Public Procurement System in Tanzania Presentation in the SADCOPAC / EAAPAC Accountability Conference 2012 Windhoek Namibia Welcome Karibuni Presentation prepared by: Mathew N. KILEO Clerk Public Accounts Committee Tanzania P.O. Box 9133 Tel: +255 22 2112065/7, Fax: +255 22 2112538 Email: tanzparl@parliament.go.tz Websit: www.parliament.go.tz Dar-es-Salaam Tanzania

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.

Applicable to all public bodies including those not receiving subvention Procurement Thresholds No Procurement Thresholds Central Tender Board PPRA PPA No. 21 of 2004 PPA N0.3 of 2001 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 PPAA has chairperson and Four Members PPAA has chairperson and six members Major differences between PPA 2001 and PPA 2004

Regulatory Framework of Procurement in Tanzania The Public Procurement (Goods, Works, Non-Consultant Services and Disposal of Public Assets by Tender) Regulations GN. No 97 of 2005 Public Procurement Act No. 21 of 2004 Local Government Tender Board (Establishment and Proceedings) Regulations Standard Tender Documents Guidelines for Preparation of Responsive bids Other Circulars periodically issued by PPRA Tender Evaluation Guidelines The Public Procurement (Employment and Selection of Consultants) Regulations GN. No 98 of 2005

ACCOUNTING OFFICER PROCUREMENT MANAGEMENT UNIT PPAA SET UP OF PROCURING ENTITIES ACCOUNTING OFFICER PPRA TB submits to AO approved bidder for notification of award Provisions to Handle disagreements Reports to AO approved by AO recommended by PMU and Members TENDER BOARD PMU Submit Recommendations to TB for Approval Evaluation committees PROCUREMENT MANAGEMENT UNIT Evaluation report submitted to PMU User Departments initiate Requirements, inputs to specifications and in evaluation

Strong oversight body (PPRA) Proper implementation Guidelines INTERVENTIONS FOR COMPLIANCE WITH PPA 2004 Capacity of PEs and bidders to implement the Act Proper system for checking and Monitoring Proper System of Sharing Information

2015 – 100% COMPLIANCE WITH THE LAW AND ENSURING VALUE FOR MONEY THE JOURNEY TOWARDS 2015 2015? 2015 – 100% COMPLIANCE WITH THE LAW AND ENSURING VALUE FOR MONEY

THE JOURNEY- IS IT ACHIEVABLE ???? Yes it is achievable as long as every PE aims to achieve Vfm

The need to improve efficiency – High Expenditure in Public Procurement 216 PEs Tshs 2.96 trillion 264 PEs Tshs 3.10 trillion 315 PEs Tshs 4.52 trillion VOLUME OF PROCUREMENT CARRIED OUT BY PROCURING ENTITIES SINCE FINANCIAL YEAR 2007/08

The need to improve efficiency – Low levels of Compliance 20 PEs 100 PEs 99 PEs 91 PEs 174 PEs TREND OF PROCURING ENTITIES COMPLIANCE WITH PUBLIC PROCUREMENT ACT AND ITS REGULATIONS SINCE FINANCIAL YEAR 2006/07

Efforts to increase efficiency Many efforts are being undertaken – only few shall be highlighted in this presentation

AREAS OF FOCUS

Expanding PPRA Outreach New Structure- From 51 Staff (2001) to 142 Staff (2004) 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 CORPORATE SERVICES Contract Performance Section Monitoring and Evaluation Section 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 Expanding PPRA Outreach

PPRA TO REACH LGAs – opening of zonal offices Mwanza Arusha D’Salaam Iringa

SUPPLIER/SERVICE PROVIDER SYSTEM OF PROCUREMENT OF COMMON USE ITEMS AND SERVICES – REDUCED PROCUREMENT TRANSACTION COSTS -Aggregates all CUIS from PEs GPSA -Decides on the appropriates Procurement Method -Submits a list of CUIS to GPSA -Prepares and Maintains CUIS and Suppliers Data Base -Compiles a list of CUIS -Submits a list of Framework Agreements -Maintains Data on placed Call Off orders as received from PEs -List of CUIS approved PROCURING ENTITY PPRA Enters into Framework Agreement with winners Invites Tenders -Submits copies of Call Off Orders to PPRA and GPSA -Places and pays for Call Off Order -Supplies and paid for the call off order SUPPLIER/SERVICE PROVIDER 16

Efficiency in sharing procurement information to the public

Efficiency in sharing procurement information to the public

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

Amendments to the Act –Notable Amendments to Complaints Review Mechanism

System for Procurement Complaints Review PPAA-if not satisfied with the decision of PPRA or after the expiry of a 30 days period PPRA-if not satisfied with the decision or after the expiry of a 30 days period Suspend procurement proceedings TOTAL 105 DAYS Copy of decision submitted to PPRA and the RC After signing of contract Before the signing of contract Conduct investigations HEAD OF PE Decision within 30 days Bidders complaint Presented within 28 days from the day of the event leading to complaint Copy of complaints submitted to PPRA and the RC System for Procurement Complaints Review

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

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

WE can all overcome

Thank you for listening The End