The Acts established a nine-member board with the prime objectives of harmonising the process of public procurement.

• A person competent and experienced in public procurement, as the chairperson
• Four persons from the public sector made up of a representative of the Attorney General and three other persons, nominated by the Minister, one of whom is a woman and each of whom shall have experience in public procurement and be familiar with governmental and multi-lateral agency procurement procedures.
• Three persons from the private sector who have experience in procurement, at least one of whom is a woman.
• The chief executive officer of the authority.

Total value of goods=100 pickups x GH¢120,000= GH¢12,000,000. The Entity Committee of Social Department must use International Competitive Tendering in awarding the contract for the 100 pickups. This is because international competitive tendering is used in Public procurement where the contract value of the goods in question exceeds GH¢10,000,000. This is per the Fifth Schedule of the Public Procurement Amendment Act,2016, Act 914.

The Entity Committee of Social Department must use International Competitive Tendering in awarding the contract since the contract value for the Consultant’s service is GH¢6,500,000, above the maximum threshold for the National Competitive Tendering to be used. This is in accordance with the Fifth Schedule of the Public Procurement Amendment Act,2016, Act 914, where International Competitive Tendering is applied for Services, having a contract value above GH¢5,000,000.

The Department should use national Competitive Tendering to award the Construction of the offices having a contract value of GH¢13,700,000. This is in line with the Fifth Schedule of the Public Procurement Amendment Act,2016, Act 914, where National Competitive Tendering is applied for Works, having a contract value for more than GH¢200,000 but up to GH¢15,000,000.

The contract value of the 20 laptops=20 laptops x GH¢ 2,400= GH¢48,000. The Department must use Requestion for Quotation in the award of the contract. With reference to the Fifth Schedule of the Public Procurement Amendment Act,2016, Act 914, Requestion for Quotation is used for Goods with a contract value up to GH¢ 100,000

• Competition
  Opening up procurement opportunity to all potential supplies and contracts bring forth to competition and creating value for money. Thus, competitive tendering should be the first option in procurement decisions
• Accountability
  The procurement entity as well as the head of the procurement is answerable to the public for their procurement decisions. The head of procurement has the responsibilities to give explanations for their actions and inactions.
• Transparency
  The entire procurement processes should be transparency, from the invitation, opening of tenders, evaluations and selection of the supplier or contract should be done in the open.
• Fairness/non-discrimination
  All potential suppliers and contractors should be treated fairly, ensuring that only price and quality are discriminatory factors. Gender, party affiliation, ethnicity, religion should not be used to discriminate against suppliers.
• Economy
  Procurement should aim at reducing the cost of the process as well as the cost of the procurement itself.
• Efficiency
  The process must ensure efficiency in procurement. The objective of the procurement should be achieved efficiently.
• Environmental sustainability
  The environmental implications should be factored into procurement decisions.
• Social impact
  The social implications of the procurement decisions should be given due attention. For example, buying from China may be economical but may increase unemployment in Ghana.

(1 marks each for 6 principles explained = 6 marks)

• High propensity to over value procurement contracts and supplies.
  In the public sector, it is not uncommon to find the buyer negotiating for high prices of goods and services for their personal gain.
• High possibility of procuring inferior goods and services.
  It a common practice in which goods and services that could not be sold in the open market find their way into the public sector for personal gain and lack of competence in procurement. For example, public sector entity procurements a plant which never works well from the first day of installation.
• Susceptibility to conflict of interest situation
  Head of entity and other officers responsible for public procurement may give contracts and supplies to their own private companies or affiliates. This is a recipe for corruption in public procurement.
• Fake procurement of goods and services
  Paying for goods and services that has never been procurement and the perpetrators share the proceeds.
• Discrimination of supplier
  Contracts are given not on merit but other considerations that breeds unfairness and discrimination.

(1 mark each for any 4 risks explained = 4 marks)

Public sector entities are generally required to apply the Public Procurement Act 2016 to their procurement activities. However, the Public Procurement Act has allowed the use of commercial practices under certain conditions. The conditions under which a public sector entity can use commercial practices are that:

• The entity is legally and financially autonomous and operates under commercial law
• It is beyond contention that public procurement practices are not suitable, given the strategic nature of the procurement.
• The proposed procurement method will ensure value for money, provide competition and transparency to the extent possible.

