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Public Procurement System in Tanzania

Presentation in the SADCOPAC / EAAPAC Accountability Conference 2012 Windhoek

Namibia

Presentation prepared by:Mathew N. KILEOClerkPublic Accounts Committee TanzaniaP.O. Box 9133Tel: +255 22 2112065/7, Fax: +255 22 2112538Email: tanzparl@parliament.go.tzWebsit: www.parliament.go.tzDar-es-Salaam Tanzania

WelcomeKaribuni

Reforms in Public Procurement Regime

Procurement reforms in Tanzania started way back in 1997.

The reforms led to enactment of Public Procurement Act No. 3 in March 2001 (PPA 2001). It became operational in July 2001.

Reforms in Public Procurement Regime

In 2002 a Country Procurement Review Assessment was carried out which suggested further reforms from centralized to decentralized procurement System

The Reforms culminated in enactment of Public Procurement Act 2004.

-

PPA N0.3 of 2001

PPA No. 21 of 2004

Central Tender Board

PPRA

Head of PEs

chairperson of TB

Head of PEs not chairperson of TB but they

appoint members

Not applicable to Parastatals

not receiving Gov.

subvention

Applicable to all public

bodies including those not receiving

subvention

PP

AA

has chairperson

and Four Mem

bers

PPAA

has chairperson

and six mem

bers

Procurement Thresholds

No Procurem

ent Thresholds

Major differences between PPA 2001 and PPA 2004

Public Procurement Act No. 21 of

2004

The Public Procurement (Goods, Works, Non-Consultant Services and Disposal of Public Assets by Tender) Regulations GN. No 97 of 2005

The Public Procurement (Employment and Selection of Consultants) Regulations GN. No 98 of 2005

Sta

nd

ard

Ten

der

Do

cum

ents

Ten

der

Eva

luat

ion

Gu

idel

ines

Gu

idel

ines

fo

r P

rep

ara

tio

n o

f

Res

po

nsi

ve

bid

s

Oth

er

Cir

cu

lars

pe

rio

dic

ally

iss

ued

by

PP

RA

Regulatory Framework of Procurement in Tanzania

Lo

cal

Go

vern

men

t

Ten

der

Bo

ard

(Est

abli

shm

ent

and

Pro

ceed

ing

s)

Reg

ula

tio

ns

SET UP OF PROCURING ENTITIES

ACCOUNTING OFFICERACCOUNTING OFFICER

TENDER BOARDTENDER BOARD

Evaluation committeesEvaluation committees

TB submits to AO approved bidder for notification of award

Mem

bers

recom

men

ded

by P

MU

and

app

roved

by A

OPMU Submit Recommendations to TB for Approval

Rep

ort

s to

AO

Evaluation report submitted to PMU

Provisions toHandle

disagreements

User DepartmentsUser Departments

PROCUREMENT MANAGEMENT UNITPROCUREMENT MANAGEMENT UNIT

initiate Requirements, inputs to specifications and in evaluation

PPRA

PPAA

INTERVENTIONS FOR

COMPLIANCE WITH PPA 2004

Strong oversight

body (PPRA)

Capacity of PEs and

bidders to implement

the Act

Proper implementation Guidelines

Proper system for checking

and Monitoring

Proper System of Sharing

Information

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THE JOURNEY TOWARDS 2015

Yes it is achievable as long as every PE aims to achieve Vfm

THE JOURNEY- IS IT ACHIEVABLE ????

216 PEsTshs 2.96

trillion

264 PEsTshs 3.10

trillion

315 PEsTshs 4.52

trillion

The need to improve efficiency – High Expenditure in Public Procurement

11

39%

50%55%

73%68%

49%

59%

69%

80%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

2006/07 2007/08 2008/09 2009/10 2010/11

AV

ERA

GE

COM

PLIA

NCE

LEV

ELS

ACTUAL TARGET

TREND OF PROCURING ENTITIES COMPLIANCE WITH PUBLIC PROCUREMENT ACT AND ITS REGULATIONS

SINCE FINANCIAL YEAR 2006/07

The need to improve efficiency – Low levels of Compliance

Efforts to increase efficiency

Many efforts are being undertaken – only few shall be highlighted in this presentation

