursue is usually the decisive repairing in this peel of colonization. Most new curtails denounce atonement instrument. Curtail shutting up should be seen as multiply of the procurement recurrexistence that assures that the master gets what it remunerated for and curtailor, liquidation for pi or utilitys delivered. The Role of Synod in Dishonorable Procurement A amiable regulatory framework is pre-defective for an fruitful Dishonorable procurement manner. The role of cunning deviseulation should be unconnected from cunning operation and a instrument for exertionling expostulates must be recurrent. Any exertion complicated in any devise of operation of dishonorable procurement should not be complicated in reigning procurement. The Nigeria Dishonorable Procurement Act is still, somehow peccable in the area of disjunction of cunning deviseulation, operation and synod and expostulate exertionling instrument. The Bureau is encork in giving no cohibit for curtails yet is encork enforcing docility succeeding a opportunity the stipulations of the Act. This vested the susceptibility of operation and synod in the Bureau. The Bureau so through the consultation (where the DG is the secretary) is complicated in cunning deviseulation and exertionling of expostulate. A amiable stance of disjunction of synod, operation and expostulate exertionling instrument is the Kenyan dishonorable procurement manner. It incorporated the convinced disjunction of operation, cunning deviseulation and expostulate exertionling instrument. However, this has not prevented politicians in Kenya from abusing the procurement manner. In 2004 all the procurement professionals in the unanalogous MDA in Kenya were hanging to remit politicians recaggravate the prevalence they departed in choice war. The unanalogous agencies beneath the Kenyan Act are: Dishonorable Procurement Oversight Example The functions of the Kenyan Dishonorable Procurement Oversight Example are: To individualize that the procurement procedures recurrent beneath the Act are complied succeeding a opportunity; To admonishr the dishonorable procurement manner and repute on the aggravateall functioning to the Minister and so do the succeedingcited functions: subsistence the trailing and professional harvest of aid-souls complicated in procurement Effect written frequentedions to ublic entities succeeding a opportunity honor to procurement including the open of procurement chronicles and the dissemirace of declaration on procurements; and individualize that procuring entities enregister procurement professionals in their procurement items. To originate dishonorable procurement cunning and susceptible amendments to the Act. To perdevise such other functions and duties as caterd for beneath the Act Dishonorable Procurement Oversight Advisory Board Composition The Dishonorable Procurement Oversight Advisory Board shall continue of nine parts appointed by the Minister current by Parliament from aid-souls nominated by the prescribed organizations and the Director-General. Functions To admonish the Example generally on exertion of its susceptibilitys and the deterrent of its functions To affect the estimates of the fruits and expenditures of the Authority; To confide the Nursing Assignment and finishedment of the Director-General of the Example Perdevise such other functions and duties as caterd for beneath the Act. Public Procurement Negotiative Reconsideration Board The Dishonorable Procurement Negotiative Reconsideration Board, reconsideration complaints and compel expend confideation to the synod. The Dishonorable Procurement Oversight Example shall cater negotiative utilitys to the Reconsideration Board. Procuring Entities (MDA) It is the business of Procuring Entities to surrender succeeding a opportunity stipulations of the Act. Specifically the Kenyan Act caters; What is substance procured must be succeeding a opportunityin the current budget of the procuring substance and embodyd an annual procurement scheme Procurement beneathtaken by a procuring substance must be as per rouse matrix as set out in the synods There is bland heterogeneity of duties in honor of procurement preface, recurrentitying and acknowledgment of pi, works and utilitys. A dishonorable substance shall fir a susceptible committee, procurement item and such other bodies as claimd beneath the synods for the aim of making such ecisions on aid of the dishonorable substance as exact in the Act . Procurement Planning The primitive creature to do in procurement is, schemening the recurrentity. It encloses determirace of the purpose aim and expected height term. Specifically, the procuring entities deficiency to realize the claimd works, pi or utilitys to be procured. The procuring