States must comply with public procurement act (2007) to get refunds

By Chief Ebube Etudo   |   24 June 2016   |   4:28 am

kjkIn a letter dated 10 February, 2012, I confronted the then Federal Minister for Works with publications in the newspapers which stated that the Federal Government had decided to reimburse some State Governments that have rehabilitated Federal Government Roads. I protested the non-insistence that such refunds must follow the provisions of the Public Procurement Act (PPA) 2007.

The Hon Minister replied and informed me that Government had commenced a verification exercise in respect of claims for refund by the 36 states of the Federation and also advised that the outcome would conform with the Federal Government guideslines on reimbursement and that I would be informed of the outcome.

We requested details of the guidelines from the Hon. Minister who failed to reply till he left office. Subsequently in the Guardian newspaper publication of 10 April 2013, the then Hon. Minister of Works was reported to have announced to the National Working Committee of the then ruling party that “some states could not be paid for the work they did on some Federal Roads because they failed to comply with the Public Procurement Act”. So, only N20 Billion Naira was paid out of the N350 Billion Naira earmarked for reimbursement. It is noteworthy that the Hon Minister failed to communicate the outcome of the verification but it is heartwarming that the Federal Government by my intervention grudgingly complied with the provisions of PPA 2007.

It has become necessary once again to discuss the proposed refund of money purportedly spent by the states on Federal Government Roads as proposed by the President. Federal Roads are not in doubt as works done on them are verifiable, but the cost effectiveness of the contracts awarded for the roads must be subjected to the scrutiny of PPA 2007. The recent statement credited to the various news media that the President has promised to bail out the states by approving refunds in respect of roads is welcome but such approvals must follow due process.

By that I mean that all provisions of PPA governing budgetary plans, prior budgetary appropriations of the procuring entities and procurement processes must be based on the fundamental principles of Public Procurement set out in section 16 of PPA 2007. In summary the section insists that procurement processes must be planned, budgeted for, money made available to finance them and that the process of procurement must be open, competitive, transparent, timely, and equitable in order to ensure accountability with a view to achieving value for money. On the basis of these principles, it appears to me that most of the applications for refund may fail.

These ideals are the core beliefs that have driven Mr. President’s public service, and he must neither waiver nor buckle under pressure from authorities that have broken the law. He must insist that the Fundamental Principles of Public Procurement are respected and enforced. PPA 2007 is a suis generis legislation that provides that the violation of any of its sections is a crime.

The President should as a matter of urgency establish the National Council on Public Procurement which has the statutory function of formulating policies on Public Procurement. It is the responsibility of the council to “give such directives and perform such other functions as may be necessary to achieve the objectives of PPA 2007”. It is the National Council that will direct the Bureau of Public Procurement to implement policies that will rein in all Public bodies with a view to ensuring that PPA 2007 extends its reach to Local Governments, States, States Assemblies, National Assembly and the Judiciary.

The President should also direct the Bureau of Public Procurement to audit all claims made by the States by reviewing “the procurement and award of contract procedures of every entity to which” PPA 2007 applies as provided in Section 5(0) of PPA 2007 with a view to ensuring that only those procurements that have complied with PPA 2007 are approved for reimbursement.

I equally advise Public bodies that have not yet embraced PPA 2007 to do so without delay because it is not only useful in respect of dealings with the Federal Government, but it is a useful cost cutting tool in order to eliminate waste and corruption in the procurement process and make more funds available for developmental projects. Chief Ebube Etudo is a Lagos based Lawyer and Estate Surveyor and Valuer.




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