2. Public Procurement Authority (PPA), Ghana
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MODULE OBJECTIVES
By the end of this module, participants will be able to:
• Explain basic procurement principles and the underlying
rules that support these principles – professionalism,
transparency, value for money, accountability, fairness,
competitiveness etc
• Apply the codes of conduct in the performance of their
procurement functions
3. BASIC OBJECTIVES OF GOOD PROCUREMENT
The basic objectives of good procurement are:
• To obtain the Right Quality of goods, works, or services
• From the Right Source
• In the Right Quantity
• At the Right Price
• Delivered to the Right Place
• At the Right Time
• Whilst achieving the lowest total cost.
Public Procurement Authority (PPA), Ghana
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4. PRINCIPLES/FACTORS AFFECTING ACHIEVEMENT OF
PROCUREMENT OBJECTIVES
The following principles/factors affect the achievement
of good procurement objectives:
• Professionalism
• Transparency
• Value for money (Efficiency and Economy)
• Competitiveness
• Accountability
• Fairness
• Sustainability
• Ethical approach
Public Procurement Authority (PPA), Ghana
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6. PROFESSIONALISM
Professionalism is the discipline whereby educated,
experienced and responsible procurement officers make
informed decisions regarding purchase operations.
The role of procurement professionals is critical to
Ghana’s economic development.
It is in the recognition of this fact that the Public
Procurement Authority’s object includes:
‘‘the professional development, promotion and support for individuals engaged
in public procurement and ensure adherence by the trained persons to ethical
standards”. (AB Adjei, Chief Executive, PPA July 2006).
Public Procurement Authority (PPA), Ghana
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7. TRANSPARENCY
Transparency refers to the level of openness of a procurement
process and the idea that procurement procedures should be
characterized by clear rules and by means to verify that such
rules were followed in the procurement process.
Transparency means that the same rules apply to all suppliers,
contractors, consultants/service providers for goods, works and
services respectively and that these rules are publicized as the
basis of procurement decisions prior to their use.
Transparency enables the creation of open and fair procedures.
It encourages inward investment and competitiveness as the
public sector is seen as a responsible business partner.
Public Procurement Authority (PPA), Ghana
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8. TRANSPARENCY (Cont’d)
Transparency can be achieved in various phases of a public
procurement process:
• Publicity of contract opportunities
• Publicity for the rules governing each procurement procedure
• Rules relating to the clarification of tenders
• Public opening of tenders
• Debriefing
• Publication of contract awards
• Limits to control the discretion of procuring entities or officers
in making public procurement decisions
• The possibility for interested parties to verify the application of
the public procurement rules as publicised
Public Procurement Authority (PPA), Ghana
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9. VALUE FOR MONEY (EFFICIENCY AND ECONOMY)
Value for Money (VFM) is the optimum combination of whole life
cost and quality to meet the customer’s requirements. It is reflected
in the price of the item or service procured.
The essence of the Public Procurement Authority’s object is to
“secure a judicious, economic and efficient use of state
resources in public procurement’’.
Value for Money (VFM) is a critical measure of the effectiveness of
the procurement process, its outputs and outcomes.
Achieving VFM requires a strategic and integrated approach to
procurement.
VFM may be compromised if the Public Procurement Act and
Regulations are not followed.
Public Procurement Authority (PPA), Ghana
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10. VALUE FOR MONEY (Cont’d)
The key aspects of VFM cover the following:
• Ensuring the goods, works or services acquired are fit for the
intended purpose. This means that:
They can meet the requirements for the task in question, and
They are not over-specified
• Ensuring that the goods, works and services are acquired at the
right price
• Concluding an arrangement to secure what is needed on the best
contractual terms
• Ensuring the contracting parties fulfil their parts of their
obligations under the terms and conditions of the contract
Public Procurement Authority (PPA), Ghana
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11. COMPETITIVENESS
Competitiveness means actively encouraging greater suppliers,
contractors, consultants and/ or service providers’ participation
in the tendering process through advertising, sourcing reviews,
prequalification and transparent procedures.
The merits of competitiveness include:
• Potential for cost savings and achievement of value for money
• Increases the potential for supplier, contractor, consultant and/or
service provider’s base
• Greater awareness of new developments
• Greater understanding of the Act and confidence in public sector
procurement
Public Procurement Authority (PPA), Ghana
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12. ACCOUNTABILITY
Accountability can be explained as the process of holding an
individual or an organization fully responsible for all aspects of
the procurement decision making process over which they exert
authority.
