Mohammed B. Attah's Address             

REPORT OF THE SPECIAL COMMITTEE FOR THE

REVIEW OF THE PROPOSED AMENDMENTS TO

THE PUBLIC PROCUREMENT ACT 2007

(As passed by the Senate and House of Representatives respectively)

MAIN REPORT

A POST-NATIONAL SEMINAR ON PROCUREMENT

AUGUST/SEPTEMBER 2009

NATIONAL SECRETARIAT

2nd Floor, Gidan Abbas MG, 12 Sultan Road GRA PO Box 9689, Kaduna 800001, Nigeria

Tel: 234-8034537392, 8085878950 8036063418 Email: nspnigeria@yahoo.com

PROFILE OF THE COMMITTEE MEMBERS

The seminar participants which include the Federal Ministry of Justice, Finance, health, Office of the Head of Service, the Air Force, Police, other Para-military agencies, staff of MDAs, blue-chips, private organizations, Professional Associations/bodies and Civil society organizations, commended the President for signing into law, the Public Procurement Act 2007. The seminar participants including the representatives of the offices of the Head of Service of the Federation, Minister of Finance, the Attorney General of the Federation, the Military, the Police, NGOs, Blue Chips, Oil and Gas, The Academia, media etc urges the Executive to inaugurate the National Council on Public Procurement based on 2007 Act while the proposed amendment process to the 2007 Act continues.

The members of the proposed amendment dialogue committee are:

1.      Mohammed B. Attah              -        NGO Network, Nigeria Abuja                                        Chairman

2.     Mr. S. O. Owobu                     -        Int. Institute of Tropical Agriculture, Ibadan                Member    

3.      Ms. Obiageli Onuorah            -        Action Aid International, Abuja                                     Member

4.      Mallam Abdul Mamman         -        CIPSMN, Abuja  Branch                                              Member

5.      Ms. Ene Ede                          -        Equity Advocate, Abuja                                                Member

6.      Barrister C. U Nwonu             -        Cypriain  Nwonu  and  Associates, Kaduna                Member

7.      Engr. Tasiu Ringim                -        CIPSMN Kaduna Branch                                             Member

8.      Barrister Adeyemi Gabriel      -       Babatunde Adeyemi & Company., kaduna                Member

9        Emma I. Obiegbu                      _          E-Global Procurer Services, Manila, Philippines  -            Member

10     Mr. Biebele  E. Arimie           -        Ritola Integrates Services, Port Harcourt                   Secretary

COMMUNIQUE ISSUED AT THE END OF THE TWO-DAY EVENT

PREAMBLE

A two-day National Seminar on Public Procurement was held on August 20-21, 2009 at Rockview Hotel, Abuja. Over two hundred (200) participants drawn from government Ministries, Agencies and Departments (MDAS) the National Assembly, the military and paramilitary, academia, oil and gas companies, the judiciary, civil society organizations, media, politicians, financial institutions, and Nigerians in the Diaspora attended the event, organized by GIBS Associates Nigeria and NGO Network, in collaboration with the Chartered Institute of Purchasing and Supply Management of Nigeria (CIPSMN)

THEME:          -          Procurement Process in Nigeria: The Salient Issues.

Professionals and scholars in the field of Supply chain Management/purchasing and supply presented various academic and professional practice papers on relevant topics to the theme.

OBSERVATIONS

After series of brainstorming on the issues that emanated from the papers, the participants highlighted the following concerns:

1.                  That procurement and supply chain management is a burning issue in Nigeria and that the poor performance of our national economy is due to the unplanned, uncoordinated and unbudgeted procurement activities being carried out by non-professionals in the field.

2.                  That the non-inauguration of the National Council of Public Procurement, the lack of skilled procurement professionals at the Bureau Public Procurement (BPP) and the need for procurement information on latest research findings are responsible for the poor procurement performance and budget implementations.

3.                  That there is a continuous violation of the Public Procurement and the Chartered Institute of Purchasing and Supply Management Acts 2007 which stipulates that only people with relevant, adequate and professional qualification(s) should compete for the post of a Director General of the Bureau of Public Procurement (BPP) and only after being qualified by examination and certified by the Institute

4.                  That there is selective implementation of some provisions of the Public Procurement Act 2007.

5.                  That procurement issues are implemented without recourse to the input and advice of the procurement professionals.

6.                  That there is training needs for procurement officers to facilitate their monitoring roles

7.                  That there is low level of transparency, integrity and honesty in public procurement practice in Nigeria

8.                  That since procurement affects all aspects of the economy; it is the collective responsibility of every institutions/stakeholders to participate in the procurement process.

9.                  That some states in the Federation are manipulating and disabling the PPA by calling for mediation and arbitration without consideration for the criminal aspect of procurement, which only a court of law should serve as the final arbitrator.  

10.              That the BPP is usurping the constitutional duties of the Head of Service of the Federation by appointing and training civil servants thereby making the BPP a judge in her own matter.

11.              That there is no Senate Committee on Public Procurement as obtained in the House of Representatives, and the Finance and Establishment Committees lack the competence to handle issues on public procurement.

12.              That it is improper and illegal to remove stores from the procurement department of MDAs as presently proposed by the BPP.

13.              That it is improper for the Federal Executive Council to award contacts and remain the approving body for the implementation of the same contract and at the same time receive audit report on the contract.

14.              That the new Federal High Courts civil procedures have not provided for the procedures to be adopted when handling procurement disputes adjudicated by the Bureau of Public Procurement as an administrative body.

15.              That some unaccredited individuals and bodies conduct trainings on procurements, contrary to the law on procurement practice in the country.

16.              That some foreign trained and certified procurement professionals are practicing the profession illegally in Nigeria

17.              That the Chartered Institute of Purchasing and Supply Management of Nigeria (CIPSMN) is a public Institute established by an Act of Parliament but is being neglected by the same government that established it for the certification, regulation and practices of public procurement matters.

18.              That due to lack of qualified procurement professionals; the National Assembly is yet to receive a Public Procurement Audit  report till date as specified by the law.

19.              That the proposed amendment of the PPA 2007 as sought by the Executive and as respectively passed by the Senate and House Committees of the National Assembly is not justifiable.

20.              That the Federal Executive Council (FEC), MDAs and other government functionaries are not properly applying the statutory ‘No Objection Certificate’ from the Bureau of Public Procurement due to incompetence.

21.              That the Civil Service Commission is yet to prepare and release the Scheme of Service for Procurement Officers in the MDAs and professionals

RECOMMENDATIONS

In line with the observations, the participants recommended the following:

1.                  That the Federal Government should allow professionals to perform their function without undue interference.

2.                  That the Federal Government should, as a matter of urgency, inaugurate the National Council on Procurement (NCP) for the Public Procurement Act to be efficient and effective in curbing corruption in the system.

3.                  That only people with adequate and relevant professional qualifications as well as member of the Chartered Institute of Purchasing and Supply Management of Nigeria, qualified by examination should be appointed as Director General of the BPP and other Heads of Procurement Departments and units in all the MDAs.

4.                  That the Federal Government should fully implement the Public Procurement Act for the benefits of all Nigerians.

5.                  That there is need for the Federal Government to always consult procurement professionals before embarking on technical procurement issues.

6.                  That the government should encourage constant manpower development programmes for procurement professionals and practitioners in the country

7.                  That the government should introduce and apply ICT tools in public procurement practice without delay to ensure transparency and integrity in its operations.

8.                  That the government should involve every stakeholder (NGOs, media, business etc) in the procurement process.

9.                  That the Federal Government should advise the state governments to adopt the PPA 2007 with less mutilations and should set time limits for its implementation.

10.             That it is the constitutional role of the Head of Service of the Federation to appoint/post procurement officers and not that of the BPP which should rather act as pubic procurement desk auditor in that purpose,

11.             That the Senate should establish Committee on Public Procurement to, among other things, assist in the proper handling of procurement matters especially reviewing the bi-annual public procurement audit.

12.             That the government and the general public should know that stores are part of procurement in supply chain management and as such should be retained in all procurement processes.

13.             That FEC should only announce the approval for the implementation of contracts awarded by the Ministries and Parastatals in their respective Tenders’ Board

14.             That the Judiciary should advise all procuring entities, such as MDAs, private organizations and professional procurers on the procedures in filing appeals at the Federal High Courts after a dispute resolution by the Administrative Body of First Jurisdiction, which is the BPP as contained in Section 54 of the Public Procurement Act 2007.