entities so deficiency to individualize the unanalogous procurement sequences. The procuring substance allure prime equipment bundles and cull the manner of procurement to use depending on the aim and entanglement of the assignment. The succeedingcited manners are usually used in procurement of pi, works and utilitys (non-intellectual utilitys): Interpolitical competitive command (ICB) Insufficient interpolitical command National competitive command Shopping Procurement Scheme should unconnected consultancy utilitys, works, pi and minister and installation of schemets and equipments. Procurement scheme should discourse the succeedingcited; How the procurement recurrexistence should be exertionled (ICB,NCB, Others, Co-financing) Define the timing of each stride in the procurement recurrexistence (Each stride, Each Package). It should so realize the procurement & implementation team The scheme should so use in recital the acclaims recurrexistence and delays that may supervene. It should use into recital all technical, staffing, allowable and trailing etc. Procurement Steps There should be identification of deficiencys. The register of pi, equipment, materials schemets etc. Types of Works (Large, Small, Very Small) and aassociated Services. The procuring substance should so indentify the instrument of manner, distribution and trailing. The scheme should so use into recital succeeding sales utility and protection duration. The strides embody the contrivance of susceptibles. The Cosmos-people Bank claim mirror in G. D. Market and United Race Business on-line. National competitive command claims mirror in at meanest two raceally learn newspapers. The recurrexistence embodys; Issuance of Command Documents Bid or Quotations Resigrace & Sstride Bid or Quotation Evaluation Curtail and Purchase Ordain Award. This allure be preceded by curtail declaration, attestation and efficiency. Pre-curtail Meeting Officials of the procuring substance encork in the procurement recurrexistence should as in ordain to: Understand their responsibilities and restrictions beneath the curtail The role of the purpose supervisor should so be defined The unanalogous tests and other devises of nature repress should be defined. Specific deliverables and distinctive curtail stipulations should be explained. Monitoring and deterrent prizement should be beneathstood and invoicing and liquidation procedures should be explained. Pre- curtail asing/argument betwixt the master and the curtailors are usually organised. At such asing, the extrinsic of the curtail and its claimments are generally-knownly defined. The curtail efficiency stipulations are explained. Others effects to be discussed are: The purpose supervisor (from the master) and curtailors appointd-to-others Organization and structures of the curtailor’s implementation team. Implementation register and Reporting manner Speed asings, works certification and invoicing Succeeding the pre-curtail argument all grey areas are ironed out, the curtail is verified by curtailor’s appointd-to-others succeeding a opportunity the susceptibility of counsellor and the authorised appointd-to-others of the curtailor. Curtail Effectiveness This allure use situate succeeding the curtail has been verified and succeedingcited stipulations enjoy been enactled: Contractor cater deterrent bail and proceeding liquidation bail (if claimd) If the curtail claims liquidation of proceeding liquidation, it has been remunerated If Note of Security is claimd it must be recurrent The Note of Security must be aged (if funded by Nigeria synod) or made efficacious through issuance of distinctive commitment if Cosmos-people Bank financed curtail or note of bail if AfDB financed curtail The master must transcribe a note conveying the efficiency to the curtailor Note of Security Letters of Security are guided by uninsufficient habit exercise recurrent by Interpolitical Chamber of merchandize and Industry fixed in Paris, France. It caters proviso to empower multiplyies to curtail of sale aid in unanalogous countries to compel and accept liquidation for pi gifted. It rouse succeeding a opportunity a bank in the buyers province (sstride bank) sstride frequented despatch succeeding a opportunity another bank in the seller province (advising bank), through a epistle bank (usually the negotiating bank). The sstride bank allure generally-known either an irexchangeable Note of security or a exchangeable note of security depending on the occurrence of the affair. It is irexchangeable accordingly equally recurrent neither of the multiplyy can countervail it unilaterally precedently the dulness of the security. Note of Security is said to be aged if in restitution to the acclaim of the sstride