Relevant provisions under Act 663 as amended are sections
17(1) and 18(1) which place obligations on the head of entity
and officers to whom authority is delegated to be accountable.
The merits of accountability include:
• Strengthens the perception of transparency and fairness
• Reduces the incidence of corruption
• Increases the need for actors within the procurement process to
take ownership and responsibility for their actions and decisions
Public Procurement Authority (PPA), Ghana
Prepared by GIMPA Consultancy MODULE 3
13. FAIRNESS
Fairness in public procurement implies showing consideration
and impartibility in all stages of the procurement process, such
as demonstrating equality in tender evaluations.
Fairness results in:
• Development of mutual trust
• Instils confidence in the procurement process which ultimately
promotes increased participation by tenderers for contract
opportunities
• Increases the potential for supplier, contractor, consultant and/or
service provider’s base
Public Procurement Authority (PPA), Ghana
Prepared by GIMPA Consultancy MODULE 3
14. FAIRNESS
Fairness in public procurement implies showing consideration
and impartibility in all stages of the procurement process, such
as demonstrating equality in tender evaluations.
Fairness results in:
• Development of mutual trust
• Instils confidence in the procurement process which ultimately
promotes increased participation by tenderers for contract
opportunities
• Increases the potential for supplier, contractor, consultant and/or
service provider’s base
Public Procurement Authority (PPA), Ghana
Prepared by GIMPA Consultancy MODULE 3
15. EFFICIENCY
Efficient public procurement means:
• A system which operates in a timely manner, with a
minimum bureaucracy, while being responsive to the needs
of the ultimate users of the goods, works or services
procured.
• Efficiency covers the optimum utilization of scare resources
to achieve desired results.
Public Procurement Authority (PPA), Ghana
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16. ETHICAL APPROACH
Ethics is concerned with moral principles and values
which govern our beliefs, decisions, actions and
behaviours.
Ethical approach implies exemplary approach to all
procurement processes that cannot be questioned or
criticized.
Public Procurement Authority (PPA), Ghana
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17. IMPORTANCE OF ETHICS
Ethics is important in procurement for the following reasons:
• Procurement staff are the representatives of their organization
in its dealing with suppliers, contractors, consultants and/or
service providers.
• Sound ethical conduct in dealing with suppliers contractors,
consultants and/or service providers is essential to the creation
of good relationships and the establishment of supplier
goodwill
• It is impossible to claim professional status for procurement
without reference to a consideration of its ethical aspects.
• Procurement staff are probably more exposed to the
temptation to act unethically than most other employees.
Public Procurement Authority (PPA), Ghana
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18. SUSTAINABILITY
The introduction of sustainability into Ghana’s public procurement
regime is to ensure that in making procurement decisions today,
procurement entities should be mindful of the implications of their
decisions on future generations.
“Sustainable procurement is all about taking environmental, social
and economic factors into account in procurement decisions”
“It’s about looking at what your products are made of, where they
come from and who has made them” (HEPS Sustainable
Purchasing Guidance)
Sustainable procurement is about laws, policies and practices to
integrate economic, social and environmental risks into public
procurement processes and decisions.
Public Procurement Authority (PPA), Ghana
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19. CODE OF CONDUCT
Section 86 of the Act 663 as amended requires the compilation
and publication of a code of conduct by PPA.
The codes of conduct shall apply to each official of a
procurement entity, the members of evaluation panel, members
of tender review committees, tenderers, suppliers, contractors,
consultants and service providers. The codes of conduct shall
address the following:
• Confidential information
• Conflict of Interest
• Fraud and Corruption
• Gifts and Entertainment
• Training
Public Procurement Authority (PPA), Ghana
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20. Confidential information
Officials must not disclose to any third party confidential
or proprietary information.
Public Procurement Authority (PPA), Ghana
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21. Conflicts of interest in Procurement
Conflict of Interest can be explained as “A situation where personal or business
interests of a party could adversely affect the outcome of a procurement transaction.”
Public procurement officials must avoid conflicts between their personal
financial interests and their official duties.
