Senate Amends Procurement Act; Mobilization Fee Now 30%
The Senate yesterday (3rd Dec 2019) jerked mobilization fee for local contractors from the present 15 percent to 30 percent, just as it agreed that contracts should be processed within two weeks while the certificate must be issued within four days. The Senate also reduced the time frame for contract award to two weeks for processing and four days to issue certificates to qualified contractors.
The increase was carried out following the amendment of the Public Procurement Act 2007 and consideration of Report of the Committee on Procurement presented by its Chairman, Senator Shuaibu Lau, Peoples Democratic Party, PDP, Taraba North on the Public Procurement Act 2007 (Amendment) Bill, 2019( SB.106, 109, 158). In his lead debate, Senator Shuaibu Isa Lau said that the various sections amended in Act would revolutionise procurement process and contract award in the country. The Bill was then read the third time and passed. According to the Senate, it became imperative to increase the current mobilisation fee for local contractors because the present one was inadequate and that usually result to contracts abandonment. On the issue of mobilisation for local contractors, the committee recommended not more than 20 per cent, but the Senate thereafter approved 30 per cent after much debate on the issue. But the Senate however failed to fix any percentage as mobilisation fee for foreign contractors against the backdrop that some senators argued that they should be ready to use their money for projects and get paid afterwards.
During consideration of the report, issue of certificate of no objection became intense as it brought about serious debate among the Senators, just as most of the Senators who spoke were sharply divided on whether the certificate should be issued by heads of the Ministries, Departments and Agencies, MDAs or a special committee in the Bureau of Public Procurement. Some senators however suggested that a representative of the Bureau of Public Procurement be posted into the MDAs for the purpose of issuing certificates based on their various threshold, even as the Senators agreed to use the issue of timeframe as a way of saving time and stopping corruption in contracts award. In his remarks, President of the Senate, Senator Ahmad Lawan who noted that the parliament should ensure that there was no delay in contract processing and award by giving a timeframe for the necessary document to issued, said that doing so would help nip corruption in the bud. Lawan stressed that there should be a deliberate plan of the government to encourage local contractors through policies and legislation, said that the BPP has been problematic over the years. The President of the Senate who expressed confidence that the procurement process would now be faster with the passage of the Public Procurement Act 2007 (amendments) Bill 2019, said that the House of Representatives would concur before the Christmas break so that it could be signed into law by President Muhammadu Buhari.