bank, another bank (say the negotiating bank so add its acclaim). Beneath LC for curtails financed by Cosmos-people Bank, LC’s are irexchangeable but are pointless. They are made operational when a distinctive commitment is effectd on it by Cosmos-people Bank. Incoprovisions 2000 Incoprovisions instrument Interpolitical Commercial Provisions published by Interpolitical Chambers of Merchandize (ICC), Headquarter in Paris. Incoprovisions was created in 1936 by ICC to arrange interpolitical calling by providing unidevise exposition of calling edibless. Incoprovisions are recurrently updated to guard stride succeeding a opportunity harvests in interpolitical calling. The ultimate is incoprovisions 2000. The aim of incoprovisions is insufficient to propers & dutys of multiplyies to curtail of sales as it relates to bestowal of material pi. For stance beneath the C edibless, the Seller enacts his duty upon the shipment of pi. Uniformly the amiable are shipped by the seller, beneath the C edibless the buyer is indebted to accept the pi. The succeedingcited are the unanalogous incoprovisions Group E: Departure {text:list-item} Group E: Ocean Carriage unremunerated {text:list-item} {text:list-item} Group C: Ocean Carriage Remunerated {text:list-item} {text:list-item} {text:list-item} {text:list-item} Group D: Arrival {text:list-item} {text:list-item} {text:list-item} {text:list-item} {text:list-item} Provisions of Liquidation There are edibless of liquidation for unanalogous curtails. Provisions of liquidation are usually exact in the command muniment or beseech for balanceture (RFP). Beneath a purpose financed by security from the Cosmos-people Bank, the succeedingcited edibless shall allot as follows; Register 1-Plant & Equipment from Abroad text:list-item} {text:list-item} {text:list-item} Register 2-Plant & Equipment from Employers Province {text:list-item} {text:list-item} {text:list-item} Register 3-Local Manner {text:list-item} {text:list-item} Register 4-Installation Utility {text:list-item} {text:list-item} {text:list-item} All liquidation must be made 45 days from resigrace of invoice and invoice not remunerated balance than 60 days allure fascinate circumspection. Role of Purpose Supervisor and Contractors Representative: Purpose Supervisor The curtailor must be notified of the Purpose Supervisor in congruity. The Purpose Supervisor shall act and portray the master at edibless during the security of the curtail. He shall produce all instructions, marks, ordains, title etc. He shall produce acclaim and accepts marks, instructions, declaration on aid of the master. Contractors Representative: The master must be notified in congruity succeeding a opportunity his CV determined. Contractor appointd-to-others must be current by master. The curtailors appointd-to-others act and portray the curtailor at all term during the security of the curtail, He acceptd all instructions, marks, ordains, title, acclaims and despatchs. The curtailor appointd-to-others effects all marks, instructions, declaration and other despatchs on aid of the curtailor Monitoring and Evaluation Monitoring and Evaluation is an essentially multiply of curtail synod. It is usually effected by purpose supervisor. Purpose Supervisor affects all designs and drawings for minister & installations curtail etc. The purpose supervisor inspects & effect repartee certificate precedently shipment. Proper admonishring individualizes immanent argues are averted Invoicing and Payments Contractors and masters are multiplyners. The curtailors enjoy pi/services or works claimd by the master opportunity the curtailor scantiness prevalence from the master. Curtail won beneath interpolitical competitive command recurrexistence produce cosmos-people-wide, most competitive worth to the master. Issuance of invoices and insist for liquidation is an duty of the curtailor opportunity the master has business to pay for pi delivered and or utilitys and works effected by the curtailor. The deviseat of invoicing and works certification should be worked out present to dodge calling of punishment portion. Speed Meetings Progress asing is convinced exhibition of vast and many-sided curtails which uses coveter term to entire. Speed asings are held at recurrent intervals. It is usually held to admonishr the speed of the curtail implementation. At such asing curtail implementation speed are discussed and compared succeeding a opportunity the curtail implementation register. Implementation substances are so discussed succeeding a opportunity a purpose of solving them. The extrinsic is to individualize that the curtail allure be entired succeeding a opportunity defective nature, on term and succeeding a opportunityin budget. Some identified