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THE PUBLIC PROCUREMENT AND DISPOSAL OF PUBLIC ASSETS (AMENDMENT) BILL 2019

3

Amendment of

section 3 of principal Act

Definition of ‘Award Decision’

Clause 3(a) seeks to substitute for the definition of the term ‘award’ with ‘award decision’ in accordance with section 28(1)(a). We however note that throughout the PPDA Act, there is consistent usage of the terms ‘award(s)’, ‘award of a contract’ and ‘award decision’.

It is not clear whether the new amendment is intended to substitute all the above terms as the proposed new term (award decision) can only effectively be used as a noun, yet in some circumstances the term ‘award’ is used as an action word (verb). Refer to sections – 52, 75,76 e.t.c

We  thus  propose  to  harmonise  the  definition  to  be  used

throughout the Act and hence the clause could be amended to read as follows:

3 (a)……… “award or award decision”  means a decision made by a contracts committee in accordance with section 28(1)(a)

Justification:

To ensure clarity

Definition of consultancy services

We note that the Bill amends the above definition by substituting ‘practitioner’ with ‘consultant or consulting firm.’ This proposal introduces more ambiguity when applied into the general clause that is being amended. By principle the proposal seems

We thus suggest to amend clause 3(b) to read as follows;

Proposed Amendment

Clause 3(b)

……………..by substituting the phrase “practitioner who is” with

“a firm of Consultants or a consultant,”

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to imply that even the consulting firm(s), shall be

expected to be skilled and qualified in a particular field or profession which is far from the normal.

Justification:

To draw clarity and align the requirement for skill set directly to an individual consultant other than the consulting firm per se.

Definition of consulting firm

With the amendments above we propose that the term ‘consulting firm be deleted and replaced with a ‘firm of consultants’ wherever it is used in the Bill.

We therefore propose to further amend the definition under

clause 3(d) to read as follows:

Justification:

Clause 3(d)

“firm of Consultants” means a company, corporation, organization, sole proprietorship or partnership that provides consultancy services to a procuring and disposing entity

Justification:

• To provide for sole proprietorship a common business vehicle for single operators of business firms like under the accountancy profession.
• Absence of such clarity may devoid such accountants participation and contribution to the procuring  and disposal of assets since accounting firms can only operate as partnership or sole proprietorship and not any other form.

4

Clause 4

Insertion of new section 4B in the Principal Act

The clause introduces the role of the Ministry in the

PPDA process. The current provisions under section

7  of  the  Principal  Act had  vested  the  power  to advise  including  government  and  the  issue  of

We suggest to provide clarity and a definition of Ministry in the

interpretations clause.

Proposed Amendment

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guidelines to the Authority.

However,  the  amendment  does  not  provide  a specific definition of the term ‘Ministry.’

Ministry” means the Ministry responsible for Finance. Justification:

To ensure clarity

6

Amendment of

section 8 of the Principal Act

We note that the proposal seeks to alienate powers

to conduct an investigation from the Authority. Generally as a principle, whenever law establishes an Authority and bestows to it powers to manage a particular activity, the same will always empower such Authority with the mandate to institute investigations incase of any misconduct. The proposed amendment is negating that. The amendment is seeking to repeal the investigative powers, ability to summon witnesses, examination of parties among others, which in actual fact may not be desirable for a supervisory entity.

Proposed clause 6(a) is not better than the current provision since requiring of any information by the Authority should arise from situations involving breach of the process.

We therefore propose that sections 8 (1)(a), (b) and (c) of the

Principal Act be retained instead.

Justification:

To allow for the Authority carry on investigations whenever necessary.

8

Clause 8

Amendment of section 10 of the Principal Act

The  bill  seeks  amendments  with  respect  to  the

functions of the Board of the Authority.

This is a welcome proposal as it aligns the functions of the

Board of the Authority to best practices in corporate governance.

Note that a Board’s mandate generally is to establish policies for corporate management and oversight, making decisions on major issues and not really executing the functions and powers

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of the entity as provided for in the current provision under

section 10 of the Principal Act.

12

Amendment of

section 21 of Principal Act

The  Bill  seeks  to  amend  section  21  relating  to

accounts and audit. We propose to have clarity on a number of provisions herein.

