By Simon ANNAN (PhD)
Public procurement in many developing countries is often viewed through a lens of skepticism, frequently seen as a breeding ground for inefficiencies, loopholes, and corruption.
However, when properly understood and implemented, public procurement becomes not just a regulatory formality but a powerful lever for development, accountability, and national transformation.
This article will illuminate the scope of application and pitfalls of public procurement, particularly under Ghana’s Public Procurement Act 663 (as amended).
It also calls for collective reflection: Are our policymakers, development partners, and public sector leaders truly aligned in their understanding and execution of public procurement?
Many studies suggest that there is often a fundamental misunderstanding of public procurement, with many treating its principles in a manner that suits their immediate circumstances.
For example, departmental partners may insist that borrowing countries adhere strictly to the tenets and provisions outlined in their procurement regulations. Conversely, these partners frequently employ varying procurement methods depending on the situation, leading to considerable confusion and misunderstanding regarding public procurement.
The scope and power of Act 663
The Procurement Act 663, as amended, provides the legal and procedural framework for the procurement of goods, works, and services funded wholly or partly by public funds. It extends its reach to include the selection and award of contracts, contract administration, and even the disposal of public assets.
The breadth of the Act reveals the government’s intention for procurement to serve as more than just a bureaucratic hurdle—it’s a tool for promoting transparency, economic development, and value-for-money in governance.
Yet, procurement has long battled a dual image. A recent KPMG-GIPS 2023 Procurement Enhancement Survey underscored this duality.
On one hand, the system is seen as a mere buying function—anyone can do it, it opens doors for kickbacks, and needs no formal certification. On the other hand, it has the potential to drive cost efficiency, optimize inventory levels, enhance supplier relationships, and promote sustainability.
The role of leadership and oversight
The Act places clear responsibilities on the head of entity—a role that is pivotal in ensuring procurement integrity. This includes chairing the entity tender committee, ensuring proper disposal of assets, setting up a procurement unit with qualified staff, and overseeing contract administration.
Importantly, heads of entities are also tasked with investigating complaints by tenderers, emphasizing the legal and ethical dimensions of the role.
The law mandates accountability, and ultimately, any deviation from due process may result in serious consequences, including fines, imprisonment, or both. Section 92 of the Act outlines offenses ranging from collusive bidding to document forgery and unlawful contract alterations. It leaves no doubt that procurement misconduct is a criminal act.
The procurement cycle—and its pitfalls
At the heart of any procurement process lies a cycle: from need identification, method selection, tendering, evaluation, and award, to contract management and close-out. Each step carries inherent risks.
Common pitfalls in the process of procurement include initiating procurement without prior authorization, conducting evaluations not aligned with published criteria, delivering goods or services before contract award, and poor contract supervision and failure to close out contracts properly.
Even more insidious are red flags like bid rigging, vague specifications favoring particular suppliers, and artificial demand creation. These not only undermine competition but foster a culture of impunity.
Building a culture of compliance
Equally, there are several safeguards to counter the aforementioned procurement risks. Firstly, it is incumbent on the procurement practitioner to always seek commitment authority from the expending body before beginning procurement—in this case the Ministry of Finance.
There is also the need for public institutions to engage only certified procurement professionals who have are well-versed in ethical and value-based sourcing, they [state agencies must also maintain accurate and comprehensive records of all procurements proceedings, especially for the purposes of transparency and auditing, and embrace the willpower to avoid contract variations without legal counsel and proper justification.
Moreover, it’s crucial to remember that tenderers have the right to review decisions and lodge complaints. Transparency is not just a principle—it’s a procedural obligation.
Procurement as a development tool
Beyond compliance and penalties, the larger message is: procurement must be repositioned as a development enabler. It is a mechanism that can empower SMEs, promote innovation, enforce environmental standards, and drive social impact.
But this requires alignment—across ministries, donor partners, procurement entities, and oversight bodies. Public procurement cannot be left to chance or treated as a secondary function. It demands strategic leadership, robust systems, and above all, integrity. Remember, there will be a day of accountability, so treat public procurement with the respect and decorum it deserves.
>>>The writer of this article is an astute procurement practitioner with over two decades of continuous experience in procurement and supply chain management. He is the current president of the Ghana Institute of Procurement and Supply (GIPS) and chief executive officer of the procurement consultancy firm, SourceOne Ghana. Dr. Annan is a fellow of the Chartered Institute of Procurement and Supply (CIPS), Institute of Project Management Professionals (IPMP), and the Ghana Institute of Procurement and Supply (GIPS). He is also a member of the Chartered Institute of Logistics and Transport (CILT).
