The launch of Praz was aimed at bringing efficiency as procurement reverted to accounting officers in their entities in line with best practice the world over. Business Reporter Melody Chikono (MC) spoke to Praz chief executive Nyasha Chizu (NC) to discuss the journey the procurement authority has travelled, a year after its launch. Below are the excerpts:
MC: As we have just wrapped up 2018, what can you say have been your key achievements and challenges?
NC: The Procurement Regulatory Authority of Zimbabwe’s key achievements in 2018 are quite enumerate. Firstly, since it was our first year of operation as Praz. The authority managed to fully resource and it is fully operational now. Secondly, we have managed to register a total of 195 Procurement Management Units (PMUs) out of a total of 294. Praz is conducting massive sensitisation of state-owned enterprises combined with the publicity provided for by the authority on the need to register PMUs as the authority will be licencing public procurement officers. Soon we foresee the remainder of the unregistered state-owned enterprises applying for registration. We have seen in the newspaper adverts of state-owned enterprises advertising vacancies of procurement officers meaning that all the state-owned enterprises are working towards compliance on the Public Procurement and Disposal of Public Assets Act.
The 2019 supplier registration is ongoing after the call for registration and I can say the response is overwhelming. This year, the authority managed to come up with mobile offices in Bulawayo, Gwanda, Hwange and Victoria Falls to register suppliers in the southern part of the country. In 2018, supplier registration was only done in Harare at the Praz head office.
In terms of challenges, the Public Procurement and Disposal of Public Assets (PPDPA) Act [Chapter 22:23] is change of public procurement law through the repealing of the Procurement Act [Chapter 22:14] and any new law and regulations faces one or two challenges. The main challenge that we are facing is for procurement management units whose procurements are above their procurement thresholds to register with the authority and sensitisation is in progress for them to register and the response is favourable.
In addition, the procurement management units at times are failing to comply with all statutory requirements in terms of their procurement. There is a transitional period of two years, therefore the authority consistently highlights areas that need improvement for procurement management units to follow.
Where there is complete lack of procurement capacity in the units, the authority as guided by the Act is calling upon procurement management units to professionalise by having staff with procurement qualifications in their units. The authority is available in addition to train all those who need to be trained during this transactional period and beyond.
MC: Last year, you set up a department to investigate the awarding of tenders following the decentralisation of tender allocation systems. What can you say have been the major findings of the probe?
NC: Yes, there is now a new monitoring and evaluation department which is a resourced department and now it is working on regulations for compliance, monitoring and evaluation as well as establishing framework and tools for monitoring and evaluation.
So far, the monitoring and evaluation department is assisting procuring entities with regards to compliance of tenders advertised. The department is also collecting information with regards to procurement done in 2018 so that it will be part of the Praz annual report.
MC: Since establishment there are some leases that you have cancelled, due to various reasons, chief among them not going to tender. How prevalent has been this problem last year to date?
NC: We do not have information so far regarding cancelled leases. The reports that the monitoring and evaluation department is requesting from procuring entities might shed light on which leases were cancelled.
MC: What can you say have been the achievements of the new procurement rules?
NC: Significant strides have been made in terms of reforming the procurement process in the public sector. Firstly, clear assignment and accountability of procurement decision making to every procuring entity. So far all ministries, state-owned enterprises and local authorities have either established or are in the process of finalising the establishment of procurement management units (PMUs). These units are expected to be manned by professional procurement officers who will be licenced in terms of the Public Procurement and Disposal of Public Assets Act [Chapter 22:23].
As part of enhancing and sustaining a culture of procurement efficiency and effectiveness, the PMUs are now responsible for the whole procurement cycle in the public sector from the planning, adoption of the appropriate method of procurement, preparing bid notices and shortlisting, managing the bids and evaluation processes, preparing evaluation reports to awarding of contracts and overseeing their management and preparing procurement reports. Our role as Praz is to ensure these requirements and processes are adhered to.