• We propose to amend the proposed clause 12 and insert a

new clause 21(1b) which should read as follows:

“21(1a) The Executive Director shall cause to be prepared and submitted to the Accountant General and the Auditor General or an auditor appointed by the Auditor General in respect of each financial year, within two months after the end of the financial year, a statement of accounts of the Authority, which shall include—

1. 1. a balance sheet, an income and expenditure account and a source and application of funds statement; and
   2. any other information in respect of the financial affairs of the Authority as the Minister responsible

for finance may, in writing, require.

21(1b) The Auditor General or any auditor appointed by the Auditor General shall have access to all books of accounts, vouchers and other records of the Authority

Justification:

To provide for clarity

• We propose that Section 21 (2) of the Principal Act be amended by including the words “or an auditor appointed by the Auditor General” immediately after the word ‘Auditor General ‘; for the section to read:

“21(2) The annual accounts of the Authority and the

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procurement and disposal activities of the Authority shall

be audited by the Auditor General or an auditor

 ap p ointed b y  th e  Auditor Ge neral”

Justification:

• To provide the Auditor General with clear mandate on delegation of work in line with the practice of the accountancy profession.
• Harmonise with other laws in the work for the Auditor General

27

Clause 27 Insertion

of new section 73A in the Principal Act

The insertion aims to provide for the handling of

low priced bids.

There is need to guard against the section being utilized to allow for manipulated prices vis a vis genuinely low prices.

We therefore call for introduction of strong measures against

variation of prices to curb a tendency where a bidder will bid a low price but vary the price there after.

We thus propose insertion of clear guidance that variations in prices shall not be allowed once the process commences.

30

Amendment of

section 79 of Principal Act

The Bill under clause 30 seeks to amend section

79(3) by replacing the word ‘Authority’ with ‘Minister’. This in essence implies that the use of other methods of procurement other than those provided for under Part VI shall be authorized by the Minister.

1. The proposed amendment draws the political leadership into procurement process and hence impliedly making the Minister equally accountable as an Accounting Officer instead of oversight officer.

2. The proposal would be in conflict with Section 24 of the Principal Act which enlists the structures

We thus propose deletion of the proposed and maintain the

current section 79 (3) of the Principal Act which vests the mandate to use any other method other than the ones prescribed in the Act with the Authority.

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for a procuring and disposing entity automatically

having no provision for a Minister;

(c) The proposal would also contradict section 26 of the Principal Act which places the overall responsibility for the execution of procurement and disposal process with the Accounting Officer. By having the Minister as part of the structure, it introduces hierarchical hurdles.

34

Insertion of new

section 88AA in Principal Act

We  observe  that  the  proposal  seeks  to  give  the

Minister and Attorney General the mandate to approve ‘other methods of procurement’ particularly in respect to procurement of complex, speciliased and strategic goods. This opens a window for discretion and hence likely abuse of the process. All known procurement methods should be put in the law to minimize discretion and any exceptions should be handled under the accreditation of alternative procurement system. Otherwise any other overriding issues should be addressed by policy.

Secondly, the category of goods/ services is vague as any good/ service can be taken to be complex, specialized and strategic by the declaration of Attorney General and Minister.

We thus propose that clause 34 should be deleted

36

Replacement of

section 89 of principal Act

The current administrative reviews have a three tier

system with the Accounting officer of the respective entity forming the first layer, then the PPDA and

We thus propose to retain the administrative review structure

as contained in the principal Act and hence we suggest that proposed amendment under clause 36 be deleted.

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the PPDA Tribunal. This form of review system has

been noted to be time consuming and costly  to doing business.

We recommend that for purposes of ensuring continuous flow of affairs even amidst a review, the procurement process should not be halted but instead sanctions or penalties for compensation should be introduced for the party that may lose the case after a review.

Justification:

To ensure prudence in managing administrative reviews by retaining the role of an Accounting Officer since they are not necessarily part of the contracts committee of a particular procuring and disposal entity.

We propose to insert clause section 90(7)(c) of the Principal Act to read as follows:

“90(7)(C)(i)

The above notwithstanding a contract may be awarded after the Accounting Officer’s review.

90(7)(C)(ii)

Any administrative review thereafter will result into penalties to the Accounting Officer and the procuring and disposal entity but the contract may not be terminated”

Justification:

• To  handle  economic  transaction  with  the  urgency needed.
• To  halt  unnecessary  administrative  reviews  to  the detriment of the country

We propose an insertion immediately after the current section 95 (1b) of the principal Act a new penalty the reads as follows:

95(1b) (c)

A procuring or disposal entity or an Accounting Officer who