15.             That every Nigerian and non-Nigerians should note that the Chartered Institute of Purchasing and Supply Management of Nigeria (CIPSMN) is the only entity in Nigeria established by law to train and certify persons wishing to practice procurement in Nigeria, as well as those certified abroad

16.             That government should recognize and collaborate with the CIPSMN to aid the fight against corruption and for the achievement of best practices in the procurement profession as well as sound economic platform.

17.             That a Special Committee arising from the two-day Seminar has been mandated to liaise with the Executive, the Judiciary, Senate and House of Representatives to advise them on the implications of some of the grey areas in the Public Procurement Act 2007 as currently amended by the Senate and House   of the National Assembly respectively..

18.             That the Federal Executive Council (FEC) should use only qualified personnel to sign ‘Certificate of No Objection’, since it is an audit certificate in procurement proceedings involving the Presidency, MDAs, Legislators and other bodies, and a Statutory Certificate for the withdrawal of monies from the treasury and Federation Account on contracts.

19.             That the Civil Service Commission should prepare and release the Scheme of Service for Procurement Officers in the MDAs in line with Sections 9 (5), 10 (5) and 11 (5) of the CIPSMN Act 2007.

COMMENDATION

The participants were pleased with the outcome of the Seminar and therefore agreed to have a general online listserv for networking among procurement practitioners in the country and commended the following:

1.                  The Federal Government of Nigeria and the National Assembly for the passage of the Public Procurement Act and the Chartered Institute of Purchasing and Supply Management Acts 2007, as it would support the administration’s effort in reducing corruption in Nigeria.

2.                  The Federal Ministries of Justice, Finance, Health, Office of the Head of Service, Defence, Police, independent legal practitioners, multi-national corporations and other MDAs for identifying with the Seminar geared at sanitizing the public service, private sectors procurement practice in Nigeria

3.                  The Participants however regretted the non-participation of the Bureau of Public Procurement (BPP) in this vital and relevant event for the development of procurement process in Nigeria.

CONCLUSION

The Seminar achieved its major objectives. It created more public awareness on procurement issues and processes for the realization of the 7-Point Agenda and Vision 20-2020 of the present administration.

1.         Mr.  Arimie E. Biebele                      –          Ritola Integrated Services, Port Harcourt                           -            Chairman

2.         Barrister Adeyemi Gabriel               –         Babatunde Adeyemi & Company, KD                               -             Member

3.         Mrs. Godiya Shanoba                      –         National Assembly, Abuja                                                    -            Member

4.         Mr. Joseph Oru                                  –         National Assembly, Abuja                                                    -            Member

5.         Emma I. Obiegbu                              _          E-Global Procurer Services, Manila, Philippines  -            Member

6.         Isari Pere Samuel                             –          National Information Tech. Dev. Agency, Abuja    -           -            Member

7.         Owobu A. Sylvester              –          Int. Institute for Tropical Agriculture, Ibadan                        -            Member

8.         Daropale Frederick Okunola           –          Ministry of Health, Akure                                                      -            Member

9.         Amegwa C. Adams                           –         Federal Medical Centre, Jalingo                                         -            Member

10.       Chief Casmiar U. Obialom              –          NGO Network, Kaduna                                                         -            Secretary

 REPORT OF THE SPECIAL COMMITTEE ON THE DIALOGUE FOR THE REVIEW OF THE PROPOSED AMENDMENTS TO THE PUBLIC PROCUREMENT ACT 2007

INTRODUCTION

The  17th resolution that emerged from the Communiqué for the National Procurement  seminar for Public Procurement is the setting up of a Special Committee,  made up of representatives from the Chartered Institute of Purchasing and Supply Management of Nigeria (CIPSMN), one of the organizers of the event, Civil society organizations (The NGOs), the media and the private sector, to review the present amendments to the 2007 Public Procurement Act by the upper and lower legislative Chambers and make their observations and recommendations available to all the stakeholders and the general Public  as a means to engaging/promoting the procurement process in Nigeria for a  more effective ,efficient, transparent and accountable procurement regime.

As a follow up to the resolutions to set up this Special Review Committee, another suggestion by the participants as adopted was that the best way to make the dialogue more productive and it was agreed that CIPSMN and the Seminar participants through the special committee ,to make representations to governments, to ensure that the Institute is well represented in the National Council on Public Procurement  and to channel all  issues observed in respect of  the amendments and/or omission in the Public Procurement Act  2007, with  recommendations for further dialogue  with the Governments.

Accordingly the organizers set up a special committee to examine the Public Procurement Act 2007, and the proposed amendments and to compile a report to be submitted to the Executive, Judiciary and the Legislature.

This report therefore is geared towards throwing more lights on the grey areas of the proposed amendments,  enlighten the public about the danger of amending the Act 2007 with the newly proposed provisions and to assure the  President, Senate President, The speaker of the House of representatives and the Chief Justice of the Federation  that their constitutional duties  and responsibilities relating to fundamental objectives and directive principles of Nigerian policy as clearly stated in sections 13, 14 and 16 of the 1999 constitution has not been removed by the provisions of the Public Procurement Act 2007 , as is presently claimed  by some individuals and groups in various publications in the newspaper and television.

The summary   observations and recommendations are captured in the main report while Annexes I – V represents different   procurement activities /methods / thresholds/respective positions of Executive/Legislature as it affects the various arms of government.  The report of the Committee is hereby summarized below in parts:

1.               Main Report of the Committee deals with the observations on the proposed   amendments by the Executive, both legislative houses and recommendations and recommendations .It also contains list of critical areas calling for amendment not yet mentioned.

2.                Annex I hereby attached which is the record of Public Procurement procedure in the Executive arm of Government in accordance with Public Procurement Act 2007.

3.                Annex II hereby attached which is the record of Public Procurement procedure in the   Legislative   arm of Government in accordance with Public Procurement Act 2007.

4.                Annex III hereby attached which is the record of Public Procurement procedure in the judicial   arm of Government in accordance with Public Procurement Act 2007.

5.                Annex IV which is the present thresholds in use for Procurement in the Executive arm of Government as approved by the President (on the recommendation of the Bureau of Public Procurement), through the Federal Government Circular of 11^th March 2009, with Ref. No. SGF/OP/1/S.3/VIII/57 of 11/3/ 2009 and indicating the missing gaps in the thresholds in terms of other arms of Government on procurement method omitted in the Threshold

6.                Annex V is Summary of Present Positions

QUESTIONS/ISSUES FOR DETERMINATION  IN RESPECT OF THE PROPOSED AMENDMENT

After a careful examination of the proposal made to the National Assembly by the Executive as contained in the Executive Bill of June 2008 and further examination of the different versions of the Bill passed by the Senate and the House of Representatives, the Committee therefore raised the following questions/issues for determination.

QUESTION NO 1.

On the recommendation for the removal of Minister of Finance as the Chairman of the National Council on Public Procurement   as contained in Section 1 (2) of the Public   Procurement Act 2007 (Principal) and replace him with an appointee of the President not confirmed by the National Assembly?

OBSERVATIONS

The Committee  examined and observed  that Sections 5(1) and 148 of the 1999 Constitution which deals with the Executive powers of the President and the constitutional right of the President for the delegation of such powers to  Vice President and or to Ministers , and also noted Sections 3, 4, 5 and 6 of the Finance (Management and Control) Act No 33 of 1958, (an Act to provide for the Control and Management of the Public Finances of the Federation and for matters connected therewith) and thereafter came to the conclusion and belief that before  considering appointing  any person that is not a serving Minister  of Finance as Chairman of the National Council on Public Procurement, it will be  crucial  to also amend these  sections of the constitution and the Act mentioned above, as they are both complementary to the responsibility of the Minister of Finance as the Chairman of the Council.

RECOMMENDATIONS

The Committee therefore recommends that the Minister of Finance should be retained as the Chairman of the Council, in view of the constitutional, legal and professional implications of the office of the Chairman of the Council and in line with the complimentary requirements of Sections 5(1) and 148 of the Constitution, the Finance (Management and Control) Act and the Public Procurement Act 2007.

The Committee further suggests that if the current situation is reversed and a person other than a serving Minister  of Finance is  nominated as the Chairman  of the National Council on Public Procurement, that such a person should also be confirmed by the Joint session of the National Assembly before assumption of office, in view of the fact that the National Council on Public Procurement is not only responsible  for setting contract thresholds for the Executive but also for both National Assembly and the Judicial arms of Government.

QUESTION NO 2.

On the request to replace the  name of Nigerian Institute of Purchasing and Supply Management with their new name ‘Chartered Institute of Purchasing   and Supply Management of Nigeria’ in Section 1(2)  of the Public Procurement Act 2007.

