Federal government has potential opportunity to save up to N12 billion annually from procurement by Ministries, Departments and Agencies, MDAs, annually if goods, services are standardised and demands of MDAs are aggregated to negotiate fair discounts from suppliers.
This was disclosed yesterday in Abuja by Patience Oniha, Head, Efficiency Unit of the federal ministry of finance in a presentation to the Media.
She explained that if the procurement processes for goods and services of the MDAs are standardised and their demands appropriately scrutinised, government has ample opportunity to block loopholes in the system, thereby saving the scarce resources being frittered away and channel same to other developmental purposes.
Efficiency Unit was created last November in the Office of the Minister of Finance. It was established against the urgent need to achieve better cost structure for the government and derive maximum value for money spent.
The Unit is charged with the task of eliminate waste and duplications in government’s work processes and activities and generate savings for government from the procurement process.
Oniha said there have been concerns over the years about Overhead Expenditure (cost of running the Government), and the concerns have become ‘real’ in the face of dwindling government revenue and the disproportionate share of Overheads in the Annual Budget.
She pointed out that Nigeria is not alone in this regard, as over the years, advanced and developed countries have been faced with the challenge of managing recurrent expenditure.
“Thus over the years, countries including Nigeria have introduced reforms to reduce public sector costs. The reforms have been varied and multidimensional”, Oniha stated.
She said the Efficiency Unit has reviewed the Public Procurement Process and compared it with best practices from other jurisdictions and large private sector from the perspective of: “Doing more with Less” and “Value for Money”.
The Unit, she noted would use “government’s large purchasing power to negotiate favourable terms from suppliers, streamline the procurement process to make it more wholesale rather than fragmented, increase transparency through the introduction of Price Guidelines, introduce Shared Services, review work processes and practices to identify and eliminate areas of wastage, excess capacity and duplications.”
The benefit of this exercise, Oniha noted would result in huge savings for government from procurement, elimination of wastages, excess capacity and duplications.
Such savings, she added can be channeled into priority projects which will improve infrastructure, encourage domestic production (GDP) and attract investors, create employment opportunities and overall, increase the quality of life of Nigerians.
Another marked benefit of the exercise, she said would be improvement in work processes and practices leading to a more efficient and result-oriented service delivery.

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