COMPETITIVE BIDDING AND ADMINISTRATION OF

CONTRACT IN PUBLIC SECTOR

(A CASE STUDY OF MINISTRY OF FINANCE IMO-STATE)

BY

EZEKWE OGADIMMA JENNIFER

09H/1140/PS

BEING A PROJECT WORK SUBMITTED TO THE DEPARTMENT OF

PURCHASING AND SUPPLY MANAGEMENT, SCHOOL OF BUSINESS AND

MANAGEMENT TECHNOLOGY FEDERAL POLYTECHNIC NEKEDE OWERRI

IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE

AWARD OF HIGHER NATIONAL DIPLOMA (HND) IN

PURCHASING AND SUPPLY.

NOVEMBER, 2011
 APPROVAL PAGE

We the undersigned certify that this project work was carried

by Ezekwe Ogadimma Jennifer, Reg No. 09H/1140/PS in the

department of purchasing and supply Federal Polytechnic,

Nekede Owerri.

We also certify that the work is adequate in scope and

quality in partial fulfilment of the requirement for the award

of the Higher National Diploma (HND) in purchasing and

supply.

…………………………… ………………… .…………..

MR. V.O. Chilaka Signature Date
(Project Supervisor)

………………………… …………………… ………………

MR. A.M. UZOR Signature Date
(HOD)

…………………………… ………………… ……………

External Examiners Signature Date

ii
 DEDICATION

This project work is dedicated to almighty God, the

author of wisdom and knowledge for his favour, grace,

mercies and life which made it possible for me to carryout

the various research.

iii
 ACKNOWLEDGEMENT

I give thanks and all the glory to God Almighty for giving me

this opportunity.

I wish to sincerely express my gratitude to my supervisor,

Mr. V.O Chilake who painstakingly went through my research

work and for his lecturers and person which will remain ever

green in my memory.

Words are not enough to express my appreciation to my

beloved parents; Mr. and Mrs. M.A Ezekwe, my brothers and

sisters, Aunties and uncles and all other family members

who in one way of another supported me financially morally

and otherwise.

My profound gratitude goes to my H.O.D, Mr A.M Uzor and

also to my lecturer Mr. Chris Udoh for their moral support.

I am highly grateful to my best friend, Ezeifeka Dominic .I.

for his care, companionship, advice encouragement during

the period of my program.

iv
This work will not be complete without the support and

encouragement from these special people in my life; Ogun

Uyi, Ugonna Nwaneri (Sico), Emele Obinna (Agumba),

princewill (Papawa), Akubuiro kingsley, Ubochi Onyedikachi,

Ben, O.A.U, Joy and all other too numerous to mention. I

say thank you because they all have roles they played in my

life and I hereby say I love you all.

Worthy of remembering and deepest gratitude to Chief M.C

Eluji for his academic brainstorming, and assistance in the

course of this academic voyage. I salute your courage,

tolerance and understanding.

Finally, to the blessed Holy spirit who is the teacher,

reminder and guide in all things.

v
ABSTRACT

The subject matter of this study is the use of tendering and

competitive biding in the public sector procurement. A case

study of ministry of finance, Imo State, Owerri, among the

objective is stated in chapter one of the study.

In other to attain to the objectives a research question was

constructed to enable the researcher collect relevant

information in the subject matter. The researcher review

related literature and some facts drawn from the work in

chapter two. Chapter three welcomes the research

methodology; the population and size e.t.c. chapter four

contains the researcher’s presentation and analysis of data.

Finally, chapter five is all about conclusion, summary and

recommendations.

vi
 TABLE OF CONTENTS

Title page - - - - - - - - i

Approval page - - - - - - - - ii

Dedication - - - - - - - - iii

Acknowledgement - - - - - - - iv

Abstract - - - - - - - - - vi

Table of contents - - - - - - - vii

CHAPTER ONE

1.0 Introduction - - - - - - - 1

1.1 Background of the study - - - - - 1

1.2 Statement of the problem - - - - 3

1.3 Objectives of the study - - - - - 5

1.4 Research question - - - - - - 6

1.5 Statement of hypothesis - - - - 7

vii
1.6 Significance of the study - - - - - 8

1.7 Scope of the study - - - - - - 9

1.8 Limitation of the study - - - - - 10

1.9 Definition of terms - - - - - - 11

CHAPTER TWO

2.0 Literature review - - - - - - 16

2.1 Introduction - - - - - - - 16

2.2 Meaning of tendering and competitive biding 17

2.3 Method of tendering and competitive biding - 18

2.4 Need for inventory control planning and control- 25

2.5 Purchasing policies in the public sectors - - 27

2.6 General procedures of competitive bidding - - 28

2.7 Tender document - - - - - - 30

viii
2.8 Pre-qualification for tenders - - - - 31

2.9 Tender board and tenders - - - - 33

CHAPTER THREE

3.0 Research design and methodology - - - 34

3.1 Introduction - - - - - - - 34

3.2 Research design - - - - - - 35

3.3 Source/methods of data collection - - - 36

3.4 Population and sample size - - - - 37

3.5 Sample technique - - - - - - 39

3.6 Validity and reliability of measuring instrument 40

3.7 Method of data analysis - - - - - 41

CHAPTER FOUR

4.0 Presentation and analysis of data - - - 43

4.1 Introduction - - - - - - - 43

ix
4.2 Presentation of data - - - - - - 43

4.3 Analysis of data - - - - - - 44

4.4 Test of hypothesis - - - - - - 67

4.5 Interpretation of result - - - - - 74

CHAPTER FIVE

5.0 Summary, conclusion and recommendations - 76

5.1 Introduction - - - - - - - 76

5.2 Summary of findings - - - - - 76

5.3 Conclusion - - - - - - - - 78

5.4 Recommendation - - - - - - 80

References - - - - - - - 84

Appendix - - - - - - - - 86

x
 CHAPTER ONE

1.0 INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The dictionary of purchasing and supply management

defines tendering and competitive biding as offer from

tendering without callous, usually in scale enveloped

delivered by a time and date specified in the invitation to

tendering for supply of goods and services.

Uzors (2004, 2009: 489) and (Lysons 1996:42) defined

tendering as a purchase procedure whereby potential

suppliers are invited to make a firm and unequivocal offer of

the price and terms which on acceptance shall be the basis

of the subsequent contract.

Frank Harris and Ronald MC Caffer defined competitive

bidding as an invitation by an organization (i.e the client) to

supplier to submit its quotation for a job or services required

xi
by the client organization the whose main objective is to

determine the performance abilities of the supplier.

Tendering and competitive bidding is usually required when

an organization or a firm needed supply of certain goods

such as furniture, generating set, caterpillars, vehicles,

drugs, medical equipment and computers e.t.c.

Tendering is widely used in the public sector to ensure

observance of the principles of public accountability. It may

also be used by private sector organization most especially

in respect of construction and services contracts to obtain

prices and terms of the contract. According to Compton and

Jessap (1989) such tenders are opened only at the time and

data specified by the tender panel of qualified persons who

records the necessary details the essence of this research

therefore is to examine the use of effective and efficient of

tendering and competitive bidding in improving public sector

procurement.

1.2 STATEMENT OF PROBLEMS

xii
The problems of tendering and competitive bidding and its

implications on public sector procurement has been

identified by many as not only enormous but complex now

that there is serious needs on the part of our various

government to provide more services with little funds and

issue to corruption in our “public life” some of the problem

are:

i) A great numbers of problems have bedevilled sector

tendering which has great affection in the quality of

contract entered by the public sector organization.

The entire contract system has gone sour as a result

of mis-management, corruption, miss application of

rules and regulation set to be adhered to, in

contracting for goods and services.

ii) The negligent on the part of the various authorities

to ensure a uniform codes standard of practice and

professional ethics of conduct all have made a

complete mess of our public sector tendering.

xiii
iii) The out data nature of our financial regulation which

guide the operations of public procurement as well as

public sector tendering in the greatest problem of

our public sector tendering and therefore has serious

implications on the efficiency and effectiveness of

public sector contract management and

administration.

iv) Competitive bidding in public sector procurement

usually ends with the lowest price bidder getting the

award of the purchasing firm gains population for

negotiation with the lowest bidder after bids are

opined. This will make future bidders not to offer

their best price initially, believing that they do better

in any subsequent negotiation. They will adopt a

system of submitting a bid low enough to allow them

to be included in any negotiations. But their initial

bid will not be as low as when it is anticipated that

the award be made to be the lowest bidder without

further negotiation. Competitive bidding tends to put

xiv
 great pressure on suppliers to reduce their cost to be

able to bed low but profitable prices. This cost

pressure may result sacrifice in product quality

development efforts and other vital services.

