NCPP:Matters Arising

How Nigerian Leaders failed to implement the Public Procurement Act 2007   A Case of Non-Constitution of the National Council on Public Procurement (1)

By Anthony Chibundu Akalugo

The Public Procurement Act, PPA 2007 was passed into law on 30^th May 2007 by the House of Representatives, having been passed earlier by the Senate on 17^th May, 2007. The President, Alhaji Umaru Musa Yar’Adua gave his assent on 4^th June, 2007, being the first bill he assented to after assumption of office on 29^th May 2007.

The Explanatory Memorandum of the Act states that “this Act establishes the National Council on Public Procurement and the Bureau of Public Procurement as the regulatory authorities responsible for the monitoring and oversight of public procurement, harmonizing the existing government policies and practices by regulating, setting standards and developing the legal framework and professional capacity for public procurement in Nigeria”.

The Act establishing the Chartered Institute of Purchasing and Supply Management of Nigeria (CIPSMN) 2007 was earlier passed by the Senate on 28^th February 2007 and by the House of Representatives on 7^th March 2007. The President, Chief Olusegun Obasanjo, gave his assent on 30^th April 2007. However, it was gazette on 4^th July 2007.

The explanatory memorandum of the Act states that “This Act establishes the Chartered Institute of Purchasing and Supply Management of Nigeria as a statutory body responsible for registration and discipline of members of the profession”

This Act further lays down conditions for registration of members of the Institute by setting up a Disciplinary Tribunal and an Investigating Panel to uphold the ethics of the profession, prescribe penalties for any contravention of its provisions and provide for a Governing Council to which is responsible for policy formulation and implementation.

 It is deducible from the above that the Public Procurement Act 2007 was structured to be anchored on a tripod, namely: The National Council on Public Procurement, The Bureau of Public Procurement and The Chartered Institute of Purchasing and Supply Management of Nigeria (CIPSMN). The two Acts were passed in response to the recommendations of international financial institutions, especially, the World Bank, on the need to introduce conscious framework for frugal expenditure of public finances.

According to the Act establishing the National Council on Public Procurement (NCPP) and the Bureau of Public Procurement (BPP), they were given the authorities for monitoring and oversight functions of public procurement, harmonizing the existing government policies and practices by regulating, setting standards and developing the legal framework and professional capacity for public procurement in Nigeria.

How much of the above responsibilities have been achieved four years after, is a case for consideration. Late Alh. Umaru Musa Yar’Adua led government failed to constitute the Council even after signing into law the PPA 2007, during his two and a half years reign. The present government, an extension of Yar’Adua’s administration has turned down all entreaties towards the constitution of the Council.

An attempt to analyze the specific responsibilities of the three distinct components will however reveal the cacophony of indiscretion inherent in the way the implementation of policies and constitution of relevant bodies are conducted by the government. No one may be in doubt that the three distinct bodies established by the Acts have interwoven responsibilities but definite as defined above. Therefore, the non-existence of any arm creates a vacuum in the germane strive to institutionalize frugality in public expenditure.

It is helpful therefore to analyze the statutory functions of the entities in view of the need for which they were established. Let us start by analyzing the PPA 2007 as follows: Part 1:  The Establishment of the National Council on Public Procurement (NCPP) There is established the National Council on Public Procurement referred to as “the council” and the Council shall consist of the Minister of Finance as Chairman, the Attorney General and Minister of Justice of the Federation, the Secretary to the Government of the Federation and the Head of Service of the Federation. Others include the Economic Adviser to the President, six part-time members to represent the Chartered Institute of Purchasing and Supply Management of Nigeria, the Nigeria Bar Association, Nigeria Association of Chambers of Commerce, Industry, Mines and Agriculture, Nigeria Society of Engineers, Civil society, the Media and the Director General of the Bureau who shall be the secretary of the Council.

There have been several calls on the President to constitute the Council with dispatch but it has never received the necessary attention to warrant the right actions. One is tempted to think that the decision to avoid the implementation of the stipulations of the Act is intentional and political. But why should one play politics with crucial issues as NCPP?

