FM – L2 – Q128 – Public Procurement Principles

(a) Public procurement rules seek to ensure adherence to certain general principles in procurement of goods, works and services in the public sector with the view of enhancing public financial management.

Required:

Explain five general principles of public procurement.

(b) Structures are important in achieving an open and orderly public procurement system. Each structure is entrusted with certain responsibilities in public procurement.

Required:

Explain the responsibilities of the following structures in public procurement within the framework of the Public Procurement Act:

(i) Head of Procurement Entity

(ii) Procurement Unit

(iii) Entity Tender Committee

(a) Generally, an effective public procurement system is built on certain universal principles, which include:

Competition. Public procurement is to engender competition among multiple suppliers or contracts which has the propensity to culminate in quality and lower prices of goods, works and services procured by government. Competitive procurement methods are therefore favoured in the public sector.

Accountability. Public procurement involves the use of public money to acquire goods, works, and services and as much it must be subjected to accountability procedure. Thus, persons and entities involved in the procurement process are accountable for process and methods used in such activities.

Transparency. It required that public procurement should be carried out in a transparent manner such that persons outside the procurement cycle can verify and see through the entire process. The selection of method, processes and tenderer should be open and orderly and must allow for easy verification by a third party.

Fairness/non-discrimination. The procurement process must be fair to all potential suppliers and contractors. There should not allow for discrimination on basis of race, gender, political party affiliation and other unfair discriminates.

Economy. Public procurement should aim at minimising the cost of goods, services and works. Thus, the process involved in the procurement should help in achieving this prime objective.

Efficiency. Procurement should ensure there is efficiency in service delivery and where economy considerations will undermine efficiency. A balance may be required.

Environmental sustainability. Public procurement should promote environmental sustainability including climate change actions. In recent years, environmental issues have been a major concern in governments’ agendas, and public procurement has been seen as a major driver of green and sustainable development. Besides being sensitive to environmentally sustainable goods, products and works, the green procurement policy focuses on considering the underlying life cycle of relevant items, and the way they can be managed and disposed of at the end of their cycle.

Social impact. Public procurement should reflect the social impact of the decision.

(b). (i) Responsibilities of Head of Procurement Entity
The head of a procurement entity is charged under the Act to:
Ensure compliance to the Act and concurrent the Act to: tender review committee does not absolve the approval from the head for contracts made.
Establish a procurement unit within the entity of qualified personnel.
Establish competent and qualified evaluation panels.
Ensure that procurement procedures are followed (due process).
Ensure stores, vehicles and equipment are disposed of according to the Act.
Exercise sound judgement in making procurement decisions.
Seek concurrent approval from the tender review committee when threshold is exceeded.
Approve of contract awards by within the threshold values established by the Act.
Facilitate contract administration and ensure compliance to contract reporting requirements.

(ii) Responsibilities of Head of Procurement Unit
The Head of the Procurement Unit is responsible for undertaking and coordinating all detailed procurement activities within the procurement entity, which may include:
Receiving procurement requests from originating officers, checking that the proposed procurement is within the approved procurement plan, and that budgeted funds are available prior to commencement of procurement proceedings;
Ensuring that funds are properly committed prior to issue of any contract or purchase order;
Co-ordinating the preparation of specifications, terms of reference, bills of quantities, drawings, short-lists or advertisements, and prequalification, tender or request for quotation documents. Where so required by the Tender Committee, submission of documentation for review and approval by the Tender Committee prior to issue;
Arranging the publication of advertisements and notices of contract award;
Co-coordinating the process of opening of tenders and quotations and ensuring the preparation of formal records of tender or quotation opening in accordance with the Act.
Participating in evaluation activities of the Tender Evaluation Panel where necessary and assisting in preparation of formal Evaluation Reports;
Preparing submissions for approval of award by the appropriate authority in accordance with the threshold values established in the Act.
Maintaining and updating the database of suppliers, contractors and consultants;
Participating in negotiations with consultants where necessary or other tenderers where expressly permitted in the Act or Regulations;
Preparing notification of awards and contracts;
Arranging publication of notices of contract awards;
Preparing contract documents and purchase orders, in line with the award decision;
Preparing and issuing tender rejection and tenderer debriefing letters;
Preparing contract variations and modifications;
Assisting with the inspection and acceptance of goods, works and services;
Maintaining procurement records in accordance with the Act and the Regulations.

(iii) Responsibilities of Entity Tender Committee
Specific functions of Entity tender Committee of Central Management Agencies, Ministries, Departments and subvented agencies are:
Review and approve procurement plans and quarterly update of the plan to ensure connection with the objectives and operations of the entity.
Approved cost of items in the plan and ensure they fit into the budget amounts.
Review procurement schedules and specifications and ensure compliance with law.
Secure concurrent approval from the relevant tender review committee.
Facilitate contract admin and ensure compliance with all reporting requirements.
Ensure that stores and equipment are disposed of according to the law.