1.3 OBJECTIVES OF STUDY

In most public establishment there is a wide

misunderstanding of tendering and competitive bidding as a

tool for public sector procurement.

i) To examine the use of tendering in improving the

efficiency and effectiveness of public sector

procurement.

ii) To find out the reasons why there is

misunderstanding of competitive bidding.

iii) To determine whether or not there is need for an

independent unit to be created with trained and

qualified professional to handle public sector

procurement.

xv
 iv) To examine the procedures and processes of

tendering and contract awards and the skills of

officers involved in public tendering and contract

management.

1.4 RESEARCH QUESTIONS

Based on the project topic and objective of the research, the

following question were developed by the researcher:

i) Does tendering have a role to play in improvising the

efficiency and effectiveness of public sector

procurement?

ii) What qualifies a bidder to be invited to bid?

iii) Has there been instances where the lowest bidders

are not offered the job?

iv) Can the current tendering process or procedures as

used by the public sector organization eliminate

corruption and build accountability and transparency

in the public sector?

xvi
 v) Are the officers handling tendering in the public

sector qualify?

1.5 STATEMENT OF HYPOTHESIS

Base on the research question formulated, the following

hypothesis are formulated.

HYPOTHESIS ONE

Ho: Tendering is not an effective tool in public sector

procurement.

Hi: Tendering is an effective tool in public sector

procurement.

Ho: There is effective method the ministry adopt other than

competitive bidding.

Hi: There is another effective method the ministry adopt

other than competitive bidding.

xvii
1.6 SIGNIFICANCE OF THE STUDY

This topic of study was carefully chosen based on its

relevance to the success of any organization who perform

tendering and competitive bidding.

i. This project work will be beneficial to me because the

study is a requirement for the award of Higher National

Diploma (HND) in purchasing and supply by NBTA.

ii. This research work will also be beneficial to the

ministry of finance, it will set a standard to measure their

performance towards the use of tendering and competitive

bidding in the ministry. The result will prove to them if they

have been doing things right or wrong and learn a better

way of handling i.e

iii. This project work will be of increase importance to

other scholars who may pick interest in this topic in the

nearest future thereby it will serve as a data bank/reference

material for them.

xviii
iv. It will also be beneficial to the government and the

general public. They will find it to be a very good reference

source that will create awareness to those public factors who

are intending top go into the tendering and competitive

bidding and also help those already in the system to know

how to go about i.e. rightly

1.7 SCOPE OF THE STUDY

This study has been limited to the public sector

organizations.

Tendering and competitive bidding has play many role in the

management and administration of public sector contract,

this study would have covered all the ministries,

departments, agencies, boars even the local government

areas in this country but the researcher after due

considerations of various variables and implications decide to

concentrate on the study of the implications of effectiveness

and efficient tendering in the administration and

management of contract in the ministry of finance, Owerri

xix
Imo state. In doing this, then researcher concentrated on

most of the department and units that have one or other

things to do with the subject matter of this study.

These departments of units include administration,

engineering, planning, finance of these areas will give a

great insight as what takes place in other ministries,

departments, board, agencies etc.

1.8 LIMITATION OF THE STUDY

In the process of conducting this study, the researcher has

confronted with the various problems, among them are:

i) It was not easy for the researcher who had to

combine attending lectures in school and other

activities in school with the various visits to the

ministry during this research work. This in no small

way limits the level of investigation, the research

intended to carryout.

xx
 ii) Yet another limitation faced by the researcher was

financial constraints. This made it impossible for the

researcher to make all the necessary visits in order

to obtain the right quality of information the research

of this nature requires.

iii) Lastly many officials changed with the management

and administration of tendering and competitive

bidding and public sector contracts were not keen to

give out much needed information by way of

documents and forms which were classified as

“strictly confidential” by the government.

1.9 DEFINITION OF TERMS

1) Bid: A quotation for a price or other conditions for

contracts whether for payment or acceptance.

2) Lead Time: This is the interval between when a need

is perceived and the fulfilment or satisfaction of that

need.

xxi
3) Tender: It is the procedure there potential supplier are

invited through newspaper and other selected media

advertising to make a firm and unequivocal offer of the

price and terms which on acceptance, shall be the basis

of the subsequent contract in competition with others.

4) Competitive bidding: This is one of the methods by

which the right price can be obtained.

5) Quotation: A formal statement prepared by a

contractor/supplier to his customer that includes cost

estimates, specification and other key information

about an agreement between the two parties

6) Government: An institution with power to governor

and direct the affairs of a state.

7) Evaluation: The process of finding out and deciding

the amount and value of something.

8) Negotiation: Seeking agreement between the

purchaser and the contractor/supplier on mutually

xxii
acceptance terms and conditions prior to concluded a

contract.

9) Analysis: The process of breaking components into

separate parts or units in order to examine each unit

and constitute critically.

10) Certification: Act of licensing by a document formally

testing the fulfilment of conditions.

11) Performance bonds: This is an undertaking or

security to perform a contract as required and failure to

perform as required the client will be compensated by the

supplier or contractor.

12) Procedure: A way, system or pattern or pattern of

performing a work, service, suppliers etc

13) Specification: This is the description of any objective

materials or process in sufficient detailed requirement

of a job/ suppliers or contract which the contractor or

xxiii
 the supplier must compile with. It is what the supplier

must supply to the buyer as described by the buyer.

14) Sourcing: This is a process and procedure used by the

buyers to survey, evaluate and determine which

supplier that can meet with the best requirement of

their organization.

15) Price: This is the amount of money for which a thing is

offered, sold or brought.

16) Sourcing policy: These are policies developed to guide

the purchasing functions in respect of who many be the

major sources of the organizational suppliers.

17) Quality: It is the fatality of futures and characteristic

of a product or a serves that bears in the ability to

satisfy a stated or implied needs.

18) Price analysis: This is the examination of the seller’s

price without examination and evaluation of the

element that make up the price.

xxiv
19) Fair price: A fair price is the lowest price that makes it

possible for a continuous sup[ply of the right quality

materials by the supplier where and when needed.

20) Selective tender: It is a method where only

competent suppliers on the approved list of suppliers

are invited by the buying firm to tender.

21) Forward buying: This is a buying practice which

embraces the buying of materials in quantity more that

it current requirements.

22) Standardization: It is an agreement on definite size,

design, quality and the life.

23) Contract: It can be defined as an agreement between

two or more persons which is intended by theme to

have legal consequences.

24) Pricing: It is the process of determine the price.

25) Order: This is an instruction to a manufacturer or

trader to supply something.

xxv
 CHAPTER TWO

2.0 LITERATURE REVIEW

2.1 INTRODUCTION

In writing this research, the relevant materials from various

published works were used. This section of research

therefore contain a review of the various text books,

journals, magazine, newspapers and publications also in the

project.

However, Ayeni (1987:107) defines tendering as an act by

which submission of a quotation is made by a tender when

so desired by a client, which may be an individual, a group

of people, a company, government ministry or any of its

parastatals. The purpose of such initiation maybe for the

supply of certain goods such as furniture, generating sets,

vehicles, medical; equipment, caterpillars etc and can be for

construction and erection of a new classroom block, a new

laboratory block, health center, road works, bridges etc,

xxvi
such can be a one man kind of business, medium, size

company, a big term manufactures etc.

When such quotation is submitted, it constitutes what is

known as tender.

2.2 MEANING OF TENDERING AND COMPETITIVE

BIDDNG

According to Uzor (2004, 2009:489) in Lysons (1996)

defines tendering as a purchases procedures whereby

potential suppliers are invited to make a firm and

unequivocal offer of the price and terms which on

acceptance shall be the basis of the subsequent contract.

Uzor also states that tendering is widely used in the public

sector to ensure observance of the principle of public

accountability. It may also be used by private sector

organizations most especially in respect of construction and

service contracts to obtain prices and terms on the

contract.

xxvii
Therefore the researcher belief that tender is an offer of

supply goods or services stating the price at which the offer

is made in response of an invitation of submit such an offer

in competitive with others.

Frank Harris and Ronald MC Caffer defined competitive

bidding as an invitation by an organization “i.e the client” to

a supplier to submit its quotation or for a job or services

required by the client organization whose main objectives is

to determine the performance abilities of the supplier.

However, according to Uzor (2010:263) purchasing

management stated that competitive bidding is a widely

discussed form of purchasing. It represents one of the three

method by which price can be determined.

