Ethics and Due Process Compliance in Public Procurement

Emeka M Ezeh, OFR&

James O Akanmu, PhD, FNSEBureau of Public Procurement

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Highlight

On the Marble

Ethics and Ethical Requirements in Public Procurement

The Due Process in Public Procurement

Offences

Sanctions

Way Forward

Tools for Compliance

Conclusion

On the Marble

NOTE THAT IT IS NOT• What

we eat but what we digest that makes us strong;

• What we read but what we remember that makes us learned;

• What we profess but what we practice that gives us integrity.

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Ethics

•What are ethics?1: a discipline dealing with good and evil and with moral duty 2: moral principles or practices

• Business ethics include practices and behaviours that are good or badOK, so what does “moral” mean?

1: of or relating to principles of right and wrong 2: conforming to a standard of right behavior

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Right behaviour?

• So, who determines “right” behaviour?– Society?– The government?– God?– Basic human nature?– Profession

DrJOAkanmu/ethics/nse/2011 6

Why talk about ethics and Integrity?

To Avoid:

• Corporate failures

• Questionable professional practices

To prevent:

• Moral decadence

• Corrupt practices

Fraudulent practices

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Why Leaders behave ethically

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Most of Us1. To avoid some punishment1. To avoid some punishment

2. To avoid some punishment2. To avoid some punishment

Many of Us3. To be Responsive to family, friends or Superiors3. To be Responsive to family, friends or Superiors

4. To be a good Citizen4. To be a good Citizen

Very Few of UsVery Few of Us 5. To do what is right, pursue ideal, such as justice5. To do what is right, pursue ideal, such as justice

Ethics and the Law

• Law often represents an ethical minimum• Ethics often represents a standard that

exceeds the legal minimum

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Ethics Law

Frequent Overlap

To be ethical,

You must

• Demonstrate Integrity

• Exercise Leadership

You must

• Practice Competently

• Promote Sustainability

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DUE PROCESS in Procurement is

• the legal requirement that the Procuring Entity must respect all of the legal rights that are owed to the

Staff, • Suppliers, contractors and service providers, and • the government.

• a generic expression used to describe the combination of all the Laws, rules, regulations, standards and procedures which must be followed in the effective public procurement

DUE PROCESS is NOT

• wilful violation of the Law, laid down rules and regulations; it is not about circumventing the Law, rules and procedures;

• driving on the wrong side of the road or driving against traffic or jumping traffic lights;

• interfering with the bidding process• exerting undue influence on the public procurement

process to manipulate and steer the award of contract to a preferred contractor and pre-determined winner of a tender.

DUE PROCESS IN PUBLIC PROCUREMENT

Need Assessment and

Procurement Planning

PrepareBid

documentAdvertisement

Evaluation

Collection & Submission and Opening of

Bid

Contractaward

ContractPreparation

Signing of contract

Performance Of

contract

1 2 3 4

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6 7 8 9

Advertisement

• Advertisement shall be in line with Section 25 and provisions of the regulations that guides the type of procurement

Bid Opening, Examination and Evaluation

• Section 30• prescribes the due process required in Bid opening

• Section 31• prescribes the due process required in Bid Examination

• Section 32• specifies the due process required in Bid Evaluation

• Section 32 sub section 2– The Objective of bid evaluation is to determine the

Lowest Evaluated Responsive Bid

Award and Approving Authorities

• To award a contract, the approving authorities include the following:– Accounting Officer– Tenders Board– BPP for Certificate of No ObjectionTo award a contract, the approving authority is

determined based on service wide approved threshold as given in the Circular

• All complaints must firsts be addressed to the Accounting Officer.

• Accounting officer to decide complaint in writing addressed to complainant within 15 working days,

• Provides right of appeal to Bureau if there is ( failure to decide or if unsatisfied by decision).

• Bureau has to decide in writing within 21 working days.

• Provides access to Federal High court within 30 days of BPP decision if not satisfied with BPP decision

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Due Process in Complain Procedure: Section 54

Way Forward

We must agree to have these core values in all our activities:

• Integrity, Accountability and Transparency; • Respect; Meritocracy; • Creativity; Team Work; Open Mindedness; • Social Responsibility

Way Forward

Code of Conduct for Officials, suppliers, contractor or service Provider, Tenders Board Member

• Section 57 – Honesty– Accountability– Transparency– Fairness– Equity

Can we agree that we shall follow the provision of Section 57 sub section 1 to 13?