OBSERVATION

The Committee   observed that by the provisions of Sections 1, 2, 6(6), 6(7), 6(8) and 17 of the CIPSMN Act 2007, the association has changed name and a is now a Public Institution by name  ‘Chartered Institute of Purchasing   and Supply Management of Nigeria and  to be audited with guidelines supplied   by the Auditor General of the Federation while the oversight functions of the Institute is rest with the Hon. Minister of Commerce and the Hon. Minister of Finance, Commerce and Education are part of the Governing Council that is responsible for administration and Management of the Institute.

 The phrase ‘Nigerian Institute of Purchasing and Supply Management’ is no longer valid and legally registered at the Corporate Affairs Commission following that the Federal Government invested a ‘Charter’ in it and changed the name, as contained in sections 1, 7, 6(1) and 6(2) of the Chartered Institute of Purchasing and Supply Management (CIPSMN) Act 2007.

­RECOMMENDATION

The Committee therefore recommends that it is correct, as amended by the Senate, to replace the name ‘Nigerian Institute of Purchasing and Supply Management’ with the ‘Chartered Institute of Purchasing and Supply Management of Nigeria’ in line with the new status of the Institute, as corrected by the Senate in the 2009 Amendment Bill.

QUESTION NO 3.

On the recommendation to remove the word ‘Media’ in the list of part-time Council members in Section 1(2) of the Principal Act and replace same with the word Nigerian Union of Journalists (NUJ).

OBSERVATION

The Committee members   are of the view that replacing Media with the Nigerian Union of Journalist will make the participation in the Council more professional. The participants observed earlier that the word media is too wide to be used in the Council membership list since it also covers non professionals in Media practice. The committee also seizes this opportunity to also recommend that the word “Civil Society”  stated in the same section of the Act  where Media was mentioned as a member of the council should also be changed to  representative of NON GOVERNMENTAL ORGANISATIONS (NGOs) so that it will be in line with the clear intension of the Act as in section 19 (b) (ii) which states ;

“Non-Governmental Organization working in transparency, accountability and anti-corruption areas and duly registered and up to date with corporate affairs commission and the observers shall not intervene in the procurement process but shall have right to submit their observation report to any relevant agency of their choice or body including their own organizations or associations;”

QUESTION NO 4.

A.             On the recommendation of the Senate to   include the Nigerian Institute of Quantity Surveyors   as part time   members   of the National Council on Procurement   in section 1(2) to increase the number of part time members to seven (7)

B.                Whether it is proper for the senate to now confirm the appointment of all the 7 part time members of the council?

C.                And to remove the Nigerian Society of Engineers, the Media and the Civil Society from the Council  and include the  Nigerian Institute of Quantity Surveyors   as proposed by the Federal House of Representatives

OBSERVATION

With respect to the proposal for the confirmation of the Part time members of the Council by the Senate, the Committee agreed with this proposition but recommends that the confirmation should not only be by the Senate but also by the Joint session of the National Assembly, since PROCUREMENT is a VERY CRUCIAL ISSUE IN ANY ECONOMY, and since the Council and the Bureau of Public Procurement are also by law an independent arm of the Executive that makes procurement policies for all arms of government.

With respect to including Quantity Surveyors as members of the Council, the Committee noted from the discussions on the role of Sector Specialists in Procurement during the seminar and other consultations that Engineering is a different profession from Quantity Surveying and both of them are different professions with different establishment Acts / Laws in Nigeria, distinct from Procurement/Purchasing and Supply Chain Management.

Whereas “Quantity Surveying Practice” means/involves the preparation of the documents that describe the quality and give the quantities of the constituent parts of proposed building works from the analysis  of drawings and specifications prepared by Architects or engineers and setting out/translating the drawings  into price-able items with the detailed descriptive requirement of works and quantities involved  in construction contracts by following a standard set of rules and provide schedule of rates for pricing variations  for the project ,

“Engineering Practice” on the other hand includes any professional service or creative work requiring the application of special knowledge of mathematics, physics and engineering in form of consultation, invention, discovery, valuation, research and teaching in recognized engineering institutions, planning, operation, maintenance, supervision of construction and installation involving investigating, advising, operating, evaluating, measuring, planning,  designing  specifying, laying and directing, constructing, commissioning, inspecting or testing in connection with any public or private utilities. Structures, building, machines, equipment, processes, works or project”.

WHILE SUPPLY CHAIN MANGEMENT PRACTICE which Is the responsibility of Chartered Institute of Purchasing And Supply Management as defined In Section 20 of the CIPSMN ACT  ” denotes the general coordination of activities that involves procurement, purchasing, stores, warehousing, logistics, materials and supply management”

The roles of the media and civil society organizations (CSOs), largely NGOs as obtainable in Section 19 of the PPA, include but is not limited to observation, and the monitoring  of public procurements, including assets disposals as well as ensuring transparency in the application and management of the national economy.  The media on the other hand remain the key watchdog, while ensuring free flow of information to all stakeholders, such as the public. Even though this role is largely shared between and among the NGOs and media, the professions are still distinct from each other without conflict of interest for them to remain independent members of the Council.

RECOMMENDATION

The Committee objected to the proposal of the Federal House of Representative to remove the Nigerian Society of Engineers, the Civil Society and the Media from the Council but agreed with the senate and the House of representatives  that also bringing  Nigerian Institute of Quantity Surveyors  when it is in addition to  NIGERIAN SOCIETY OF ENGINEERS,CIVIL SOCIETY AND THE NIGERIAN INSTITUTE OF JOUNALISTS, into the Council as sector specialists in building industry/ANTI-CURRUPTION/professional advisers    will improve the quality of discussion in the council and will not be in professional conflict as each of the professions are distinct in nature and respectively have Governing Councils recognized by the  National Assembly Acts, with definite terms of reference, that are not in conflict with each other.

QUESTION NO 5.

On the recommendation by the Senate Committee to amend the Principal Act to include the JUDICIARY AND THE LEGISLATIVE ARMS OF GOVERNMENT   in a new Subsection in Section 1 of the Public Procurement Act to set their own independent contract thresholds different from the one to be set by the National Council on Public Procurement as captured in Section 2 of the Principal Act.

OBSERVATIONS

The Committee observed with great concern, that the National Assembly is clearly deviating from their legislative functions to get into the Executive and professional function of setting contract thresholds   and also viewed  with more concern the Federal Government Circular No Ref: SGF/OP/1/S.3/VIII/57 of 11^th March 2009 on thresholds as released by the SGF and approved by the President, which excluded the thresholds for Legislative and the Judicial arms of Government, even though it was also addressed to the Chief Registrar of the Supreme Court, the Secretary of the Judicial Council, the Clerk of the National Assembly and other Officials of the Executive. The Committee is equally of the view that it is not the responsibility of the President to set contract thresholds in Nigeria.

The gap created by the exclusion of the Judiciary and the Legislative arm of Government is what the Seminar participants and members of this Committee believe, gave rise to the proposal of the Senate for the amendment of the Public Procurement Act to pave way for other arms of Government to prepare their own thresholds. (See Annex IV of this report which shows the gap created in the thresholds approvals for the Executive, to the exclusion of the Judiciary and Legislative arms of the Government.) 

The Committee noted therefore that it is not proper as proposed by the Senate, to amend Section 2 of Public Procurement Act, to allow the Legislature to commence the setting up of separate/independent thresholds for contract awards for the legislature and another one separately for Judiciary and strongly believes that, if this is allowed, it will amount to the Legislature /Judiciary INTERFERING WITH THE FUNTIONS OF THE EXECUTIVE ARM OF GOVERNMENT.

The Committee also noted that although the Council and its Secretariat, the Bureau of Public Procurement belong to the Executive arm of Government, it is still an independent organization established by law to regulate Public Procurement in Nigeria, in the three arms of government. The statutory responsibility and the activities of the Council and the Bureau of Public Procurement is not restricted to the Executive arm of Government only.

The Committee further noted that, the fact that ,the National Assembly and the Judiciary respective tenders boards are presently and wrongly not seeking for “No Objection Certificate” from the Bureau of Public Procurement for the contracts that they are awarding does not imply that  their actions  is not a violation of sections     5(c) ,6(1) 16 (2 ) 16(3 ), 16( 4 ),15 and 59,  of the Public procurement Act  2007,requiring correction by the concerned arms of Government as this correction will  save the integrity of the Judiciary and the National assembly.

The  Committee further observed that setting thresholds for contracts  involves setting financial limits for award of different categories of contracts and it is an Executive function that the President initially exercises through the Minister of Finance alone  and now to be carried out by the National Council on Public Procurement by virtue of Section 5(1) of the constitution, Finance and Management Control  Act etc and , the Public Procurement Act 2007 which still makes the Minister of Finance  the Council Chairman, to enable him still  perform his statutorily functions with contributions from council members..

