Sustaining Nigeria Economic Development Through Effective Public Procurement Practice: Lessons from Brazil and United Ki

1. Sustaining Nigeria Economic Development Through Effective Public Procurement Practice: Lessons from Brazil and United Kingdom.By ⃰⃰ Olusegun, B.SProcurement UnitUniversity of Lagos, Akoka , Yaba Being a Conference Paper Presented at the 5th School of Business Studies, the Federal Polytechnic Offa, Kwara State, Nigeria

2. Introduction • Nigeria, like any developing economy is faced with myriad of sustainable economic development challenges. • Notwithstanding the various plans and policies of successive governments towards revamping the economy, economic growth remains epileptic, lacking sustained growth. • Effective Public procurement has been advanced as veritable tool for achieving sustainable economic development considering the large volume of government expenditure on procurement of goods and services • In Nigeria, approximately ₦ 2 trillion is estimated to be spent from government purse on public procurement (BudgIT, 2015). • This paper explores the potential of sustainable public procurement in achieving sustainable economic development in Nigeria drawing important lessons from Brazil and United Kingdom

3. Concept of Sustainable Public Procurement(SPP) • SPP is the process “whereby organization meet their needs for goods, services , works and utilities in a way that achieves value for money on a whole life basis in terms of generating benefits not only to the organization but also to society and the economy while minimizing damage to the environment • SPP if effectively implemented will not only ensure value for money through financial savings over the lifetime of a product but also be a veritable tool in driving innovation and promoting sustainable production and consumption patterns.(ROOS,2013) • Despite the benefits inherent in the implementation of SPP very few developing countries Nigeria inclusive have an overarching policy on SPP.

4. Overview of Nigeria Public Procurement Act(PPA,2OO7 • PPA,2007 guides procurement activities in Nigeria Federal Ministries, Department and Agencies • Prior to the promulgation of the PPA, the nation’s public procurement process was fraught with anomalies; corruption was at the peak . • Through the mechanism of the PPA, the government of Nigeria has realized lot of saving by blocking loopholes through which government official siphoned public fund .(Musa & Aderonmu,2015) • Despite the achievements of the PPA since its introduction, there have been clamour from the every quarter for its reform. • Countries such as Brazil, United Kingdom and South Africa are using their procurement policies to enhance development of Small and Medium Enterprises (SMEs). • Evidences abound that the procurement policies presently in use in Nigeria has created a bottleneck and barrier for SMEs participation in public contract despite the contribution of SMEs to the economic growth of the nation.(Olusegun & Akinbode2016).

5. SMEs Preferential treatment policy of Brazil • Article 170(IX) of the Brazilian Constitution provides that preferential treatment may be allowed for small enterprises that have their headquarters and management structure located in Brazil and registered under the Brazilian law. • By virtue of Law No. 147/2014, public contracts up to BRL 80,000 are exclusively reserved for execution through bidding procedures by small businesses. • SMEs unlike their large –sized counterparts, are allowed to take part in government public contract without submitting the mandatory certificate of good standing for tax purposes at the time of bidding. This can be provided after contract award • SMEs are allowed to participate in bidding process notwithstanding of owing debts to the administration, and enjoy two business days relief to pay up the debt after winning the contract. • SMEs benefited as a result of the intervention, measured by their involvement and success rates in contract competitions and further increased their participation and chances of winning public contracts in Brazil. (Reis and Cabral , 2014)

6. SMEs set-aside policy of United Kingdom • UK government set 25% of government expenditure on public procurement for purchasing goods and services solely from SMEs. This is refer to as ‘aspirational target’ • To ease access to public contracts ALL contract opportunities are advertised online free of charge. • Mystery shopper Scheme was initiated for the purpose of reporting superfluous bureaucracy in public contracts. • The prequalification process was improved to reduce lead time for completion of contract process and reduce bottleneck associated with public contract • Support for Apprenticeship and Skills • Procuring entity are required to request prospective suppliers to provide evidence in the bidding documentation its commitment to skill acquisition and development under contract

7. Important lessons for Nigeria • Reforming the existing procurement policy to allow for granting of preferential treatment to SMEs • Integrating sustainability criteria in the bidding process . • Encouraging promulgation of Public Procurement Laws in each state of the federation • Involving civil society and professional bodies at every stage of the procurement process • Conclusion • The study concludes that effective public procurement is indeed a veritable tool in achieving sustainable economic development and therefore recommend for review of the existing PPA to integrate the lessons learned.

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