1. METHODS OF PROCUREMENT AND PROCESS BY ROCKE ALEX

2. Introduction Basic considerations in procurement – the need for economy and efficiency in the use of public funds and in the implementation of projects including the provision of related goods and services; – the best interests of a public authority, in giving all eligible suppliers, contractors, and service providers equal opportunities to compete in providing goods or executing works or providing services;

3. Introduction cont. – encouragement of national manufacturing, contracting and service industries; – the importance of integrity, accountability, fairness and transparency in the procurement process.

4. REJECTION OF TENDERS Tender documents and request for proposals may provide that procuring entities reject all tenders or all proposals. The rejection of all tenders or all proposals under this section shall be justified where- – there is lack of effective competition; – tenders or proposals are not substantially responsive to the tender documents or to the request for proposals; – the economic or technical data of the project have been altered;

5. Rejection of Tenders cont. – tenders or proposals involve costs substantially higher than the original budget or estimates; – exceptional circumstances render normal performance of the contract impossible; – tenders received contain serious irregularities resulting in interference with the normal play of market forces; or – funds voted or earmarked for the procurement have not been withheld, suspended or have otherwise not been made available.

6. Rejection of Tenders cont. Where rejection is caused by the lack of competition; the procuring entity shall review the causes justifying the rejection and shall consider - – making revision to the conditions of contract, design and specifications, scope of the contract, or a combination of these before inviting new tenders; or – revising the request for proposals (including the short list) and the budget.

7. Methods of Procurement We have seen that all public procurement and disposal should be done by competitive tendering PPA 2011 require that all procurement and disposal shall be conducted in a manner that maximizes competition and achieve economy, efficiency, transparency and value for money.

8. Methods of Procurement cont. When a competitive tendering is used, the regulations prescribe different methods depending on; – the type and value of the procurement or disposal in any case, the successful tenderer shall be the tenderer evaluated to have; – the capacity and capability to supply the goods/provide the services or to undertake the assignment or – the highest evaluated offer in case of services for revenue collection or disposal of public assets.

9. Methods of Procurement cont. A procuring entity may select an appropriate alternative method of procurement as provided by PPR These methods are; – International Competitive Tendering – National Competitive Tendering – Restricted Tendering – Shopping – Single source for goods or services – Direct contracting for works

10. Methods of Procurement cont. – Minor value procurement – Turnkey – Force account – Public Private Partnership – Community participation – Procurement of commodities with seasonal variation of prices

11. International competetive tendering In international competitive tendering or otherwise known as international competitive bidding, a procuring entity shall invite suppliers, contractors, service providers or asset buyers regardless of their nationality, by means of a tender notice that shall be advertised nationally and internationally to submit priced tenders for goods, works or services or purchase of public assets. Reg. 65(1)

12. International competetive tendering This form of tendering shall be used in all cases where: – payment may be made in whole or in part in foreign currency; – the estimated cost of the goods or works exceeds the threshold for such tenders provided in the Third Schedule to the PPR 2013; or – it is desired to attract tenders from the widest range of suppliers, contractors or service providers, regardless of the estimated value of the goods or works to be procured.

13. National competetive tendering Also known as national competitive bidding, PE shall invite submission of priced tenders regardless of their nationality, by means of a tender notice advertised only in the United Republic of Tanzania.

14. National competetive tendering cont. Such form of tendering may be used in cases where: – payment may be made wholly in Tanzanian shillings; – the goods, works or services are available locally at prices below the international market; – the estimated cost of the goods, works or services is small and does not exceed the threshold for open international tendering prescribed in the Second Schedule to the PPR 2013

15. National competetive tendering cont. – works or services are scattered geographically or spread over time; – works are labour intensive; – the advantages of international competitive tendering are clearly outweighed by the administrative or financial burden are involved; – the estimated value of assets is small and does not exceed the threshold for open international tendering prescribed in the second Schedule to the PPR 2013

16. Restricted tendering A procuring entity may restrict the issue of tender documents to a limited number of specified suppliers, contractors, or service providers when: – have already pre-qualified further to Regulations 15 and 64 and the procedures set out in Regulation 15 of these Regulations (PPR 2013); OR

17. Restricted Tendering Cont. – the goods, works, or services required are of a specialised nature or can be obtained from a limited number of specialised contractors, service providers or reputable sources; or – the estimated contract values are within the limit for restricted tendering prescribed in the Second Schedule to these Regulations; or – there is an urgent need for the goods, works or services such that there would be insufficient time for a procuring entity to engage in open national or international tendering, provided that the circumstances giving rise to the urgency could not have been foreseen by a procuring entity and have not been caused by dilatory conduct on its part.

