europeaid/127054/c/ser/multi lot 11 · management • public finance management and procurement...

Projet financé par l’ Union Européenne

EUROPEAID/127054/C/SER/multi Lot 11

EU Project objectives

• Global objective - Is to support the implementation of Public Financial Management (PFM) reforms in the area of procurement in The Gambia.

• Specific objectives - Are to: (1) support the implementation of the reform of the regulatory framework; (2) improve the procurement management capacity; and (3) improve the GPPA Information systems for procurement in line with the Integrated Financial Management Information Systems (IFMIS).

Support to the Procurement Reform in Gambia

11 December 2014 2

Objectives of this workshop

• Public procurement and public finance management and achieving ‘value for money’

• Procurement Cycle including risks, bottle necks and success factors/ benchmarks

• Public Procurement legislative framework – The Essential Elements of the PPA (2014) and the Procurement Regulations (2003)

• Roles/responsibilities in the procurement processes

• Ethics in procurement and Anti-corruption aspects in public procurement


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Key Timings


4

Timings Activity

9.00am to 9.15am Workshop Administration

9.15am to 9.30am Workshop Introduction and Opening Address

9.30am to 10.00am Public procurement and public finance management

10.00am to 10.30am Morning Tea and Photo

10.30am to 11.00am Procurement Cycle

11.00am to 1.15pm Public Procurement legislative framework

1.15pm to 2.15pm Lunch

2.15pm to 3.00pm Public Procurement legislative framework (Cont)

3.30pm to 4.00pm Roles/responsibilities in the procurement processes

4.00pm to 4.15pm Afternoon Tea

4.15pm to 4.45pm Ethics and Anti-corruption aspects in public procurement

4.45pm to 5.00pm Workshop Summary

11 December 2014

Workshop Introduction and Opening Address

• This Workshop – – Provides an opportunity for the UNDP IPs to become familar with The

Gambia public procurement system

– To build the capacity of stakeholders of The Gambia public procurement system

• This Workshop is one of the ‘core’ procurement training courses delivered by GPPA

• This Workshop will be delivered by GPPA specialist procurement officers supported by EU funded Short Term Technical Assistance Consultants


5 11 December 2014


• Workshop Rules

– Facilities

– Breaks

– Timings

– Cell Phones

– Workshop Notes

– Participation

– Questions


6 11 December 2014


• Opening Remarks by GPPA

• Opening Remarks by Workshop Leaders


7 11 December 2014

Public procurement and public finance management


8 11 December 2014


• Public Finance Management and Procurement – Wide agreement that effective institutions and systems of public

financial management (PFM) have a critical role to play in supporting implementation of policies of national development and poverty reduction.

– Significant public spending takes place through the public procurement system and a well-functioning procurement system ensures that money is used effectively for achieving efficiency in acquiring inputs for, and value for money in, delivery of programs and services by the government.

– While the procurement system operates within its own framework, it benefits from the overall control environment that exists in the PFM system, including public access to information, internal controls operated by implementing agencies, and external audit.


9 11 December 2014


• PFM and Procurement (Cont) – The procurement system also contributes too many aspects of the

PFM system, providing information that enables realistic budget formulation, providing access to information to stakeholders that contribute to public awareness and transparency, and supporting efficiency and accountability in delivery of government programs.

– Public procurement is at the interface of the public and private sectors, which requires close cooperation between the two parties to achieve value for money. It also requires the sound stewardship of public funds to reduce the risk of corrupt practices. Public procurement is also increasingly considered a core element of accountability to the public on the way public funds are managed.

– PFM and public procurement are intertwined.

– It is through the procurement process that approximately 70% of the Budget is spent.


