6. Procurement Methods PDF

Preview

Summary

Warning: TT: undefined function: 22TOPIC SIXPROCUREMENT METHODSLearners being able to:-a) Explain the factors influencing the choice of procurement methods. b) Describe procurement methods with reference to UNCITRAL Model law, PPA (T). c) Describe frame work agreements and Private Public Partnership...

Description

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

TOPIC SIX PROCUREMENT METHODS Learners being able to:a) Explain the factors influencing the choice of procurement methods. b) Describe procurement methods with reference to UNCITRAL Model law, PPA (T). c) Describe frame work agreements and Private Public Partnership. d) Describe circumstances under which procurement methods can be used. e) Apply thresholds for using each procurement method. Procurement Process involves successive stages in procurement cycle which are; i.

Procurement planning.

ii.

Choice of procedures.

iii.

Solicitation of offers from the bidders or Tenderers.

iv.

Examination and Evaluation of bids or tenders.

v.

Award of Contract.

vi.

Contract Management. Choice of Procurement Methods •

Procuring entities are responsible for deciding on method of procurement to use.

•

Depending on nature and size of procurement procuring entity may use any method of procurement stipulated in PPA 2011.

•

The most preferred method is competitive tendering.

Factors to consider in choosing of method of procurement: •

The nature of the goods or services to be

procured.

•

The value of the procurement

•

Interest to attract wide range of suppliers and foreign tenderers.

•

Critical date for delivery

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

•

Transparency of procedure

•

Pre-qualifications results International Competitive Tendering

•

Procuring entity invites suppliers, contractors, service providers or asset buyers regardless of their nationality found in different countries.

•

Tender notice is advertised in PPRA’s Journal and Tender Portal. PE website/notice board

•

One local and international newspaper

•

Standard tendering document issued by PPRA/ Donors/Development partners are used.

•

The value of procurement is unlimited ( No limit) Condition for Application

•

Payment in whole or part in foreign currency

•

There is interest to attract wide range of suppliers Foreign Suppliers National Competitive Tendering

•

Procuring entities invites suppliers, service providers, contractors or asset buyers found in Tanzania only regardless of their nationality

•

The invitation to tender notice is required to appear in PE website, PPRA Journal, Tender Portal and one local newspaper.

•

Domestic or national preference shall apply in evaluation of tenders where foreign firms have participated.

•

Standard tendering document issued by PPRA must be used Condition for Application

•

Project is financed by Tanzania Government – or payment is made wholly in Tanzania shillings.

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

•

The goods, works or services are available within the country at lower price than international price

•

The estimated cost of procurement does not exceed the threshold shown in the Regulation 2013.

•

The works or services is labor intensive

•

Works or services are scattered geographically or spread over time

•

The advantage of international competition is outweighed by administrative cost or financial burden. Restricted Tendering

•

Procuring entity restrict the issue of tender documents to limited number of suppliers/contractors

•

Justification for restriction must be shown in the Record of Procurement Proceedings.

•

PE must use Standard Tendering Documents Condition for Application

•

Suppliers, contractors and service providers have been pre-qualified.

•

Specialized items i.e. can be obtained from limited number of suppliers.

•

No limit but justification for application must

•

Urgent

•

Need to achieve social objectives- local participation Shopping

•

Method of comparing quotations from several suppliers at least three suppliers

•

The list of suppliers to be contacted must be approved by tender board.

•

The invitation for quotation must be in writing

•

Invitation of quotations must be provided to all bidders at same time

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

•

Suppliers are permitted to submit only one bid/quotation

•

The minimum period for preparation of quotations for National Shopping 4 days while for International Shopping 8days.

•

Limit for application for Goods TZS. 120 Million, Non –consultancy 100 million Works TZS 200 Million

•

The supplier/ contractor with lowest evaluated price is awarded contract. Condition for Application

•

It is appropriate method for off-the shelf goods or standard specification of small value

•

Goods procured are so diversified that it would be of no commercial value for single supplier to tender Single Source for procurement of goods and services

•

One bidder is invited to submit quotation

•

The Invitation for Quotation must be in writing using standard IFQ prepared by PPRA

•

Tender Board must approve the use of single source procurement method

•

Submitted quotations must be examined to ensure the requirements are properly addressed and price charged is reasonable.