For an entity to apply the commercial practices of procurement, they must seek the approval of the Governing Board of the Procurement Authority. Board approval to use commercial method must be published in a gazette.

The hospital is not legally and financially autonomous and does not operates under commercial laws. The hospital is established under the Ministry of Health and Ghana Health Services therefore cannot be said to be autonomous legally and financially.

It will be a tough order to justify that the public procurement practices are not suitable for a public hospital like ours. Similar, the value for money argument for using the commercial practices will be difficult.

In my opinion base on the above analysis, the hospital does not qualify to apply for approval to use the commercial practices for procurement. I suggest, the public procurement practices should be made more efficient in the hospital.

• Ensure compliance to the Act 914 and concurrent approval from a tender review committee does not absolve the accountability of the head for contracts made.
• Establish procurement unit within entity staffed with qualified personnel.
• Empanel competent and qualified evaluation panels
• Ensure that procurement procedures are followed (due process)
• Ensure stores, vehicles and equipment are disposed of according to the Act
• Exercise sound judgement in making procurement decisions
• Seek concurrent approval from the tender review committee when threshold is exceeded.
• Facilitate contract administration and ensure compliance to contract reporting requirements

(Any 3 points @ 1 mark each = 3 marks)

The procedures involved are as follows:

• Establish a Board of Survey
  The authority to dispose of is vested in a Board of Survey. Head of procurement entity shall convene a board of survey comprising representative of the departments with vehicle, unserviceable, obsolete or surplus stores, plant and equipment which shall report on the items and subject to a technical report from them, recommend the best method of disposal after the officer in charge has completed the board of survey form.
• Approval of Board of Survey’s recommendation
  The board of survey’s recommendation shall be approved by the head of procurement entity and the items shall be disposed of as approved. Note that for items that become unserviceable for reasons other than wear and tear, disposal guidelines issues by the Board of procurement authority. However in the case of the vehicles, they become unserviceable due to wear and tear so this rule does not apply.
• Procedures for disposal
  Procedure should be carried out based on the recommendations of the Board of Survey. The procedures approved under the Procurement Act 2016 include:
  ** Transfer to government department or other public institution with or without financial adjustment.
  When this procedure is recommended by the BOS, the entity will enter into agreement with another public sector entity to transfer the vehicle to them for a charge or no charge to the receiving entity. However, in the case in question, this method may not be appropriate since the vehicle is completely out of service and giving it to another entity may cause a financial burden to public purse.
  ** Sale by public tender to the highest bidder, subject to reserve price
  When this option is recommended, the entity has to arrange for a public tender and invite tenders for the sale of the vehicle. Under sale by public tender the services of auctioneer is not required.
  ** Sale by public auction, subject to reserve price
  Here a professional Auctioneer in good standing should be appointed by the entity to carry out the disposal on its behalf.
  ** Destruction, dumping or burying as appropriate. Only appropriate when the vehicle has no use at all.

                                                   Name of Hospital
                                                            Memo

.              Subject:      Procurement of X-Ray Component
As we have discussed at the just ended management meeting concerning the above subject matter, I wish to provide you with some information to support our use of single source procurement for the X-Ray equipment, despite your strong reservation for it at the meeting.

I agree that the use of single source procurement raises questions because it is a high-risk method of procurement. However, the Public Procurement Act 2016 (Amendment), Act 914 has permitted the use of single source procurement under certain exceptional circumstances. Under the law single source procurement is allowed when:
i) Goods or services are only available from a single supplier or the supplier has exclusive right.
ii) Urgent need for the GWS not caused by dilatory conduct of the procurement entity, making it impracticable to use competitive methods
iii) Occurrence of catastrophic even making the use of competitive method impracticable.
iv) Contract for research, experiment, study or development not for commercial purpose.
v) Procurement has implications for National security
vi) Where additional supplies need to be procured from a supplier who had made supply in the immediate to ensure standardization and compatibility with existing goods or equipment.

Our use of single source procurement for the procurement of the X-Ray component is justifiable on the ground of circumstance (i) and (ii) above. All that we have to do is to apply to the public procurement authority for approval.
Kindly consider this fact.