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• The Gambia public procurement system consists of 5 elements all of which must be in place and working if such a system is to operate effectively and efficiently – – Procurement documents including legislation, regulations, standard

bidding documents, etc

– Procurement structure including regulatory authority, contracting committee(s) (tender boards), procuring units, etc

– Procurement cadre including procurement professionals and para professionals, capacity building and training

– Procurement oversight including audit

– Procurement data and information including the value and quantum of procurement, procurement records, contractor registration, contractor performance, etc


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• Key Procurement documents – Public Finance Bill (2014) & Finance Instructions (2004)

– PPA (2014)

– Procurement Regulations (2003)

– GPPA Standard Bidding Documents

– GPPA Forms

– International Development Partner Rules and Procedures


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13

Legal and Regulatory Framework

Procurement Cadre, Capacity Building and Training

Public Procurement Information System/IFMIS

GPPA

‘National’ Tender Board

Procuring Organisations

National Assembly

MoFEA

Suppliers & Contractors

Oversight and Monitoring

Organisations

International Development

Partners

Other Stakeholders

11 December 2014


• Procurement structure – GPPA, including GPPI and Training Organisations; and the PMO for the

Procurement Cadre

– 200 Procuring organisations including their Accounting Officers, Contract Committees, Specialist Procurement Units, Finance and Accounts, Etc

– MoFEA including Budget, Treasury, Internal Audit, IFMIS

– Contractors/Suppliers including their Representative Organisations i.e. The Gambia Chamber of Commerce and Industry

– Oversight and monitoring organisations

– International Development Partners

– Other Stakeholders, including Media, Civil Society

– ‘National’ Tender Board (PPA (2014), Part VIII, Section 52 refers)


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• Procurement cadre – Professionals and Sub-Professionals working in the Procurement

function of the Government of The Gambia

– GPPA officials

– Procuring Organisations officials, including Government Ministries, State Owned Enterprises and Other Organisations

– GPPI and the training of all members of the Procurement Cadre including ‘High’ level officials; procurement officers; officers involved in procurement; oversight, audit and monitoring officials, suppliers/contractors, media, donors, etc


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• Procurement oversight – National Assembly including its PAC/PEC

– Auditor General and the NAO

– GPPA, through its conduct of Compliance Reviews

– MoFEA Internal Audit Department

– Judiciary

– Media

– Civil Society including various Industry Representative Organisations

– International Development Partners


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• Procurement data and information – Procurement information systems

– IFMIS


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• Achieving ‘Value for Money’ – VFM does not necessarily mean the lowest price.

– The delivery of overall VFM is a product of Quality, Time and Cost and there are clear trade-offs between the three. For example, a higher quality outcome may involve a longer delivery timeframe or higher cost, while implementing a project in a shorter time period may involve either lower quality or a higher cost, or both.

– In assessing VFM each component must be assigned a measure of relative importance.


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• Achieving ‘Value for Money’ (Cont) – VFM also suggests a whole-of-life assessment is required and this

includes the consideration of factors such as:

• fitness for purpose;

• the performance history of each prospective supplier;

• the relative risk of each proposal;

• the flexibility to adapt to possible change over the lifecycle of the property or service;

• financial considerations including all relevant direct and indirect benefits and costs over the whole procurement cycle; and

• the evaluation of contract options.


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• Achieving ‘Value for Money’ (Cont) – Delivery of VFM in public procurement in The Gambia can be assisted

by a number of actions including:

• Avoiding unnecessary purchases – procure only what is needed

• Improved management of inventory and assets to ensure government knows what it has and where so that a reallocation of resources rather than procurement should be an initial consideration

• Focus on competitive tendering for all procurements

• The form of competition should be appropriate to the value and complexity of the procurement and barriers to the participation of suppliers should be removed

• Limit exemptions from compliance with provisions of PPA (2014), especially for public works and utilities’ procurement and institutions – all exemptions should be item specific and time limited

• Ensuring that all procuring organisations are regularly assessed by GPPA


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• Achieving ‘Value for Money’ (Cont) • Removing unnecessary and/or high cost procurement processes

• GPPA to develop a policy and/or procedure on achieving/reporting ‘value for money’ in public procurement’

• Facilitate reporting by all procuring organisations, including their achievement of ‘value for money’

• Establishing and capacitating the Procurement Cadre

• Building capacity of the NAO and Internal Audit to undertake procurement audits

• Ensuring that all Donor funded procurement complies with PPA (2014)

• Ensuring ‘on-time’ payment of suppliers’ invoices – this one issue can result in a reduction of prices of up to 10 (+) percent

• Developing a system to regularly ‘benchmark’ prices for common use items

• Ensuring that procurement planning is incorporated into the budget process

• Ensuring proper asset and inventory management of all procured goods and equipment


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Questions


22 11 December 2014

What do you need to know?