Since this is a new trajectory of procurement, a lot of activities around capacity building are already being rolled out. To date, accounting officers of procuring entities, procurement management units, trainers and the Procurement Regulatory Authority of Zimbabwe management and staff have undergone training. Authorisation of procurement management units is ongoing and evidence of a new culture of public procurement is emerging through efficient public sector expenditure utilization, better quality and timely service delivery to citizens. The new culture of procurement is not only bringing in efficiency and effectiveness in the public sector but it also brings in value for money.
Lastly, there are clear sanctions to violations with the PPDPA Act as outlined in Section 94 of the Public Procurement and Disposal of Public Assets (General) Regulatons, 2018.
MC: What is the outlook for 2019?
NC: The authority’s outlook in 2019 is bright as it will be unveiling a number of regulations to sharpen the teeth of the regulator. The authority will be introducing the Public Procurement and Disposal of Public Assets Act (Compliance, Monitoring and Evaluation) Regulations and the Public Procurement and Disposal of Public Assets Act( Procurement Council) Regulations which Praz is planning to promulgate in this first quarter.
This PPDPA (Procurement Council) Regulations are a milestone as, once there is licensing and certification of public procurement officials, the cost of corruption will be very high. Once a procurement official engages in misconduct in one position and so happens he is dismissed he will not be able to undertake a procurement job within a public entity meaning that official has to change professions completely. This will definitely minimise misconduct by public procurement officials.
MC: After all your efforts in 2018, what key grey areas remain that still need much attention?
NC: The grey areas are alignment of procurement within procuring entities. The authority is aware that some procuring entities are submitting applications to conduct procurement where Procurement Management Unit (PMU) is aligned to the accounting officer and the staff manning the PMU will be having procurement qualifications. The authority is hearing from the corridors that in some instances these submissions are not factual and it is going to be a serious offence once the Authority’s PPDPA (Compliance, Monitoring and Evaluation) Regulations are out.
MC: There have been reports that some state entities are failing to comply with new regulations. How do you intend to curb this in 2019 and what are your target numbers?
NC: The Procurement Regulatory Authority of Zimbabwe is still undertaking capacity building to state-owned enterprises who need to be capacitated on the Public Procurement and Disposal of Public Asset Act and Regulations. In 2018, the department went up to the last week before the Christmas holiday conducting capacity building and in 2019 they have already started capacitating state-owned enterprises. Those entities who feel they need to be capacitated need to contact the authority and training will be conducted.
The authority’s target number is 100% compliance as there are stiffer penalties that come by not complying.
MC: What key policies do you think need to be put in place to enhance transparency in procurement in the country?
NC: The Public Procurement and Disposal of Public Assets Act [Chapter 22:23] and the Public Procurement and Disposal of Public Assets (General) Regulations, 2018 are sufficient to bring transparency in procurement in the country. The other two sets of regulations will harness transparency, efficiency, fairness and competition in public procurement.
The Act has enabled various policy pronouncements that are inculcating a new and professional culture of procurement. Procuring entities are now compelled to come up with yearly procurement plans and budget on what is to be procured in a particular year. The procuring entity is supposed only to proceed to procure when the requirements are on the procurement plan and is budgeted for.
The Act also sets parameters, thresholds and standards to be followed. There has been classification of procuring entities and this classification is based on the value of procurement budgets. That classification defines the thresholds for prior review by the Special Procurement Oversight Committee and the threshold for approval of the PMU by the authority. In addition, the procuring entities are supposed to submit periodic reports of the procuring proceedings to the authority.
The operations division is providing technical guidance to ensure that statutory requirements are being complied with in terms of all procurements. To ensure compliance with the Act and regulations, the authority has a fully-fledged monitoring and evaluation division that ensures adherence to the set law and standards. The division monitors performance of the public sector in terms of compliance and performance of the procuring entities, the procurement management units, suppliers and contractors.
MC: What do you think are the key problems in terms of procurement in Zimbabwe?
NC: The key problem is compliance with the Act with respect to procurement for every threshold. The other problem is speculative pricing.
MC: What can you say about Zimbabwe compared to other regional country in terms of procurement?
NC: The Procurement Regulatory Authority of Zimbabwe is one of the countries with the new Public Procurement Framework that is aligned to the Zimbabwean Constitution and the UNCITRAL Model Law of 2011 and international best practice.