2.3 METHODS OF TENDERING AND COMPETITIVE

BIDDING

There are several methods used to obtain tender or bidding

to supply goods both in the public and private organization.

xxviii
Uzor (2004, 2009: 489) states that there are three (3)

methods of tendering which include:

2.3.1 OPEN TENDERING

This is a type of tendering that is thrown open to all and

sundry. The advertisement which can be in the newspaper or

radio or television will all interested suppliers/contractors to

come forward and collect tender documents for the purpose

of submitting quotations for a particular contract.

Sometimes such advertisement can state the category of

supplier/contractor expected to collector such tender

documents.

The advertisement will also carry the following

information’s:

i) Title of the project

ii) Location of the project

iii) The closing data for submission of tender, time and

place of each submission.

xxix
 iv) All other points relevant to the project.

The contractor or supplier will collect the tender documents

and submit their computed quotation as prescribed. Then

the tender will be opened and award made to the winner or

lower local authorities and government ministries, perhaps

as a way of avoiding criticism.

2.3.2 SELECTIVE TENDERING

In this type of tendering, the buyer invites tenders from the

list of registered contractors or suppliers who are regarded

as competent to the work and are financially sound.

This method is used by the buyer when a project is too

important to him, because this method ensure good

performance by the supplier or contractor.

Selected contractors or suppliers are written asking them to

come and collect tender documents to enable them submit

their tenders.

xxx
2.3.3 SINGLE TENDERING

According to Uzor (2004, 2009:492) single tendering means

the only one firm is invited to submit a tender. Tender

documentation can be much reduced and price can the

negotiated progressively as the design develops. This

method can save a lot time and lead to earlier completion of

the work.

A single tendering is used when for technical or

management reasons, only one firm is suitable but it is also

used to make the contractor part of the team from early

stage in the project and this make full use of the contractor

experience.

However Achison (1999:240-243) states six method of

tendering which includes:

i) Open tenders

ii) Restricted open-tenders

iii) Selective tenders

xxxi
iv) Serial tenders

v) Negotiated tenders

vi) Bond-bid tenders

i) Open Tenders: According to Achison this type of

method if a situated where the original injure has

been open and free nor all to enter and make open

and free for all to enter and make offers, as district

from the closed or restricted or selected ones of

those invited to tender. The original enquiry of open

tender is done through paid advertisement. Under

this tender, potential contractor suppliers complete

for the supply contractor often the lowest priced

tender is generally accepted provided the tendered

will execute as proposed and accepted.

ii) Restricted –Open Tenders : This is one whose

enquiring or limitation to tenders its advertised

through “restricted” appropriate technical journals or

newspapers. Through such newspapers or journals,

xxxii
 competent and prospect professional suppliers of the

items are invited to compete the offer.

iii) Selective tenders: According to Achison

(1999:239) is a situation in which only competent

suppliers are invite to tender”. A tender maybe

negotiated with only one supplier so that competition

is eliminated.

iv) Serial tenders: Here tender could be on often or

restricted basis, prospective suppliers or contractor

are requested to tender for an initial project or

projects on serial basis on satisfactory performance

within specifications.

v) Negotiation tender: This method is made up of two

sub-method namely”

i) Pre-tender negotiation

ii) Post-tender negotiation

xxxiii
A pre-tender negotiation is said to be a tender procedures in

which the buyer holds discussions and ask question to the

propose contractor, classifying what is accepted of their best

offer in their final sealed tender. On the other hand, post-

tender negotiation is a tender procedure whereby tender are

contracted after receipt of formal tender and before the

letting of contractors individually or together to discuss

details of offers, which may affect the purchasers final

selection of the best bid with a view to improvement in price

or delivery of content in circumstance.

vi) Bond bid-tender: This is a tendering method which

requires the tender to provide bond will assure the buyer

that:

i) The bid is guaranteed by a bank

ii) The tender or bidder will not withdrawn his offer or

bid or even depart from the conditions set out in his

tender.

xxxiv
Bond relating to supply contract or performance in

purchasing are designed to guarantee that a seller wills

satisfactory perform the contract in accordance with all its

terms and conditions. In other words, the bid is bonded.

2.4 PUBLIC SECTOR PURCHASING TENDERING

PROCEDURES

According to Achison (1999:242) procurement in the public

sector requires proper public accountability. The procedures

usually prescribes money limits in purchasing above which

tender must be used, the type of tender or contract to be

used under its circumstances as well as whose function or

responsibility, its procedures are as follows:-

i) Open tender is advertised, inviting sealed tender

from potential tenders to make specific offer quoting

prices and terms.

ii) Identical specification are issued in the

advertisement for tender to apply without collusion

xxxv
 and submit in sealed identifiable envelop within a

specific data and time.

iii) On a given data, the tenders are opened by

authorized personnel from the purchasing and other

units of the organization requiring the suppliers or

services.

iv) Tenders are invited, listed on analysis sheets

showing details of price quoted, rates delivery,

settlement terms and other relevant information’s

necessary for complete evaluation.

v) Late tender are rejected and returned un-opened to

the tenderer or sender.

vi) Scheduled tenders are evaluated and considered by

tender board authorised to do so.

vii) Unless otherwise the consent of the chairman or

permanent secretary will be sought to accept and

xxxvi
 award the supply project to the next acceptable

tender that meets with most of the specifications.

viii) Very often, the lowest price quoted tender that

meets all the requirements is recommended.

The procedures is more frequently used in public sector than

in private sector organization. In certain circumstances, the

tender maybe negotiated fulters.

2.5 PURCHASING POLICIES IN THE PUBLIC SECTOR

The federal state and local government authorities one

required to make standing order in relation to purchasing

and to ensure that competition is used wherever possible

standing rules made by a local authority with regard to

contracts for supply of goods or materials or for the

execution of works shall include provision for searching

competition for such contracts and for regulating the manner

in which tenders are invited but may exempt from any such

provision when the authority are satisfied that the emption

is justified special circumstances.

xxxvii
The appropriate government department issues model

standing orders in relation to purchasing and to ensure that

competition is used whether possible standing orders are

required for the following reasons:

a) To demonstrate that justice is done

b) To ensure that all potential suppliers have equal

opportunities.

c) To ensure that the authority delegated to

officers is clearly defined.

d) To ensure that authorities of buying

corresponds with official government policy and

is in the public interest.

2.6 GENERAL PROCEDURES OF COMPETITIVE

BIDDING

Competitive bidding requires the following procedures firstly,

the preparation on invitation for bid (IFB). The IFB is a

complete bid documents which includes all they contractual

xxxviii
obligations and term i.e once a decision is make to use

competitive bidding and invitation for bids or a request for

proposal (RFP) is prepared. The IFB or RFP normally consists

of a project or contracts regarded, information of competent

contractors or suppliers on a special terms and condition and

standard terms and conditions.

This involves publications and distribution of documents to

bidders. During this stage, the bidding document is made

public and bidders are invited to bid with documents

distributed to them.

The advertisement will also carry the following information:

A) Title of the project

B) Location of the project

C) The closing date for submission of tender time

and place of such submission

D) All other points relevant to the project

xxxix
2.7 TENDER DOCUMENT

These documents include:

i) The working drawings prepared by the architect,

structural and service engineers, the mechanical and

electrical detailing.

ii) The bill quantities prepared by the quantity survey

which will also contain the specifications on the

project or specifications only where bill of quantifies

does not apply.

iii) From of tender which the tender must fill to shows

the tender sum, completion time and the liquidated

damage for the period of competition of the work.

iv) The schedule of basic price of labour materials and

plant changes and day work.

v) A form of questionnaire. This is for the contracts,

executed including details such as title, client,

consultants, value of sub-contract, the staff and

xl
 experience of each the equipment available, proof of

financial capability and the like.

vi) Submission of bill of quantities.

vii) Submission of tender form containing the tender

sum.

2.8 PRE-QUALIFICATION FOR TENDERERS

In Nigeria, contractors are expected to fulfil certain

conditions, before they are qualified to tender for

government suppliers project.

These conditions includes the following:

The suppliers or tender or contractor must be registered

with the federal state of local government and must shows

proof of such registration. Usually suppliers or contractors

who wish to do business with the state, local government,

bank etc are required to register before they will be allowed

to submit tenders with specific fees and an accordance with

xli
the value of the project will intend to do. It must be paid,

varying form organization to another.

Both the state and federal government registration is

categorized based on the contract value of the project. It is

the category in which the contract is registered that he will

be qualified to tender for.

There are four classes for registration for the federal level

while six classes in the state level each of the classes have

lower level-A,B,C and D, state level A,B,C,D, E and F.