• Components of The Gambia public procurement system

• Key procurement documents

• Procurement structure and the organisations involved in procurement

• Value for Money does not necessarily mean lowest price


23 11 December 2014

Morning Tea and Photo


24 11 December 2014

Procurement Cycle


25 11 December 2014

Procurement Cycle

Pre-tendering

• Needs assessment

• Planning and budgeting

• Definition of requirements

• Choice of procedures

• Invitation to tender

• Evaluation • Award

• Contract management

• Order fulfilment and payment

Post-Award Tendering


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Procurement Cycle

• Pre-tendering

• Needs assessment – inventory & asset management

• Planning and budgeting – supply market assessment, costing, procurement plan, budget development, budget launch

• Definition of requirements – specifications, evaluation criteria

• Choice of procedures – what procurement procedure will be used i.e. Open tender (The Gambia’s preferred method), RFQ, Restricted tender including Single Source, RFP for consulting services

• There is a decision at the end of each step

• Each decision can/should be recorded


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Procurement Cycle

• Tendering

• Invitation to tender – development of procurement document, supplier registration, advertisement, pre-qualification, pre-bid meeting/site visit, tender submission, tender closing, tender opening

• Evaluation – evaluation, team, evaluation and recommendation for award

• Award – adjudication, notification of award, signing of contract




28 11 December 2014

Procurement Cycle

• Post-Award

• Contract management – contract execution, contract administration, contract and contractor performance

• Order fulfilment and payment – delivery, inspection, inventory & asset recording, issue & use, invoice checking & authorisation for payment, payment, reporting




29 11 December 2014

Questions


30 11 December 2014


• The three phases of procurement and each stage

• The linkage of procurement with inventory & asset management at the start and end of the procurement cycle

• The linkage of procurement with the budget cycle at the start of the procurement cycle and with accounts at the end




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Public Procurement legislative framework


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• PPA (2014)

• Procurement Regulations (2003)

• GPPA Standard Bidding Documents

• GPPA Forms

• All GPPA documents are on the GPPA Web Site


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• The Public Procurement Act (PPA) adopted by the National Assembly in 2001 and Accented to by the president in 2002, came into force in 2003.

• Revised PPA (2014) assented to in October 2014.


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• Objectives of the PPA (2014) –

– Transparent, efficient & economic procurement

– Accountability in public procurement

– A fair opportunity to all prospective suppliers of goods, works & services

– The prevention of fraud, corruption & other forms of malpractices in public procurement

– Improvement of social & economic capacity of SMEs

– Achieving ‘value for money’?


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• Scope of application of the PPA (2014) –

– Section20 (1) of the Act – the Act applies to all public procurements except for: • Procurements related to national defense or national security

• Where a provision in the Act conflicts with the procurement rules of a donor or funding agency

• Presidential Directive.


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• Public Funds – Any monetary resources appropriated to procuring

organizations through budgetary process – Aid, Grants and Credit made available to procuring

organizations by local and foreign donors – Revenues of procuring organizations, including the

consolidated Revenue Fund, the Development Fund and general funds of Local Government Authorities.


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• International Donor Rules Vs PPA (2014)

– Section 20 (4) of the Act provides that where a provision of this Act Conflicts with the procurement rules of a donor or funding agency, the application of which is mandatory pursuant to an obligation entered into by the government, the requirements of donor rules shall prevail, but in all other respect, the procurement shall be govern by the PPA (2014)


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• Functions of GPPA

– Responsible for the regulation and monitoring of public procurement in the Gambia

– Monitor performance of procuring organizations to ascertain efficiency and compliance with applicable legislation, regulations and instructions

– Provide annually to the Minister of Finance a quantitative and qualitative assessment of procurement activities in the Gambia

– Representative(s) of the Authority are entitled to attend any meetings of Contracts Committee as non-voting observer(s)


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• Functions of GPPA (Cont)

