UWASA-MBEYA. Key Findings on Non-Compliance. 1. Establishment and composition of Tender Board

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1 UWASA-MBEYA The audit was conducted between April and August This audit covered procurement amounting to 1,287,133,144 which had been processed by the time of the audit. Overall compliance of UWASA-Mbeya was 75% using 13 indicators. The scores for the 13 indicators were as follows; Establishment and composition of TB (70%), Establishment and composition of Procurement Management Unit (PMU) (85%), Functioning of Accounting, Tender Board, Procurement Management Unit and User department (74%), Preparation and adherence to annual procurement plan (APP) (61%), Approvals (88%), Advertisement of bid opportunities (70%), Publications of awards (0%), Time for preparation of bids(1%), Method of procurement (1%), Use of standard tender/contract documents (85%), Record keeping (76%), Quality assurance (36%) and Contract implementation (81%). Key Findings on Non-Compliance 1. Establishment and composition of Tender Board TB was composed of eight (8) members in accordance with section 28 of PPA 2004 read together with paragraph (2) of second schedule of PPA However during the audit UWASA TB had 7 members only. One member died on August TB members had not attended training on PPA, 2004 and its Regulations except for the Secretary of Tender Board. Establishment of TB was communicated to PPRA. The establishment and composition of TB therefore complied with section 28 read together with section 1 (2) of the 2 nd schedule of the PPA 2004 The score on establishment and composition of TB is 70% 2. Establishment and composition of PMU The PMU appeared in the organization structure of UWASA with the Head of PMU reporting directly to the Accounting Officer (AO). The HPMU was a holder of CPSP (T), other PMU staff was qualified with ACSE and Foundation II. PMU was also established with one technical specialist in Water Engineering. PMU had a secretary, adequate office accommodation and one computer with its printer according to Section 34 of PPA HPMU had no appointment letter by AO pursuant to section 34 (4) of PPA The score on establishment and composition of PMU is 85% 1

2 3. Functioning of AO, TB and PMU and User Department It was observed that AO officer performed all responsibilities according to section 33 of the PPA, Tender Board also exercised powers and performed most of responsibilities pursuant to section 30 of PPA PMU also performed the responsibilities according to section 35 of PPA However, it was noted that there were some incidences of interferences between functions of Accounting Officer, Tender Board and Evaluation Committee contrary to Section 38 of PPA The score on Function of AO, TB and PMU is 70% 4. Preparation of Procurement Planning: It was observed that UWASA prepared the Annual Procurement Plan (APP) for financial year 2011/2012 using appropriate templates prepared and issued by Public Procurement Regulatory Authority (PPRA). However, numbering of packages/tenders was not prepared according to PPRA guidelines; Processing time was allocated in tendering section of the APP. However, tender processing time through NCB was given a total of 39 days from tender document preparation to contract signature date contrary to the tender processing time indicated in the 3 rd schedule of GN. No. 97 of There was no evidence of updating the plan at each stage of implementation so as to measure the performance of the PE in managing the procurement processes and time given in the actual implementation was not complying with the 3rd Schedule Part (a) of GN. No. 97 & 98 of The score on preparation of Annual Procurement Plan is 35% 5. Approvals. TB approved bidding documents and tender adverts. The lists of suppliers or services providers under framework contract were submitted to the TB for approval according to Sec. 68 of PPA of The score on approvals is 100% 6. Advertisement It was observed that one (1) planned tender through NCB was advertised in Tanzania Daima, Daily News pursuant to Reg. 80 (5) of GN. No.97 of Copy of advert was submitted to PPRA to be posted in its website and Procurement Journal. The score on Advertisement is 100%. 2