Thank you
Johnson

The general rule is that all covered entities shall use GIFMIS from the commencement of procurement process through to payment.
The procedures for payment of works procured by MDA include the following:
i) Inspection for the purpose of certification
As a condition for certification, the PSO shall inspect the physical output of the works and supplies in the field. This can be done before progress payment is made or when the work is fully completed.
The PSO may authorise an officer with adequate expertise to carry out the inspection on his behalf.

ii) Certification of completion of works or supply of goods and services
Upon the completion of works or supply of goods and services, the Principal Spending Officer (PSO) prepares a certificate statement in respect of the work and stores received and this statement shall include:

• The quantity and particulars of the works and supply.
• The method and result of the inspection,
• Any evidence supporting the results.
• the necessary remedial actions where the PSO identifies that the work or supply is inconstant with contracts or specification such as partial rejection, full rejection and others actions.

iii) Record invoices and supporting document
When certificate is issued, the PSO records the details of the invoices in the GIFMIS and upload the certification statement and other supporting documents onto the GIFMIS.

iv) Record of approval of payment voucher
A payment by a covered entity shall be accompanied with a payment voucher authorised by the head of accounts and approved by the PSO on the GIFMIS.
Here the head of accounts and the PSO should ensure:

• the validity, accuracy and legality of the claims for payments.
• the commitment has been approved through the Purchase Order or Expense Order generated under the GIFMIS.
• An invoice, certificate statement and completed set of supporting documents are recorded in the GIFMIS.

v) Payment
When a payment voucher is approved, the Controller and Accountant General shall release the cash to the covered entities using the GIFMIS.
All payments for expenditure of covered entities shall be made through GIFMIS system using the following methods:

• Electronic fund transfer (EFT)for third party transactions
• System cheques or electronic means for withdrawal of money for internal payments of allowance.
• Physical cash disbursement only from imprest and payment of allowances to ultimate individual beneficiaries.

(a) entering or attempting to enter into a collusive agreement, whether enforceable or not, with any other supplier or contractor where the prices quoted in their respective tenders, proposals or quotations are or would be higher than would have been the case has there not been collusion between the persons concerned;

(b) directly or indirectly influencing in any manner or attempting to influence in any manner the procurement process to obtain an unfair advantage in the award of a procurement contract;

(c) altering any procurement document with intent to influence the outcome of a tender proceeding and this includes but is not limited to
(i) forged arithmetical correction;
(ii) insertion of documents such as bid security or tax clearance certificate which were not submitted at bid opening; and

(d) request for clarification in a manner not permitted under this Act.

A tenderer in public procurement shall:

• possess the necessary professional and technical qualifications and competence,
• have adequate financial resources,
• have the necessary equipment and other physical facilities,
• have managerial capability, reliability, experience in the procurement object.
• have the personnel to perform the procurement contract;
• have the legal capacity to enter into the contract;
• be solvent, not be in receivership, bankrupt or in the process of being wound up, not have its business activities suspended and not be the subject of legal proceedings that would materially affect its capacity to enter into a contract;
• fulfil its obligations to pay taxes and social security contributions.
• Meeting ethical and environmental requirements associated with the procurements.

Section 1:

• The procurement of goods, works and services, financed in whole or in part from public funds except where the Minister decides that it is in the national interest to use a different procedure;
• Functions that pertain to procurement of goods, works and services including the description of requirements and invitation of sources, preparation, selection and award of contract and the phases of contract administration;
• The disposal of public stores and equipment; and
• Procurement with funds or loans taken or guaranteed by the State and foreign aid funds except where the applicable loan agreement, guarantee contract or foreign agreement provides the procedure for the use of the funds except as exempted under section 96.

Without limiting subsection (1), this Act applies to:
a) Central management agencies;
b) government ministries, departments and agencies;
c) Subvented agencies;
d) Governance institutions; state owned enterprises to the extent that they utilise public funds;
e) Public universities, public schools, colleges and hospitals;
f) The Bank of Ghana and financial institutions such as public trusts, pension funds, insurance companies and building societies which are wholly owned by the State or in which the State has majority interest;
g) Institutions established by Government for the general welfare of the public or community.
h) Statutory funds, commissions and other bodies established by Government for specific purse; and
i) The phases of contract administration as specified in the contract administration manual.

From the case the following facts were obtained:

• The entity is established by an Act of Parliament;
• The entity if financed from 95% IGF retention and 5% budget support, which are all are part of the public funds.