Also, it was observed that   by the provisions of   sections 15, 5(c), 6(1), 16(2) ,16(3), 16(4), 59 the Accounting officers in the Procuring entities in the Judiciary and legislative arms of Government are also required to comply   with the contract threshold set by the National Council on Public Procurement and obtain No Objection certificates from the BPP to contracts awarded or be awarded by them  before withdrawing any money from the treasury, bank  or from Federation  account. The only difference is that  there are no Ministers in the legislative and judicial arm of government thus the  Accounting Officers in those arms of government  will after receiving a CERTIFICATE OF NO OBJECTION  for AWARD of contracts from the BPP,  will either proceed with the IMPLEMENTATION of the contracts decided/Awarded  by the Tenders Board or forward the contract  so awarded for implementation approval/assent/confirmation  to the respective Principal Officers of the National Assembly and Chief Justice of the Federation/Judicial Council members as  determined/approved  by the National Council on Public Procurement ,before the execution of contract agreements. it will not be the role  of the FEDERAL EXECUTIVE COUNCIL to approve implementation in  Judiciary or the National assembly arms of Government.   (See Annexes   1, 2 and 3 of this report which shows procurement process for the respective arms of Government).

The committee  concluded their observation by noting that the national assembly and the judiciary arm of government are part of the Federal government of Nigeria captured in sections 15 and 16(2), 16(3), and 16(4) of the public procurement act 2007 and that  the accounting officers of the procuring entities in the judiciary and the legislature , and likewise the executive arm , are not required by the provisions of sections 2, 5(c), 6(1), 16(2-4),16(18),16(21-22), 58 etc, to enter into or execute any contract without a certificate of no objection issued by the bureau of public procurement as an independent public procurement  regulator and public procurement auditor etc.

RECOMMEDATION

The committee strongly recommends that the Legislative and the Judiciary arms of Government should not be allowed by the amendment of the Public Procurement Act 2007,  to set  independent contract thresholds different from the one to be set for them by the National Council on Public Procurement when it is  constituted and inaugurated by the President.

QUESTION NO 6.

On the position of the Senate to retain the clause that guarantees a competitive selection process as basis for the recommendation and appointment of Director General of the Bureau of Public Procurement as in Section 7(1) of Public Procurement Act 2007.

OBSERVATION

The Committee noted that the Director General of the Bureau of Public Procurement is an officer statutorily empowered by law in the context of Sections 59, 5(c), 6(1), 16(2) ,16(3), 16(4),15 etc of the Public Procurement Act 2007 to perform Public procurement AUDIT and sign the statutory certificates of No Objection” for award of contract or to award of contract, not only for the Executive arm of Government but also in the Legislative and Judicial arms of Government .

On the basis of the above alone, it is very important that the Director General is recruited not only through a competitive selection process, but should be done with the involvement of the Legislative arm of Government for the purpose of the confirmation of   the appointment ,after the  competitive selection process carried out by the council before their recommending a  preferred candidate to the President for eventual nomination/appointment and presentation to the National assembly for confirmation.

The need to retain the competitive selection process as a clause in section 7(1) of the   Public Procurement Act 2007 as the basis for appointment of Director General of BPP, as maintained by the Senate, therefore need not be over emphasized. The Committee observed that the Motto of the BPP includes COMPETITION, EFFICIENCY, and TRANSPARENCY, and therefore believe that these actions should begin in  the Bureau.

The Committee also noted that the post of the Director General of the BPP   is not a mere political appointment but  a statutory and professional position that deals with preparation of statutory Certificate of No Objection” that will be used to withdraw money from the Treasury , Government Bank Accounts in CBN/Commercial Banks and the Federation Account. (FROM TAX PAYERS ACCOUNT)

The Director General  is also noted to be  the Chief Executive and the Chief Accounting officer of the BPP with responsibilities which include signing of the ‘Certificate of No Objection’ which will also serve as a statutory instrument for approval/assent to  for implementation of contracts by the President/Federal Executive Council, and for award/authorization/Decision on  contracts by procuring entities in their respective tenders boards and  that the “Certificate of No Objection” by definition in section 60 of Public Procurement Act is a statutory instrument and means, the document issued by the BPP evidencing (SEE EVIDENCE ACT 2004) and authenticating (SEE AUTHENTICATION ACT CAP 4 LAWS OF FEDERATION OF 1990,  particularly section 2 subsection 1) that due process and the letters of  the Public Procurement  Act have been followed in the conduct of a procurement proceeding and allowing for the procuring entity to enter into a contract or effect payments to contractors or suppliers from the Treasury,

This certificate is also by the provisions of section 16(2  ) of Public Procurement Act used to withdraw money from the FEDERATION account and other bank ACCOUNTS OF GOVERNMENT in addition to, from the treasury.

The Committee further noted that, The DIRECTOR GENERAL OF BPP, BY VIRTUE OF SECTION 5(P) AND 7 OF THE PUBLIC PROCUREMENT ACT 2007, is the statutory Chief Independent Public Procurement Auditor for the Federal Republic of Nigeria, who should  statutorily be a Chartered Procurer certified by the Chartered Institute of Purchasing and Supply Management of Nigeria,( CIPSMN) in accordance with section 11(9 ) ,5(11) ,16(2) AND 18 of the CIPSMN Act 2007 and he/she is required to submit a Bi-annual professional public  procurement audit report to the National Assembly as statutory function in accordance with section 5(p) of Public Procurement Act 2007.

The committee observed  that Bidding Proceeding  Petition by a bidder seeking  administrative review( PROCUREMENT AUDIT) for any omission  or breach  by a procuring entity under the provisions of the Act or any regulations or guidelines made under the Public procurement Act 2007 or the provisions of the bidding document are basically complaints about bidding and conduct of bidding which do not really deal with Civil rights and obligations which  warrant wasting the time of the Federal High Court  to entertain same as a court of first jurisdiction hence the wisdom in statutorily giving the BPP authority to administratively settle such disputes in section 54 of Public Procurement Act 2007,hence  the decisions of the Bureau headed by the Director General in respect of any Procurement disputes between bidders, in accordance with section 54(7) of Public Procurement Act 2007, can only be challenged in the Federal High Court on appellate jurisdiction. 

The competence and qualifications of the Director General of the Bureau for this quasi-judicial   function/responsibility is very important to Nigeria as a whole and specifically to the Judiciary , considering the fact that his/her actions is amenable to judicial remedy(see Hartv Military Governor of Rivers State(W6) 11 SC 211 at 240 where the Supreme Court observed that;

“Although the Military Governor was not sitting as a court “stricto sensu”, he was under a duty to ACT JUDICIALLY AND FAIRLY”

On the strength of the above submission the committee also noted  that  by the principles laid down in the case of GABRIEL MADUKOLU & ORS VS JONATHAN NKEMDILIM (1962 1 ALL NLR 1 as restated in the case of BABALE VS ABDULKADIR (1993) 3 NWLR (Part 281) Page 253 ,the  BPP will only be competent to exercise jurisdiction  only when the BPP  is properly constituted through a competitive process , in its composition and the qualification of its Director General and other panel members are in accordance with sections 7, 8, and 16(1)(b) of PPA and sections 11(9),5(11),16(2) and 18 of CIPSMN act 2007 and there is no other extrinsic factor affecting its jurisdiction.

Also by virtue of supreme court decision in the case of  Owoyemi v Adekoya(2003) CLR 12(b) (SC) AND the appeal court decision in the case of Egware v GOV.  Bendel state (1991) CLR 4(h) (CA)  it obvious that   BPP  must act judicially or fairly on the Account of any dispute brought before the BPP as they must show the criteria to justify what they have resolved to do and since any Certiorari proceedings against BPP and or other parties will involve the Federal High court being mainly concerned with whether the record brought before it, on the face of it shows errors or JURISDICTIONAL IRREGULARITIES, the qualifications of the officials of the BPP as established by law is very paramount to the jurisdiction of the BPP to settle any dispute that will go to Federal High Court for judicial review/appeal. This means therefore that competitive process is the most guaranteed way to produce the best candidate.

