Project Materials

EVALUATION OF THE USE OF TENDERS IN A PUBLIC SECTOR PROCUREMENT

ABSTRACT

The purpose of this study is to carefully assess the usage of tenders in public sector procurement. In order to have a better knowledge of public procurement in terms of Nigerian content, the Nigerian Procurement Act of 2007 was enacted. As a case study, this research will look at the Bureau of Public Procurement’s (BPP) Lion Building in Enugu. This research will also look closely at the various terminologies used in public procurement. The purpose of this research is to conduct a thorough examination of the use of tenders and tendering in enhancing efficiency and effectiveness in the public sector, as well as public sector contract management and administration. In order to meet the study’s aims, research questions were carefully designed to allow the researcher to acquire appropriate data/information on the topic area. Attempts were also made to evaluate relevant literature and the perspectives of professionals, experts, and consultants, particularly in the following areas. Meaning of tenders and tendering, tender evaluation and procurement in the public sector, tendering documentation, tender pre-qualification, and tenders board. During the fieldwork, all acquired data will be presented and analysed, and some of the findings will be discussed before a conclusion is reached. Based on the findings, recommendations were developed to aid the development of public sector tendering, which, if carefully implemented, will assure accountability while also reducing the rate of contract abandonment after contractors have been fully mobilised.

Chapter one

INTRODUCTION

1.1 Background of the Study

Tender to a layperson can signify a variety of things, including pampering a child or something young. However, in this context, a tender is defined as “an offer made in writing by one party to another to execute a specific supply contract/commodity at a specified cost.” Tendering is the process of submitting an offer, bid, proposal, or showing interest in response to a tender invitation or request.

The dictionary of purchasing and supply management defines tender and tendering as bids from without callous, usually in sealed envelopes, presented by the time and date stated in the invitation to tender from the provision of goods and services.

According to Uzor (2004:440), in CIPS, tendering is the public announcement by an organisation of the requirements for products or services for a project in order to allow formal bids to be made to offer those goods or services.

Lyson (1996) further characterised tendering as a purchasing procedure in which potential suppliers are encouraged to submit a formal and unequivocal offer of price and terms, which, if accepted, will serve as the basis for the future contract.

Chilaka o. and Amanze c. describe tender as an offer to sell at the specified price that can be converted into a contract by acceptance in the form of a buyer’s order.

Tender is an offer to sell at the indicated price and can be transformed into a contract by accepting the offer in the form of a buyer’s order.

Perhaps tendering is the first opportunity for buyers to obtain complete information about the provider, and for suppliers to improve their service level is the most significant factor. Public sector management has contributed significantly to the effective and efficient management of contracts in the public sector.

Several constraints have been implemented to ensure that tenders and tendering are strictly followed. For example, no contract work involving construction will be considered by the bids board unless for the following reasons:

(a) The land has been bought and the topography map on soil examined, unless it has been approved by the Architect and is not required. The architect’s document relating to the land, survey map, soil, test report, or certificate of example should then pay off the contract document before being handed to the board. See the recently reviewed financial regulations (2000)

i. Architectural design

ii. Structure Design

III. Mechanical Design

iii. Bill of quality

Furthermore, Chapter 32 of Financial Regulation (2000) specifies the conditions governing the local purchase of stores, and subject to those conditions, all local purchases of stores, etc., as well as all work and services costing more than N500,000 must be obtained through contract after public tender. It must be documented that tendering has been exploited, mismanaged, or even misunderstood.

This single cause of poor contract collection of mobilisation fees is carefully examined. The purpose of this research is to evaluate the use of effective and efficient tendering in improving public sector contract management and administration.

1.2 Statement of the Study

(a) A growing number of issues have plagued public sector tenders, which have received a lot of attention. The quality of the contract signed by a public sector organisation.

The entire contract system has gone sour as a result of mismanagement, corruption, and misapplication of the rules and regulations that must be followed when contracting for products and services.

(b) Another issue confronting public sector tendering is the Nigeria factor, in which the nation suffers while the individual prospers; selfishness, political consideration, godfatherism, embezzlement of public funds, contract abandonment, and so on. All of these have had a significant impact on the quality of tendering, which in turn affects the quality of the public sector.

(c) The out-of-date nature of our financial or store regulations, which guide the operations of public procurement as well as public sector tendering, is the most serious issue with our public sector tendering and thus has serious implications for the efficiency and effectiveness of public sector contract management and administration.

1.3 GOALS OF THE STUDY

(a) Conduct an examination of the use of tenders or tendering to improve the efficiency and effectiveness of public sector contract management and administration.