18. International and National Shopping Shopping is a procurement method based on comparing price quotations obtained from several suppliers to ensure competitive prices, and is an appropriate method for procuring readily available off-the shelf goods or standard specification commodities that are small in value.

19. International and National Shopping cont. A tender board may approve for competition to be invited through request for quotations at international or national level, where it has been determined that: – the goods to be procured are so diversified that it would be of no commercial interest for any single supplier to tender for them; or – the goods are readily available off-the-shelf or standard specification commodities.

20. homework Read the other methods and its restrictions in application

21. Emergency procurement Emergency procurement may be made where the accounting officer determines that it is in the public interest that goods, works or services be procured as a matter of urgency. Emergency procurement shall meet one of the following criteria:

22. Emergency procurement cont. – compelling urgency that creates threat to life, health, welfare or safety of the public by reason of major natural disaster, epidemic, riot, war, fire or such other reasons of similar nature; – situation whereby, without the urgent procurement, the continued functioning of the Government or organisation would suffer irreparable loss, the preservation or protection of irreplaceable public property, or the health or safety of public will be threatened.

23. METHOD OF SELECTION AND LIMIT OF APPLICATION 23 Method of tendering GoodsWorksNon Consultancy MServices Disposal of Assets International competitive tendering - No limit National competitive tendering Up to Tshs 800,000,000 Up to Tshs 3,000,000,000 Up to Tshs 500,000,000 Up to Tshs 3,000,000,0 00 Restricted tendering Up to Tshs 400,000,000 Up to Tshs 1,500,000,000 Up to Tshs 200,000,000 Up to Tshs 100,000,000 Competitive quotations Up to Tshs 80,000,000 Up to Tshs 100,000,000 Up to Tshs 50,000,000 Not applicable Single source procurement Up to Tshs. 500,000,000/ - Up to Tshs 800,000,000 Up to Tshs. 100,000,000 Not applicable Minor value procurement Up to 10,000,000 Up to 20,000,000 Up to 10,000,000 Not applicable

24. 24 Tender Proceedings – Solicitation of Tenders Invitation to tender and advertising – soft copy of advert to be submitted to the Authority for posting in the website – Adequate details to attract prospective bidders – contents as per Reg. 81.; – Necessary approvals by Tender Board. – Advertise in papers of wide circulation at least twice

25. 25 Tender Proceedings – Solicitation of Tenders Issue of solicitation documents – Immediately after the invitation; – Fees for collection of documents to cover only reproduction costs

26. 26 Tender Proceedings – Solicitation of Tenders Contents of solicitation documents – Reg. 83 – All details about the tender process including how to prepare and submit a tender, how to seek clarifications, site visits, evaluation criteria etc. – Use Standard Tender Document issued by the Authority – effect changes only in the Bid Data Sheet and Special Conditions of Contract. – Read this regulations

27. 27 Tender Proceedings – Solicitation of Tenders Tender period – see Third Schedule Once tender period given it can not be reduced however may be extended as appropriate.

28. 28 Serial Number Method of procurement Period (calendar days) PREQUALIFICATION STAGE 1.International competitive bidding30 2.National competitive bidding21 TENDERING STAGE 3.National competitive bidding30 4.International competitive bidding45 5.Restricted national competitive bidding21 6.Restricted international competitive bidding30 7.National shopping7 8.International shopping14 9.Where large works are involved90

29. 29 Tender Proceedings – Solicitation of Tenders Clarification and modification of solicitation documents – PE required to respond to queries by bidders within three days – Minutes of meeting with suppliers to be communicated within three days from the date of the meeting.

30. 30 Tender Proceedings – Submission of Tenders Fix place and day, date and time for submission – this shall be the time for opening All requirements for the tender like bid security etc. must be submitted before the deadline. Late tenders shall not be considered.

31. 31 Tender Proceedings – Submission of Tenders Validity of tenders should be complied with regulations normally not exceeding 120 days Extension may be requested from all bidders before the expiry of original validity period – period of effectiveness of tender securities must be extended as well. Successful tenderer shall remain bound for a further period of 30 days after notification.