The members of the Committee also noted that the Bureau of Public Procurement  is a strategic Regulatory Agency of Government (regulatory authority) for exercise of autonomous authority over Public Procurement proceedings in Nigeria while the Chartered Institute of Purchasing and Supply Management of Nigeria is responsible  for Private and Public Procurement professional practice in Nigeria, including  the responsibility to train and certify both public and private individuals and organizations  wishing to take up  statutory duties  as Procurers. It is also pertinent to state that both the BPP and CIPSMN were born out of the same document; that is the recommendations of the Nigeria Country Procurement Report (CPAR) of 2000 that was carried out by the World Bank in collaboration with other stakeholders in Nigeria. Consequently, the BPP (including its headship) as a PROCESS BASED organization cannot be separated from the CIPSMN which is the procurement professional KNOWLEDGE BASE organization in Nigeria and abroad, as process without knowledge is vanity.

The Committee further noted that BPP as a statutory Agency for Public Procurement in Nigeria is clearly independent from other branches and arms of government, and deals in areas of administrative law/review, rule making, codifying, monitoring, enforcing rules and regulations and imposing supervision/oversight for the benefit of the general public.

In addition, the Committee observed that the existence of the Bureau of Public Procurement is justified by the increased and complicated Public Procurement functions in Nigeria and the need for rapid implementation of Public procurement reforms/authority in Procurement and to avoid the previous drawbacks of political interference.

The Bureau of Public Procurement as stated before is authorized by law to conduct/perform investigations/audit and can even   recommend for parties to be fined by the courts or Accounting Officers to be removed from office or transferred based on convictions for abuse of procurement processes and   to ensure that the Bureau of Public Procurement does its role as a Regulatory Agency without interferences, it is to use mechanisms such as:

a.       Transparency /competition /accountability of processes, information and decision

b.      Procedures of consultation and participation

c.       To explain reasons for actions

d.      To promote principles of non arbitrary and responsive decision.

e.      To have administrative decision reviewed by Courts or the President

The committee finally observed that some of the problems/dangers that the Federal Government, including the National assembly are now facing with or without their knowledge, as a result of not complying with sections 7(1) and 16(1) of the Public procurement Act 2007 and sections11 (9),5(11) and 18 of the CIPSMN Act 2007, in the  appointment of the DG of the of the Bureau of public procurement through a competitive and transparent process include

(a)             That the NATIONAL ASSEMBLY shall not statutorily receive the  statutory bi annual public procurement Audit report  required for budgeting, monitoring and planning as per section 5(p) of public procurement Act for the rest of their tenure as legislators as this PUBLIC PROCUREMENT AUDIT report  to be officially submitted to National assembly  is required to be statutorily signed by a Director General of BPP who is a registered /Chartered procurer  with CIPSMN ,with valid practicing license,  by virtue of the provisions of sections 1,11(9),5(11),14,15,16,18 and 20 of CIPSMN Act, while the ICAN members sign for FINANCIAL AUDIT report and certify same.

(b)            That by virtue of the provisions of section 16(1) ,7(1), 16(2).16(3),16(4),5(c) and 6(1) of the public procurement Act 2007,all procurement contracts in Nigeria since June 4 2007 have failed the comply with the fundamental conditions stipulated in the Public Procurement Act and the CIPSMN Act 2007 and therefore by the provisions of section 16(4)  of the Public Procurement  Act 2007,contracts awarded without DUE CERTIFICATES OF NO OBJECTION ARE NULL AND VOID.

(c)             The BPP , sitting as an administrative body  with jurisdiction  to resolve  dispute   as required by section 54 of Public Procurement Act  is ruled out until the National Council on Public Procurement is constituted and inaugurated and the members of the council mandated by the President to  properly recommend a Director General of BPP for appointment by the President and other required Directors of BPP are duly appointed as recognized by law . This situation will also continue to affect the performance of budget as issues that could have been trashed at BPP as administrative panel and very fast and only go to Federal High Court on appeal,  are now going to Federal High Court as court of 1^st Jurisdiction with the attendant delays that the Act has provided to be avoided. Besides we have pointed out that complaints about bidding or conduct of bidding do not really deal with civil rights and obligations requiring the attention of the Federal High Court on original jurisdiction.

RECOMMENDATION

The Committee   is  therefore of a strong view that the clause which guarantees the appointment of the Director General of the Bureau of Public Procurement through a competitive selection process  should  not only be retained but that the Committee further recommends that such a candidate should also be screened and confirmed  by the           joint Session of the National Assembly even after the competitive selection process and should be from among  members  of Chartered Institute of Purchasing and Supply Management who are qualified by examination with    relevant and adequate professional qualifications for a minimum of 15 years, in accordance with Section 7 of the Public Procurement Act 2007 and Sections 11(9) and 5(11) of the Chartered Institute of Purchasing and Supply Management Act 2007.  The CIPSMN, as observed by the   Committee, is not a private professional body but a duly established Institution to certify professionals in procurement, supply chain management, etc with the participation of Federal Government Ministers and Auditor General of the Federation.

The committee also recommends to the Judiciary arm of Government through the Chief Judge of the Federal High Court to look into order 53 and 54 of the New Federal High Court civil procedure rules to determine how an appeal from rulings/judgments/decisions made by a properly constituted BPP, in a dispute as an administrative body can be challenged at the Federal High Court on appellate review/jurisdiction.

QUESTION NO 7.

On the proposal to amend Section 17 of the Public Procurement Act 2007 to transfer the responsibilities of considering, reviewing and approving contract thresholds from the National Council on Public Procurement, NCPP, as in Section 2 of the Public Procurement Act 2007, to The President  and to  include the Federal Executive Council as contract approval authorities.

OBSERVATION

The committee observed that amending this section as sought by the Executive  will amount to the President reporting to the Bureau to obtain contract ‘No Objection Certificate’ before award instead of the  President questioning  the Bureau before approving/assenting to contracts already  awarded by procuring entities and requiring his assent/confirmation/approval  as the President before implementation. This should be resisted..

The  Committee noted that by virtue of the provisions of Sections 5(1),13,14 ,16  and 148 of the 1999 Constitution and sections  22(5) , 19, 20 of the Public Procurement Act 2007, decisions/award made by the Tenders Board   in the  procuring entities in the Executive arm of Government  is to  be legally sent by the Accounting Officers/Tenders Board to the Ministers for implementation  and  depending on the value of contract ,it  forms the basis for the Ministers to present their respective  tenders board decisions/awards  to the President/Federal Executive Council, to obtain approval /Assent/ratification for the implementation of awards made  by the tenders board by virtue of Section 17 and the request for approval/assent for implementation by the Minister by virtue of Sections 5(1) and 148 ,13,14 and 16 of the 1999 Constitution  and Sections 22(5) , 5(c)  6(1)(b) ,16(21) ,16(22)  and 19 of the Public Procurement Act 2007.

It was observed that if the FEDERAL EXECUTIVE COUNCIL   is now reduced to the status of Tenders Board   by allowing the amendment   sought   in Section 17 in the Executive Bill of 2008, it  will imply that the Federal Executive Council headed by the President will come down from their exalted position to seek for ‘NO OBJECTION CERTIFICATES’ for award of contracts just like   the  Tenders board of a procuring entity , from BPP, for contracts  to be awarded by them  as procuring entity. THIS WILL   AMOUNT TO THE PRESIDENT REPORTING TO THE DIRECTOR GENERAL OF BPP INSTEAD OF THE OTHER WAY ROUND.(see the  organogram of the relationship between the BPP and all the three arms of Government as prepared by the committee and attached to this report.)

This also would mean that the President of the Federal Republic of Nigeria and the entire Federal Executive Council  of Nigeria will also become technically  and legally be responsible for award of contracts which is not the case now . The Federal Executive Council as a  non procuring entity to date  is not responsible for authorization of contract /awards but only to give assent/approval/ratification for contracts already awarded by Tenders board based on statutory No Objection Certificates issued by the BPP thus FEC cannot be legally/technically  held responsible  for contracts awarded by Tenders Board after an evaluation report and submitted to Minister for implementation and which is being implemented with an approval /Assent of the Federal Executive Council  and more importantly a contract s supported with a ‘no objection certificate’ duly signed from the BPP by a qualified professional duly appointed in accordance with sections 7, 8, and 16(1)(b) of PPA and sections 11(9),5(11) ,16(2) and 18 of CIPSMN act 2007

The committee observed that it is very important for the Federal executive council to carry out a Public Procurement Desk Audit on all the officials of BPP to ensure that  only qualified persons issue the  certificate of No Objection since it is a  statutory document issued by the BPP evidencing (SEE EVIDENCE ACT 2004) and authenticating (SEE AUTHENTICATION ACT CAP 4 LAWS OF FEDERATION OF 1990,  particularly section 2 subsection 1) that due process and the letters of  Public Procurement  Act have been followed in the conduct of a procurement proceeding and allowing for the procuring entity to enter into contract or effect payments to contractors or suppliers from the Treasury/Federation Account/Bank Account .