WAY FORWARD•

Selflessness: Officials should take decisions solely in terms of the public interest. They should not do so in order to gain financial or other material benefits for themselves, their family, or their friends. Integrity: public official should not place themselves under any financial or other obligation to outside individuals or organisations that might influence them in the performance of their official duties. Accountability: Public officials are accountable for their decisions and actions to the public and must submit themselves to whatever scrutiny is appropriate to their office

DrJOAkanmu/ethics/nse/2011 19

Way forward…• Openness: Officials should be as open as possible about all

the decisions and actions that they take. • Honesty: Engineers and public officials have a duty to declare

any private interest relating to their public duties and to take steps to resolve any conflicts arising in a way that protects the public interest.

• Leadership: Officials should promote and support these principles with leadership by example.

• Recognize the right of your contractors/consultants to make money too!

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In this world everything changes except good deeds and bad deeds;

these follow you as the shadow follows the body.

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INTEGRITY

• Guidelines, rules, and policies do not make us honest. They only mark the pathway we should follow. Each one of us must make our own decisions, based on our own values and courage. Only when we make ethical behaviour a reflex action as natural as breathing will we truly possess INTEGRITY.

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Can we proudly say Integrity works here?

• Integrity is not easy.• It doesn’t allow us to take shortcuts. • It may mean accepting a short-term sacrifice

to create a long-term benefit. • Integrity can sometimes even make us

temporarily unpopular.

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Integrity…

• When we encourage and support each other in making the right decisions, integrity is no longer difficult.

• It becomes the norm that we all follow and the bond that holds us together.

• It is up to each of us to create a place where we can proudly say, "INTEGRITY WORKS HERE.”

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• Some of the Offences– Bid Rigging – Pre-arrangement of offers where winners have been

predetermined– Collusion– Splitting of contracts– Procurement Fraud using undue influence, favour, bribery,– Altering procurement document– Willful refusal to allow Bureau and its officers access to any

procurement records– Using fake documents like TCC, etc.

Offences and Sanctions- Section 58

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• For a natural person not being a public official– Section 58 subsection 1– Jail term of not less than 5 Calendar years and not exceeding 10

calendar years without option of fine• For officers of the Bureau, UNN, FME etc

– Section 58 subsection 5– Jail term of not less than 5 Calendar years without option of fine.– Summary Dismissal from Government Service,

• Contractors, Suppliers or Service Providers– Section 58 sub section 6– Debarment– A fine equivalent to 25% of the value of the procurement in issue– Every Director of the Company is liable on conviction to Jail term of not

less than 3 Calendar years but not more than 5 years without option of fine. 26

Sanction or PENALTY FOR VIOLATORSSection 58

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Think About this. Any Violation?

• James is part of a team evaluating proposals for a competitive procurement for a Procuring Entity.

Violation?

• At dinner, after a week of evaluating proposals, James shares his opinions and observations with his wife, a professional colleague, about the differences between the proposals.

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Think About this. Any Violation?

• Major Ishaq’s commanding officer asks for a brief on how the evaluations are going. Major Ishaq provides him with an overview of the strengths and weaknesses of each bidder.

• Major Ishaq is the Army representative to a team evaluating proposals for a competitive procurement for Ministry of Defence.

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Ethics Summary

• Ethical behavior is your responsibility if you are involved with Public Procurement

• Rules are often complicated with many exceptions• If you are not sure, seek guidance

– Public Service Rules – Section 57, PPA, 2007– ICPC ACT– EFCC ACT– NIGERIAN CONSTITUTION

• Document your efforts to obtain clarification/ approval

Compliance will become easier if you will:

• Promote Excellence in place of Mediocrity• Put Nation and the profession before self• Be an asset not a liability• Provide solutions to problems• Keep promises• Not defraud the Govt and Contractors or

service providers• Follow Due Process in Public Procurement

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Thank You

Thank You