32. 32 Tender Proceedings – Submission of Tenders Tender Securities shall be as required Shall be in the following forms: – certified banker’s cheque; – a letter of credit; – a banker’s cheque, – a bank of guarantee from a reputable bank and – an insurance bond from reputable insurance firm Should remain valid 28 days beyond the validity period of the bid.

33. 33 Tender Proceedings – Submission of Tenders Bid bonds for non winning firms must be returned not later than 30 days after the expiration of bid validity period OR upon award of contract whichever is earlier.

34. 34 Tender Proceedings – Receipt, opening and Evaluation of Tenders Receipt of tender shall be as per Regulations – Use tender box or submission to secretary of tender board who shall keep them in a secure place. – Keep register of received tenders – Open immediately after deadline in the presence of bidders representatives.

35. 35 Tender Proceedings – Receipt, opening and Evaluation of Tenders During the opening read the important information like: the name of the bidder, bid amount, validity, discounts, presence of important documents like bid security etc. Evaluation team to consist not less than three members appointed by the head of PE.

36. 36 Tender Proceedings – Receipt, opening and Evaluation of Tenders Carry out evaluation sequentially: – Preliminary evaluation to determine commercial responsiveness; – Detailed Technical Evaluation; – Financial Comparison; and – Post-qualification to the lowest evaluated bidder. Evaluation to follow criteria stipulated in the Bidding Documents.

37. 37 Tender Proceedings – Receipt, opening and Evaluation of Tenders Negotiations with successful bidder shall be carried out as provided in Regulation 95. Minimum number of 3 members of the negotiation team. Procedure for negotiation – Reg. 95(11). Negotiation plan should be approved by TB.

38. 38 Tender Proceedings – Receipt, opening and Evaluation of Tenders Award of contract must be made within the period of validity of the bid or extension thereof. Copy of the award to – Authority; – Controller and Auditor General; – Attorney General and – Technical Audit Unit of MOF

39. WEEKEND TASK Read and write two pages on the following; – Prohibition – Review of procurement Decisions

40. 40 Miscellaneous Provisions Submission of copies of contracts to Authority, CAG, SV dept of MoF, TAU of MoF, TRA within 30 days from signature. Amendments after signature by written approval of tender board and office of AG. Extension of contract issued by Head of PE and copy sent to CAG.

41. 41 Miscellaneous Provisions Liquidated damages must be deducted for late completion or late delivery. A firm abandoning works should be reported to the Authority and AG for information and taking appropriate action. Proper management of contracts to ensure timely completion with the required quality.

42. INTRODUCTION TO THE PUBLIC PROCUREMENT (SELECTION AND EMPLOYMENT OF CONSULTANTS)

43. Application Consultancy Services shall not apply – to services in which the physical aspects of the activity predominate. – Non-Consultant services

44. Fundamental Differences In Procurement GOODS, WORKS AND NON CONSULTANT SERVICES – PRODUCT/(Service) BASED – OPEN COMPETITION – PRICE IS THE MAJOR CRITERION – PUBLIC OPENING OF BIDS CONSULTING SERVICES – KNOWLEDGE BASED – SHORTLISTS – PRICE PLAYS MINOR ROLE – PUBLIC OPENING OF TECHNICAL PROPOSAL (Not necessary) – PUBLIC OPENING OF FINANCIAL PROPOSALS

45. Fundamental Differences In Procurement cont. GOODS AND WORKS – DETAILED SPECIFICATIONS – SINGLE STAGE PROCEDURE NORMALLY – NEGOTIATIONS ONLY EXCEPTIONALLY CONSULTING SERVICES – TERMS OF REFERENCE (GENERAL WORK PROGRAM) – TWO-STAGE PROCEDURE – NEGOTIATIONS NORMALLY

46. TYPES OF CONSULTANTS Private Sector Individual Partnership Limited Liability (Corporation) Joint Venture Public Sector Government-owned Government-subsidized Other

47. MethodLimits International Competitive SelectionNo Limit National Competitive SelectionUp to Tshs 1,000,000,000 Restricted Competitive SelectionUp to Tshs 500,000,000 Single-Source SelectionUp to Tshs 300,000,000 Individual SelectionUp to 150,000,000/- Minor Value ProcurementUp to Tshs 7,500,000 METHODS OF PROCUREMENT