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BEST GUIDE TO GHANA’S PUBLIC PROCUREMENT [UPDATED]

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Ghana Public Procurement refers to the process through which goods, services and works are financed either wholly or in part by public institutions (MDAs/MMDAs) for public purposes in Ghana.

Public Procurement is governed by an Act of Parliament called the Public Procurement Act, 2003 and led by a Board with a Chief Executive Officer and a Minister of Procurement.

Scope of Application of the Act

  • The Act applies to the procurement of goods, works and services financed in whole or in part from public funds except where the Minister decides that it is in the National interest to use a different procedure.

It applies to:

  • Central management agencies
  • Ministries, Departments and Agencies (MDAs)
  • Subvented agencies; these are organizations funded by government to undertake projects.
  • Government institutions
  • Public Universities, public schools, colleges and hospitals
  • Bank of Ghana
  • Among others.

Structure of the Public Procurement

The structure of the Public Procurement in Ghana is as follows:

PUBLIC PROCUREMENT BOARD

PROCUREMENT ENTITY (IES)

        TENDER COMMITTEE                       

   TENDER EVALUATION PANEL                 

   TENDER REVIEW BOARDS              

       LOCAL GOVERNMENT

1.1.       Functions of the Public Procurement Authority

The Public Procurement Authority (Board) oversees the entire Public Procurement in Ghana. Below are some of the functions of the Board:

  • Make proposal for the formulation of policies on procurement
  • Monitor and supervise public procurement in the country
  • Development of Public Procurement documents (rules, directives, instructions, other regulations)
  • Preparation and presentation to annual report on procurement
  • Government advisor on public procurement issues
  • Maintenance of public procurement entities.

What the Public Procurement Authority does not do:

  • Procure for or on behalf of any Government Entity
  • Award any contract for or on behalf of any Government Entity
  • Invite tenders for or on behalf of any Government Entity

Expenses of the Board; Parliament through appropriation grants the Board with such money as it may require.

Accounts and Audit; The Board shall keep records and prepare annual accounts as prescribed by the Controller and Accountant General and approved by the Auditor General.

1.2. Procurement Entity:

A Procurement entity is responsible for procurement of goods, services and works.

The Minister may in consultation with the Board by notice in the Gazette declare any entity or individual to be a procurement entity and shall carry out its duties as laid down in this Act or by the Board.

 1.3.  Tender Committee:

Each Procurement Entity shall have a Tender Committee that will be responsible for:

  • Ensuring that each stage of the Procurement activities in this Act and recommended by the Board.
  • Ensuring that the Procurement Entities exercise sound judgment in making procurement decisions
  • Referring to appropriate Tender Review Board for approval beyond its authority.

1.4. Tender Evaluation Panel

  • This Panel has the expertise to evaluate tenders and assess the Tender Committee in its work.
  • They shall evaluate each tender according to the pre-determined and publish evaluation criteria.

1.5. Tender Review Boards (TRB)

At each level of the Procurement process, the TPB is established;

  • Central TRB
  • Ministerial TRB
  • Regional TRB
  • District TRB

NOTE: The Public Procurement (Amendment) Act 2016 (Act 914) has brought dissolution of District and Ministerial for TRB.

Functions

  • Approval of the Procurement process by the Procurement Entity
  • Furnish the Procurement Board with annual report
  • Participate in Public Procurement forums
  • Review the decisions of heads of entities in respect of a complaints.

The procurement process.

Ghana Public Procurement process that Procurement Entities follow in making procurement decisions for government entities can be summarized as follows:

Procurement Plan

A Procurement Entity prepares a Procurement Plan and submits its approved programmes and plan for approval by the Tender Committee and shall indicate:

  • Contract packages
  • Estimated cost for each contract packages
  • The procurement methods
  • Processing steps and time
  • Among others

Qualification of Tenders

A tenderer in Public Procurement shall

  1. Possess the necessary:
  • Professional and technical qualifications and competences
  • Financial resources
  • Equipment and other physical facilities
  1. Have the legal capacity to enter the contract
  2. Be solvent; not bankrupt
  3. Pay taxes
  4. Directors of the tenders are qualified and not declared bankrupt or illegal behavior
  5. Pay Social Security Fund and pay all compensation for pollution if any.

Pre – qualification Procurement

A Procurement Entity may engage in pre- qualification proceeding to identify tenderer who are qualified prior to the submission of tenders.

Rejection of tenders, proposals and quotations

A Procurement Entity may reject any tender when the tenderer fails to meet a qualification in the predetermined or published requirement. The grounds for rejections shall be communicated to the Tenders.

Methods of Procurement

  1. Competitive Tendering:

This method of procurement is used by the Procurement Entity when it has the specific/formulate detailed speculations for the goods and gives all tenders equal opportunities.

  1. Two – Stage Tendering:

This method is used when the Procurement Entity does not have specific specifications for the goods or services. The first stage gives tenderer opportunity to furnish the Procurement Entity with likely specifications which will meet the needs of the Procurement Entity and after that, the second stage is where each tenderer is given opportunity for bid for the contract.

  • First stage (Invitation Document)
  • Second stage (Tender proceedings)
  1. Restricted Tendering

A Procurement Entity may for reasons of economy and efficiency and subject to the approval of the Board engage in procurement by means of Restricted Tendering.