The committee  noted that it is only when the President deliberately refuses to constitute and inaugurate the Council and or refuse to appoint a qualified Director  General of the BPP in accordance with the law, that he may be  questioned  in future, in respect of contracts approved  by his regime with undue certificates of no objection, in violation of section 16(4), 2 , 7,  and 16(1)(b) of PPA and sections 11(9), 5(11) ,16 (5) and 18 of CIPSMN act 2007 .

RECOMMENDATION

The Committee is of the view that it will be inconsistent with  sections 5(1)  and 148 of the constitution  and the status of Executive council to amend Section 17 of the Public Procurement Act 2007 to include the Executive Council as a Procuring Entity/Contract Awarding/approval  Authority in Nigeria and strongly advise the President to resist this temptation to be included as the officer to set contract thresholds and award contracts at the Federal Executive Council and remain an approving council for contracts awarded  by the procuring entities/tenders boards , as the new offer to him in the proposed amendment  is very dangerous and not in line  within the high office of the President. 

The Committee recalled  the recent case at the  Federal High Court  where the Judge  frowned at the Former President for violating Section 5(1) of the Constitution by serving both as the President and Minister of Petroleum during his regime and failing to execute his powers through the Minister of Petroleum   and this is the same situation here, the President is not the one to set thresholds but he  is to do so through his Minister of Finance and in this case, as Chairman of Council.

QUESTION NO 8.

Whether it is proper to amend   Section 35 of the Public Procurement Act 2007 to allow procuring entities in Presidency, National Assembly, Judiciary and the MDAs to pay any amount of payment for contract Mobilization fees as may be determined by them and also excluding insurance companies from issuing advanced payment bonds?

OBSERVATION:

The Seminar participants observed that mobilization fees are mainly for contracts in works and also observed that Insurance Companies are reasonably capitalized in Nigeria and it is a substantial part of their business to give guarantees for contracts.

RECOMMEDATION

The Committee does not have any objection to increasing the immobilization fees from 15% to 25% subject to bank   guarantee, but of the view that insurance companies should not be removed from issuing advanced payment guarantees, as presently passed by the Senate in the 2009 Amendment Bill. The bank and insurance companies should be involved in the issuance of guarantees. The committee is however   opposed to the proposal to leave the amount  open and to be fixed by procuring entities  in their tender documents on case by case basis ,as proposed by the executive and passed by the House of Representatives

QUESTION NO 9.

Whether it is proper for the Senate to amend Sections 16(1)(b) , 16(2) and 16(3) of the Public Procurement Act 2007 to allow Principal officers of the National Assembly (including the Senate President and the Speaker of House of Representatives), the Federal Judicial Tenders Board (Chaired by the Registrar of Supreme court)  to  join the Bureau of Public Procurement as an independent  and parallel professional regulatory body to issue contract “NO OBJECTION CERTIFICATES”  for Award of contracts for  their respective arms of Government?

OBSERVATION

The Committee believes that many Nigerians still lack the understanding of the meaning and implications of CERTIFICATE OF NO OBJECTION FOR AWARD OF CONTRACT and  wondered how it can be possible that the Executive in the first instance will watch the Principal Officers of the Senate and House of Representatives respectively as well as Judicial Tenders’ Board to perform a highly skilled and professional Executive function of issuing ‘Certificate of No Objection’ to or for an award of contracts as made by the respective tenders boards of the   procuring entities, whether in the  legislature or in the Judiciary. The Committee believes there is presently a mix up as to whether the Bureau is required by law to issue ‘No Objection Certificate’ to the three arms of government or not.  The answer here is YES by virtue of the provision of Section 15, 5 (c) 6 (1), 16(4),16 (2),16(3),59 etc of the PPA.

It is the opinion of the Committee members that if the above situation had been clear to the National Assembly members, the only other reason why the National Assembly is proposing to make the Principal Officers to issue “No Objection Certificate”  to or for contracts awards could be  because of the failure of the  Executive to constitute and inaugurate the National Council on Public Procurement. The Council is the only statutory body mandated by law to recommend the appointment of   Director General to the President  through a competitive process and  actually appoint other  qualified Principal officers for the Bureau of Public Procurement that can statutorily issue the required “No Objection Certificate” for contracts award or to contract award by the Legislative and Judiciary arm of Government. 

Going by the provisions of Sections 16(1) and 7(1) of the Public Procurement Act 2007 and Sections 16(2), 16(3) and 16(4) of Public Procurement Act of 2007, therefore all the “Certificates of No Objection” presently being issued for award of contracts in the Executive arm of Government are not products of qualified professionals and technically  null and void and also brings to questions  the legality of contracts awarded with such certificates .

The Committee also observed that since the Senate did not amend Section 16(4) which supersedes Sections 16(2) and 16(3) , the amendment of Sections 16 (2) and 16 (3 ) is of no significant effect and unnecessary.

In another instance, the Committee observed that a  “Certificate of No objection”  for  an award  or to a award of contract in respect of any particular procurement proceeding is the end result of a Public Procurement Audit engagement for a particular procurement proceeding and is  the  statutory/legal certificate issued by  a Chartered  Procurer after performing/carrying out  a Public Procurement Audit (in `the case of BPP, issued by   the signature of the  DIRECTOR GENERAL  as a Chartered Procurer  and not under the seal of the BPP or by the signature of any another Chartered Procurer in the Bureau of Public Procurement approved by the Council in accordance with section 59 of Public Procurement Act 2007 and other relevant sections of the CIPSMN Act 2007)  and evidencing ( in accordance with the Evidence Act of 2004)and authenticating  (In accordance with the Authentication Act cap 4 laws of Federation of 2004 )  that due process and the letters of the Public Procurement  Act have been followed in the conduct of a procurement proceeding and allowing for the procuring entity to enter into contract or effect payments to contractors or suppliers from the Treasury/bank Account/Federation Account.

The Committee also noted in Sections 14 and 15 of CIPSMN Act 2007 that if the issuance of such audit opinion by way of ‘certificate of No objection’ is abused, by any Chattered Procurer the professional involved may be indicted by the provisions of the CIPSMN Act 2007.  It is stated clearly in these sections that it will be wrong for the CIPSMN tribunal to try any   person who is not registered with the Institute and made a Director General of BPP, on any   abuse of NO OBJECTION CERTIFICATE. This further explains why the DG should be a registered professional.

RECOMMENDATION

Under the above circumstances, the Committee calls on the National Assembly and the Judiciary arm of Government to impress on the Executive for the constitution and  inauguration of the National Council on Public Procurement and to set machinery in motion to appoint qualified   officers of the Bureau that can statutorily sign certificates of No Objection for them instead of proposing to amend the law for the principal officers of the National assembly to sign the certificates of No Objection.. It is also noted that it is unconstitutional for the Principal Officers of the National Assembly and that of Judicial Tenders Board to begin to issue professional procurement certificates of ‘No Objection’ to contracts as it is the responsibility of the Bureau of Public Procurement based on threshold approved by the National Council on Public Procurement. 

The committee also noted that the Principal Officers of the National Assembly includes the Senate President and Speaker of the House of Representatives ,hence they should not  be reduced to the status of a Director General of the Bureau of Public Procurement  by issuing Public Procurement Audit Certificates by way of certificate of No objection for Award of contracts..

ISSUE NO 10.

A recommendation by the Senate to   amend Section 20(2) (a) of the Principal Act to remove the clauses which places/reinforces the responsibility for contract mis-procurement on the accounting officers

OBSERVATION

The Committee observed  from Sections,16(20) and 16(21),  19 and 22(5), of the Public Procurement Act 2007, that  contrary to the popular view that only Accounting Officers of the respective procuring entities are responsible for contract failures,  that in addition to the Accounting Officers and  the individual respective Ministers who send memos to the Executive council for implementation approval before executing contracts agreements as  in Sections 19 and 22(5) of the Public Procurement Act as well as all the  Procurement Experts/Professionals and Sector Specialists  in Engineering, Quantity Surveying, Medicine, law,  Pharmacy, involved in professional advise/preparation of technical specifications etc.,  are also statutorily held accountable for their respective actions taken or not taken  or to be taken in compliance or in contravention of the Public  Procurement Act 2007.

The  Committee therefore observed that amending Section 20(2)(a) will not achieve the set objective of the Senate as Sections 16(21) and (22) are still in place and it is obvious that to remove the clauses which place responsibility for contract mis-procurement on accounting officers, as passed by the Senate will promote corruption in Nigeria to remove the clauses which places responsibility for contract mis-procurement on  accounting officers, as passed by the Senate  will promote corruption in Nigeria, instead of reducing it.