It is the policy of the federal and state government

respectively that contractors/suppliers wishing to collect

tender documents must pay certain fixed sum of money

known as non refundable deposit to the treasuring. They are

also required to produce receipt of such payment before the

tender document can be issued to them.

Contractors are expected to pay tax as a national; duty.

Presently the contractor or supplier must submit photocopies

of tax clearance certificate for at least three (3) years while

xlii
the original must be sighted before they an be allowed to

collect tender documents.

Contractors are required to shows their VAT registration

certificate.

Contractors are also required to show their certificate of

incorporation.

2.9 TENDER BOARD S AND TENDERS

In accordance with chapter 29 of financial regulations

(2006) SEE Uzor (2004, 2009:501) the tender boards,

general application is divided into the conditions governing

the local purchase of stores are set out in chapter 23 and

subject of those conditions, all local purchase of stores etc

and all works and services costly over N1,000,000 must be

obtained by the contract after public tender.

Contracts for the local purchase of stores and for works and

services costing up to N1, 000, 000 maybe arranged by

permanent/head of extra ministerial departments after

obtaining quotations from all suitable sources.

xliii
CONTRACT ADMINISTRATION

A contract is a written agreement, enforceable by law, between a procuring entity and a

supplier, contractor or service provider for the provision of goods, works and
services.Contract Administration Basics

Contract administration involves all activities related to the monitoring of suppliers,

contractors and service providers’ performance in the fulfillment of their contractual
obligations, and to ensure appropriate actions are taken to promptly remedy any
deficiencies observed in contract implementation, scope or terms and conditions.

To define contract administration in the simplest terms, it's the task of ensuring that any
contractor fulfills their job to the terms and stipulations written in the contract. Having
oversight to catch deviations and unfulfilled terms as they happen means that project or
person is more likely to be successful in executing the contract to correct problems or
omissions long after the fact rather than shortly after they transpire. Great contract
administration skills are invaluable in companies that employ contractors on a regular
basis.

In creating a contract, a seven-step process kicks off. All seven of these stages fall under
the contract management umbrella, and contract administration doesn’t really hit full boil
until around step five. A contract manager may be employed to oversee the contract, and
their role begins as soon as talk of a contract begins. But with any great contract
oversight team, a manager and administrator may work in tandem through all seven
stages.

The first step is knowing what the goal of the contract will be. What are the risks and
expectations? What are the needs and duration? Why is the contract needed?

The second step is all about authoring the contract. The legal team should be on board to
ensure no ambiguities remain because a lack of clarity can leave a contract vulnerable for
nonfulfillment or underperformance.

Step three is when negotiation happens. The second party receives the contract and takes
the opportunity to hammer out any issues they may have or eliminate anything they
perceive as unrealistic or unfair. To avoid a difficult contract negotiation, it’s wise to
author the contract after some communication so you understand the other party's
expectations. Once negotiations begin and the give/take exchange happens, it’s called
“redlining,” and it can get complicated if the team isn't on top of the changes. Using
contract management software can make this, as well as administrative oversight, a much
easier process. There are a couple dozen well-recommended management software
systems that might make a contract easier, depending on your needs.

Approval comes in step four. For larger companies, there may be an auditing process or a
board meeting required to go over the contract and get approval. Management software
can simplify this by having real-time approval possible by those with authority to give it.

xliv
Step five is all about signing the dotted line. Executing the contract means getting
signatures and final agreements. Dating and witnesses may be required. Legally binding
electronic signatures are helpful here when parties aren’t in the same city or country. An
administrator makes sure everyone is on schedule to complete the execution process
before signing deadlines arrive.

After the contract has been accepted and executed, there can be amendments and
revisions needed as projects and tasks get underway. Managing these may be part of the
contract administrator’s role and can be simplified through contract management
programs. Staying abreast of changes and alterations is the sixth stage of the contract
process.

The contract administrator is front and center in responsibilities now, as the seventh stage
of the contracting process comes in. There should be milestones along the way for the
administrator to monitor progress and success on the contracted services. Regular audits
mean catching shortfalls or seizing on opportunities that could come up along the way.
There should be reminders and alerts set for things like renewals and completion stages,
and these should be communicated to all upper-level management that needs to stay
informed of contractual progress. The administrator and contract manager must be
communicative and proactive to avoid any lapses or end dates passing without action.

Contract Administration Functions

There’s a lot more to this job than what meets the eye. To be great in contract
administration, it means working well with executives and personnel at all levels. Being a
great communicator can mean helping to create more effective contracts and ensuring
everyone’s needs and wants are met. To this end, they’ll need to be smooth at liaising
both internally and externally. This may require the ability to work with parties
internationally and will almost certainly require working with the legal and procurement
teams.

The contract administrator's negotiating skills will be non-debatable. They’ll use savvy
and insight to hammer out pricing, conditions for fulfillment and terms while being the
hall monitor that makes sure these are all met as time progresses. They’ll also be
confident risk analyzers, being able to ascertain if amendments or revisions might be at
odds with their company’s best interests.

Contract administrators must be good at not just resolving conflicts but spotting them
before they escalate. This may mean working to create clear language and rules that
might be applied to future contracts, or even current ones, for resolving or avoiding
issues.

Reporting on progress to management and other important players is required, even if

things are going smoothly, as many other aspects of the business may be affected by any
success or hiccups in the contract.

xlv
Finally, they’ll monitor cash flow to ensure disbursements and other contractual
payments are made properly and on schedule and that they're received by the proper
parties.

xlvi
Careers in Contract Administration
Contract administration is a growing field, with the Bureau of Labor Statistics suggesting
job opportunities may grow by 10 percent between 2016 and 2026, a growth trajectory
higher than in most careers. Given how much is riding on contract success, this is a job
that requires higher education, with a minimum being a bachelor’s degree coupled with a
great deal of contract-related on-the-job experience or a master’s degree in business
administration with related degrees in accounting, economics and mathematics. Law
degrees are also often well suited to this career.

Industries that require contract administrators are widespread. Construction is a huge area
for contract management and administration, and applicants may benefit from having
engineering or architectural education in addition to a business degree. Sports is a great
contract administration division, with everyone from food vendors to players having to be
under contract. Any kind of manufacturing or engineering company will need a steady
hand with contracts. Educational institutions, such as colleges and schools, deal with
contracts of all kinds constantly, as do any kind of government enterprise. Human
resource professionals deal with contract administration and management regularly as
well.

Skills Every Contract Administrator Needs

There may be a legal team involved in creating contracts, but the administrator’s job is to
support all levels of the contract process. As a result, they need to have exceptional
written and oral language skills. The reality of contracts is that even a misplaced comma
can dramatically alter the meaning of a line, which could bring serious blowback with it.
That means their reading comprehension skills need to be top notch.

The administrator's oversight will benefit from a painstaking attention to detail – they’re
the kind of person who likely notices a restaurant menu's misspellings. They also notice
work quality and can easily spot inconsistencies.

The contract administrator needs to have both proven leadership skills but also be able to
be a solid team player. These team-playing abilities and management tendencies will
serve them well when it comes time to make reports, negotiate between parties and
departments and complete the overseeing of contract execution.

Preparation for contract administration begins with planning, which should begin during
the bidding and selection process. This planning includes the nomination of contract
administrators, a strategy for undertaking periodic performance review, the timeframe for
certifying performance and acceptance of contract deliverables in order to avoid payment

xlvii
delays, and an understanding of the contract terms and conditions to ensure effective
oversight.

Although the actual planning begins during the selection process, contract administration
actually starts upon the signing of the contract, which is the point at which the parties to
the contract are bound by its terms and conditions.

Who is responsible?
The procuring entity would usually appoint staff members or, preferably a team of
qualified individuals, to take the responsibility of administering the contract. It is the
responsibility of the Contract Administrator to perform the obligations and duties of the
procuring entity specified in the contract and to ensure the suppliers, contractors and
service providers implement the contract in accordance with its terms and conditions.
Nonetheless, the supplier, contractor or services provider, has the primary responsibility
to ensure that the goods, works or services meet the required standards and to advise on
the need for any changes as a result of constraints faced during contract implementation.

Where does it end?

Contract Administration generally concludes with a final inspection and acceptance of the
goods, works or services prior to the completion date or termination of the contract. The
inspection and verification, prior to acceptance, should ensure as a minimum that:

1. The correct quantity has been received,

2. The goods, works or services meet the technical standards defined in the contract,
3. Any variations to the contract are well documented and accounted for,
4. The goods, works or services have been delivered or completed on time, or that
any
delay has been noted and appropriate actions taken as indicated in the contract,
and
5. All required manuals or documentation have been received.