-

83

57

57

42

56

68

26

79

79

66

31

32

52

0 20 40 60 80 100

Establishment and composition ofTender Board

Establishment and composition of PMU

Functioning of AO, TB and PMU

Preparation of Annual ProcurementPlan

Approvals

Advertisement of bid opportunities

Publication of aw ards

Time for preparation of bids

Method of Procurement

Use of standard tender documents

Records keeping

Quality Assurance

Contract implementation

Series1AR

EA

S O

F F

OC

US

DIVISION OF INFORMATION AND COMMUNICATION

TECHNOLOGY

DIVISION OF CAPACITY BUILDING

AND ADVISORY SERVICES

Research and Documentation

Section

Guidelines Development and

Dissemination Section

Training and Advisory Services

Section

Finance and Accounting Section

Administration and Human Resources

Section

DIVISION OF CORPORATE

SERVICES

Contract Performance

Section

Monitoring and Evaluation

Section

DIVISION OF MONITORING

AND COMPLIANCE

Systems Development and

Maintenance Section

BOARD OF DIRECTORS

CHIEF EXECUTIVE OFFICER

INTERNAL AUDIT UNIT

Systems Support and Administration

Section

PROCUREMENT MANAGEMENT UNIT

Planning and Coordination

Section

DIVISION OF LEGAL AND PUBLIC AFFAIRS

Public Relations Section

Legal and Secretariat Affairs Section

Investigation and Anti-Corruption

Section

Zonal Services Section

NORTHEN ZONE

LAKE ZONE

COAST ZONE

CENTRAL AND SOUTHERN ZONE

New Structure-From 51 Staff (2001)

to 142 Staff (2004)

Expanding PPRA Outreach

MwanzaArusha

Iringa

D’Salaam

PPRA TO REACH LGAs – opening of

zonal offices

-Submits copies of Call Off Orders

to PPRA and GPSA

-Places and

pays for Call

Off Order

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SYSTEM OF PROCUREMENT OF COMMON USE ITEMS AND SERVICES – REDUCED PROCUREMENT

TRANSACTION COSTS

PROCURING ENTITY

SUPPLIER/SERVICE PROVIDER

PPRA

GPSA

-Compiles a list of CUIS-List of CUIS

approved

-Sub

mits

a li

st

of C

UIS to

GPSA

-Aggregates all CUIS from PEs-Decides on the

appropriates Procurement Method

Invit

es

Tenders

Ente

rs into

Fr

am

ew

ork

A

gre

em

ent

wit

h

win

ners

-Prepares and Maintains CUIS and Suppliers Data

Base-Maintains Data on placed Call Off orders as

received from PEs-Sub

mits

a li

st o

f

Fram

ewor

k

Agre

emen

ts

-Supplies and paid

for the call off

order

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Efficiency in sharing procurement information to the public

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Efficiency in sharing procurement information to the public

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Efficiency in procurement transactions – e-procurement – Tanzania has done a feasibility study and is currently

working on issues relating to system selection, hosting, infrastructure, application, operation and maintenance, as

well security

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Amendments to the Act –Notable Amendments to Complaints Review

Mechanism

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Bidders complaint

HEAD OF PE

Presented within 28 days from the day of the event

leading to complaint

Copy of complaints submitted to PPRA

and the RC

Befo

re t

he s

ign

ing

of

con

tract

Conduct investigations

Decision within 30

days

Copy of decision

submitted to PPRA and

the RC

Suspend procurement proceedings

PPRA-if not satisfied with the decision or after the expiry of a 30 days period

PPAA-if not satisfied with the decision of PPRA or after the expiry of a 30 days period

Aft

er

sig

nin

g o

f con

tract

System for Procurement Complaints Review

TO

TA

L 1

05 D

AY

S

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Amendments to the Act –Notable Amendments: Integration of

procurement plan with budgeting process

Challenges

Failure by Some PEs to utilize the opportunity for reducing procurement transaction cost e.g use framework contracts for procurement of CUIS and advertize in the TPJ and Authority website

Corrupt and fraudulent practices in procurement process despite the effort being spent to prevent and combat them

Challenges

Commercial operators such as suppliers and service providers, as well as CSOs have not effectively used the opportunities availed by the PPRA to build their capacity

PEs to be encouraged to do procurement capability review assessment and allocate resources for capacity building of their staff

Way Forward

Action to be taken against PEs not demonstrating commitment to reduction of procurement transaction cost

Commercial operators should be sensitized to register as appropriate and take part in improving their capacity to withstand the competitive procurement market in the country as well as in the region

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Way Forward

The CSOs should be empowered to actively participate in advocacy of good governance in public procurement and monitoring of process and outcome in delivery of services

The fight against fraud and corruption in public procurement should be intensified by more collaborative initiatives among key stakeholders

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WE can all overcome

Thank you for Thank you for listeninglistening

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