[size=14pt]Fed Govt ties contract payment to performance[/size]
By Vincent Ikuomola, Abuja1 hour ago

The era of consultants getting full payment for projects before completion is gone for good, the Federal Government said yesterday.
Henceforth, payments would be tied to performance, government added, even as it announced the establishment of a team to work on a template that will reduce contract cost.

These were some of the decisions reached at the weekly Federal Executive Council (FEC) presided over by President Goodluck Jonathan yesterday.

Briefing reporters at the end of the meeting, Minister of Information Labaran Maku, said the issue of uncompleted projects has become a source of concern to the president who had directed that  no contract will come to the council without an agreed and verifiable transition plan, to ensure all projects are awarded and completed smoothly and on time.

He said: “Another issue was that of uncompleted projects that has continued to be a source of concern to Mr. President and all Nigerians. “He directed that for the period he is in power, he will want to see all the projects initiated and awarded by his administration are completed on schedule, within the period of his administration.

“He directed the coordinating minister of the economy as well as the Bureau of Public Procurement (BPP), Minister of Finance, to ensure that no contract will come to council without an agreed and verifiable transition plan, to ensure all projects are awarded and completed smoothly and on time.

“The consequence of uncompleted projects is that money is tied down and Nigerians are not benefiting from the services that those projects are suppose to offer. In addition to that, contractors keep coming up with augmentation plans, once execution time plan for a project is exceeded.

“So, this matter has become a very serious problem not just to the Federal Government but nationwide, but Mr. President believes one of the quick ways of tackling it is to ensure that onward we can make a remedy.
“So, all contracts every minister is bringing must be proved and backed up with a financial plan that will be smooth and timely exist from those projects.

“It was agreed that there is no need starting something that will not be completed and Nigerians will not benefit.

“As you do know part of the strategy of this budget is to complete existing project  awarded by previous administrations, that unless we carry this project to completion, the huge investments in them running to trillions of naira will be wasted,” the minister said.

On contract cost, Maku said the President is also worried that various measures put in place have not been able to stem the tide as contract cost soars against normal norms.

Government, he said has still not been able to arrive at what could consider to be universally appropriate valuation of projects in the public sector in Nigeria.

http://www.thenationonlineng.net/2011/index.php/news/25865-fed-govt-ties-contract-payment-to-performance.html

This policy will greatly help to lessen corruption. I wonder what the state governors will have to say about extending the practice to their domains?

One of those political round tables, little or no effect, lets just hpe n pray accordng to GEJ

Beaf:

This policy will greatly help to lessen corruption. I wonder what the state governors will have to say about extending the practice to their domains?

Very much so.
Fighting corruption does not necessarily mean bundling people to jail, and hounding political opponents as we saw in pasted years.
Plugging loopholes is brilliant, very subtle, yet effective way of ridding the populace from the corrupt men and practices.

Good one - GEJ!

Mr. President, thanks for that single approach. You have saved Billions for this Nation if they don't flaw this policy.

Beaf:

This policy will greatly help to lessen corruption. I wonder what the state governors will have to say about extending the practice to their domains?

It's only a start, albeit a good one. Will this reduce corruption? Let's wait and see. Metrics for measuring performance has to be clear and transparent to all, if not corruption as usual will rule the day. No be Naija

For instance, how do you assess performance on a road project? Timely completion, quality of work or both. If a contractor completes a road project and within 12 months potholes begin to render the road unusable, will govt demand a refund or a redo of the project? All sounds good on paper but so long as GEJ surrounds himself with corrupt ministers, its all talk.
 
What of Mobilization fee? I can see this fee going up significantly as contractors will try to get more money upfront to settle Ministers and civil servants

Yawn!!! Na wa oo!!! And here I thought this was an obvious common sense idea. Oh no, we have to CONGRATULATE the FG for finally figuring out this is how it ought to happen.

I pray this works,

Story,story,STORY!!

After saving bilions wat do they do with it.

anuforoudo:

Mr. President,  thanks for that single approach. You have saved Billions for this Nation if they don't flaw this policy.

Who are they kidding ? Let's hope this is enforced because talk is cheap.

Kobojunkie:

Yawn!!! Na wa oo!!! And here I thought this was an obvious common sense idea. Oh no, we have to CONGRATULATE the FG for finally figuring out this is how it ought to happen.

I tire o! I Cant belive Some GEJ apologists re actually congratulating him for this cheap talk dat will neva be backd wit action.

