Procurement Procedure in SSA

33rd Review Meeting of State FCs- Delhi

(24th - 25th May 2012)

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Main Considerations

PROCUREMENTPROCUREMENT

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Main Considerations of Proficient Procurement

(i) Economy: Give the purchaser best value for money.

(ii) Efficiency: Best procurement is simple and swift, producing positive results without protracted delays.

(iii) Fairness: Impartial, consistent, and therefore reliable.

(iv) Transparency: Maintains rules and procedures that are accessible and unambiguous. It is not only fair, but should be seen to be fair.

(v) Accountability and Ethical Standards: A key deterrent to collusion and corruption, and a key prerequisite for procurement credibility.

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Why is Procurement Important?Why is Procurement Important?

• In procurement terms inputs are generally grouped into three categories:

(i) Civil Works – School Infrastructure and facilities like New PS, UPS, Residential Schools, Hostel, ACR, HM Room, BRC/URC, CRC, Drinking water, Toilets, Girls Toilet, Ramps, Handrail, Electrification, Retro-fitting, Boundary wall/ fencing, Major Repairs, etc.

(ii) Goods - Typically equipment, computers, furniture, textbooks, library books, uniforms, TLE, TLM, other materials, supplies, commodities, etc.

(iii) Services – Hiring of services including academic, technical and resource support provided by institutions/organizations in all areas, research studies, third party quality evaluation of civil works, auditors etc.

• The quality, timeliness, local appropriateness and affordability of those procured inputs can largely determine whether the public investments will succeed or fail.

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Effective ProcurementEffective Procurement

ObjectivesObjectivesObjectivesObjectives

Right Quality product

Right Quality product

Right quantities

Right quantities

Lowest possible

price

Lowest possible

price

Meeting recognized standards

Meeting recognized standards

Timely Delivery as per

schedule

Timely Delivery as per

schedule

Reliable suppliersReliable

suppliers

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PROCUREMENT IN SSA

• Strictly follow procurement procedure prescribed in Chapter IX of the Manual on Financial Management and Procurement (FM&P).

• Mandatory to follow the Manual provisions for all procurements under SSA.

• Follow States’ financial ceilings except when not prescribed by MHRD.

• Strictly follow MHRD’s financial ceilings prescribed for various method of procurement on 17-09-2008 as extended on 2-7-2010 which shall prevail on States’ ceilings.

• This ceiling is applicable upto 30-9-2012 and thereafter follow the State ceiling.

• Convert the Ceilings in US$ to Indian Rupee by adopting RBI’s buying rate of exchange prevailing on the date of issue of purchase order/work order.

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MHRD’s Financial ceilings per contract MHRD’s Financial ceilings per contract

Category Open Tender Limited Tender

Single Tender

Community

Goods >50,000

<3000,000

< 50,000 <30,000

Works >40,000

<300,000

<50,000 <40,000 <40,000

Text books Upto 1 million

<500.000

SIEMAT Upto 800,000

Information Technology equipment

>50,000

<4 million

<50,000

Books, Teaching materials school facility improvement, hiring of vehicles of equipment

<30,000

Service Contract <200,000

• Any contract in excess of the maximum limit indicated above shall not be procured using SSA funds.

(In US $ equivalent)

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• Identification of Needs.

• Ensure availability of specific budget provision.

• Assessment of bulk requirement at the beginning of the financial

year.

• Computer, equipment, furniture, books etc in economic lots as

per annual need.

• Procure miscellaneous items of stores not covered by bulk

requirement as per actual need.

• Make all purchases to the best advantage after comparison of

competitive prices.

• Strictly follow the level of procurement prescribed in the Manual

• Encourage decentralized procurement

• Avoid centralized procurement of items prescribed at lower level

Points to be kept in view Points to be kept in view

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PROCUREMENTPROCUREMENT

Strictly follow the levels of procurement provided in Para 112 of the Manual on FM&P

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School/KGBV levelSchool/KGBV level

All civil works, except buildings for Residential Schools/Hostels and

KGBV. Furniture to Govt. UPS Library Books for schools Teaching Learning Material School grant. Maintenance grant.

Teaching Learning EquipmentREMSLearning Enhancement Programme (LEP).Items required for KGBV.Uniform

Special Training related ItemsSpecial Training related Items

TLM, Contingency etc.

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CRC/BRC levelCRC/BRC level

Furniture/ equipment/computer etc.

Office contingencies

Teaching Learning Material

Teacher Training

Community Training

Civil works for construction of BRC, augmentation of BRC

and CRC

Maintenance of BRC and CRC

Printing work

REMS

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District levelDistrict level Office equipment for DPO Office furniture for DPO Textbooks/other books/supplementary materials Computers and accessories Aids and appliances for CWSN Office contingencies Hiring of vehicles Maintenance of equipment and vehicles District level training and workshops Printing work REMS ECCE Kit Educational Kits for girls Learning Enhancement Programme (LEP) Construction of Residential Schools/Hostel and KGBV

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State levelState level Textbooks Computers and its accessories Office equipment for SPO Office furniture for SPO Equipment for distance education Aids and appliances for CWSN Office contingencies Hiring of vehicles Maintenance of equipment and vehicles State level training and workshops Printing work Engagement of consultancy firms (service contract) Engagement of Auditors for external and internal audit Engagement of experts/resource persons Engagement of NGOs REMS Learning Enhancement Programme (LEP).