– No procuring organization shall engage in any procurement of D1million and above without obtaining its approval at every stage of proceedings i.e: Tendering, Request for Proposals, Awards, Direct (Single Source) Procurement

– GPPA can annul in part or in whole any unauthorized act or decision of a procuring organization

– Reverse or substitute such a decision

– Provide administrative review of bid protests


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• Functions of GPPA (Cont)

– Refer to the Auditor General any violations and submit a report to the Minister

– GPPA shall not interfere in the award of any specific procurement contract, except where a complaint is not dismissed

– GPPA reports directly to, and operates under the General Supervision of Cabinet


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• Methods of Procurement and Thresholds

– Single-source - • Goods & Services D10,000

• Works D30,000

– Request For Quotations - D500,000

– Restricted / Open Tenders - above D500,000

– Request For Proposals -

– International Tendering:- 10million & above


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• Establishment of Contracts Committees and Composition

– A contracts committee shall be established by all procuring organizations supported by a specialized procurement unit

– A contracts committee shall consist of at least three members, and shall include the chairperson (CEO or his representative), a budget professional as well as a technical person familiar with the substance of the procurement, ad hoc members to complement the CC’s expertise and a Secretary


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• Functions of Contracts Committees

– Verification of procurement method and availability of funds

– Approval of invitation to bid and bidding documents-criteria not set forth in the later cannot be used in the evaluation

– Conducting the opening of bids and their evaluation

– A quorum requires attendance by 3 members and majority decision stands

– Establishment of a specialized Procurement Unit in all Procuring Organizations (Section 50 of the PPA (2014) refers)


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• Functions of Contracts Committees (Cont)

– The Secretary to the Contracts Committees shall take minutes of meetings of the contracts committee and maintain a file on all matters considered by the Contracts Committee

– A contracts Committee may delegate, to a specialized procurement unit, authority to make contract award decisions - Caveat: they are accountable for all the procurements conducted by the SPU


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• Specialised Procurement Unit

– The Minister concern or the head of the procurement organisation shall establish specialised procurement units

– The head of SPU shall have the Authority to conduct procurement Activities in accordance with the PPA (2014) and the Procurement Regulations (2003)

– The SPU shall be responsible for the preparation of the bidding document

– Staff: well trained personnel in public procurement and whose professional qualifications meet the requirement that may be established in accordance with guidelines to be issued by GPPA


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• Procurement Planning

– Each Procuring organizations must prepare an annual procurement plan by 15th of January each year

– Rationale for plan is to achieve maximum value for money

– The plan which shall be provided to the GPPA, should describe the extent, timing and purposes of the projected requirements

– Identification of appropriate procurement method for procurement packages e.g. RFQ, Framework contract


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• De-Aggregation and Splitting of Procurement

– A procuring organization shall not divide its procurement artificially to avoid the monetary thresholds set in the Act and Regulations

– Note: when apportioning or splitting an acquisition is technically or financially feasible, the acquisition may be divided into lots


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• Bid Security

– Bid security shall be required for procurement valued D1Million and above

– The amount shall be set in the bidding document at between 2% to 3% of the estimated value of the procurement

– A bid security shall remain valid for a period of 4 weeks beyond the expiry date of validity period of bids

– A receipt of bid security shall be recorded in the GPPA Form 015


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• Deadline for Submission of Tenders

– The deadline for submission of tenders shall be no less than 30 days – • from the date of publication of invitation to tender for

procurement valued between D500,000 and D1million

• from the dispatch of the invitation to tender, in the case of restricted tender.

– Bids shall be valid for a period of 90 days


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• Tender Opening

– Tenders shall be opened in a session open to the public, including the bidders and their representatives

– The time of tender opening shall coincide with deadline for submission

– The name and address of each bidder and the amount bided shall be announce

– Tender prices may be communicated on request to bidders that have submitted but not represented at the bid opening


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• Qualification of Buyers

– In order to qualify for the award of a procurement contract, a bidder shall demonstrate to the satisfaction of the procuring organisation that – • The supplier possesses the necessary professional and technical

qualifications and competence, financial resources, equipment and other physical facilities, and managerial capability, experience in the procurement object reputation and personnel to perform the contract

