Monday, 15 April 2013 07:50
Dodoma. The Public Procurement Act, which is meant to check fraud in the purchase of goods and services, has proved to be a liability and should be reviewed, according to the Controller and Auditor General.
Mr Ludovic Utouh told The Citizen here recently that those who were expected to adhere to the law had found ways to either circumvent or abuse it.
He said even President Jakaya Kikwete had voiced his concern about the law enacted in 2004 with a view to improving procurement procedures in public entities and local government authorities.
“During our recent meeting as I was presenting my audit reports at State House, among the issues President Kikwete asked me to work on is a review of the Procurement Act,” Mr Utouh said.
He said the President was concerned because the cost of goods procured in accordance with the requirements of the law was twice or even three times their market value.
Mr Utouh cited as an example of an air ticket bought for a minister who was travelling abroad on official duty, which cost thrice as much as the one he paid for his wife, who was travveling with him on the same flight and class.
“The minister’s ticket was purchased through the government’s procurement procedures. He decided to travel with his wife so he went and bought another ticket from a travel agent... its price was so low that people were amazed,” he said. The CAG’s audit reports for the year that ended June 30, 2012 show that hundreds of millions of shillings were lost through dubious public procurement.
According to Mr Utouh, an audit report by the Public Procurement Regulatory Authority (PPRA) on the performance of procuring entities (PEs) highlighted many problems, most of which also featured in the CAG’s previous reports.
According to PPRA, similar weaknesses have been recurring every financial year , and these include: inappropriate establishment of procurement management units (PMUs); inappropriate preparation of annual procurement plans; poor record keeping; weak contract management, and failure to publish contract awards.
The audits revealed that the overall level of compliance on establishment and composition of PMUs was averaging 78 per cent (56 per cent in 2010/11) for MDAs.
This, the report says, leads to another problem of inappropriate preparation of annual procurement plans.
“Most of the audited procuring entities are still not complying with the requirement for preparing annual procurement plans despite their importance in helping procuring entities,” said Mr Utouh.
The overall average level of compliance on preparation and implementation of annual procurement plans is only 58 per cent, according to the CAG’s audit of central government and its entities.
On contract management, it was observed, like in previous years, that some of the contracts lacked important contract documents and some contained non-contract documents.
“In other many areas it was observed that performance guarantees were not enforced in cases of performance failure and warranties were not enforced in cases of supplied goods with poor quality,” Mr Utouh said.
He added that there were many entities which failed to liquidate damages applied for delayed contracts while in other cases, site meetings were not conducted for most of the reviewed contracts and there were no adequate quality assurance and control plans.
There are also many cases where completed works were not tested to ascertain whether they have attained the specifications as provided in the contract documents and progress reports for works contracts were not prepared in other cases.
“It is amazing that though the procurement law sets conditions there are many incidents in which extensions of time for completion of contracts were issued without justifiable reasons and without following appropriate procedures,” reads part of CAG’s report. The audit results further indicate that average levels of compliance were 55 per cent and 71 per cent for quality control and contracts management, respectively.
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