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Obasanjo submits bill on contract award to Assembly

Posted by From Martins Oloja on 2005/01/18 | Views: 274 |

Obasanjo submits bill on contract award to Assembly

PRESIDENT Olusegun Obasanjo has submitted to the National Assembly a bill that will regulate contract awards in the country's public service.

PRESIDENT Olusegun Obasanjo has submitted to the National Assembly a bill that will regulate contract awards in the country's public service.

Tagged Public Procurement Bill, it proposes to change the name of the Due Process Office in the Presidency to Bureau of Public Procurement. And from then, the bureau becomes a public property to be sited in a Federal Secretariat.

At the moment, the precursor, Budget Monitoring and Price Intelligence Unit (PMPIU), is in the President's office inside the villa.

The Guardian confirmed at the weekend that President Obasanjo who received a draft copy of the bill from PMPIU, headed by Mrs. Obiageli Ezekwesili, submitted the Bill to the National Assembly before the Christmas Eve last year.

The draft bill, when enacted into law, "will regulate the procurement of goods, services, works and construction in the public sector procurement practices."
Besides, it "will provide adequate legal institutional framework and financial mechanism to achieve the laudable goals of government in its efforts to enthrone transparency, accountability and equal access to public sector procurement."
The draft bill also makes provision for the "establishment of a nine-member National Council on Government Commerce" to be headed by the President. But as in the National Planning law, the council will delegate its power to an "autonomous regulator of public procurement - the Bureau of Public Procurement."
The bill provides that the "National Council on Government Commerce is the apex authority for the regulation of public procurement function and process." And if the provision is accepted, the regulatory function will be delegated to the Bureau of Public Procurement, which is the council's Secretariat. That arrangement is a replica of the relationship between the National Council on Privatisation (NCP) and Bureau of Public Enterprises (BPE). The NCP is headed by the Vice President but the BPE is the council secretariat.

The bureau will be headed by a technocrat to be designated Director-General who will be appointed by the President.

It will be structured along professional directorates in public service.

But the council secretariat will be administered by a board of management representing professionals, national chamber of commerce, manufacturers, organised labour, civil societies and the media.

The bill, which designs the bureau as a "stand alone regulator", provides that the body will not report directly to the President, but "to the National Assembly through the Presidency and shielded by the Council."
Envisaged to strengthen the Fiscal Responsibility Bill, the bill, when approved, the council would be funded through three major sources, namely: "Direct-line charge equivalent to 0.5 per cent of the Federal Government capital votes" in the budget; subventions; fees and charges as defined by the draft law.

These are the main thrust or scope of the application of the Bill/Act:
"Procurement of goods, works and services by the Federal Government, its line ministries and corporations or any entity created or existing by virtue of a Federal legislative enactment or any procurement by any government in Nigeria of which at least 35 per cent of the amount for funding the procurement will accrue from the Federal budget."
In alliance with the Fiscal Responsibility Bill, Section 17(2) of the Bill mandates the states and local councils to replicate the procurement legislation at their respective tiers.

When the bill becomes law, "procurement awards may only go to the lowest cost and qualified bidder."
Besides, the draft Bill stipulates that "all contract values must be denominated in Nigeria currency."
Who takes the responsibility for procurement? The draft says that is "subject to thresholds as regulated by council through the Bureau but generally, the responsibility goes essentially to "permanent secretaries/accounting officers in the ministries and chief executives in the corporations and extra-ministerial departments."
According to the draft, mobilisation fees will be restricted to 15 per cent contract value for local contractors and suppliers and 10 per cent for foreign contractors. And in all cases, all bids "must be supported by unconditional bank guarantee."
In a prelude supplied by the government to justify the bill, it submits that: "The existing laws and regulations have gaps and deficiencies and thus lead to faulty implementation and opportunities for abuse. Finance (Control and Management) Act, 1958, together with the Financial Regulations (e.g. lack of permanent arrangements for control and surveillance create opportunities for bribery and corruption."
The brief says part of the abuses that characterises the existing practice is: "Proliferation, ineffective mandates, powers and authorisation thresholds of Tender Boards accentuated abuses, prominent among which is spitting of contracts." The prelude adds that: "Procurement is often carried out by staff who substantially lack relevant training."
Not only that, the government accepts in the preface that "perception of the general public and the private sector is that public sector procurements are non-transparent and are major sources of misappropriation."
The synopsis says that is why "a modern law on public procurement and permanent oversight body to provide guidance and monitor procuring entities is sine qua non for efficient public expenditure."
The drafters of the bill want the National Assembly to note that "Procurement (otherwise known as contract) is the process of acquisition of goods, services and works projects from third parties (including logistical aspects), from initial concept and definition of individual, business or public sector needs through to the end of the useful life of a procured asset or services contract."
The Due Process Office had earlier said even the ad-hoc arrangement it had adopted had saved the nation some N132 billion since 2001 when it began in earnest.

The Guardian learnt that the PMPIU had concluded arrangements with Microsoft Corporation for procurement of a soft ware that will contain price index of all procurable goods and services in Nigeria and when procured, the information therein will be available on the world-wide web - the Internet.`

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Comments (22)

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