The Review Of Challenges And Prospect Of Public Procurement Act 2007 In The Execution Of Construction Projects In Nigeria

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The Review Of Challenges And Prospect Of Public Procurement Act 2007 In The Execution Of Construction Projects In Nigeria

Abstract

In the public procurement system in Nigeria has over the years been abused leading to cost inflation, delay in project delivery, poor quality of work, and project abandonment. The aim of this study is to examine the impact of the due process policy on construction projects delivery in Nigeria. Data were collected using a structured questionnaire distributed to 52 random selections of constructing, consulting and public organizations operating in Lagos Nigeria. Data were analysed using descriptive statistics.

The result shows that due process policy has a very positive impact in Niger’s procurement terrain. Adherence to due process proceedings had highest impact on cost savings, prequalification of contractors and detailed project design, quality of project delivery, and project duration. The study serve as a feedback to the construction stakeholders in Nigeria and contains useable information for optimizing the existing due process mechanism to enhance not only probity, accountability, transparency and competition in public contract awards, but also the policy’s resultant effects on quality of executed projects, delivery-on-budget and time considerations.

Chapter One

1.0 Introduction

1.1 Brief History of the Study

Project success is basically to gain the research on public procurement act in the execution project Shash(1993) explains that a construction company can either negotiate with the client or use a competitive tendering process to obtain a contract. F.U. and Drew (2002) suggest that competitive tendering is the most common method use for contractor selection.

In competitive tendering process, a client selects a numbers of constructor to tender or not tender. The contractor need to submit an estimated cost to execute the project at hand, if they intend to tender. The client would select the contractor who submitted the best cost for executing the project (Shash 1993, P. 111). Therefore the decision to tender is the first step that contractors need to consider. The are various factors that need to be considered by the contractor in order to make a decision to tender. The decision is highly related to the specific project and macro environment. It is hard to make a decision in a limited time by the management team. The decision generally is made on the basic experience, intuition and guesses. (Egemen and Mohamed 2007, therefore are many researchers that have discovered the factors that affect the tender / no tender process unfortunately, there has not been any similar research project global economic recession, construction related activities are decreased significantly.

1.2 Statement of the Study

The statement of the study are the research design and procurement effect of tendering is a huge challenge in Act for most contractors who seek government contracts in Nigeria. A study conducted by Obuji (2003) in some West African countries, including Nigeria, revealed that some small scale contractor are not favoured during a tendering process by prospective client because, they neglect various factor that affect the success and failures of submitting a tender for a contract. Some contractors do not structure and draft their tenders in an appropriate manner, hence their chance of being contacted is reduced.

Construction industry has complexity in its nature because it contains large number of parties as client contractor, consultants, stakeholders, shareholder, regulators and others contraction project in Nigeria suffer from many problem and complex issues in performance because of many reasons and factor. This project is very important to identify and to evaluate the main factor affecting, contractors tenders in construction project in Nigeria. The practices concerning with tenders such as time, cost, project owner satisfaction and safety checklists will be analyzed in order to know the main practical problem of contractors who do not win tenders as well practical solution. In help enhance of our indigenous contractors in Imo State in wining federal government and foreign contract.

1.3 Research Question

  1. What are the procurement effect project in Nigeria
  2. What are the challenges Act affect Nigeria when submission of project.
  3. What are the factors that affect contractors tender for construction project.

1.4 Purpose of the Study

The aim of this research is to analyzed and assess the local factors that account for the success or failure of tenders submitted by contractors when applying for a construction project in Imo State. The aim of this research can be broken down into the following objectives.

  1. To assess the factor that affect contractors tenders for construction project.
  2. To identify the challenges faced by contractors when applying for contracts in Nigeria.

1.5 Significance of the Study

This research will help contactors become aware of what the factor which need to be considered when they intend to submit tenders for different projects. This research will also provide the information that could be used by any contractor to create a competitive bidding strategy.

This study will also give a dear insight into the various ways in which profit and efficiency from contracts and contracting can be increased and how the challenges facing contract tendering can be properly tackled. The study also give a clear insight into the various factors affecting tenders and their effects on contractor efficiency and chance of winning a contact in Nigeria.

The findings and recommendations of the researcher will help in building a strong and better contract policy and tendering guideline for contractors especially small scale contractors in Imo State other construction companies in Nigeria.