Perhaps as it is claimed, the successive governments we have witnessed in Nigeria have been a congregation of strange bedfellows, who are incidentally knitted together by a singular personal interest, to gather to share and protect their own instead of pulling strengths together to forge a positive course for all. We shall understand this thinking better in due course, as we analyze the functions of the Council.

According to the PPA Act 2007, the Council shall perform the following functions, which include to Consider, approve and amend the monetary and prior review thresholds for the provisions of this Act by procuring entities. Recently, some individuals proposed the amendment of the Act to decentralize the powers to set thresholds. Without central control of threshold, what then is the need for the PPA 2007? Incidentally, Nigeria is like a case of one goat with seven people who feed it. Everyone feels that the other person would know when the goat should be hungry as to provide it with fodder. Virtually all would consider bringing fodder at the only time when there is ceremony, for all to witness that they are making effort to sustain the goat, and be counted as do-gooders. However, no one will eventually realize that all others have not fed the goat in an ordinary time until the true farmer comes on his routine inspection. Here, the procurement professionals are concerned as things are not being done the right way. We cannot run this country on selfish sentiments because few individuals want to perpetrate their greedy tendencies.

It is clear that many greedy Nigerians only see the threshold as an encumbrance that inhibits their desired freedom to utilize the award and administration of any contract to obtain maximum selfish benefit. To many, the saying goes thus “he who climbs to the top of the iroko tree should maximize the opportunity provided to collect enough firewood because one rarely gets such opportunities, which could be once in a life time”

We may then ask, why should we continue to view our common concern as that of the case in the animal kingdom, who strives to get to the stream before the others so as to be able to drink the clean waters and to match its feet in the waters to turn the once settled muddy deposit, which makes the other animals to drink muddy waters instead?

Many Nigerians want to see sanity in the conduct of government business but are defiant to the need to comply with ethical procedure where necessary. I recall a case when I was elected to lead an association in my school. We planned to carry out some projects within my tenure but due to the shortness of the tenure and lean purse, we could not execute all the proposed projects. We decided to initiate plans to raise some funds to provide a good financial base for my successor. I was shocked that many students were sending delegation to me to propose a fictitious project and to misappropriate the fund. They asked me to check whether it has been recorded in the annals of history of the school that anyone left some substantial amount in the coffers before handing over to succeeding administration. We resisted the urge and handed over as proposed. But this left a sore feeling in my mind about the poor orientation and mindset of our future leaders, who incidentally could be among the present crop of national leaders. What a weird succession of leadership this country is locked in?

It is imperative to know that many Nigerians have so much strayed from frugal orientation that they only study policies and procedures with the aim of discovering possible lapses to enable them circumvent the legitimate conduct. How long shall we continue to provide a lapse in our institutionalization of frugality thus paving way for indiscriminate perversion of due process? How long shall the government pretend that it doesn’t matter because the political godfathers have insisted that the pace of change and transformation should not be allowed to enter the fast gear?

Their only concern is to ensure that systems are not and even if they eventually get established, shall not be allowed to flourish. To consider, approve and amend the monetary and prior thresholds for the application of the provisions of this Act by procuring entities demands immediate action by the relevant body, the NCPP. The Federal government needs to explain whether the task of constituting the Council is daunting and as such that they cannot or will not. Let Nigerians know the reason for not constituting this all important council.

The second responsibility to consider and approve policies on Public Procurement, the dynamics of ethical procurement operation is huge. It is unfortunate that the Nigerian leaders and a greater percentage of the citizens have not realized that as much as someone needs a lawyer to interpret a constitutional matter, as to guide and advice legal matters properly, so are the policies and strategies of procurement hidden from the minds that are not trained professionally.

The smooth implementation of the provisions of the PPA 2007 requires proper management of the dynamics of the policies. There is no law or Act that is completely fashioned to accommodate the demands of the future. Situations cropping up shall always warrant some relevant interpretations and interventions. This is also the case of the role of NCPP on PPA 2007. Imagine what would have happened in Nigeria without the parliament when there was the need for the doctrine of necessities. Nigeria would have remained in the constitutional imbroglio and economic comatose thus throwing all into avoidable turmoil.