RECOMMENDATION:

On the basis of the information provided above, the Committee disagrees with the Senate over proposal for the removal of the clause in this Section 20(2)(a) which states “whether  or not the act or omission was carried out by him personally or any of his subordinates and it shall not be material that he had delegated any function, duty or power to any person or group of persons.” and strongly recommends that there should be no amendment of  this Section, especially because Sections 16(21) and 16(22)  of the Public Procurement Act are also not amended along with 20(2)(a).

QUESTION NO 11.

Whether it is proper   for the Senate to amend Section 22(5) of the Principal Act to include the WORDS “or the accounting officer of the procuring entity as the case may be” after the word “Minister”?

OBSERVATIONS

The Committee observed that in accordance with Sections 20(5), 16(21), 16(22), 20 (1) and 20(2) of the Public Procurement Act 2007, it is stated that it is the duty/responsibility of the Accounting officer, (i. e. Permanent Secretary, Director General or other officer of coordinate responsibility which is the Clerk of the National Assembly   in the legislature and Registrar in Judiciary to plan, organize, evaluate tenders and execute all procurements.

Although it is not expressly stated in the Constitution and Public Procurement Act 2007, that the Registrar of the Supreme Court and the Clerk of the National Assembly are to submit contracts awarded by Tenders Board /Decision taken for implementation approvals, it is  clear by virtue of  section 13  and 16 of the constitution that the authorities  Executive,  the National Assembly  and the judiciary include   amongst others , ensuring equitable distribution of the National wealth  to serve the common good of Nigerians and to promote balanced and planned economic development and therefore the officers of co-ordinate responsibility with Permanent Secretaries in the Executive need not be informed that, that they   need approval from the Principal Officers of the National Assembly  or Chief Justice of the  Federation/Judicial Council  respectively  as the case may be before the implementation of certain contract thresholds ,as will be approved by the council when constituted and inaugurated.  in accordance with Sections 2, 5(c), 6(1)(b), 16(21), 16(22),  17, 19, 20(1) and 20(2) of the Public Procurement Act 2007 and sections 13,14 and 16  of the 1999 constitution.

 In the case of the Executive arm of Government, it is also very clear in Section 22(5) of the Public Procurement Act 2007 that the decision of the Tenders Board shall be communicated to the Minister (in any procuring entity where there is a Minister), for implementation .

The implication of section 22(5) is that the processes involved in procurement implementation in Section 19 of the Public Procurement Act 2007 for the Minister to implement, is that part of the implementation of Procurement Process that comes after the award/decision of the Tenders Board up to Contract execution and announcement of the award.

The Tenders Board is under obligation of the law to forward their decision/award to the Minister for the implementation  of  the execution of all Contract Agreements subject to threshold approved by the council and sections 5(1), 13,14 and 16 of the 1999 constitution; and  to Announce and publicize the award of contracts by the Federal Government in the format stipulated by this Act and guidelines as may be issued by the Bureau from time to time.

The provisions of section 5(1), 13, 14, 16, with special reference to 16 (2) and 148 of the Constitution makes it mandatory for Ministers to seek approval of the President/Federal Executive Council for the implementation of certain thresholds not within their approvals limits for implementation, based on the thresholds to be set for them by the National Council on Public Procurement.

The problem  we have today, is a situation where some Ministers, after obtaining approval for the implementation of contracts already awarded by their various Tender’s Board ,  return after the Federal Executive Council meeting, to announce that the FEC has awarded certain contract instead of announcing the approval obtained for award of same by the Tenders board . What they should announce is the approval obtained for the implementation of the award of contract and discuss award by Federal Government which include the Tenders board and not award by FEC.  Another problem is that the Bureau of Public Procurement has labeled the FEC as one of the approval Authorities in the Threshold that they submitted to the President for approval while the FEC is actually not awarding contracts as an approval authority but only giving assent/confirmations/approvals to contracts already awarded by the approval authorities and presented to the council through council memo .

In accordance with Sections 17, 22 (5 ), 19 ,16(21) and 16(22) of the Public Procurement Act 2007, it is the specific statutory function of the Minister in the executive arm of government and not that of the accounting officer   to receive the details of the decision/award made by tenders board and continue with the implementation of procurement process in accordance with section 19 of Public Procurement Act,  and will continue to supervise this implementation until a contract agreement has been executed and contract award announced. As far as Public Procurement Act 2007 is concerned, implementation by virtue of section 19 ends with announcing award   and that is where the statutory responsibility of the Minister in contract award implementation end and the rest is for the Accounting officer’s full responsibility.

The Minister is the one statutorily empowered to proceed further with the implementation of THE DECISION/AWARD made by the Tenders Board by arranging to execute all Contract Agreements; and   finally announce and publicize the award in the format stipulated by this Act and guidelines as may be issued by the Bureau from time to time. Or obtain the approval of the President through a memo to Executive council if the threshold is beyond his power as approved by the council when inaugurated before entering into agreement.

In the case of the JUDICIARY AND LEGISLATIVE arms of Government, the Ministers and the Federal Executive Council roles does not arise as the Accounting officers in those respective arms of government are required to deal directly with their Principal officers of the National assembly and the Chief Justice of the Federation  to obtain approvals for implementation  of awards/decisions of Tenders board after obtaining a “Certificate of ‘No Objection’  for or to Contract Award” from the Bureau   of Public Procurement ,within the prior review threshold as stipulated in Section 6 (1) of the Public Procurement Act ,

The Chief Accounting officers shall also proceed further with the implementation of the decision of the Tenders Board by  , Executing  Contract Agreements; and  finally Announce and publicize the award in the format stipulated by this Act and guidelines as may be issued by the Bureau from time to time etc  and shall receptively obtain approval/assent  from the Senate President, The speaker of House of Representatives and the Chief justice of the Federation  or their representatives,  respectively in accordance with sections 13,14 and 16 of the 1999 constitution to implement certain  contracts approved by the tenders board as will be determined by the council upon inauguration.

The Committee noted that although the National Assembly and the Judiciary arm of Government are presently not seeking for ‘No Objection’ certificate for Contract award ,it is important that the National Assembly/Judiciary  understand that it is mandatory by virtue of Sections 5(c), 15, 16(2) 16(3), 16(4) and 6(1) of the Public Procurement Act for such Certificate to be issued to them by the Bureau before award of contracts .This knowledge ,we believe will be enough to stop the request by the Senate for the Act to be amended to authorize for the Principal Officers of the National Assembly to start issuing certificates of No Objection to contract awards, along with the Bureau of Public Procurement.

RECOMMENDATION

The Committee believes that it is proper  for the Senate to   amend Section 22(5) of the Principal Act  to include the  WORDS “ or the accounting officers of the procuring entity as the case may be” after the  word “Minister”  and recommends that it should be  amended as this will make it clearer to the National Assembly and to the Judiciary that the Bureau of Public Procurement is responsible for issuing “No Objection Certificate” to the National Assembly Tenders’ Board, managed by the Accounting Officer of a co-ordinate responsibility with Permanent Secretary in the Executive. This also applies to Judiciary. (The Clerk of the National Assembly, the Registrar of the Supreme Court and the Secretary of the Judicial Council are all officers of co-ordinate responsibility with the Permanent Secretaries in the Executive arm of Government and are therefore Accounting Officers

QUESTION NO 12.

Whether it is proper  for the Senate to   amend Sections  25(2)(i) and  25(2)(ii)   to reduce   the  contract advertising time  from   minimum of  6 weeks  to minimum of  3 weeks before bid opening and to peg the total Procurement cycle to 60 days, 45 days, and 30 days respectively.

OBSERVATION

The Committee members observed that, if section 23 of the Public Procurement Act 2007 (under Prequalification) is professionally analyzed, no prequalification process can be completed before 28  days as against the 14 days being advertised and practiced by various procuring entities  on the recommendation of the BPP  .  The Committee further noted that when an invitation to submit  bid is published  without prequalification, it should  the minimum 29days required  for the prequalification stage  since it involves pricing and all other factors making up the bid, including bid bonds from banks.

The   Committee   thus disagrees with the recommendation of the Senate to reduce the contract advertising time from a minimum of 6 weeks to 3 weeks minimum, but instead recommend that it should be a minimum of 30 days before any bid opening or for prequalification of bidders.

The members also disagreed with the time table fixed by the House of Representatives as the total contract award cycle ranging, from 60 days to 30 days because it is not practicable and as T                his will also affect time for proper evaluation and settlement of disputes etc. in contract award.