• It has the legal capacity to perform the contract

• It is not insolvent , in receivership, bankrupt or being wound up, its business activities have not been suspended, and it is not the subject of legal proceedings for any of the foregoing


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• Qualification of Buyers (Cont) • It has fulfil its obligations to pay taxes and social security

contributions if it applies

• It or any of its Directors or officers, have not been convicted of any criminal offence relating to professional conduct or the making of false statements or misrepresentations as to its qualifications to enter into a procurement contract within a period of three years preceding the commencement of procurement proceedings, and that it is not subject to debarment


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• Application of Evaluation Criteria

– A procuring organisation shall evaluate and compare the bids in accordance with the procedures and criteria set forth in the bidding document

– No criterion shall be used that has not been set forth in the bidding document

– A record of the evaluation of each bid and the comparison between them shall be maintained by a procuring organisation by using GPPA Form 017 Record of Evaluation of each Tender, and GPPA Form 018 Summary Report of Evaluation and Comparison of Tenders


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• Application of Evaluation Criteria (Cont)

– The successful bidder shall be the bid with the most responsive bid price & technical specification, subject to any margin of preference applied pursuant to Sub-Regulation 5(d)

– In determining the most responsive evaluated bid, a procuring organisation may consider the following – • the bid price

• live cycle cost

• the effect the of a bid on the environment

• margin of preference


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• Rejection of Bids

– The procuring organisation shall not accept a bid – • If the bidder that submitted the bid is not qualified

• if the bidder have already submitted another bid for the procurement in question

• if the bidder does not accept a correction of an arithmetical errors

• if bid security is not provided, if required


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• Cancellation of Procurement

– A procuring organisation may cancel a procurement proceedings after bid opening only in the following cases • The object of procurement is no longer required

• It has become necessary to modify the specifications

• Defects or gaps in the specifications have been revealed

• Failure to include all items of cost to a procuring organisation

• There is evidence of collusion among bidders in setting up prices

• Where the bid prices exceed substantially the estimated value


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• Accountability

– Public Accountability: requires that all procurements

are conducted in a manner they are able to withstand

scrutiny in the event of a query or investigation

– Misfeasance: it amounts to a misconduct if a public

officer acts above his/her authority, or fails to act

within his/her authority and the action or inaction

results in injury to a party


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• Debarment of Suppliers

– GPPA shall exclude a suppliers or bidder from participating in public procurement


59 11 December 2014

Lunch


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• Right to Review

– Right to Review: a bidder can seek review for just cause – Article 54 (1) of the Act

– 54(1) Subject to subsection (2), a bidder that claims to have suffered, or that is likely to suffer, loss or injury due to a breach of a duty imposed on the procuring organisation by this Act may seek review in accordance with this Part.


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• Right to Review (Cont)

– The selection of a method of procurement pursuant to Part VII

– The choice of a selection procedure in request for proposals for services, in accordance with the Regulations

– A decision by the procuring organisation under section 32(2) to reject all bids or to cancel the procurement proceedings

– A refusal by the procuring organisation to respond to an expression of interest in participating in request for proposals for services proceedings set out in the Regulations.


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• Right to Review (Cont)

– An application for review shall not be entertained unless it identifies the specific act of omission or commission alleged to violate this Act or the Regulations.


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• Procedures for Review

– Prior to the entry into force of a procurement contract, application for review shall be made in the first instance, in writing, to the head of the procuring organisation.

– The head of the procuring organisation shall not entertain an application for review unless it was submitted within ten working days of when the bidder submitting it became aware of the circumstances giving rise to the complaint or of when that bidder should have or other deadlines set in the Regulations, whichever is earlier.

– The head of a procuring organisation shall render a decision within ten working days of the submission of the application for review


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• Procedures for Review (Cont)

– In the form of an appeal by the complaining bidder against a decision by the head of the procuring organisation, provided that the appeal is submitted within ten working days

– Where the head of a procuring organisation fails to render a decision within the required time frame, provided that the application for review is filed within ten working days of the expiry of the time for the decision by the head of the procuring organisation referred to in subsection (3)


65 11 December 2014


• Procedures for Review (Cont)

– In the case of an application for review submitted in the first instance to the Authority, if the procurement has already entered into force, the application shall not be entertained unless it is submitted to the Authority within ten working days of when the bidder submitting it became aware of the circumstances giving rise to the complaint or of when that bidder should have become aware of those circumstances, whichever is earlier.