The government’s inaction in this regard is not even in the interest of the leaders and their cronies. It is a case of burying landmines that will eventually explode to affect whoever may be available. We must have to appreciate the fact that life is a catenation of activities tailored towards observing the principles of good conduct and advancing the course of nature. No matter how we try to sabotage the implementation of the right principles, we shall only succeed in removing our names from the course of history as positive contributors and earn being circumvented by nature in its bid to see to the fulfillment of its goals. We only do the right thing and are counted or we discontinue our relevance in the sands of time.

There is no alternative individual, organization or agency that is mandated by the constitution to consider and approve policies on public procurement other than the National Council on Public Procurement. It is important to remind the president and other functionaries of the government that the non-constitution of this important body, the NCPP, does not shield them from facing future prosecution for actions in retrospect.

It is safer for all to empower the PPA 2007 Act to run its full course and handle relevant issues as has been established than to create the loophole by avoiding the establishment of a council that has been created constitutionally.

Approve the appointment of the Directors of the Bureau include that it would have made more sense if the present Director General of the Bureau of Public Procurement, BPP, were appointed as sole administrator, instead of naming him as the Director of the Bureau. The nomenclature of Sole Administrator would have been ideal, while his team members could assume secretaries of their departments. This is so because the Director of the Bureau was solely appointed by the President, without due process. Without the constitution of the NCPP, there is no constitutional ratification and hence remains an imposition on due process.

For the fact that there is no NCPP, the position of the Director remains constitutionally vacant. Having an individual there on unilateral appointment is only an aberration because it negates the principle of due process. Since the appointment of the DG of the Bureau is standing on a faulty foundation, it is evident that there is ground for compromise on topical issues. This creates a grave consequence on the integrity of the Bureau. The lacuna created by the non-constitution of the NCPP has engineered disharmony within the circle of the tripod entities, which should ordinarily champion the task of strategizing for zero corruption target in the public expenditures through coordinate synergy. We shall later analyze the statutory qualifications of the Director General and the responsibilities thereof.

Receive and consider for approval, the audited accounts of the Bureau of Public Procurement. This responsibility is clearly stated in the Act. We may wish to know, since the setting up of the Bureau, who has the DG of the Bureau been submitting the Bureau’s audited accounts to? It is evident that the DG has not been submitting reports as was prescribed in the constitution, to the NCPP. Who then receives the report from the Bureau? Does it mean that the Bureau has been receiving Budgetary allocation from the government without turning in there audited account? If they have been submitting, then to whom?

One may be tempted to assume that they submit to the Minister of Finance. Does it then infer that the Minister of Finance is the sole representative of the National Council on Public Procurement? Even if we may ask whether it is submitted to the Auditor General of the Federation, then we may ask which constitution empowers the Auditor General to collect the audited account from the Bureau. Who among these is in position to understand the budgetary expenditure in line with the dynamics of procurement ethics? Who asks the necessary questions arising from the budgetary formulation and audited report? It obviously means that there is circumvention of due process which obviously is a time bomb.

When the administrative arm of the due process becomes an incompatible ally who is clad in the toga of incoherence, then the drive to entrench due process in the national scheme becomes only a wishful thinking.

It bugs a sane mind indeed to see how Nigerian “literate” leaders often cling unto an opportunity without toeing the providential path of honour. The present DG of the Bureau is sure a literate gentleman, who could present an endless list of qualifications and degrees to prove his literate standing. Beyond the evidence of the literate mould lies the charisma of standing out to put things right in the face of obscure decisions of incoherence. There is no evidence of the DG’s ignorance of the contents of the PPA 2007, but he decides to play along.

If our literate leaders will continue in the flux of mid-career crises, as it is demonstrated by the show of insensitivity to the constitutional provision, then how do we think we can move forward as a nation? I am yet to see a noble Nigerian who will resign a juicy job because of personal integrity, where things are not run the way they ought.  We need charismatic leaders with integrity, not men who only as a result of fear for hunger, cling unto demeaning providence, which could lead to colossal setback to all. Our integrity should be our pride.

