By Haydar Daudu
Public Procurement is central to an efficient and effective service delivery system of a government. It is the process of purchase by governments and state-owned enterprises of goods, services, and works. A well-governed public procurement contributes directly to greater public trust, enhanced well-being, and more prosperous and inclusive societies.
The global best practice of public procurement implies that stakeholders adhere to a well-defined and established code of ethics and require all implementers to uphold the code and show commitment to it by rejecting nepotism, bribery, and other associated corrupt practices.
Nigeria has had decades of down moments-impunity and corruption in processes of awarding contracts in public procurement, to address these problems, Nigeria’s President, Late Umar Musa Yar’adua in 2007, gave assent to Public Procurement Act 2007 which established two key entities; (i) the Bureau of Public Procurement (BPP) and (ii) the National Council for Public Procurement (NCPP). To guide the procedures and ensure transparency in governance as enshrined in the nation’s constitution.
Over one decade after BPP and NCPP, Public Procurement in Nigeria is still covered by massive waste and corruption. It is estimated that Nigeria loses between 20-60 percent of its total public spending due to poor procurement processes. This amounts to anything between 6 to 20 billion dollars annually to various abuses associated with public procurement and contract awards. To put this in perspective, Nigeria’s capital allocation to the ministry of health from 2006 to 2018 is 1.8 billion dollars.
The NCPP has been at the center stage of controversy particularly as the Federal Executive Council (FEC) has been accused of utilizing the procurement procedures as a means of enriching themselves. To understand the DEMAND over the constitution of NCPP, the roles of both the FEC and the NCPP needs to be understood. The FEC is legally backed by the Nigerian constitution which constitutes of the President, the Vice President, all the ministers as well as some presidential advisers. In essence, the FEC is a combination of the president and all of his political appointees who aim to aid the president in achieving specific goals without question.
The NCPP, on the other hand, constitutes of the Minister of Finance as the head of the council, the Director-General of BPP, as the Secretary; Attorney-General of the Federation, Secretary to the Government of the Federation, Head of Service of the Federation, and the Economic Adviser to the President. The other members of the NCPP include the Nigerian Bar Association; the Nigerian Institute of Purchasing and Supply Management; Nigeria Association of Chambers of Commerce, Industry, Mines and Agriculture; Nigeria Society of Engineers; and Civil Society (contextually refers to non-governmental organizations) and the media.
The role of the NCPP includes the monitoring and oversight function of public procurement; creating a harmonized set of policies and practices which would ensure transparency; consideration, approval, and amendment of monetary thresholds for the application of the provisions of the act by entities engaged in procurement. Most important, however, is that there is a need to address the problems that stem from a faulty institutional framework especially with regards to the development of policies that will aid in the improvement of the entire procurement process in Nigeria which is to be in line with stipulated regulations.
Essentially, the argument being raised in this article is that the FEC should not have, in any way, the sole power of awarding contracts especially with the increasing loss that Nigeria experiences as a result of the excessive intervention of the council. This is because the FEC is not empowered by the PPA 2007 to set thresholds for approval or awarding contracts.
According to the PPA 2007, the bodies constituted to engage in the administrative and regulatory roles of the procurement process are the NCPP and the BPP. It is important to further point out that section 2, 16 and 17 of the PPA 2007, empowers the NCPP to be the authority for setting and approving the thresholds for public procurement as well as approving the necessary policies.
Regarding the issue of awards and approvals of awards of government contractors, the FEC is basically usurping the statutory duty assigned to the NCPP especially as the PPA does not make mention of the FEC as having the power to approve contracts. What this means is that the FEC is acting beyond its legal power or authority. Furthermore, the FEC’s involvement in awarding and approving contracts is contrary to the World Banks Country Procurement Assessment (CPAR) recommendation which states that “high-level politicians” (such as the FEC members) should not be involved in the approval and awarding process, rather, they should maintain an overall managerial oversight, thus, leaving the administrative as well as operation roles to the civil servants (who are also not without their faults). However, this has not been the case.
Thus, the lack of non-governmental organizations presence which is aptly captured in the constitution of the NCPP, in the process of procurement means that FEC members award or approve contracts without assessing the full implication or getting a holistic viewing of the impact of the procurement process which they have approved.
It is clear that what needs to be done is to either specify that the FEC is responsible for awarding, approving and setting the monetary threshold for government contracts (all of which will be contrary to World Bank recommendations), or formally constitute the NCPP, giving them their full powers and allowing them to carry out their functions.
Haydar Daudu is a phD Candidate of Economics at Nile University of Nigeria