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• Remedies for the Authority

– Prohibiting the procuring organisation from acting or deciding in an authorised manner or from following incorrect procedure

– Annulling in whole or in part any unauthorised act or decision of a procuring organisation, other than any act or decision bringing the procurement contract into force

– Reversing a decision by the procuring organisation or substituting its own decision for such a decision, other than any decision bringing the procurement contract into force

– Payment of reasonable costs incurred in participating in the bidding process where the results were not in accordance with this Act or the Regulations


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• Period of suspension

– The timely submission of a complaint in accordance with deadlines set in this section suspends the procurement proceedings for a period of ten working days, and the suspension shall take effect on the filing of the application for review

– The head of the procuring organisation or the Director General of the Authority may extend the period provided in subsection (7) in order to preserve the rights of the bidder submitting the application for review, provided that the total period of suspension shall not exceed thirty days


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• Period of suspension (Cont)

– The suspension provided by this section shall not apply if the procuring organisation certifies that urgent public interest considerations require the procurement to proceed.

– The certification, which shall state the grounds for the finding that urgent considerations exist and which shall be made a part of the record of the procurement proceedings, is conclusive with respect to all levels of review except judicial review.


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Questions


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• The Gambia public procurement system is well founded on key documents including - PPA (2014), Procurement Regulations (2003), GPPA Standard Bidding Documents, GPPA Forms

• Remember that GPPA is available to provide advice and support in understanding and applying the legal and regulatory framework to your procurement activities


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Roles/responsibilities in the procurement processes


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• A Contracts Committee shall be established in every of procuring organisation in The Gambia supported by specialised procurement units to be established in the organisation

• A procuring organisation is responsible, and accounting officers and other officials concerned are accountable, for public procurement in accordance with the PPA (2014)and the Procurement Regulations (2003) issued by the GPPA, and other applicable laws, regulations, and Financial Instructions applicable in The Gambia.


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• The head of the accounting unit, or the head of the procuring organisation, where there is no designated accounting officer or, his or her representative shall chair the Contracts Committee

• The accounting officer, or the head of a procuring organisation where there is no designated accounting officer, shall appoint a staff member of the organisation to act as secretary to the Contracts Committee

• The Secretary of State, concerned or the head of a of specialised procurement organisation shall establish a specialized procurement unit and assign, to the heads of those units, authority to conduct procurement activities in accordance with the PPA (2014) and the Procurement Regulations (2003)


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• A Permanent Secretary or Head of procuring organisation shall be:-

– Personally responsible for any lapses in the general supervision & control of stores

– financially liable for any financially lose incurred through his or her failure to meet those responsibilities


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• A public officer involved in requisitioning, planning, public officials preparing and conducting procurement proceedings and bidders administering the implementation of procurement contracts, shall –

– discharge his or her duties impartially

– always act in the public interest, and in accordance with the objectives and procedures

– at all times avoid conflicts of interest and the appearance of impropriety

– not commit or abet corrupt or fraudulent practices, including the solicitation or acceptance of improper inducements

– keep confidential the information that comes into his or her possession relating to procurement proceedings


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• A procurement officer and member of a Contracts Committee shall on assuming his or her duties subscribe the oath of office with specific reference to the obligation to –

– adhere to rules of conduct set out in the PPA (2014), the Procurement Regulations (2003), instructions and other applicable procedures

– faithfully execute the duties and tasks properly assigned to him or her


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Questions


78 11 December 2014


• All procuring organisations must have a contracts committee and a procuring unit

• Accounting officers have specific responsibilities

• Procurement officers have specific responsibilities

• Procuring organisations need access to procurement data/information

• Remember that if you are not sure of your specific responsibilities, then contact GPPA

• Remember that GPPA conducts regular Compliance Reviews of procuring organisations and must report all findings


79 11 December 2014

Afternoon Tea


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Ethics and Anti-corruption aspects in public procurement


