Procurement Procedure in SSA

1. Procurement Procedure in SSA 33rd Review Meeting of State FCs- Delhi (24th - 25th May 2012)

2. Main Considerations PROCUREMENT Accountability and Ethical Standards Economy Efficiency Transparency Fairness

3. Main Considerations of Proficient Procurement • Economy: Give the purchaser best value for money. • Efficiency: Best procurement is simple and swift, producing positive results without protracted delays. • Fairness: Impartial, consistent, and therefore reliable. • Transparency: Maintains rules and procedures that are accessible and unambiguous. It is not only fair, but should be seen to be fair. • (v) Accountability and Ethical Standards: A key deterrent to collusion and corruption, and a key prerequisite for procurement credibility.

4. Why is Procurement Important? • In procurement terms inputs are generally grouped into three categories: • (i) Civil Works – School Infrastructure and facilities like New PS, UPS, Residential Schools, Hostel, ACR, HM Room, BRC/URC, CRC, Drinking water, Toilets, Girls Toilet, Ramps, Handrail, Electrification, Retro-fitting, Boundary wall/ fencing, Major Repairs, etc. • (ii) Goods - Typically equipment, computers, furniture, textbooks, library books, uniforms, TLE, TLM, other materials, supplies, commodities, etc. • Services – Hiring of services including academic, technical and resource support provided by institutions/organizations in all areas, research studies, third party quality evaluation of civil works, auditors etc. • The quality, timeliness, local appropriateness and affordability of those procured inputs can largely determine whether the public investments will succeed or fail.

5. Effective Procurement Objectives Timely Delivery as per schedule Right Quality product Lowest possible price Meeting recognized standards Reliable suppliers Right quantities

6. PROCUREMENT IN SSA • Strictly follow procurement procedure prescribed in Chapter IX of the Manual on Financial Management and Procurement (FM&P). • Mandatory to follow the Manual provisions for all procurements under SSA. • Follow States’ financial ceilings except when not prescribed by MHRD. • Strictly follow MHRD’s financial ceilings prescribed for various method of procurement on 17-09-2008 as extended on 2-7-2010 which shall prevail on States’ ceilings. • This ceiling is applicable upto 30-9-2012 and thereafter follow the State ceiling. • Convert the Ceilings in US$ to Indian Rupee by adopting RBI’s buying rate of exchange prevailing on the date of issue of purchase order/work order.

7. MHRD’s Financial ceilings per contract (In US $ equivalent) • Any contract in excess of the maximum limit indicated above shall not be procured using SSA funds.

8. Points to be kept in view • Identification of Needs. • Ensure availability of specific budget provision. • Assessment of bulk requirement at the beginning of the financial year. • Computer, equipment, furniture, books etc in economic lots as per annual need. • Procure miscellaneous items of stores not covered by bulk requirement as per actual need. • Make all purchases to the best advantage after comparison of competitive prices. • Strictly follow the level of procurement prescribed in the Manual • Encourage decentralized procurement • Avoid centralized procurement of items prescribed at lower level

9. PROCUREMENT • Strictly follow the levels of procurement provided in Para 112 of the Manual on FM&P 9

10. School/KGBV level • All civil works, except buildings for Residential Schools/Hostels and KGBV. • Furniture to Govt. UPS • Library Books for schools • Teaching Learning Material • School grant. • Maintenance grant. • Teaching Learning Equipment • REMS • Learning Enhancement Programme (LEP). • Items required for KGBV. • Uniform Special Training related Items • TLM, Contingency etc.

11. CRC/BRC level • Furniture/ equipment/computer etc. • Office contingencies • Teaching Learning Material • Teacher Training • Community Training • Civil works for construction of BRC, augmentation of BRC and CRC • Maintenance of BRC and CRC • Printing work • REMS

12. District level • Office equipment for DPO • Office furniture for DPO • Textbooks/other books/supplementary materials • Computers and accessories • Aids and appliances for CWSN • Office contingencies • Hiring of vehicles • Maintenance of equipment and vehicles • District level training and workshops • Printing work • REMS • ECCE Kit • Educational Kits for girls • Learning Enhancement Programme (LEP) • Construction of Residential Schools/Hostel and KGBV

13. State level • Textbooks • Computers and its accessories • Office equipment for SPO • Office furniture for SPO • Equipment for distance education • Aids and appliances for CWSN • Office contingencies • Hiring of vehicles • Maintenance of equipment and vehicles • State level training and workshops • Printing work • Engagement of consultancy firms (service contract) • Engagement of Auditors for external and internal audit • Engagement of experts/resource persons • Engagement of NGOs • REMS • Learning Enhancement Programme (LEP).