Any instances of conflict of interest should immediately be
disclosed/declared prior to the commencement of a procurement process.
Tenderers have an obligation to disclose any situation of actual or potential
conflict that impacts their capacity to serve the best interest of the
procurement entity or that may reasonably be perceived as having this
effect.
Failure to disclose said situations may lead to the disqualification of the
Tenderer or the termination of the Contract.
Public Procurement Authority (PPA), Ghana
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22. Fraud and Corruption
“A fraudulent practice is any act or omission, including a misrepresentation,
that knowingly or recklessly misleads, or attempts to mislead, a party to obtain a
financial or other benefit or to avoid an obligation.”
“A corrupt practice is the offering, giving, receiving or soliciting, directly or
indirectly, anything of value to influence improperly the actions of another party.”
Procurement Entities and tenderers, suppliers, contractors, consultants, technical
service providers and their agents and any personnel thereof, are required to
observe the highest standard of ethics during the procurement and execution of
public-financed contracts.
Section 93 of Public Procurement Act, 2003 (Act 663) as amended on Corrupt
Practices, states the following:
1. “Entities and participants in a procurement process shall, in undertaking procurement
activities, abide by the provisions of article 284 of the Constitution”.
2. “An act amounts to a corrupt practice if so construed within the meaning of
corruption as defined in the Criminal Offences Act,1960 (Act 29)”.
Public Procurement Authority (PPA), Ghana
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23. Common Forms of Corrupt and Fraudulent Practices
“Coercive practice” means impairing or harming, or
threatening to impair or harm, directly or indirectly, any party or
the property of any party, to influence the actions of a party in
connection with the implementation of any contract supported,
in whole or in part, including such actions taken in connection
with the execution of a contract.
“Collusive practice” means a tacit or explicit agreement
between two or more parties to perform a coercive, corrupt,
fraudulent, obstructive or prohibited practice, including any
such agreement designed to establish prices at artificial, non-
competitive levels or to otherwise deprive the Employer of the
benefits of free and open competition.
Public Procurement Authority (PPA), Ghana
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24. Common Forms of Corrupt and Fraudulent Practices (Cont’d)
“Obstructive practice” means any act taken in connection
with the implementation of any contract supported, in whole
or in part:
• That results in the destroying, falsifying, altering or concealing of
evidence or making false statement(s) to investigators or any
official in order to impede an investigation into allegations of a
coercive, collusive, corrupt, fraudulent or prohibited practice,
• That threatens, harasses or intimidates any party to prevent him or
her from either disclosing his or her knowledge of matters relevant
to an investigation or from pursuing the investigation and/or
• Intended to impede the conduct of an inspection and/or the
exercise of audit or investigation rights provided under Act 663 as
amended and related regulations, manual, agreements and standard
tender documents;
Public Procurement Authority (PPA), Ghana
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25. Common Forms of Corrupt and Fraudulent Practices (Cont’d)
“Prohibited practice” means any action that violates
Compliance with Anti-Corruption, Anti-Money
Laundering, Terrorist Financing, and Trafficking of
Persons, Statutes and Other Restrictions of the United
Nations.
Public Procurement Authority (PPA), Ghana
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26. Gifts and Entertainment
Officials must not accept directly or indirectly, any gift
(including any gratuity favour, entertainment, loan or
other consideration) with a value in excess of a certain
amount of money (which should be set at a low level,
having regard to the overall situation in the country
concerned from any person or entity which has or seeks
to obtain a contract with their own agency.
Public Procurement Authority (PPA), Ghana
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27. Training
It is important to institute screening procedures and training
requirements aimed at building the capacities of key actors in
ethics of procurement.