How important is it really?

The contract implementation phase is very important because it is where the results of the
procurement process are obtained and the requesting entity is in a position to finally
receive the expected benefits of their procurement request. Without contract award and
effective contract implementation, the objectives for initiating the procurement process
cannot be attained. The supplier, contractor or service provider has the responsibility of
performing the contract in accordance with its terms and conditions to meet all the
technical and quality standards. The procuring entity also has the responsibility of
complying with the terms and conditions of the contract; especially the obligation of
ensuring payments are made on time.

xlviii
Does it get the attention it deserves?
Contract administration involves the management of risks. Its basic purpose is to monitor
performance to ensure the objectives of the contract are met on time and within the
intended budget, and also to detect any deficiencies and find a remedy (including
suspension or termination of the contract) before it’s too late.

Good contract administration is crucial to the success of the public contracting process,
because it is during this stage that a significant amount of waste and abuse of public
funds and corruption in public contracting happens. Most of the focus is placed on the
procurement process, which is a comparatively shorter period than contract
implementation. The real benefits, however, are obtained after the contract is awarded, so
more attention needs to be placed on ensuring the contract is implemented consistent with
its terms and conditions. This is not to lessen the importance of the procurement process
in getting the contract awarded, but it is only after the contract is awarded that the real
value of the entire procurement process is realized.

CHAPTER THREE

3.0 RESEARCH DESIGN AND METHODOLOGY

3.1 INTRODUCTION

This chapter will discuss the method to be used in the study.

This will expressed proper understanding and aid in

achieving the objective of which the study was designed. It

also described the population and the procedure used in

selecting the sample from the population.

xlix
The research method is the procedure to be used by the

research in course of data collection and analysis. It

specifies the detailed method of data collection and analysis.

It also presents a blue print of the researcher on how to

access the valid of the study. Infact,, this envelopes entire

method in which the research is carried out.

Generally, the method adapted in carrying out his research

methods put together is to enable the collection of a reliable

data for cogent information.

The method of research in this study is a descriptive

method. the study was limited to ministry of finance Imo

state Owerri, since this was designed to determine the use

of tendering and competitive bidding in public sector

procurement.

3.2 RESEARCH DESIGN

This is the specifications of methods and procedures for

acquiring the information needed. It is the overall

operational partner of framework of the project that

l
stipulates what information to be collected from which

source and by what procedure.

This research design is categorized based on the researcher

extent of control over the independent various of study.

Therefore we have experimental research design, which is

carried out on a pure applied science.

This involves carrying out the study in specially made

settings.

Quest-experimental research design is referred to as survey.

It represents the class of empirical study that lacks the

glamour of pure experimentation. This involves the opinion

of human beings and rarely occurs in a lab which is why the

researcher has perfect control the variables understudy.

For the purpose of this, work I adopt the question

experimental research design because it focuses one the

people’s opinion, beliefs, attitude, motivations and

behaviours.

li
3.3 SOURCES OF DATA

This study is mostly based on two major source of data

collection:-

i) primary source

ii) secondary source

1) The primary source: This refers to the original data

that is first and information obtained personally by the

researcher regarding the project specifically and they are

obtained from the ministry of finance personnels. This

provides the bulk of information and data used in this work.

Oral interviews were used and questionnaires were

distributed and collected after answering.

2) Secondary source: This refers to data that has been

previously gathered for some other purposes, but which are

related to the present study. Such data could be collected

from internal or external source. The internal sources were

made to examine how ministry of fiancé improves or uses

lii
on its procurement through the use of tendering and

competitive bidding in public sector procurement. Various

books consulted are journals, textbooks, lecture notes as

well as internet which served as the external sources of data

collection.

3.4 POPULATION AND SAMPLE SIZE

The fact if that the researcher has selected the population

designed to give him the appropriate information needed as

regards to the impacts of the organization. Precisely, this

study would have involved all the departments, but due to

high cost of transportation, it was easy for the researcher to

carryout his research work on those departments.

Population as regards to this research talks about the total

number of people/workers in the departments which are

administration, purchasing, finance, engineering and

personnel departments are made up of fourty (40) staffs.

Based on the large sized of the population, the researcher

liii
decide to use the department that concern with tendering

and bidding as the sample size.

Questionnaire distribution and return table

Table 3.1

Departments No No No % %

distribution return reject return reject

Purchasing 12 12 - 25% -

Administration 10 10 - 20.8% -

Finance 14 6 8 12.5% 16.7%

Engineering 6 6 - 12.5% -

Personnel 6 4 - 12.5% -

Total 48 40 8 83.3% 16.7%

Source: field study 2011

From the table above, a total number of fourty eight (48)

questionnaires were distributed, out of this fourty eight,

fourty were properly completed and returned while only

liv
eight were not returned. Therefore, the questionnaire to be

used for analysis is fourty (40).

3.5 SAMPLING TYECHIQUE

Though a variety of sampling technique exists, which are

simple random sampling, stratified systematic sampling and

cluster (area) sampling.

The sampling technique used in this study is the simple

random sampling. This method is good because it is not

subject to the investigator bees, since the aim of the study

is to know the views and the attitudes of the workers in the

ministry of finance Owerri, on competitive bidding and

administration of contract in public sector in the ministry. A

total number of questionnaires were distributed using the

method of simple random sampling technique.

The table 3.1 above shows the ministry’s department the

number of questionnaires distributed to each of them using

simple random sampling techniques and their responses.

lv
3.6 VALIDITY AND RELIABILITY OF MEASURING

INSTRUMENT

The researcher strongly believe that all the materials

consulted in the course of carrying out this research work

which comprises of lecture note, journals, textbooks and

internet are valid and reliable.

Also the calibre of people consulted and interviewed in the

ministry of finance Owerri for questionnaire are people that

are highly involved in the activities of the ministry.

3.7 METHOD OF DATA ANALYSIS

In analysing the data collected, appropriate figures are used

to represent the data collected from personal interviews and

questionnaire. The figures are tabulated so that they can be

easily understood and properly interpreted. The researcher

got into checking of all respondents to ensure that questions

asked in the questionnaire are well attended to, they helps

to ensure that uniform and accurate interpretations of the

responses of the questionnaire ere made.

lvi
After analysis the information by using percentage method,

the researcher used chi-square statistics to test the

hypothesis. This is because the test involves the observed

frequency and the expected frequency.

The chi-square formular is :-

X2 = Oi-Ei
Ei

Where

X2 = Clauculated chi-square

Oi = Observed frequency

Ei = Expected frequency.

lvii
 CHAPTER FOUR

4.0 PRESENTATION AND ANALYSIS OF DATA

4.1 INTRODUCTION

This chapter focuses on the analysis of data, collected data

must be analyzed for easy understanding since all the

relevant data were collected through the use of

questionnaire.

Also, this chapter reviews how the hypothesis is tested by

using chi-square, and the result gotten after the text is also

explained for easy understanding.

lviii
4.2 PRESENTATION OF DATA

The results and findings in the work are based on the

responses made in answering the questionnaires during

visits, interviews, discussions as well as observations.

The researcher analyzed the findings of this work by way of

presenting the findings in a tabular form, using percentage

method formular which is this:

F x 100

N 1

Where

F = Total number of frequency

N = Total number of respondents

100 = Indicates the percentage rate

1 = Constant denominator

4.3 ANALYSIS OF DATA

lix
The analysis of data is based on analysing and interpreting

the data collected from the questionnaire by the use of

numeric tables as they will apply to each question in the

questionnaires.

This analysis of data will enhance better understanding of

the study.

Question No 1: Is tendering used frequency in your

ministry to achieve a fair price?

Table 4.1

Department Yes % No % Total

Purchasing 12 30% - - 12

Administration 10 25% - - 10

Finance 6 15.5% - - 6

Engineering 6 15.5% - - 6

Personnel 6 15.5% - - 6

Total 40 100% 0 0 40

lx
Source: field study 2011

Comments: from the table above, all the respondents

answered yes, indicating that tendering is frequently used in

the ministry to achieve a fair price.

Researcher also concluded that tendering is used frequently

in the ministry to achieve a from price because all the

respondents answered yes.

Question No 2: Do you agree that tendering ensures

transparency and accountability in public sector contract?

Table 4.2

Department Yes % No % Total

Purchasing 8 20% 4 10% 12

Administration 8 20% 2 5% 10

Finance 4 10% 2 5% 6

Engineering 4 10% 2 5% 6

Personnel 4 10% 2 5% 6

lxi
Total 28 70 12 30% 40

Source: field study 2011

Comments: from the table 4:2 above, we can see that 28

respondents representing 70% agreed that tendering

ensures transparency and accountability in public sector

contract management, while 12 respondents representing

30% of the population said no.