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Method of ProcurementMethod of Procurement

Method of Method of ProcurementProcurementMethod of Method of

ProcurementProcurement

Open Tender Open Tender

Limited TenderLimited Tender

Single TenderSingle Tender

Procurement without tender /

quotation

Procurement without tender /

quotation

Procurement through

communities

Procurement through

communities

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OPEN TENDEROPEN TENDERMeaning

• Competitive bidding procedure and is the most efficient and economic way of procuring goods or works.

• Provides for adequate competition in order to ensure reasonable prices.

• Ensures transparency and equal opportunity to all.

• The methods used in the evaluation and the award of contracts are made known to all bidders.

Items covered

Civil works construction of BRC, Residential schools / Hostel, KGBV, SIEMAT and any other civil works specifically approved by Project Approval Board through contractors.

Goods

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OPEN TENDER

Steps Preparation of tender documents

Notification / Advertisement;

Issue of tender documents;

Pre-bid Conference

Submission of tender documents;

Public opening of tender;

Evaluation;

Selection of lowest evaluated responsive bidder based on post qualification;

Negotiation with L-1 (if necessary)

Contract award; and

Contract performance

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LIMITED TENDERLIMITED TENDER

Items covered:

Goods including books, uniforms

Teaching learning materials,

School equipment,

Hiring of vehicles, and

Operation and maintenance of equipment

Invitation for quotations –

• Based on comparing price quotations obtained from several suppliers, usually at least 3 to ensure competitive prices.

• Issue a letter to the supplier to furnish the quotations for the required goods/equipment.

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Invitation for quotations –

No need of publication of notification in the newspaper/website.

Issue the request letters to suppliers on the approved list.

The request letter should indicate description, specifications and quantity of the goods as well as desired delivery time and place.

Only one quotation by each supplier.

Bid Price Quote for the full quantity as described in the invitation letter.

Corrections, if any, made by crossing out, dated initialing and re-writing.

Include all duties, taxes and other levies payable by the Vendor/Supplier in the total price.

The rates quoted by the Vendor/Supplier be fixed for the duration of the contract and not subject to adjustment on any account.

The prices are quoted in Indian Rupee.

LIMITED TENDERLIMITED TENDER

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LIMITED TENDERLIMITED TENDER

Steps Identifying items;

Laying down specifications;

Estimating total numbers and costs of items;

Need not notify in newspaper/website

Identifying likely agencies borne on the approved list of contractors/ suppliers; (minimum 3, 8-10 for more competitive rates)

Obtaining approvals of competent authority;

Issuing letters of invitation;

Processing quotations received;

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Obtaining orders of competent authority for placing orders for

supply;

Issuing letters placing orders for supply and delivery period;

Quoted price shall include all duties, taxes and other levies;

Rates quoted be fixed and not subject to adjustment;

Ensuring inspection;

Ensuring timely supply: and

Making payments after delivery in satisfactory condition.

The financial ceiling prescribed for limited tender shall be

applicable for Rate contracts of DGS & D and Rate contracts of

State Governments.

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SINGLE TENDERSINGLE TENDERFollowed in the case of Articles specifically certified as of propriety nature; or Manufactured by a particular firm; Goods including books; Teaching materials; School grant; Hiring of vehicles; and Operation and maintenance of equipment etc

Appropriate for Extension of existing contracts Standard equipment/spare parts for existing equipments from original

supplier. Items obtainable from one source Early delivery In exceptional cases such as natural disaster.

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WITHOUT TENDER / QUOTATIONWITHOUT TENDER / QUOTATION Procurement of goods or group of goods estimated to cost the

equivalent of the ceiling of State Govt.

Issue suitable guidelines by the SIS

THROUGH COMMUNITIESTHROUGH COMMUNITIES Construction of all civil works except, BRC, Hostel, KGBV and SIEMAT

BRC construction if the community is technically capable

Purchase of materials as per ISI certification, if available;

SPD may provide simple procurement guidelines

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Identify the committee locally operating in the area. Keep the following points in view:

Active involvement of community in planning and implementation;

Who will procure the materials or goods used in works;

Goods / works have to be executed as per approved plans and specifications

The name and designation of the Engineer for technical supervision and certification.

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Service Contract

Considerations

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Service Contract Selection process Preparation of Terms of Reference Preparation of Cost Estimate and Budget Advertisement, seeking Expression of Interest (EOI) short listing of consultants/firms based on EOI Issue of Request for Proposal (RFP) to short listed

Consultants/firms. Receipt of RFP in two envelope system, technical and financial

proposals separately. Formation of Evaluation Committee Evaluation of Technical proposal and assign individual mark by

each member on the basis of responsiveness to the TOR Open the Financial proposals of the qualifying Consultants

publicly in the presence of the Consultants/representatives Final discussions including negotiations Award of contract

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Non-Government Organizations

Preparation of Terms of Reference Publication of advertisement

Formation of Evaluation Committee

Short-listing of NGOs on the basis of specifications and scope of

the work specified in the TOR.

Desk appraisal and if found suitable, field appraisal by the

Evaluation Committee Recommendation by the Evaluation Committee for the selection

of NGOs to the Grant-in-Aid Committee. Approval by Grant-in-Aid Committee based on the report of the

Evaluation Committee on the desk and field appraisal.

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