1.6 Scope of Study

This research focuses mainly on the assessment of the factors that affect tender for construction project, using construction companies and private contractors in Imo State as case study. Results and recommendations may not be used to generalize other construction companies or contractors in other parts of Nigeria as the researcher could not cover a wider scoped due to financial and time constraints. Based on the finding of this study other possible researchable areas may include studies on the various effect of other aspects of contracts such as contract laws in Nigeria and contract management and control.

Limitation of the Study

The only limitation faced by the researcher in the course of carrying out this study was the delay in getting data from the various respondents.

Most respondents were reluctant in filling questionnaires administered to them due to their busy schedules and nature of their work. The research found it difficult to collect responses form the various respondent and this almost harmper3ed the success of this study.

1.7 Definition of Key or Applicable Terms

i. Tender:

According to Simmons (2002) a tender to an offer (usually by a contract or a vendor) to take a job or supply goods.

ii Contract:

Erikson (2002) defined contract as an agreement that creates on obligation binding upon the parties thereto the essentials of a contract are as follows:

  1. Mutual assent:
  2. A legal consideration which in most instances need not be pecuniary.
  3. Parties who have legal capacity to make a contract.
  4. Absence of proud or duress and
  5. A subject matter that is not illegal or against public policy.
iii Contractor:

According to Simmons (2002) a contractor referees to an organization or individual that contract with another organization or individual (the owner) for the construction of a building, road or their facility.

iv Construction / Projects:

In the fields of architecture and civil engineering construction is a process that consists of the building or assembling of infrastructure for from being a single activity. Large scale construction is a feat of human multitasking. Normally the job is managed by a project manager and supervised by a construction manager, design execution of a project, effective planning is essential involved with the design and execution of the infrastructure in question must consider the environmental impact of the job. The successful scheduling, budgeting, constriction site safety, logistics, inconvenience to the public caused by construction delays and building etc Marshall (2001).

Chapter Five

Summary of Findings, Recommendations and Conclusion

5.1 Summary

The increasing report on the abuse of public procurement system in the three tier of government in Nigeria have led to huge losses of resources in various public project (BMPIU 2005). Ayangade (2009) also hinked the problem of influence pedding sycophaney and the use of primordial considerations to abandonment of government project non-valve for public treasury, high cost of procurement among others. In the right of this 2001 surey into the state of the federal government public procurement and its recommendation gave birth to the budget monitoring and price intelligence unit (BMPIU / popularly adopted as “Due process”. This study therefore was designed to investigate the level of compliance to due process policy in the procurement process. It also examined the perception of stakeholder on the impact of due process on project outcome.

Findings of the current study shows that signing of a binding contract agreement detailed project design and selection of tending method have the highest impact on cost saving in construction projects under the process. Standard request for proposals for selection of consulting firm 1st stage approval by project review threshold and total building commissioners had relatively low impact on project design had highest impact on request for payment interim valuation has highest influence on project time project planning phase, tender action and detailed design phase in that order top the list of stage that received the highest compliance.

5.2 Recommendation

It is therefore recommended that:

  1. Awareness is to be created to make all the stakeholders understand the importance of procurement policy.
  2. Low should be promulgated to help prosecute those who fail to adhere to the procurement regulations.
  3. There is need to carry out cost / benefit analysis of projects for easy implementation of the due process policy.
  4. It is important to develop a new cadre of professional procurement officers and contracting officers in the public service for efficient implementation of procurement reforms.
  5. It is necessary to work out an appropriate scheme of service to be adopted by all the tiers of government for procurement and contracting officers.

5.3 Conclusion

Due process policy from evaluation and analysis, has laid the necessary foundation for rejuvenating and reinventing honesty and transparency in conduct of government business in Nigeria especially in procurement and award of contracts in the public sector. The due process mechanism as a modle application of “Best practice” in procurement system has become a key reform agenda in the management of public finance. It ensures that requisite standards are maintained, while accountability and the elimination of wastes are guaranteed in contrast to the ole procurement system that was not integrity-driven. It makes it possible for contractors and suppliers to have a fair hearing when aggrieved through filling their protests to a statutory contract appeal Board. By its introduction, appropriate level of respect for rules, regtulations and procedures relating to the management of public funds are institutionalized.

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