@Beaf,

I have to differ with you on this one; I honestly believe that the right way to tackle corrpution (head-on) is criminal penalties. Trying to bypass the right channels will just create room for another loophole. If there's corruption in the Judicial system, tackle the corruption from there, if there's corruption at DOJ, tackle it from there. If there's one at the Investigative Unit of White Collar crime, tackle it from there, but trying to bypass this ain't helping , IMO. Although good initiative but less effective.

You ppl and GEJ. HMMM

deco2come:

That is a good policy is they carry it out.

[color=#990000]It would also be nice if they will show us what kind of road, house, or other project they plan to build before the contract is given to them. In most of the develop countries, before any construction firm start any project for example, road, bridge, market, etc, they have a complete design in form of 3D, or any graphical design. Citizens will have the chance of seeing what the project would look like if when the project has been completed.

Mr President, ask all of them to carry out the same procedure so that we will know when they are cheating us. Beside, it will help of people in graphic and design industry[/color]

@italic

I wonder why this practice is not the norm. Besides it not very expensive to acquire models and prototypes.

Too much talk Goodluck

Its a good development, but i hope the contractors won't decide to use inferior materials since some of their money is still on hold.

Good one but there should also be something like SLAs built into such contracts to mitigate non performance. I remember the builders of wembley stadium were paying the british govt some money per day for failing to meet the dead line. So if you signed to deliver by october 1 and have not finshed by oct 2nd without any reasonable reason, then there should be penalties

And I say again: Fresh Air!!!

na today, is that not the standard for all contract payments? payment are based on % of work certified done. Of what essence is the requirement for Bank Guanrantees or Advance Payment Guarantee in contract applications and appointment of Project Managers?

Yinkay:

na today, is that not the standard for all contract payments? payment are based on % of work certified done. Of what essence is the requirement for Bank Guanrantees or Advance Payment Guarantee in contract applications and appointment of Project Managers?

Like I said, common sense ooo!!!

a far more competent man did it quite simply - handshake or handcuff ; and without any fanfare

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Story, story

Contract payments have always been linked to performance there is nothing new in this. But in most contracts in Nigeria this is observed in default in connivance with senior government officials,the contractor pay the government officials the big wigs and the contractor doesn't have to perform.
PDP as it exists is synonymous to corruption and GEJ has'nt demonstrated the capacity to fight any evil. So don't be deceived.talk is cheap.

"Whenever I read about some company undertaking a cost-cutting program, I know it's not a company that really knows what costs are all about. Spurts don't work in this area. The really good manager does not wake up in the morning and say, "This is the day I'm going to cut costs," any more than he wakes up and decides to practice breathing." - Warren Buffett


The Nigerian tragicomedy continues.

I am convinced that the Nigerian people must rank among the most foolish people on this planet, and I make absolutely no apologies for saying this. I await the half-hearted rebuttals and insults.

There’s no need for anyone to pay for a screening of Orwell’s Animal Farm. They could watch it for free right here in the Federal Republic of Nigeria, day after day, week after week, year after year - its happening live. And as it was in that novella, the biggest problem wasn’t the pigs and their corruption/betrayal of the revolution but the incomprehensible stupidity and gullibility of the sheep and the other ‘expendables’.

It is painful to admit it but we are all sheep now. All 167 million of us. Fifty years after the British left and after 12 years of the PDP and we are still stating the obvious?  It is so sad to read that Maku was once a student unionist.

Kobojunkie:

Yawn!!! Na wa oo!!! And here I thought this was an obvious common sense idea.  Oh no, we have to CONGRATULATE the FG for finally figuring out this is how it ought to happen.

Yinkay:

na today, is that not the standard for all contract payments? payment are based on % of work certified done. Of what essence is the requirement for Bank Guanrantees or Advance Payment Guarantee in contract applications and appointment of Project Managers?

Please tell them.

Yinkay:

na today, is that not the standard for all contract payments? payment are based on % of work certified done. Of what essence is the requirement for Bank Guanrantees or Advance Payment Guarantee in contract applications and appointment of Project Managers?

Gbam.

otokx:

Story, story

stepo707:

Too much talk Goodluck

BoOOosHBoy:

You ppl and GEJ. HMMM

ugosly:

Story,story,STORY!!

After saving bilions wat do they do with it.

Nigerians and their negative spirits

It's unbeleivable that hitherto contractors were given jobs by the FG without them posting performance bonds. I wont even be suprised to know that they get advance payment without an advance payment guarantee/bond. These are fundamental business practices with which clients safeguard their funds and quailty of job delivered. One only hopes that this policy will be implemented to the letter. it's realy a shame!