The researcher conclusion was drawn from the number of

respondents 28 representing 70% that tendering ensures

transparency and accountability in public sector contract.

Question No 3: Apart from competitive bidding do your

ministry adopt another method of buying to achieve a fair

price?

Table 4.3

Department Yes % No % Total

Purchasing 10 25% 2 5% 12

lxii
Administration 8 20% 2 5% 10

Finance 4 10% 2 5% 6

Engineering 5 12.5% 1 2.5% 6

Personnel 5 12.5% 1 2.5% 6

Total 32 80% 8 20% 40

Source: field study 2011

Comments: from the table above, 32 respondents

representing 80% of the population said yes while only 8

respondent representing 20% said No.

From the number of respondents, the research concludes at

the ministry adopt another method of buying to achieve a

fair price.

Question No 4: Does your ministry frequency use

negotiation to achieve a fair price?

Table 4.4

Department Yes % No % Total

lxiii
Purchasing 4 10% 8 20% 10

Administration 2 5% 8 20% 6

Finance 2 5% 4 10% 6

Engineering 2 5% 4 10% 6

Personnel 2 5% 4 10% 6

Total 12 30% 28 70% 40

Source: field study 2011

Comments: It can be seen from the table above that 12

respondents representing 30% are of the opinion that

negotiation is frequency used in the ministry, while 28

respondents representing 70% of the population said No.

From the number of respondents, the researcher concludes

that negotiation is frequently use in the ministry to achieve

a fair price.

Question No 5: Do you strongly believe that negotiation

can be sued to reach compromise when normal competitive

bidding by supplier does not result in satisfactory result?

lxiv
Table 4.5

Department Yes % No % Total

Purchasing 8 20% 4 10% 12
Administration 8 20% 2 5% 10
Finance 4 10% 2 5% 6
Engineering 4 10% 2 5% 6
Personnel 4 10% 2 5% 6
Total 28 70% 12 30% 40

Source: field study 2011

Comments: from the above table, you can see that 28

respondents representing 70% strongly believe that

negotiation can be used to reach compromise when normal

competition bidding by suppliers do not result in a

satisfactory result while 12 respondents representing 30%

of the population said no.

From the table above, the researcher concludes that

negotiation can be used to reach compromise when the

normal competitive bidding by supplier does not shows a

satisfactory because 70% respondents strongly believe so.

Question 6: Do you understand tendering?

lxv
Table 4:6

Department Yes % No % Total

Purchasing 4 10% 2 5% 12

Administration 8 20% 4 10% 10

Finance 4 10% 2 5% 6

Engineering 8 20% 4 10% 6

Personnel 4 10% 2 5% 6

Total 28 70% 12 30% 40

Source: field study 2011

Comments: from the table above, we can see that 28%

respondent representing 70% knows what tendering is all

about while 12 respondents representing 30% of the

population said no.

From the number of respondents, the researcher concludes

that tendering is been understood in the ministry.

Question 7: Does your ministry have a tender’s committee?

lxvi
Table 4.7

Department Yes % No % Total

Purchasing 10 25% 2 5% 12

Administration 4 10% 2 5% 10

Finance 8 20 2 5% 6

Engineering 5 12.5% 1 2.5% 6

Personnel 5 12.5% 1 2.5% 6

Total 32 80% 8 20% 40

Source: field study 2011

lxvii
Comments: The above table shows that 32 respondents

representing 80% of the population said yes while only 8

respondent representing 20% said no.

From this number, of respondents, the researcher concluded

that the ministry have a tender’s committee.

Question 8: Do all the departments well represented.

Table 4.8

Department Yes % No % Total

Purchasing 2 5% 4 10% 12

Administration 2 5% 8 20% 10

Finance 2 5% 4 10% 6

Engineering 4 10% 8 20% 6

Personnel 2 5% 4 10% 6

Total 12 30% 28 70% 40

Source: field study 2011

lxviii
Comments: It is obvious that from the table above 12

respondents representing 30% are of the opinion that all the

departments are well represented while 28 respondents

representing 70% of the population said no.

The researcher from the number of respondents concludes

that all the departments in the ministry are not well

represented.

Question 9: Has there been instance where the lowest

bidder are not offer contract in your ministry?

Table 4.9

Department Yes % No % Total

Purchasing 12 30% - - 12

Administration 10 25% - - 10

Finance 4 13% 1 4.5% 6

Engineering 6 13% 1 4.5% 6

Personnel 6 13% 1 4.5% 6

lxix
Total 38 91% 2 9% 40

Source: field study 2011

Comments: From the table above, it is clear that 38

respondents representing 91% agreed that there are

instance the lowest bidder are not offered contract in the

ministry while 2 respondents represent 9% said no.

The researcher also concluded from the number of

respondents that there has been instance where the lowest

bidder are not offered contract in the ministry.

Question 10: marital status?

Table 4.10

Department Married % Single % Total

Purchasing 4 10% 2 5% 12

Administration 8 20% 2 5% 10

Finance 8 20% 4 5% 6

Engineering 4 10% 2 5% 6

lxx
Personnel 4 10% 2 5% 6

Total 28 70% 12 30% 40

Source: field study 2011

Comments: Form the table 4:10 above, we can see that 287

respondent representing 70% of married people in the

ministry while 12 respondent representing 30% are single in

the organization.

From the number of respondents, the researcher concludes

that married persons are more them the single persons in

the ministry.

Question 11: What is your sex?

Table 4.11

Department Male % Female % Total

Purchasing 10 25% 2 5% 12

Administration 8 20% 2 5% 10

Finance 4 10 2 5% 6

lxxi
Engineering 5 12.5% 1 2.5% 6

Personnel 5 12.5% 1 2.5% 6

Total 32 80% 8 20% 40

Source: field study 2011

Comments: table 4.11 above shows 32 respondent

representing 80% of the population that is male in the

ministry while 8 respondent showing 20% of the population

that is female.

The researcher also noticed from the number of respondents

that there are more male persons in the ministry them

female.

Question 12: Indicate your age interval?

Table 4.12

Department 18-25 % 26-34 % 35- % Total

above

Purchasing 4 15% 2 2.5% 2 4% 12

Administration 4 15% 2 2.5% 2 4% 10

lxxii
Finance 2 2.5% 4 15% 2 4% 6

Engineering 3 5% 4 15% 2 4% 6

Personnel 2 2.5% 3 5% 2 4% 6

Total 15 40% 15 40% 10 40

Source: field study 2011

Comments: It can be seen from the table above that 15

respondents representing 40% are of the age interval of 18-

25, is respondents representing 40% are of the age interval

of 26-34 while 10 respondents representing 20% are of the

age interval of 35-above.

From the number of respondents, the researcher concluded

that there are move persons between the age interval of 18-

25, 26-34 than 35 above.

Question 13: Do you think that the present tenders

committee of the ministry in made up of qualify man?

Table 4.13

Department Yes % No % Total

Purchasing 8 20% 4 10% 12

Administration 8 20% 2 5% 10

lxxiii
Finance 4 10% 2 5% 6

Engineering 4 10% 2 5% 6

Personnel 4 10% 2 5% 6

Total 28 70% 12 30% 40

Source: field study 2011

Comments: From the table 4.13, it is obvious that 28

respondent representing 70% agreed that their qualified

man in the tenders committee of the ministry while 12

respondents representing 30% no.

An obvious conclusion was drawn by the research from the

number of respondents that the ministry tenders committee

are made up of qualified men.

Question 14: Do you agree that inefficiency or low, of the

tenders committee have a corresponding effect on the

outcome of the public sector contract.

Table 4.14

Department Yes % No % Total

Purchasing 8 20% 1 2.5% 12

Administration 4 10% 1 2.5% 10

lxxiv
Finance 5 12.5% 2 5% 6

Engineering 5 12.5% 2 5% 6

Personnel 5 12.5% 2 5% 6

Total 32 80% 8 20% 40

Source: field study 2011

Comments: From the above table, 32 respondents

representing 80% of the population said yes while only 8

respondent representing 20% said No.

From the number of respondents, the researcher concludes

that inefficiency of the tenders committee have a

corresponding effect on the out come of the public sector

contract.

Question 15: Can the performance of the tender committee

be improved?

Table 4.15

Department Yes % No % Total

Purchasing 12 30% - - 12

Administration 10 25% - - 10

lxxv
Finance 6 15.5% - - 6

Engineering 6 15.5% - - 6

Personnel 6 15.5% - - 6

Total 40 100% 0 0 40

Source: field study 2011

Comments: from the table above, all the respondents

answered yes indicating that the performance of the tend

committee can be improved.