Approve Changes in the procurement process to adapt to improvements in modern Technology: Nigerians have often viewed the provisions of the PPA 2007 as a literary work, which could be interpreted by all and sundry including the market women in the rural villages. The global aim of establishing the PPA 2007 is to achieve value for monies expended on public expenditures. Once the intention is for all professionals to queue in, several dynamics may be introduced to achieve the desired goal. There is no rigidity in the Act.

Recently, the Chairman of INEC, in his bid to procure the DDC machines for registration of voters remarked that INEC was constrained by the provisions of the Act. This is a common view of other ill informed prominent Nigerians. The issue boils down to the existence of the Act without the constitution of the appropriate body who should normally direct affairs and advice where necessary. The Act provides for single source and commodity procurement and the distinctions and procedures are resident in professional interpretation. However, had there been any problems in the process, the NCPP is the council to authorize the way forward, but incidentally, the government has not viewed its constitution as important.

Nigeria remains static in her strive to improve the procedures of conducting public affairs. The dynamics of ethical procurement practice ensures the application of the best principles, germane to the cost effective objectives. The importance of the NCPP in this regard is as the heart is to the body.

If Nigeria must aspire to be among the twenty top economies in the year 20-20-20, which is tagged vision 20-2020, then the right things must be done. The right structures must be put in place. The present practice of compensating political jobbers with sensitive offices should be discontinued and thorough bred professionals should be allowed to conduct professional affairs.

The present claim that we are fighting corruption is fundamentally a hoarse. The right structures must be implemented if we must grow and nip corruption in the bud.

Give such other directives and perform such other functions as may be necessary to achieve the objectives of this act: this provides for the informed discretional decisions of the NCPP in procurement related matters. The provision implicitly acknowledges the competence of the members of the NCPP who represent stakeholders and the authorized professional institution, CIPSMN. It empowers them to take informed decisions for the good of all.

It becomes baffling therefore why the government should avoid the constitution of this all important body, four years after it was established by the Act of the parliament, and signed into law. We may ask, is there any alternative to due process?

Cross National Referencing: the British council’s Northern Island’s office stated in their policies and activities that they have corporate standards and policies for robust and transparent procurement activities. They stated that there exists distinct finance policies and guidance covering basic rules, ethical considerations and EU procurement directives which include; general rules, value for money, UK and non-UK purchase, European Union Public procurement directives and contracts for the supply of goods and services.

In Brazil, agreements entered into by Public Administration entities are, as a rule, regulated by Public Procurement Law (PPL).

All acts performed by public entities must be in compliance with the principles set forth by the Brazilian Federal Constitution, which are: legality; impersonality; morality; publicity; and efficiency. Regarding the specific case of agreements, since the main purpose of public procurement proceedings is to assure the compliance of the principle of equality and select the most advantageous bid made to the Public Administration, in both technical and economic aspects, the PPL, which sets forth that principles of equality, administrative probity, abidance by the bid document, sustainable national development, objective judgment and other related principles, such as the lowest-price principle, must also be considered. These principles are of the utmost importance when interpreting the rules of the PPL.

In China, government procurement is playing an increasingly important role in the country’s economic development. Since the launching of the pilot project of government procurement in 1996, government procurement has been widely accepted and used in practice in China and its market size has grown rapidly in the last decade. In order to regulate government procurement activities and promote the healthy development of government procurement, the Chinese government has promulgated the Tendering Law (TL), the Government Procurement Law (GPL) and a set of implementing regulations in recent years

One may wish to ask, with the present flaws in our procurement system, not a policy flaw, but implementation flaws, how can Nigeria measure up with advanced economies, which operate defined procurement systems that are integral part of their national economic policies?

Poor Corporate governance was described by the American parliament as the centre point among the causes of the recently witnessed recession. Corporate governance in this vein refers to the poor conduct and management of elements of cost either inherent or incurred in the corporate system through fiscal rascality or poor system formulation and uninformed implementation.

Nigeria has not queued into the new trend of world economic evolution process because of the government’s adamant indisposition to establishing and implementing right policies and structures. The Non-constitution of the National Council on Public Procurement (NCPP) is a case in point.

Chibundu Akalugo,is the President, Acdore Integrated Services Limited, House 4, J
Close, 3rd Avenue, Festac Town, Lagos.

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