Condition:

  • If the goods, services or works are available from only limited number of suppliers or contractor.
  • If the time and cost required to examine and evaluate a large number of tenders.
  1. Single – Source Procurement

A Procurement Entity may engaged in this method under section 41 with the approval of the Board.

Conditions:

  • Where goods, works or service are only available from a particular supplier or contractor.
  • Where there is an urgent need for the goods, works and services
  • Where there is an additional requirement from a supplier or contractor who has supplied the Procurement Entity with goods, services or works.
  • Where the Procurement Entity thinks in the best interest of National security a Single – Source Procurement method is used.

Tendering Procedures: There are two tendering procedures namely; National and International.

National Competitive Tendering:

This is where the Procurement Entity decides that only domestic suppliers or contractors may submit tenders.

International Competitive Tendering:

This is where the Procurement Entity decides to allow foreign firms or tenders to tender or bid for the contract.

Procedure for Inviting Tenders

A Procurement Entity shall invite tenders by publishing a document called Invitation to Tender in the newspaper. If it’s an International Competitive Tendering, the document must also be published in at least one International newspapers.

Contents of Invitation to Tender

  • Name and address of the Procurement Entity
  • Specification of goods and place of delivery
  • Time of delivery
  • Criteria and procedure for evaluation
  • Means of obtaining the Invitation of Document
  • The price and currency as well as means of payment for the Invitation Document
  • The place and deadlines for submission of Tenders
  • The place, time and date for the opening of bids.

Clarification and Modification of Tender documents

  • A supplier may request promptly clarification of the tender documents from the Procurement Entity. The Procurement Entity shall within reasonable time before the deadline for the submission of Tender respond to the request.
  • The Procurement Entity may modify the Invitation Document by issuing an addendum (textual matter added onto the publication) prior to the deadline for the submission of tender.

Examination of Tenders

The Procurement Entity may ask a supplier or contractor for clarification of its tender in order to assist in the examination, evaluation and comparison of tenders.

Evaluation of Tenders

  • The Procurement Entity shall evaluate and ascertain the successful tender in accordance with the procedures and criteria set out in the Invitation Document.
  • Upon choosing the successful tenderer, the necessary documents are assigned and come into effect.

Methods and Procedures to Procure Consultants.

It follows the same procedures as under goods.

  • Review

Right to Review:

Any supplier that claims to have suffered any loss or injury due to a breach of a duty imposed on the Procurement Entity by this Act on;

  • The selection of a method of procurement
  • The choice of a selection procedure
  • The limitation of procurement proceedings
  • The decisions by the Procurement Entity.

Review by Procurement Entity

A complaint shall in writing be submitted to the head of the Procurement Entity either before the or after the procurement contract comes into force. The Procurement Entity shall within 21 days after the submission of the complaint, issue a written decision concerning the complaint.

Administrative Review

If a supplier lodges complaints to the Procurement Entity and the Procurement Entity’s response/decision doesn’t suit the supplier, an official complaint is sent to the Public Procurement Authority (PPA).

  • Upon the receipt of a complaint, the authority shall give notice of the complaint promptly to the Procurement Entity.

The decision by the Authority may be either;

  • Declare the legal rules/principles that govern the subject – matter of the complaint
  • Annul in whole or in part an illegal act or decision of the Procurement Entity.
  • Revise an illegal decision by the Procurement Entity or substitute its own decision for the decision of the Procurement Entity.
  • Order that the procurement proceeding be terminated.

Disposal of stores, Plant and Equipment

Authority to dispose

  • The head of a Procurement Entity shall convene a Board of Survey comprising representatives of departments with surplus, unserviceable and absolute stores and Plant & Equipment.
  • The Board of Survey recommendations is approved by the head of the Procurement Entity as to how to dispose the stores.

Procedures for Disposal

  • Transfer to government departments
  • Sale by public tender to the highest tender(s)
  • Sale by public auction
  • Destruction, dumping or burring as appropriate.

Procedures for Procurement at the District Assembly Level (Local Government)

  • The storekeeper or head of spending units raises requisition by completing the Activity and Expenditure Initiation forms which is approved by the Heads of MDAs/MMDAs/Administration.
  • Procurement Officer makes requests for quotation by inviting bids from potential surplus.
  • Tender Committee reviews the bids and selects a supplier.
  • The Procurement Officer prepare the Purchase Order and sent to the Accountant to ensure that the transaction is properly charged and to commit the transaction against the Budget Allocation (Warrant) of the MMDAs.
  • The accountant authorizes the Purchase Order and approve by the Head of the MDAs and MMDAs as a warrant
  • The Purchase Order is sent to the supplier, goods is received and inspected by storekeeper and the Audit team.

WEAKNESSES OF THE PUBLIC PROCUREMENT IN GHANA

The procurement Act of Ghana, Act 663 (2003), was enacted and promulgated by parliament of the republic of Ghana to, among other things; bring sanity and conformity to public procurement by instituting bodies and principles that harmonizes the public procurement process and activities.

Even though the Act is good, it has some disadvantages which may include the following:

  1. Lack of Clear Procedure for Emergency Procurement
  2. Slow Pace in Regularizing the Draft Regulations
  3. Lack of Qualified Procurement Personnel
  4. High Cost of Advertisement

 

Public Procurement Authority, OECD Principles

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