Procurement Process May Slow N2.4trn Capital Releases
Bureaucracy associated with the public procurement process may slow the release of funds for the implementation of the 2020 budget, investigation has revealed.
Top officials in the Ministry of Finance, Budget and National Planning confided in our correspondent on Wednesday that while the country might have returned to a January to December budget cycle, release of funds for capital projects could take some time due to the Public Procurement Act.
For instance, the source, who spoke on condition of anonymity as he was not officially permitted to talk on the matter, said the bureaucracy attached to the public procurement process might reduce the speed at which funds would be released for capital projects.
Based on the Bureau of Public Procurement, there are nine essential steps that usually accompany the process of awarding contracts in the public sector.
The steps are efficient procurement plan driven by needs assessment; adequate appropriation, advertisement, transparent pre-qualification/tender; and bid submission/opening.
Others are technical and financial bid evaluation; tenders board/Federal Executive Council’s approval; contract award/execution and project implementation.
The official also said unlike in the past where funds were released to contractors for project execution, the government had decided that any release of funds would be tied to performance of the contractors handling such projects.
He said the government had adopted a strategic implementation plan for the execution of the capital budget, noting that based on the plan, no funds would be released to any government agency that had not achieved the required milestone based on its previous allocation.
The source said, “The 2020 budget was signed by the President about two weeks ago and its implementation commenced only about a week ago.
“Unlike recurrent expenditure, there are a lot of procedures that would have to be concluded before funds are released for capital projects.
“You will also have to bear in mind that even the revenues upon which the 2020 spending are predicated would have to be generated by agencies of government.
“In addition to all these is the public procurement process that would have to be done before contracts are awarded.”
When contacted on the time for the release of funds for capital projects, the Director of Information in the Ministry of Finance, Mr Hassan Dodo, said that the projects were still be uploaded in the Government’s Integrated Financial Management Information System.
The GIFMIS is an Information Technology-based system for budget management and accounting that is being implemented by the Federal Government to improve public expenditure management processes.
It is meant to enhance greater accountability and transparency across ministries and agencies of government
The GIFMIS is designed to make use of modern information and communication technologies to help the government to plan and use its financial resources more efficiently and effectively.
Dodo said it was after the uploading of the projects had been completed that the issue of capital releases would be determined by the Cash Management Office in the ministry of finance.
He said, “The releases cannot be made now because the 2020 budget has yet to be uploaded on the GIFMIS platform, which is the platform where budget is being implemented.
“It is after the uploading has been completed that we can now start talking about when the funds would be released.”
The N10.59tn 2020 budget, which was signed into law by the President, Major General Muhammadu Buhari (retd.) on December 17, has capital expenditure of N2.46tn for ministries, departments and agencies of government.
Out of the N2.46tn, the Ministry of Defence has capital allocation of N116.18bn; Ministry of Foreign Affairs, N7.6bn; Ministry of Information and Culture, N7.55bn; Ministry of Interior, N34.03bn; Office of the Head of the Civil Service of the Federation, N1.72bn; Ministry of Police Affairs, N15.95bn; Ministry of Communication Technology, N5.91bn; and Office of the National Security Adviser, N27.41bn.
Others are Office of the Secretary to the Government of the Federation, N25.18bn; Special Duties and Inter-Governmental Affairs, N2.15bn; Ministry of Agriculture and Rural Development, N124.39bn; Ministry of Finance, Budget and National Planning, N4.97bn; Ministry of Industry, Trade and Investment, N38.58bn; Ministry of Labour and Employment, N24.44bn; Ministry of Science and Technology, N62.88bn; Ministry of Transportation, N121.36bn; and Ministry of Aviation, N52.06bn.