3 7. Publication of Awards. It was observed that contracts awarded under FWC were disclosed to the public pursuant to Regulation 21 of GN. No. 97 of UWASA notified PPRA through UWSA/MBY/F.197/VOL.II/100 of 20 th July 2011 on award of suppliers and service providers for publication in PPRA s website and Journal pursuant to Regulation 97 (12 & 13) of the GN. No. 97 of The score on Publications is 100% 8. Time for Preparation of Bids AT noted that UWSA used NCB to form FWC with suppliers and service providers. Bidders were given 30 days to prepare and submit their bids from 19 th May, 2011 to 20 th June, 2011 pursuant to Reg. 80 (6) read together with Paragraph (C) of the 3 rd schedule of GN. No. 97 of The score on Time for preparation of Bids is 100% 9. Methods of Procurement. UWSA procured 559 Call Off Order for Goods and Non consultancy services contracts under FWC as per contract and pursuant to 2 nd schedule of GN.No.97 & 98 of Score for Methods of Procurement is 100% 10. Use of Standard Bidding Documents: It was noted that PMU used Standard Bidding Document prepared and issued by PPRA pursuant to Regulation 83 (3) of GN. No. 97 of However, Data Sheet and Special Conditions of Contacts were not amended appropriately. That evaluation was performed using non standard evaluation forms contrary to PPRA Guidelines on standard Documents and procedural forms Section 7 (d) of PPA Score for Use of Standard Documents is 75% 11. Record Keeping: 3

4 It was noted that there was no proper procurement record keeping system in place with regard to consolidation of procurement records in single procurement file from initiation of procurement up to completion of the contract contrary to Section 56 of PPA 2004 read together with Reg. 19 (1) of GN. No. 97 of The current procedure did not consolidate procurement contracts records in a single file from initiation of procurement up to completion with updates of the contracts. Records of information were scattered in different files and it was difficult to get flow of the entire procurement cycle as required; The Examined LPOs contracts were all filed in one batch file. Each Call off Order contract consists of one LPO document with no other attachment. The score on record keeping is 21% 12. Quality Assurance and Control: It was confirmed that the PE did form some Inspection and Acceptance Committees for inspecting goods in accordance with Regulation 121 (2) of GN No. 97 of However it was observed that AO had formed permanent inspection and acceptance for inspecting services and goods contrary to Regulations 126 and 127 of GN. No. 97 of It was not evidenced that 559 Call Off Contracts were inspected by the appointed team in absence of Inspection and acceptance report. Either it was observed that Goods Received Note (GRN) was signed by one person, while non consultancy contracts were not inspected. However, there was no proper system in place for stores to verify quality of incoming goods; stores had no copy of LPO. Stores relied on GRN which had no enough details for goods quality verifications. The score on Quality Assurance and Control is 26% 13. Contract Management and Implementation: The Assessment of contract administration revealed that there was proper procurement contracts administration; there was inspection and acceptance team. However, there was no evidence that they carry out inspection of received goods. There was no inspection certificates availed as evidence of inspection done. Score on Contract Management and Implementation is 96% Recommendations 4

5 In view of the above observations, the provisions of the PPA 2004 and its Regulations made under it, the PE should adhere to and attention should be on the following recommendations:- 1) AO should ensure that TB members attend seminars/training on PPA and its Regulations so that they become competent in carrying out procurement responsibilities of Tender Board Pursuant to Section 30 of PPA ) AO should perform all the responsibilities as per section 33 of PPA, 2004 as well as Staffing PMU to appropriate level pursuant to Sec. 34 of ) Tender Board should perform their responsibilities pursuant to Section 30 of PPA ) PMU when preparing APP should assign tender numbers according to guidelines issued by PPRA and should Estimate Processing Time and allocate for prequalification and tendering stages pursuant to 3 rd Schedule of GN. No. 97 & 98 of ) PE should ensure that tenders are implemented according to APP. 6) PMU should amend/ modify standard tendering documents for all procurement appropriately. 7) PMU should file copies of individual procurement contracts starting with; APP, approved tender adverts, bidding and quotation documents, Minutes of tender opening; tender opening register; readout prices and tender opening checklist. 8) PMU should file Letters of appointment of evaluation committee, Evaluation report with Signed covenant form, Brief summary of Evaluation report for the TB members, Signed personal covenant forms for TB members. PMU should attach letters of acceptance in the specific contract files. PMU should attach Notification of unsuccessful bidders in the specific contract files. 9) There should be quality assurance plan in place for works contracts, checklists for testing for quality verification, either there should be qualification criteria of the inspector. 5