•

The justification for Single Source procurement must be shown in the record of procurement proceeds. Single Source for Works/Direct Contracting

•

Means contracting without competition

•

Priced quotation is requested from single contractor

•

The Invitation of quotation must be in writing

•

The quotation must be examined to ensure it meets the requirement and price quoted is reasonable.

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

•

Price where necessary need to be negotiated before entering into contract

•

No limit for application

•

Record of Procurement Proceedings must be shown to justify the used of procurement method.

Condition for Application •

Limited number or there is only one contractor who is qualified

•

There is advantage of using the particular contractor who is at site.

•

Extension of work done satisfactory. The contractor must be the one who is at site

•

Procurement for security interest of the country.

•

Extremely urgently needs.

•

Procurement for standardization or compatibility with existing goods, equipment or technology.

•

Subject to approval or public notice that procurement from particular supplier, contractor, or service provider is necessary. Minor Value

•

Acquisition of items with insignificant value

•

Limit of authority for Goods/services TZS 10 Million for works TZS 20 Million.

•

The contract for provision of goods, services or works may be LPO Condition for Application

•

Prices are reasonable.

•

No advantage for seeking quotations Micro Procurement

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

•

PE purchases directly from supermarkets, shops or similar establishment by cash/purchase cards.

•

PE must obtain invoice or receipt for purchased item.

•

The procurement of such items may be delegated to user department

•

Cash purchases are required to be reported to tender board on monthly basis.

•

Quarterly reports for Micro Procurement must be submitted to PPRA Condition for Application

•

The value does not exceed the limit stipulated in Regulations. For Goods TZS 5 million per contract. For other types of procurement it is not applicable Force Account

•

Force Account is the use of the procuring entity’s own personnel and equipment to perform construction work.

•

Where force account is used, PE must be satisfied that local force account units are staffed, equipped and organized to carry out the works efficiently and at a reasonable cost. Condition for Application

•

Where it is the only practical, efficient and economic method for construction.

•

Quantities of work involved cannot be defined in advance.

•

Works are small and scattered or in remote locations for which qualified contractors are unlikely to bid at reasonable prices.

•

Work is required to be carried out without disrupting ongoing operations;

•

Emergencies needing prompt attention such as natural disasters Community Participation

•

Involvement of community in procurement of goods/works.

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

•

PPRA provides procedure for conducting procurement.

•

Procurement function is performed by members of community Condition for Application

•

Participation of local community is required

•

Increase local know how utilization

•

Labor intensive

•

where there is interest of project sustainability or to achieve certain specific social objectives Procurement of Commodities

•

The prices of commodities such as grains, fuel, oil etc. fluctuates with supply and demand

•

It is appropriate for PE to short list suppliers though open competition who will be invited to quote prices when need arises

•

Where item is included under Common Use item, PEs are required to procure through framework contracts by GPSA NB; FRAME WORK AGREEMENT means contractual arrangement which allows a PE to procure goods, services, or works that are needed continuously or repeatedly at an agreed price over an agreed period of time through placement of a number of orders. COMMON USE ITEMS means goods, works, or services that are required continuously or repeatedly over a set period of time. Condition for Application

•

Products which price fluctuate depending on demand and supply

PROCUREMENT METHODS ACCORDING TO UNCITRAL MODEL LAW a. Open tendering; BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

b. c. d. e. f. g. h. i. j.

Restricted tendering; Request for quotations; Request for proposals without negotiation; Two-stage tendering; Request for proposals with dialogue; Request for proposals with consecutive negotiations; Competitive negotiations; Electronic reverse auction; and Single-source procurement. Conditions for using the above methods

