Procurement PlanProcurement Plan

Dec 2010

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Procurement PlanningProcurement Planning

Accurate & realistic planning & prioritisation of needs is:an essential pre-requisite to effective procurement a key tool for monitoring project implementation

Best practice procurement takes time & the process has various steps

Preparedness & preparation are crucial for successful procurement

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Procurement Procurement PlanningPlanning At the time of negotiation of each project, the

borrower/recipient, in consultation with IFAD, must establish an 18-month procurement plan, which must include, as a minimum, for each activity:

• brief description of each procurement activity to be undertaken during period

• estimated value

• method of procurement to be adopted

• method of review IFAD will undertake

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Procurement PlanningProcurement Planning

Where national procurement plan templates exist & are agreed by IFAD as suitable, such templates should be used

If no such templates exist, IFAD will adopt those from other international financing institutions with which the borrower/ recipient is familiar & which are in use for other projects

Borrowers/recipients are required to keep plans updated frequently to reflect changes to project or timescales

IFAD’s review of & no objection to procurement plans is compulsory under all financing agreements directly supervised by IFAD

Procurement at Start-UpProcurement at Start-Up

Ideal Structure

Coherence with project objectives & annual work plan

Financial estimates in line with AWPB & overall funds allocation

Procurement methods in line with regulatory framework

Realistic timing & scheduling of procurement activities

Desired Features of a Procurement Plan

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Review of Procurement Plan Review of Procurement Plan (1)(1)

The initial plan covers 18 months (thereafter: 12 months) & shows for each procurement action:

financing category & component, financing rate

procurement method

estimated cost & quantities

IFAD review requirement

anticipated timeline for the entire process

Procurement actions are grouped according to categories (goods/ works/ services) for each component

Within each category, procurement actions are grouped into coded lots or packages for increased competition, efficiency & better prices

Model Procurement Plan & Templates

Ideal Structure

Annex 1 - Model of Procurement plan

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Review of Procurement Plan Review of Procurement Plan (2)(2)

Procurement actions are relevant to project objectives

Nature and quantity of goods/works/services are consistent with appraisal

report (detailed cost tables)

Nature and quantity of goods/works/services are consistent with activities

in the annual work plan

Coherence with project objectives and annual work plan

Estimated costs for each procurement action are reasonable

Cost estimates are properly reflected in the annual budget

Cost estimates are within overall project funds allocation (by expense

category)

Financial estimates in line with annual budget and overall funds allocation

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Review of Procurement Plan Review of Procurement Plan (3)(3)

Compliance with Financing agreement +/ or LTB

Compliance with the IFAD procurement guidelines & national regulations

Procurement methods in line with regulatory framework

Anticipated timeline for each procurement action (from preparation of

bidding documents to signature of contract) is realistic

Anticipated delivery dates of goods/ works/ services are consistent with

physical targets as per the AWPB

Realistic timing and scheduling of procurement activities

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Checklist procurement plan

Review of the Procurement Review of the Procurement PlanPlanCoherence

General coherence: is the nature & quantity of goods/ works/ services generally consistent with the nature of project activities/components as per design report?

Coherence with AWPB: do the nature & quantity of goods/ works/ services appear consistent with the activities in the AWPB? Are the costs of procurement adequate & reflected in the budget?

Procurement Packaging

Is the procurement systematically & logically grouped according to procurement categories (goods/ works/ services)?

Within each category, have similar or related items been combined in a single package where possible & sensible?

Has packaging been done in a way that facilitates the use of the most competitive and efficient procurement method & that ensures best value for money? Note specifically “split packaging” (e.g. several small, similar packages designed to circumvent threshold for competitive procurement methods); packaging that limits competition by de facto locking a series of contracts to the winner of 1st contract (e.g. separate package for delivery of machinery followed by future packages for spare parts & maintenance)?

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Review of the Procurement Review of the Procurement PlanPlan

Procurement Method

Is the selection of procurement methods in compliance with provisions of Schedule 4 of Financing agreement +/or LTB ?

Procurement Schedule

Do the time estimates indicated (for the individual procurement method) seem realistic?

Is the procurement schedule consistent with implementation schedules in the AWPB (does the delivery of goods, works & services correspond to physical targets in the work plan)?

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After the Procurement Plan - After the Procurement Plan - ContractContract Contract contents – all pertinent deliverables, timing, deadlines,

results-oriented reporting & expected outcomes, with

measurable indicators

Contract management – monitoring & supervision is crucial

Contract execution – procurement is complete only when the

contracted product of satisfactory quality is delivered at the

appointed time

Thank youThank you