These suggest that the entity falls within the scope of the Public Procurement Act and therefore CEO must apply the provisions of the Act fully.

Subject to the approval of the Board, a procurement entity may undertake procurement in accordance with the established commercial practices if:
a) The procurement entity is legally and financially autonomous and operates within the commercial laws
b) It is beyond contention that the public procurement procedures are not suitable, considering the strategic nature of the procurement; and
c) The proposed procurement method will ensure value for money, provide competition and transparency is extent possible. (PPA- Section, 15)

i) Identification of item of store or equipment to be disposed off.
ii) Head of department convenes a Boar of Survey (BOS) to make technical assessment of the store or equipment to be disposed and make recommendation in a report to the head. Head of department based of BOS report seek approval from the appropriate quarters (e.g minister).
iii) The disposal process is initiated based on the method approved for use (transfer to other government institutions, public tender or public auction)
iv) The stores and vehicles are valued by an approved and reputable public or private professional agency with the requisite technical knowledge;
v) In case of public auction, the following procedures are followed:
a. The stores and vehicles are valued by an approved and reputable public or private professional agency with the requisite technical knowledge;
b. The valuation report is submitted to the office of the President and head of the Agency;
c. The value submitted is used as the selling price (bargaining bench-mark) to the public auction;
d. A date for auction is agreed with the head of the agency or department;
e. An advertisement is placed in the national newspapers for the date and place of the auction and the items to be auctioned;
f. On the auction day the highest bidder above the bench mark wins.

DATE              : xx/xx/xx
TO                   : District Chief Executive
FROM             : District Finance Officer
SUBJECT        : Re-Directives on Procurement Methods in the Assembly
I write to you some concerns I have about your new directive on public procurement in the assembly. I agree that competitive tendering ensure value for public moneys through competition and fairness. The Procurement Act 663 also emphasizes the importance of the competitive tendering in securing judicious use of public resources in public procurement. However, the current directive will not be appropriate in all circumstances.
i) Circumstances under which competitive tendering will not be appropriate:

• Diseconomy in procurement where cost incurred in procurement far exceeds the value of the goods, services and works procured. This is normally the case with low value goods and services in which case alternative method will have been appropriate.
• Impracticability of the directive where there is only one or few supplier or contractor for the goods, services, and works
• Where there is a time constraint due to urgency or catastrophic event, competitive tendering may cause undue delay.
• Competitive tendering will not be appropriate when national security is at stake.
• It is also not appropriate when it is not feasible for the procurement entity to formulate detailed specifications for the goods, services or works.

ii) Other methods allowed by the Procurement Act in absence of competitive tendering include:

• Two-stage tendering
• Restricted tendering
• Single sourcing
• Request for quotation                                                                                                            Thank you.

• The procurement entity must be legally and financially autonomous and must operate under commercial law
• The existence of the procurement entity must be beyond contention that public sector procurement procedures are not suitable, considering the strategic nature of the procurement.

• Ensures value for money;
• Provide competition and transparency to the extent possible.

I disagree with the assertion that every procurement entity has the liberty to choose the method of procurement it wishes on the grounds that:

• The procurement law has mandated five methods of procurement to be used by procurement entities in the procurement of goods, services and works. The methods include competitive tendering, two stage tendering, restricted tendering, single sourcing and request for quotations.
• The procurement law also recommended the use of competitive tendering in all public procurement unless otherwise.
• Where competitive tendering is not feasible, then the entity should make a choice of the other methods based on certain conditions provided for in the law.

I therefore disagree with the assertion of the head of procurement entity that every procurement entity has the liberty to choose the method of procurement it wishes. The choice of method should meet the conditions indicated by the procurement law.

• Where there exist many suppliers or contractors that could provide goods, services and works.
• Where enough time exist to carry out the procurement, then urgency could not be used as a reason.
• Where the procurement would not compromise national security.

i) The entity will safeguard its public funds and assets;
ii) It will improve its system of fiscal management through more efficient and effective use of public monies;
iii) It will enhance transparency and accountability in its management and procurement processes;
iv) It will be able to build public confidence in its financial activities;
v) It will practice efficient use of resources through competitive bidding and value for money;
vi) It will improve its financial planning system.