The research concluded from the number of respondents

that the performance of the tender committee can be

improved.

Question 16: Does your ministry at present have a

standing tender committee board?

Table 4.16

Department Yes % No % Total

Purchasing 8 20% 4 10% 12

Administration 8 20% 2 5% 10

lxxvi
Finance 4 10% 2 5% 6

Engineering 4 10% 2 5% 6

Personnel 4 10% 2 5% 6

Total 28 70% 12 30% 40

Source: field study 2011

Comments: the table above shows clearly 28 respondents

representing 70% of the populating indicating that their

ministry at present have a standing tender committee board

while 12 respondent showing 30% population disagreed.

From the number of respondents, the researcher concludes

that the ministry at present have a standing tenders

committee board.

Question 17: Do you agree that lack of standard document,

legal instrument, trained and experienced personnel in the

field of tendering and tender management are responsible

for contract execution in the public sector?

Table 4.17

lxxvii
Department Yes % No % Total

Purchasing 2 5% 10 2.5% 12

Administration 2 5% 8 20% 10

Finance 2 5% 4 10% 6

Engineering 1 2.5% 5 12.5% 6

Personnel 1 2.5% 5 12.5% 6

Total 8 20% 32 80% 40

Source: field study 2011

Comments: From the table above, 8 respondents

representing 20% of the population said yes, while 32

respondent representing 80% of the population said No.

From the respondents number from the table above, the

researchers concludes that lack of standard document, legal

instrument, trained a experienced personnel in the field of

tendering and tender management are not responsible for

contract execution in public sector.

lxxviii
Question 18: Do you think there is total abuse of the

system of tendering in the ministry?

Table 4.18

Department Yes % No % Total

Purchasing 8 20% 2 5% 12

Administration 8 20% 2 5% 10

Finance 8 20% 2 5% 6

Engineering 4 10% 1 2.5% 6

Personnel 4 10% 1 2.5% 6

Total 32 80% 8 20% 40

Source: field study 2011

Comments: The table 4.18 shows that 32 respondents

representing 80% of the population do think there is total

lxxix
abuse of the system of tendering in the ministry while 8

respondent representing 20% said No.

The researcher also concluded from the number of

respondents that tendering system in the ministry is been

abuse.

Question 19: Do you agree that the present practice as far

as tendering concern could improve the quality of contract in

the ministry?

Table 4.19

Department Yes % No % Total

Purchasing 8 20% 2 5% 12

Administration 4 10% 2 5% 10

Finance 4 10% 2 5% 6

Engineering 8 20% 2 5% 6

Personnel 4 10% 4 10% 6

Total 28 70% 12 30% 40

lxxx
Source: field study 2011

Comments: From the table above, you can see that 28

respondents representing 70% agreed that the present

practice as far as tendering is concern could improve the

quality of contract into the ministry while 12 respondents

representing 30% disagreed.

From the number of respondent, I the researcher concludes

is concern could improve the quality contract in the ministry.

Question 20: Do you think that selective tendering method

as in most cases used in the ministry is to open corruption,

favouritism and political consideration.

Table 4.20

Department Yes % No % Total

Purchasing 1 2.5% 18 20% 12

Administration 1 2.5% 8 20% 10

Finance 2 5% 4 10% 6

lxxxi
Engineering 2 5% 8 20% 6

Personnel 2 5% 4 10% 6

Total 8 20% 32 80% 40

Source: field study 2011

Comments: From the table, we can see that 8 respondent

representing 20% of the population said yes while 32

respondents representing 80% of the population said No.

From the number of the respondent, the researcher

concludes that the ministry using selective tendering method

in most cases is not opening to corruption, favouritism and

political consideration.

4.4 TEST OF HYPOTHESIS

This has to do with testing of the two hypothesis formulated

in the study in chapter open. This section will determine

whether to accept or reject the null hypothesis. As noted in

lxxxii
chapter three, the chi-square distribution is used in the test

and at 5% level of significance.

DECISION RULE

Null hypothesis will be accepted if X2 calculated is less than

the tabulated X2 value (critical value) while the reverse will

be the case if X2 calculated is greater than the tabulated X 2

value (critical value).

HYPOTHESIS ONE

Ho: Tendering is not an effective tool in public sector

procurement.

Hi: Tendering is an effective tool in public sector

procurement.

NOTE: Table 4.1 and 4.2 and questions number 1 and 2 are

used for testing and at 5% level of significance.

Table Yes No Total

4.1 20 0 40

lxxxiii
4.2 28 12 40

Total 68 12 80

Using Ei = RTxCT

GT

Where,

Ei = Expected value

RT = Row total

CT = Column total

GT = Grand total

:- Eii = 40x68

80 = 34

E12 = 40 x 12

80 = 6

E21 = 40 x 68

80 = 34

E22 = 40 x 12

lxxxiv
 80 = 6

Calculation of the chi-square (X2)

Table chi-square calculated

Cells Oi Ei Oi-Ei (Oi-Ei)2 (Oi-Ei)2/Ei

E11 40 34 6 36 1.0588

E12 0 6 -6 36 6.0000

E21 28 34 -6 36 1.0588

E22 12 6 6 36 6.0000

Total X2 14-1176

Calculated X2 = 14.1176

Calculating the level of significance X2 and V

V = df=(R-i)(C-i)

= (2-1)(2-1)

= 1X1

= 1

lxxxv
X2 0.05, 1 = 3.841

DECISION: Since the X2 calculated is greater than X2

tabulated, i.e 14.1176>3.841. Based on this, we reject Ho

and accept Hi and conclude that tendering is an effective

tool min public sector procurement.

HYPOTHESIS TWO

Ho: There is no effective method the ministry adopt other

than competitive bidding.

Hi: There is another effective method the ministry adopts

other than competitive bidding.

NOTE: Table 4.3, 4.4 and 4.5 and questions number 3,4 and

5 and used for testing and at 5% level of significance.

Table Yes No Total

4.3 32 8 40

4.4 12 28 40

4.5 28 12 40

Total 72 48 120

lxxxvi
Using Ei = RTxCT

GT

Where,

Ei = Expected value

RT = Row total

CT = Column total

GT = Grand total

:- Eii = 40 x 72

120= 24

E12 = 40 x 48

120 = 16

E21 = 40 x72

120 = 24

E22 = 40 x 48

120 = 16

lxxxvii
E31 = 40 x72

120 = 24

E32 = 40 x 48

120 = 16

Cells Oi Ei Oi-Ei (Oi-Ei)2 (Oi-Ei)2/Ei

E11 32 24 8 64 2.6667

E12 8 16 -8 64 4.0000

E21 12 24 -12 144 6.0000

E22 28 16 12 144 9.0000

E31 28 24 4 16 0.6667

E32 12 16 4 16 1.0000

Total X2 23.3334

Calculated X2 = 23.3334

Calculating the level of significance X2 and V

lxxxviii
V = df=(R-i)(C-i)

= (2-1)(2-1)

= 1X1

= 1

X2 0.05, 1 = 3.841

DECISION: Since the calculated X2 is greater than the

tabulated X2, i.e 23.3334, therefore, we reject Ho and

accept Hi and conclude that there is another effective

method the ministry other than competitive bidding.

4.5 INTERPRETATION OF RESULTS

Based on the responses gotten from the questionnaire

distributed and the testing of the two hypothesis that were

formulated in chapter one. We hereby draw some result.

i. That tendering is widely used in the public sector to

ensure observance of the principle of public

accountability and fair price.

lxxxix
 ii. We also find out that tendering is not only the

method of buying which the ministry uses in

procurement.

iii. There is other method that could be used in buying,

such as negotiation. This can be used to achieve a

fair price when the normal competitive bidding by

the suppliers does not result in a satisfactory result.

From the result gotten in the hypothesis that were tested,

we find out that tendering is an effective tool in public sector

procurement. Also find out that there is another effective

method that the ministry adopt other than competitive

bidding.

xc
 CHAPTER FIVE

5.0 SUMMARY, CONCLUSION AND RECOMMENDATION

5.1 INTRODUCTION

This chapter deals with the summary of findings, i.e the

summary of those major highlight of the study.

From chapter one to five, talks about the conclusion which is

usually drawn from chapter two and four and finally

recommendation which aims at solving the problems that

warranted the study in the first instances.