(a) Investigate the reasons for the failure of public sector tenders, public sector contracts, and those of private sector organisations.

(c) Investigate the effects of poorly handled tenders on public sector contract administration and management.

(d) Investigate the impact of political corruption godfatherism and the Nigeria factor on public sector tendering.

(e) To propose strategies for strengthening public contract management through efficient and effective tendering.

(f) To investigate the procedures and processes for tendering and awarding contracts, as well as the abilities required of officers involved in public tender and contract administration.

(g) To offer strategies of improving public sector tender, attain better ways of contacting for goods and services that will benefit the tax payers, the government and the service providers.

1.4 SIGNIFICANCE OF THE STUDY

An assessment of the use of tenders in public sector procurement cannot be overemphasised. This has been increasingly significant in recent years, as replacement prices are typically higher than the initial estimate.

When the necessity to reach the rural areas through development project that affect the lives of the rural people has increased.

Therefore, the study is relevant in the following ways:

1. This study if relevant because it will aid the researcher in developing abilities and experience in conducting practical inquiry on vital topics mainly on tenders and tendering and other related subject in the public and private sector in the future.

2. The study will provide the researcher with insight into how tenders and public sector contracts are administered and managed.

3. This research effort is also very important to the researcher because it is one of the requirements for receiving a higher national diploma in purchasing and supply management.

4. Once completed, this study will be valuable to any public sector organisation involved in contract administration and management.

5. When completed, this study will provide new and in-depth information into the weaknesses as well as present tendering and contract methods and procedures.

This research will highlight the system’s weaknesses while also benefiting the system, organisations in both the private and public sectors, and other students who may be interested in additional research into public sector tendering, contract management, and administration.

1.5 RESEARCH QUESTION.

The researcher designed the following questions to collect all necessary information on the subject of this research endeavour.

1. Does tendering play a role in increasing the efficiency and effectiveness of the public sector?

2. Can the present tendering sector organise, remove corruption, and promote accountability and transparency in the public sector?

3. Are the officers who handle public sector tenders qualified?

4. Does the composition of the state’s tenders board comply with the provisions of the financial regulation (2000)?

5. What factor contributes to bad tender management in the public sector?

1.6 Research Hypothesis

The following hypotheses will be presented during the course of the investigation.

HO: Tenders can help improve the efficiency and effectiveness of the public sector.

Ho: Tenders play an important role in increasing the efficiency and effectiveness of the public sector.

HO: The current processes or procedures employed by public sector organisations help to prevent corruption while also increasing openness and accountability.

H1: The current processes or procedures utilised by public sector organisations contribute to the elimination of corruption while also increasing openness and accountability.

1.7 The Scope of the Study

This study was limited to public sector organisations and did not cross borders into other sectors of the economy, allowing for a more in-depth investigation into the influence of tendering on public sector contract management and administration in Nigeria.

For a proper understanding of the impact of tendering in the management and administration of the public sector contract, this study would have covered all the ministries, departments, agencies, boards, and even the local government areas in the country, but the researcher after due consideration of various variables and implications decided to concentrate on the study of the implications of efficient and effective tendering in the administration and management of contracts

In doing so, the researcher collaborated with the majority of the departments and units involved in some way with the subject matter of this study.

These departments or units include administration, engineering, planning, and finance. These areas will provide valuable insight into what happens in other ministries, departments, boards, agencies, and so on.

1.8 Definition of Terms

1 Tender: Offer to supply goods and services at a specified price in response to an invitation to submit such an offer in competition with others.

2 Quotation: This is a formal statement prepared by a contractor or supplier for his customer that includes cost estimates, specifications, and other important information about a contract between two parties.

3 Government: An institution charged with the authority to govern and direct the affairs of the state.

4 Evaluation: The process of discovering and determining the quantity and value of something.

5 Negotiation: Seeking agreement between the purchaser and the contractor or supplier through a dialogue in order to reach acceptable terms and conditions prior to signing a contract.

6 Analysis: The practice of separating components into independent sections or units in order to study and critically evaluate each element.

7 Certificate: An act of licensing by a document that formally tests the fulfilment of a condition.

8 Procedures: A method, technique, or pattern of carrying out a task, work, or service, etc.

9 Performance: This is an agreement to perform a contract as requested, and if the client fails to do so, the supplier or contractor will recompense him or her.

10 Specification: This is a detailed requirement for a job/supplies/contract that the contractor or supplier must adhere to. It is what the supplier must provide to the buyer as specified by the buyer.

11 Standardisation: This is the process of defining and applying technical standards to ensure the quality of commodities and services for both buyers and sellers.