Such training programmes could cover:
• Conflict of interest
• Bribery
• Fraud and corruption
• Child and forced labour
• Money laundering
• Terrorism financing
• Modern slavery
Public Procurement Authority (PPA), Ghana
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28. RESULT OF UPHOLDING PROCUREMENT PRINCIPLES
Procurement principles and ethics will result in the
following:
• Increased efficiency in the procurement functions
• Procurement operations become more effective
• Enhanced profile of procurement
• Improved achievement of objectives
• Professionalism of procurement in Ghana
• Reduction in bribery and corruption and thereby achieving
value for money in public procurement
Public Procurement Authority (PPA), Ghana
Prepared by GIMPA Consultancy MODULE 3
29. Examples of Unethical Conduct
Revealing confidential or “inside information” either directly or indirectly to any tenderer or
prospective tenderer;
Discussing a procurement with any tenderer or prospective tenderer outside the official rules and
procedures for conducting procurements;
Favouring or discriminating against any tenderer or prospective tenderer in the drafting of
technical specifications or standards or the evaluation of tenders;
Destroying, damaging, hiding, removing, or improperly changing any official procurement
document;
Accepting or requesting money, travel, meals, entertainment, gifts, favours, discounts or anything
of material value from tenderers or prospective tenderers;
Discussing or accepting future employment with a tenderer or prospective tenderer;
Requesting any other Public Servant or Government official representing the Procurement Entity
in a procurement to violate the public procurement rules or procedures;
Ignoring evidence that the Code of Ethics has been violated by a member of the Tender
Committee, Public Servant or other employee or representative of the Procurement Entity;
Ignoring illegal or unethical activity by tenderers or prospective tenderers, including any offer of
personal inducements or rewards.
Public Procurement Authority (PPA), Ghana
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30. Obligations of Public Servants
The guiding principles of ethical behaviour are:
• Impartiality
• Independence
• Integrity
Ethical behaviour must be promoted and supported by appropriate systems and procedures
Systems and strict adherence to procedures alone cannot create an ethical and accountable
procurement function
Public Servants involved in procurement are obliged to follow the Civil Service Code and the
regulations governing public procurement.
All procurement activities must be carried out in a manner above reproach, with complete impartiality
and with no preferential treatment.
The procurement process must allow suppliers, contractors and consultants to compete for business
on a fair basis
Public officials associated with the procurement function must be responsible by protecting the
integrity of the procurement process and maintaining fairness
Public Procurement Authority (PPA), Ghana
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31. Responsibilities of Officers
Senior officers in a Procurement Entity have responsibility to:
• Provide instructions and guidance to staff, especially where they may be exposed to
opportunities for accusations of fraud or corruption;
• Encourage staff to follow ethical principles and practices and create an environment
where transparency and openness are the standard;
• Ensure that all staff comply with instructions and guidelines, including the
maintenance of documented records;
• Set appropriate levels of financial delegation, and ensure a proper separation and
rotation of duties.
Junior officers in a Procurement Entity have responsibility to:
• Follow management instructions and procedural guidelines;
• Be alert to and report any indications of unethical behaviour;
• Seek guidance from a manager or auditor on any concerns that may arise.
Public Procurement Authority (PPA), Ghana
Prepared by GIMPA Consultancy MODULE 3
32. Responsibilities of the Private Sector
The Private Sector is not exempt from responsibility to act ethically and transparently in
procurement proceedings with the Government of Ghana.
This message is to be reinforced by requiring tenderers to sign a formal declaration
before participating in any procurement process:
“I hereby certify that I and all officers of the Company which I represent will uphold the
highest ethical standards in doing business with the Government of Ghana. We will not
attempt to bribe government officials with money or other goods or services; we will not
request favourable treatment and we will not seek information about competitors or
other information regarding the procurement process. I understand that if I, or other
officers of the Company which I represent are found to have breached this commitment,
that sanctions will be made against the Company, including being debarred from doing
business with the Government of Ghana for a period of 5 years.”
Public Procurement Authority (PPA), Ghana
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33. Sanctions for Non-compliance with Ethical Standards
Adherence to the provisions of Act 663 as amended and Regulations by Public Officials is
obligatory and failure to do so will be considered an offence subject to sanctions.
The level of sanctions will be published separately and will be graduated depending on the
offence.
Any official suspected of non-adherence to the rules and regulations will be suspended and
his or her benefits, including salary, withheld pending investigation. Officials found
misappropriating government funds, regardless of the value, will be summarily dismissed.
Other offences involving non-adherence to the rules and regulations, including negligence
and irresponsibility will result in sanctions as specified in the Act 663 as amended.
Any tenderer, supplier, contractor or consultant who attempts to influence a procurement
process, or the administration of a contract by any unfair method, will be subject to
sanctions.
This may include debarment of the company from Government contracts for a period of
five years, in addition to any remedies that may be sought in a court of law
Public Procurement Authority (PPA), Ghana
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