5.2 SUMMARY

The essence of this research work is centered at the use of

tendering and competitive bidding in public sector

procurement. In a bid to make the research work more

apparent, the topic was treated under five (5) different

chapter. We started by treating the one which presents the

general introduction of the subject matter of the study,

background information of the study, statement of the

xci
problem, objective of the study, research question,

statement of hypothesis, significance of the study, scope of

the study, limitation of the study and definition of terms.

Chapter two of this study reviews related literatures and

views of professionals especially in the areas that related to

the subject matter of the study.

Chapter three examines the research design sources of data

collection, population and sample size, sample techniques,

data analysis and research instrument used by the

researcher.

Chapter four furthermore, analyzed and presented various

data gathered, the questionnaire was analyzed in simple

percentages based on the response gotten from the

respondents, and the hypothesis was tested using chi-

square distribution.

Finally, chapter five presents the researchers summary,

conclusion and recommendation based on the findings made

by the researcher in the course of this study.

xcii
5.3 CONCLUSIONS

This study was carried out to ascertain “the use of tendering

and competitive bidding in public sector procurement”. The

findings from this study was revealing as the study results

have shown.

Consequently, the researcher concluded based on the finding

gotten from chapter two and four that:

1) A well managed tender and tendering will ensure

fairness and transparency in the management of

public sector contract.

2) Departments/units such as legal service purchasing

and administration, finance, engineering and

personal play a vital roles if the objective of public

sector tendering are to be achieved and the constant

abandonment of contracts by contractors after the

contract has been mobilized with be reduced greatly,

today the appointments to the tender committee is

basically political consideration.

xciii
3) Tenders are the means through the buyer obtains

prices as well as supplier conditions to execute a

purchase contract.

4) Tendering is widely used in the public sector to

ensure observation of the principle of public

accounted.

5) We also find out that apart from competitive bidding,

there is another methods that can be used by a

buyer to get a fair price.

6) We also conclude that when normal competitive

bidding by suppliers do not yield a good result,

negotiation becomes the ultimate road to follow for a

compromise.

7) We also find out that the lowest price quoted tender

that meets the entire requirement is recommended.

8) The processes that will ensure fairness in the

management of contracts in the public sector are

xciv
 regarded and followed at all contracts, in most cases,

tendered before they are awarded for; therefore

make the process of tendering very effective.

5.4 RECOMMENDATIONS

Based on the problems identified and conclusion drawn by

the research in the course of carrying out this research

work.

The ministry should consider the following:

1. The ministry should make sure that they laid down

rule and regulations are applied in its tendering and

regulations are applied in its tendering and

competitive bidding activities as this will ensure

transparency, accountability and reduce frequent

abandonment of contracts after the contractors had

been mobilized.

2. The ministry should re-engineer the processes of

tendering and competitive bidding. This is to

xcv
 incorporate into the processes monitoring and

evaluation elements that will ensure that the most

competent contractor does not only with the contract

but execute the state to earn creditably for the best

of the tax payers.

3. Also there is need to standardize the process and the

documentation’s of tendering and competitive

bidding in ministry in particular and in other public

sector organizations in the state. This ensure

fairness to both potentials and actual contractors of

the ministry, on the other hand, it had reduce a

situation in which contractors abandon projects after

the collection of millions of naira as mobilization

fees.

4. There is need to dismphasize political linage,

tribalism, godfathers as the basis for appointment

into the tender committee of the ministry as the

current situation builds corruption and mis-

xcvi
 management of public finance. Appointments should

be based on past records of honesty, hard working,

experience and possession of necessarily skills and

education in contract management.

5. The ministry should avoid a supply that is prone to

strike.

6. The ministry should be extremely careful when

awarding contract to ensure that the contract will be

awarded to the bidder who satisfied all requirement

of the buyers.

7. To ensure that accurate information of suppliers

tenders are obtained, the ministry should prepare a

comparative summary sheet i.e, quotation or tenders

comprise sheet which will show all the important

aspects of the contract.

8. If there are differences between what is contained in

the tender and the requirement of the ministry, all

the department concerned within the organization

xcvii
 should come together for discussions, corrections

and adjustment or to drop the supplier.

9. On receipt of quotations/tenders, the buyer should

check them properly to make sure that what is

contained there in the tender conform to the actual

requirement of the ministry. Such cross checking

should not be limited to the enquiring but also

against the initial request from the user department.

xcviii
 REFERENCES

Achison C.B (1999) Industry purchasing and supply 1 st

edition, precision printers and publishers, Enugu-

Nigeria

Amanze Dom C (2001) Public sector contract management

and administration, the problems and ways forward.

An unpublished seminar paper Jigawa.

Aljian G.W (1973) Purchasing handbook, 1st edition MC

Crraw New York Hill.

Uzor A.M (2009) Purchasing management, principles and

practice, 2nd edition, Bon publication, Owerri-Nigeria.

Davis O. (1974) The marketing approach to purchasing

journal of long range planning volume 7 No.3 June.

Lysons C.K (1993) Purchasing handbook 3 rd edition pitman

publications inc. London.

Lysons C.K (1993) Purchasing, 4th edition Mac Donald Evans

and Pitmans publishing co.ltd, London.

xcix
Heindrick I.E and Ruch W.A (1976) Purchasing principle and

application 1st edition practice Hall Inc. Englwool cliffs

New Jersey.

Oyeoky O.K and Nwanneka R.E. J (2001) Purchasing and

supply chain management, principles and practice 1 st

edition, Bon publication Owerri-Nigeria.

Baily, P.J.H (1978) Purchasing and supply management, 5 th

edition, chapman and Hall, Great Britain.

Compton and Jessap (1989) Purchasing and stoves

management. 1st edition, Bonny publishers.

England WB and leedeer M.R (1975) Purchasing and

material management, 2nd edition inc. III, R.D, Irivin.

c
 APPENDIX

Department of purchasing and supply

School of Business and Management Technology
Federal Polytechnic Nekede Owerri
P.M.B 1036
Owerri Imo State
Sir/Madam,
I am a final year student of the above said institution and
department, currently carrying out a project work on “The
use of Tendering and Competitive Biding in the Public Sector
Procurement” (A case study of Ministry of Finance, Imo
State).
The questions are part of the research project aimed at
identifying the use of tendering and competitive bidding in
public sector procurement.
Please kindly compete the attached questionnaire in order to
make this project work successful. This project work is
purely for academic purpose and as a fulfilment
requirements for the award of Higher National Diploma
(HND) in purchasing and supply.
All information given will be treated with utmost confidence.

Yours faithfully

Ezekwe Jennifer .O.

ci
 QUESTIONNAIRE

On competitive bidding and administration of contract in

public sector .

A case study of ministry of works, Imo State.

Tick as appropriate in the provided box below.

1. Sex: (a) Male (b) Female

2. Indicate your age interval?

18-25 26-34 35-above

3. Marital status? (a) Married (b) Single

4. Do you understand tendering? (a) Yes (b) No

5. Is tendering use frequently in your organization?

(a) Yes (b) No

6. Does your organization have a tender’

(a) Yes (b) No

7. Do all the departments well represent?

(a) Yes (b) No

cii
8. Do you think the present tenders committee of the
ministry is made up of quality man?

(a) Yes (b) No

9. What factors do you think are considered before one is

appointed in to the membership of tender committee of
your ministry?

(a) Polities (b) Favouritism (c)

Tribalism (d) Honesty (e)
Hardworking (f) None of the above

10. How would you rate the current performance of the

tender committee in the ministry?

(a) Very efficient and effective

(b) Very lower

(c) No comments

11. Has there been instance where the lowest bidder are
not offered contract in your ministry?

(a) Yes (b) No

12. Do your agree that inefficiency or low of the tenders

committee have a corresponding effect on the outcome
of the public sector contract?

ciii
 (a) Yes (b) No

13. Can the performance of the tender committee be

improved?

(a) Yes (b) No

14. Do you agree that tendering ensures transparency and

accountability in public sector contract?

(a) Yes (b) No

15. Does your ministry at present have a standing tender

committee board?

(a) Yes (b) No

16. Do you agree that lack of standard document legal

instrument, trained and experienced personnel in the
field of tendering and tender management are
responsible for contract execution in the public sector
organization?

(a) Yes (b) No

17. Do you think there is a total abuse of the system of

tendering in the ministry?

(a) Yes (b) No

civ
18. Do you agree that the present practice as far as
tendering is concern could improve the quality of
contract in the ministry?

(a) Yes (b) No

19. Do you think the selective tendering method as in most

cases used in the ministry is to open corruption,
favouritism and political consideration?

(a) Yes (b) No

20. Does negotiation frequency used in your ministry to

achieve a fair price?

(a) Yes (b) No

cv