14. Method of Procurement Method of Procurement Procurement through communities Open Tender Limited Tender Single Tender Procurement without tender / quotation

15. OPEN TENDER Meaning Competitive bidding procedure and is the most efficient and economic way of procuring goods or works. Provides for adequate competition in order to ensure reasonable prices. Ensures transparency and equal opportunity to all. The methods used in the evaluation and the award of contracts are made known to all bidders. Items covered Civil works construction of BRC, Residential schools / Hostel, KGBV, SIEMAT and any other civil works specifically approved by Project Approval Board through contractors. Goods

16. OPEN TENDER Steps Preparation of tender documents Notification / Advertisement; Issue of tender documents; Pre-bid Conference Submission of tender documents; Public opening of tender; Evaluation; Selection of lowest evaluated responsive bidder based on post qualification; Negotiation with L-1 (if necessary) Contract award; and Contract performance

17. LIMITED TENDER Items covered: Goods including books, uniforms Teaching learning materials, School equipment, Hiring of vehicles, and Operation and maintenance of equipment Invitation for quotations – Based on comparing price quotations obtained from several suppliers, usually at least 3 to ensure competitive prices. Issue a letter to the supplier to furnish the quotations for the required goods/equipment.

18. Invitation for quotations – No need of publication of notification in the newspaper/website. Issue the request letters to suppliers on the approved list. The request letter should indicate description, specifications and quantity of the goods as well as desired delivery time and place. Only one quotation by each supplier. Bid Price Quote for the full quantity as described in the invitation letter. Corrections, if any, made by crossing out, dated initialing and re-writing. Include all duties, taxes and other levies payable by the Vendor/Supplier in the total price. The rates quoted by the Vendor/Supplier be fixed for the duration of the contract and not subject to adjustment on any account. The prices are quoted in Indian Rupee. LIMITED TENDER 18

19. LIMITED TENDER Steps Identifying items; Laying down specifications; Estimating total numbers and costs of items; Need not notify in newspaper/website Identifying likely agencies borne on the approved list of contractors/ suppliers; (minimum 3, 8-10 for more competitive rates) Obtaining approvals of competent authority; Issuing letters of invitation; Processing quotations received; 19

20. Obtaining orders of competent authority for placing orders for supply; Issuing letters placing orders for supply and delivery period; Quoted price shall include all duties, taxes and other levies; Rates quoted be fixed and not subject to adjustment; Ensuring inspection; Ensuring timely supply: and Making payments after delivery in satisfactory condition. The financial ceiling prescribed for limited tender shall be applicable for Rate contracts of DGS & D and Rate contracts of State Governments.

21. SINGLE TENDER Followed in the case of Articles specifically certified as of propriety nature; or Manufactured by a particular firm; Goods including books; Teaching materials; School grant; Hiring of vehicles; and Operation and maintenance of equipment etc Appropriate for Extension of existing contracts Standard equipment/spare parts for existing equipments from original supplier. Items obtainable from one source Early delivery In exceptional cases such as natural disaster.

22. WITHOUT TENDER / QUOTATION Procurement of goods or group of goods estimated to cost the equivalent of the ceiling of State Govt. Issue suitable guidelines by the SIS • THROUGH COMMUNITIES • Construction of all civil works except, BRC, Hostel, KGBV and SIEMAT • BRC construction if the community is technically capable • Purchase of materials as per ISI certification, if available; • SPD may provide simple procurement guidelines

23. Identify the committee locally operating in the area. Keep the following points in view: Active involvement of community in planning and implementation; Who will procure the materials or goods used in works; Goods / works have to be executed as per approved plans and specifications The name and designation of the Engineer for technical supervision and certification.

24. Service Contract Considerations High Quality Efficiency Transparency Economy

25. Service Contract Selection process Preparation of Terms of Reference Preparation of Cost Estimate and Budget Advertisement, seeking Expression of Interest (EOI) short listing of consultants/firms based on EOI Issue of Request for Proposal (RFP) to short listed Consultants/firms. Receipt of RFP in two envelope system, technical and financial proposals separately. Formation of Evaluation Committee Evaluation of Technical proposal and assign individual mark by each member on the basis of responsiveness to the TOR Open the Financial proposals of the qualifying Consultants publicly in the presence of the Consultants/representatives Final discussions including negotiations Award of contract

26. Non-Government Organizations Preparation of Terms of Reference Publication of advertisement Formation of Evaluation Committee Short-listing of NGOs on the basis of specifications and scope of the work specified in the TOR. Desk appraisal and if found suitable, field appraisal by the Evaluation Committee Recommendation by the Evaluation Committee for the selection of NGOs to the Grant-in-Aid Committee. Approval by Grant-in-Aid Committee based on the report of the Evaluation Committee on the desk and field appraisal.

27. Thank You