RECOMMENDATION:

The minimum time to advertise for contracts should be 30 days, in order to allow at least 14 working days  of 7 working days each (19 DAYS) for bid clarification between the bidder and the procuring entity and the balance 11 days for other activities connected with bidding process. IN ACTUAL FACT  29 DAYS MAY NOT BE ENOUGH IN CERTAIN PREQUALIFICATION  OF CONTRACTS

AREAS URGENTLY REQUIRING AMMENDMENTS IN THE PUBLIC PROCUREMENT ACT 2007 BUT NOT OBSERVED BY THE LEGISLATURES AND IN THE PRESENT PROPOSALS FOR AMMENDMENT

(1)     SECTION 38 (3)

This section   as presently contained in the Public Procurement Act 2007, was viewed by the Seminar participants and the Committee as being against the spirit of rule of law and due process.  The Committee therefore, urges the Attorney General of the Federal and the Nigerian Bar Association to examine this section thoroughly and advised on possible provisions. 

It is the view of the Seminar Participants as captured by the Committee that Section 33(3) of the Act,   as presently contained empowered the procuring entities to decide when to obey or disobey a court order, to produce documents. By-passing that Procuring Entities can refuse to produce a document ordered by a properly constituted Court, if the procuring entity feels that the disclosure of the information is

a)              Contrary to the law

b)                Will impede law enforcement

c)                Prejudice legitimate commercial interest of the parties.

The Committee argues that it is the responsibility of the Courts and not the Procuring Entity to take arguments and to know when the issues listed above will occur and the Court will refuse to give the order, but once the order has come from a Court, whether correct or not,  it must be obeyed by the Procuring Entities by producing the Document so ordered by the Court.

The Seminar Committee member’s therefore calls on the Nigerian Bar Association (NBA) and the Attorney General of the Federation to examine this Section 38 (3) and to liaise with the National Assembly for possible amendment because we believe that procuring entities cannot overrule the  court on any judgment or ruling ,no matter how weak the order may be,  since the Supreme Court  ruled  in a judgment delivered on 4^th October 1991 by Justice Nwokedi in  the case of Agbai v Okogbue (1991) CLR 10(a) (SC) that the Principles of rule of law are that :-

( a ) The absolute supremacy of law as opposed to          the exercise of arbitrary power;

 (b)  Equality of persons before the law;

(c)  That the constitution is the result of the ordinary law of the land as interpreted by the courts.

(2)     SECTION 23 (PREQUALIFICATIONS OF BIDDERS)

The seminar Committee observed that the instructions on bid clarification as stated in the procurement manual presently approved by the BPP for the procuring entities is incomplete and is responsible for many problems of public procurement in Nigeria. On quote, the instruction states in section 8.1 of the manual as follows:

HANDLING REQUESTS FOR CLARIFICATIONS: “It shall be the responsibility of the respective procuring entity to provide any clarifications on prequalification or tender documents within the stipulated time limit. Every procuring entity must respond to the communication from potential bidders and if appropriate, send copies to the others who purchased the tendering documents”

From the above statement, the Committee saw a big gap without specific instructions from the Bureau of Public Procurement to guide the bidders/procuring entity. The procurement Committee also observed that the time limit for taking necessary steps is not stipulated for all bidders and procuring entities for follow ups. In accordance with section 23 (prequalification of bidders) the minimum time for prequalification   to be completed is 29 days and calculated as follows.

a)                Minimum of 11 days to allow bidder to ask questions from date of advert {See Section 23(4)}

b)                 Minimum of 9 days to allow the procuring agency to respond to bidder in a maximum of 7 working days. {See Section 23(5)}

c)                 Another minimum of 9 days to allow the bidder to return bids to procuring entity in a maximum   of 7 working days. {See Section 23 (5)}

Total time above = 29 days. By the time you put other considerations, it is a minimum of 30 days.

This also explains why three (3) weeks proposed by the Senate as minimum time to tender advert for National and International bidding is inadequate considering that this will only begin after an advertisement. The minimum time should be 30days in order to allow at least 18 days for any bid clarification by surface mail and at least another 12 days for a very efficient bidder for bid preparation, obtaining bid bond from bank and the return of bid to the procuring entity. In reality, it should be more than 30 days if the government wants bidders to be competitive.

What is the current practice in the country based on the Procurement manual for prequalification?

a)                Some prequalification are done in 4 days

b)                Some are done in 10 days

c)                Some are done in 2 weeks. etc

d)                There is no standard; every procuring entity does what they like.

There is therefore an urgent need to look at this clause, and the advertised procurement manual on the BPP website e.tc. to avoid the present crisis being experienced by bidders and procuring entities during tendering and prequalification, and which has presently resulted to so many law suits in the courts

(3)     SECTION 26 (1)

There is need to amend this section to include insurance companies as part of the organization that can issue bid guarantees and not only banks, contained in the present Act.

(4).    SECTION 31 SUBSECTION (10)( B)

This section should be amended to show that differences in standards should not be treated as minor deviation when it is lower than minimum standard.

(5)     SECTION 31 (10) (C)

This should be amended to show that the difference in delivery schedule where time is very important is a major deviation

(6)     SECTION 31 (10) (D)

This should be amended to show that alternative design that changes performance is not a minor deviation

(7)     SECTION 31 (10) (I)

This section should be amended to show that questionable and unclear subcontracting is not a minor deviation when it is not verifiable.

(8)     SECTION 31 10 (O)

This section should be amended to show that a minor deviation in payment terms that has major impact on the bids is not a minor deviation.

(9)     SECTION 37 (3)

This section should be amended to show that the applicable interest rates to be used is the one approved by the Central Bank of Nigeria for Commercial Banks on the date of  bid opening, and not the one stated on bid documents which if allowed in its present will create variation in tenders and create confusion.

(10)   SECTION 55 (I)

This section should be corrected to show that the disposal of assets by the Bureau of Public Enterprises (BPE) is subject to a “No Objection Certificate” for disposal of assets, and other sections of the Public Procurement Act 2007, subject to Privatization and Commercialization Act 1999, and not “commercialization and commercialization act 1999” as presently and mistakenly stated in the Public Procurement Act 2007.

(11)   SECTION 56 (I)

This section should be amended to show that the “Independent Evaluator” to be engaged by the Procuring/disposing entity to evaluate any asset for disposal must be an “Independent Evaluator” with a statutory expertise duly registered in Nigeria for such valuation before he or she begins evaluation of assets for disposal and not just any independent evaluator.

(12)   SECTION 58 (11) AND 58 (12)

To amend typographical error and correct section 58 (9) of this section in section 58(11) and also state section 58 (5) of this section in section 58 (12)

(13)   SECTION 60 (INTERPRETATION)

To redefine threshold to have the proper meaning, and also to redefine procurement to show that it is not only acquisition but to further explain that it means/involves obtaining from external and internal source, all goods works and services which are necessary for the running and maintaining of Government primary and secondary activities at the most favorable conditions and cost.

(15)   SECTION 8 (1)

To amend this section to read Principal Officers appointed under section 8 (1) and not 9 (1) as mistakenly stated.

(16)   SECTION 19

To correct subsection 19 (h) to read “as stipulated in section 6 (1)” and not as stipulated in section 3(a) of this Act as mistakenly stated

CONCLUSION

The   overall opinion of the Committee after an overview of the entire proposals for amendment and the approvals so far from Senate and House of Representatives as pointed out in this report shows that there is an urgent  need to first begin the implementation of the present Act of 2007, while calling for public hearing to examine  how to  further review the  Act and which we strongly recommend  should be done after a full investigation and understanding of all the issues raised during the Seminar and covered in this report.

It is also the view of the committee than the non implementation of the 2007 Act would continue to impart negatively on the economy of Nigeria, hence an urgent need to implement the Act in full.

We  also observed that the non inclusion of the procedures to seek for judicial review in the new Federal High Court Civil procedure rules 2009 may be one of the reasons why bidders who are yet to enter into contract with procuring entities  and have no obligations or civil rights to pursue are  now having a field day, slowing down the implementation of  budget by rushing to the Federal High court as a court of original jurisdiction to hear their petitions in respect of bids  and bidding   proceedings that have not matured into any contract with the procuring entities or Federal Government, instead of going  to a well  BPP in accordance with section 54 of PPA ,within the time allowed to seek for fair hearing  and then go to the Federal High Court ,if need be, to seek for judicial review.

We observed that in the absence of a well constituted BPP with jurisdiction to hear administrative petitions and try them for possible judicial review by Federal High Court, such matters are  sometimes  sent directly to the President for   adjudication and to waste his valuable time.