1. The procuring entity may engage in procurement by means of restricted tendering in accordance with article 45 of this Law when: (a) The subject matter of the procurement, by reason of its highly complex or specialized nature, is available only from a limited number of suppliers or contractors; or (b) The time and cost required to examine and evaluate a large number of tenders would be disproportionate to the value of the subject matter of the procurement. 2. A procuring entity may engage in procurement by means of a request for quotations in accordance with article 46 of this Law for the: procurement of readily available goods or services that are not specially produced or provided to the particular description of the procuring entity and for which there is an established market, so long as the estimated value of the procurement contract is less than the threshold amount set out in the procurement regulations. 3. The procuring entity may engage in procurement by means of request for proposals without negotiation in accordance with article 47 of this Law where: the procuring entity needs to consider the financial aspects of proposals separately and only after completion of examination and evaluation of the technical, quality and performance characteristics of the proposals. 4. A procuring entity may engage in procurement by means of two-stage tendering in accordance with article 48 of this Law where: (a) The procuring entity assesses that discussions with suppliers or contractors are needed to refine aspects of the description of the subject matter of the procurement and to formulate them with the detail required under article 10 of this Law, and in order to allow the procuring entity to obtain the most satisfactory solution to its procurement needs; or (b) Open tendering was engaged in but no tenders were presented or the procurement was cancelled by the procuring entity pursuant to paragraph 1 of article 19 of this Law and where, in the judgement of the procuring entity, engaging in new open-tendering proceedings or a procurement method under chapter IV of this Law would be unlikely to result in a procurement contract.

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

5. A procuring entity may engage in procurement by means of request for proposals with dialogue in accordance with article 49 of this Law where: (a) It is not feasible for the procuring entity to formulate a detailed description of the subject matter of the procurement in accordance with article 10 of this Law, and the procuring entity assesses that dialogue with suppliers or contractors is needed to obtain the most satisfactory solution to its procurement needs; (b) The procuring entity seeks to enter into a contract for the purpose of research, experiment, study or development, except where the contract includes the production of items in quantities sufficient to establish their commercial viability or to recover research and development costs; (c) The procuring entity determines that the selected method is the most appropriate method of procurement for the protection of essential security interests of the State; or (d) Open tendering was engaged in but no tenders were presented or the procurement was cancelled by the procuring entity pursuant to paragraph 1 of article 19 of this Law and where, in the judgement of the procuring entity, engaging in new open-tendering proceedings or a procurement method under chapter IV of this Law would be unlikely to result in a procurement contract. 6. A procuring entity may engage in procurement by means of request for proposals with consecutive negotiations in accordance with article 50 of this Law where: the procuring entity needs to consider the financial aspects of proposals separately and only after completion of examination and evaluation of the technical, quality and performance characteristics of the proposals, and it assesses that consecutive negotiations with suppliers or contractors are needed in order to ensure that the financial terms and conditions of the procurement contract are acceptable to the procuring entity. 7. A procuring entity may engage in competitive negotiations, in accordance with the provisions of article 51 of this Law, in the following circumstances: (a) There is an urgent need for the subject matter of the procurement, and engaging in opentendering proceedings or any other competitive method of procurement, because of the time involved in using those methods, would therefore be impractical, provided that the circumstances giving rise to the urgency were neither foreseeable by the procuring entity nor the result of dilatory conduct on its part; (b) Owing to a catastrophic event, there is an urgent need for the subject matter of the procurement, making it impractical to use open-tendering proceedings or any other competitive method of procurement because of the time involved in using those methods; or (c) The procuring entity determines that the use of any other competitive method of procurement is not appropriate for the protection of essential security interests of the State. 8. A procuring entity may engage in single-source procurement in accordance with the provisions of article 52 of this Law in the following exceptional circumstances:

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

(a) The subject matter of the procurement is available only from a particular supplier or contractor, or a particular supplier or contractor has exclusive rights in respect of the subject matter of the procurement, such that no reasonable alternative or substitute exists, and the use of any other procurement method would therefore not be possible; (b) Owing to a catastrophic event, there is an extremely urgent need for the subject matter of the procurement, and engaging in any other method of procurement would be impractical because of the time involved in using those methods; (c) The procuring entity, having procured goods, equipment, technology or services from a supplier or contractor, determines that additional supplies must be procured from that supplier or contractor for reasons of standardization or because of the need for compatibility with existing goods, equipment, technology or services, taking into account the effectiveness of the original procurement in meeting the needs of the procuring entity, the limited size of the proposed procurement in relation to the original procurement, the reasonableness of the price and the unsuitability of alternatives to the goods or services in question; (d) The procuring entity determines that the use of any other method of procurement is not appropriate for the protection of essential security interests of the State; or (e) [Subject to approval by the [name of the organ designated by the enacting State to issue the approval] and,] following public notice and adequate opportunity to comment, procurement from a particular supplier or con...