Curtail Synod Problems in Nigeria Institutional substances affect curtails enforcement and prolonged pursue procedures are grave hindrance to mitigate curtail synod. Other dishonorable curtail synod substances are: Contracts entered into succeeding a opportunity multiplyies having dwarf beneathstanding of the curtail edibless. Ccontracts’ seen as ways of dispensing favours. Therefore, dwarf circumspection is remunerated to condition. Contractors in some cases do not exercise adapted personnel to govern and enact curtails. It usually uses unnecessarily covet term to effect enough Bonds and Insurances for the operation of curtails, due to restraining stipulations. Inbland admonishring by masters so affects mitigate curtail implementation. A dishonorable curtail synod substance that has befit very conspicuous distinctly in Nigeria Susceptibility Sector is losing out other multiplyners in JV or Consortium conformity Delay in making liquidation to the curtailors due to inbland budgetary stipulations Calling of unadapted or unfitted sub-contractors Delays in sstride LC’s and extension of LC’s & Devise M. Misapplication of pay of proceeding liquidation by curtailors Argue in the exposition of curtail edibless Delay in issuing Duties and vat exemptions certificate carrier Difficulties in sstride pi in the ports and the insufficient narrate of the race infrastructure Inconsistency in synod policies and putrescence of synod professionals Avoiding Argue in curtail implementation The best argue firmness manner is not to enjoy argued at all. However, if there is a argue frequented chaffers betwixt the multiplyies at an present mark could be beneficial. If no disintegration is contrivancet through frequented chaffer, fir in a note the basis of which erect the nonperformance of curtail to standpoint the substance on the effect beneath argue In United Kingdom an resource argue firmness technique denominated “partnering technique” is substance exerciseed. Partnering rouses succeeding a opportunity a workshop usually during the rebel off asing where expectancys of multiplyies (contractor and master) are discussed and harmonised. A multiplynering conformity or charter is verified by the multiplyies. Master and curtailor are expected to aid their staff to finished the charter. In some cases the master and the curtailor portion-out stations in the activity of the multiplynering. Argue Firmness Adjudication Once a argue cannot be steady mutually betwixt the multiplyies, it can be referred to moderator by either multiplyy in congruity succeeding a opportunity a observation to the other multiplyy. The moderator shall produce his firmness in congruity to twain multiplyies. The firmness of the moderator is not decisive. The call of the moderator and his CV is usually embodyd in the command muniment. If a bidder has substance succeeding a opportunity a intimateed moderator, he must designate so in congruity and intimate another moderator which must be ancient by the master. Pacification If either of the multiplyy is irritated succeeding a opportunity the firmness of the moderator, the irritated multiplyy can transcribe to the moderator. Either multiplyy may produce the other mark to open pacification. The dfirmness of pacification are decisive and restraining on all multiplyies Pacification Courts The Pursue of Pacification of Interpolitical Chamber of Merchandize (Paris) is the most widespread pacification erect in the World. Other are; London Pursue of Pacification and Allied Professional Society The American Pacification Association in United Narrate of American Pacification Erect of Stockholm Chamber of Merchandize fixed in Sweden. United Nations Legation on Interpolitical Calling Law (UNCITRAL) – UN Interpolitical Centre for Colonization of Investment Argue (ICSID)- WB Vary Wave and Worth Adjustments Contracts are corrupt on schemes, designs, mention and quantities which are best estimates. Basis stipulations, revisions to ancient scheme could source the aim of the curtail to vary. Revisions sourced by varys in expectancy and technology may claim vary ordain. A “vary ordain” is beseech for a vary in the aim of a curtail. It may be beseeched by either multiplyy to a curtail. A “vary ordain” verified by all the multiplyies enjoy the corresponding example as the ancient curtail. For curtails financed by Cosmos-people Bank, vary ordain is applied to varys in curtail that is balance than 5% of the curtail sum. Beneath the Cosmos-people Bank procurement manner, curtail which surpass 18 months duration should enjoy edibles for worth structure. Curtail Obstruct Out Curtail obstruct out begins when the curtail has been physically entire, i. e. all utilitys enjoy been effected and products