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• Of all government activities, public procurement is one of the most vulnerable to corruption

• Bribery by international firms in OECD countries is more frequent in public procurement than in utilities, taxation, and judicial system

• The financial interests at stake, and the close interaction between the public and private actors, make public procurement a major risk area


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• Efforts to enhance good governance and integrity in public procurement are fully part of an efficient and effective management of public resources

• Through corrupt practices, market competition is hindered; and the price paid by the administration for goods and services is artificially raised, which has a direct impact on public expenditures and therefore on taxpayers resources

• Effective procedures that enhance transparency, good management, prevention of misconduct, accountability and control contribute to preventing not only corruption but also the waste of public resources


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• Integrity can be defined as the use of funds, resources, assets, and authority, according to the intended official purposes, to be used in line with public interest

• It is also useful to determine an effective strategy for preventing integrity violations in the field of public procurement. Integrity violations include:

– Corruption including bribery, kickbacks, nepotism and cronyism

– Fraud and theft of resources

– Conflict of interest in the public service and in post-public employment

– Collusion


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• Integrity (Cont)

– Abuse

– Discriminatory treatment in the public procurement process

– The waste and abuse of organisational resources


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• Corrupt practice includes the offering, giving, receiving, or soliciting of any thing of value to influence the action of a public official in the procurement process or in the execution of a contract

• Fraudulent practice includes a misrepresentation of facts in order to influence a procurement process or the execution of a contract to the detriment of the procuring organisation, and includes collusive practices among bidders (prior to or after bid submission) designed to establish bid prices at artificial, non-competitive levels and deprive the procuring organisation of the benefits of free and open competition


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• Factors on which the level of vulnerability to corruption depends within public procurement includes: 1) The extent of competition for contracts, in general or in a

particular case; 2) Inexperience, lack of training, or high turnover among

government staff dealing with procurement; 3) Special temptations due to low salaries on the government

side or to opportunities to gain access to scarce foreign exchange;

4) The existing social relationships between the private operators and government procurement officers;

5) Findings of fraud or misconduct in previous audit exercises or through independent inspection agencies like the GPPA;


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6) The choice of an unusual contract structure, including unusual form of payment or place of payment, for a particular contract;

7) Lavish spending habits or conspicuous consumption by such an official;

8) Excessive travel and entertainment involving an official responsible for procurement;

9) A contracting unit which over time has become physically or organisationally isolated from management, especially if sheltered by peculiar features of the commodity traded (for instances purchases by central medical stores of special pharmaceuticals).


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• Examples of corrupt procurement activities:


89

Product Substitution Contractors submit goods for testing/samples which

meet specification but deliver non-conforming items

Double-billing for work Same Contractor charges Government more than

once for the same work

Collusive Bidding, Price Fixing

and Bid Rigging

Groups of Competitors form an agreement to

eliminate or limit competition

Conflict of Interest Government officials or their friends or relatives

benefit from the contract or the contractor obtains an

unfair advantage in future work

False Invoice Contractors bill for goods, services or works which

have not been delivered

False Representation Contractor lies about a significant aspect of the

contract, such as the use of recycled materials or the

quality of goods

11 December 2014


• Preventive measures: 1. Lay down a straightforward list of “dos and don’ts” in the form of a

manual in simple term, preferably in the context of a code of Ethics.

2. Set standards which are conforming to the law but not requiring strictness that goes beyond the legal requirement.

3. Make use of staff meetings and training exercise to demonstrate the Government’s commitment to the anti-corruption measures.

4. Encourage strict discipline in observance of procurement regulations, for instance in terms of documenting the process through records and properly organised file.

5. Providing a “whistle-blower” system that allows, and even encourages, employees to inform on instances of fraud or misconduct, event when it requires informing on each other.


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Questions


91 11 December 2014


• Ethics and anti corruption is a key focus of The Gambia public procurement system

• Remember that GPPA has a close relationship with National Assembly and its PAC/PEC, the Auditor General and the NAO and MoFEA Internal Audit


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Final Questions


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Workshop Summary


94

• Summary comments from Workshop Leaders

• Summary comments from GPPA

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95

Thank you for your attention

11 December 2014