delivered. Close out is entired when all negotiative operations enjoy been entired, all argues fixed, and decisive liquidation enjoy been made. Materials and equipment to be exertioned aggravate truly acknowledgmented. Curtail obstruct out is as dignified as curtail accord and curtail admonishring. A cohibit register of all utilitys, products, etc. to be delivered in the curtail should be kept in the curtail smooth. Governance: Fraud, Putrescence & Conflict of Circumspection Conflict of circumspection refers to a office in which procurement professional evaluate susceptibles involving companies in which they enjoy frequented or infrequented circumspection. Robbery on the other exertion embodys deformity or oversight of basis to wave a procurement recurrexistence or the operation of curtail. It so embodys confederacy natant bidders. putrescence embody gift, giving, receiving or soliciting frequentedly or instraightly of anycreature of prize to wave the operation of a dishonorable professional in the procurement recurrexistence or curtail operation. Governance: Identification of Putrescence Some “red flags” in procurement recurrexistence that designate possibility of putrescence embody the succeedingcited: Insufficient annals guarding Deviations from procedures succeeding a opportunityout written defence Poorly defined roles/responsibilities Absence of amiable inner repress manner “Red flags” can be exhibited by people encork in procurement and curtail synod as follows: Extravagant lifestyle Excessive interoperation succeeding a opportunity supplier(s) and curtailors Too abundantly secrecy Reluctance to appoint duties Guardianship touch succeeding a opportunity undeniable suppliers exclusively Some “red flags” in a multiplyicular procuring substance are: Always the corresponding suppliers competing & wining Reluctance of recurrent supplier and curtailors to bid for curtails in an substance Some “red flags” in curtail synod Excessive consume aggravateruns Excessive bulk of vary ordains (increasing consume) Liquidation of silly claims Governance: Putrescence Contributing Factors& Known Signals Noncommunication of competitive environment Noncommunication of skilled & competent procurement staff Widesplearn noncommunication of legation & job security Permissive environment (no sanctions succeeding recurrent cases of robbery and putrescence) Noncommunication of amiable instrument for exertionling expostulate & delays Known signals {text:list-item} {text:list-item} {text:list-item} {text:list-item} Case Study Case 1 An master invited bid for the minister of one X-ray channel for the ocean hospital for bestowal one month ex-stock succeeding a opportunityin 2 months of Note of Credit. In the command muniment, bidders were asked to plead worth on CIP principal city by air in US dollars. Bidders were caterd 60 days to refer bids. Six bids were generally-knowned dishonorablely. All exclude one bidder pleadd the worth as solicited. One bidder pleadd the worth in French Francs. In its evaluation the master unusual the bid as it did not surrender succeeding a opportunity the prevalence edibles. The master susceptibled to accord the curtail to the last bidder as all the other bid are sympathetic. The curtail allure be financed beneath a security from Cosmos-people Bank and the unusual bidder expostulateed to the Cosmos-people Bank on the basis that Cosmos-people Bank permitted bids from any part province and prevalence and his bid was in incident the last. What should the Cosmos-people Bank do and Why? Case 2 In an unroving purpose, an master presented papers relative-to to an proceeding procurement of two bulldozers for Cosmos-people Bank financing retroactively. The master/borrower claimed to enjoy followed the Cosmos-people Bank ICB procedures. On reconsideration, it was notable that the General Procurement Mark (GPN) and Specific Procurement Mark (SPN) were effectd, bland term caterd for the command, there was amiable retort and accord had been made to the last bidder. The solely short-coming was the bids were generally-knowned by a synod committee succeeding a opportunityout attracting the bidder appointd-to-others. Is the recurrexistence strong beneath this occurrence? Case 3 You are the manager of dishonorable procurement negotiative reconsideration legation. A purpose embodys the procurement of 10 tracks Dozers and excavators to be procured beneath a only bundle. The mentions narrated the tracks should be susceptibilityed by an engine succeeding a opportunity a stint of 175 horsesusceptibility (SAE) at a rated RPM. Firm A offered its dozers succeeding a opportunity a 165HP. In the evaluation the committee cogitate the gap as unimportant and accorded the curtail to Firm A. Firm B