Sponsor of the amendment bill to the 2007 Procurement Act, Senator Sam Egwu, has said that the bill, when signed into law by President Muhammadu Buhari, would help end capital flight in Nigeria.
Senator Egwu, who represents Ebonyi North Senatorial District on the platform of the Peoples Democratic Party, PDP, also assured that it would encourage local manufacturers to invest seriously in local production.
Egwu who made this explanation in Abuja weekend, while shedding light on why he proposed an amendment to the existing Act, said that he was deeply concerned and propelled by the quantum of capital flight taking place in the country on yearly basis.
The bill entitled “A Bill for an Act to Amend the Public Procurement Act to provide for and adopt a Local Content Policy and timely Completion of Procurement Processes and Other Related Matter”, was considered and passed by the Senate on Thursday June 16, 2016.
He explained that the new legislation made it compulsory for ministries, departments and agencies of government to first seek to procure certain percentage of locally made goods before considering foreign products, where such local products are available.
Egwu said, “I was inspired by the fact that I realised that a lot of money is appropriated for capital projects every year and most of these funds end up in the hands of foreign companies that produce the goods and services that we need.
“This is because once a budget is passed, it simply goes for procurement of goods and services. Then you start asking yourself, what is the fate of this huge amount of money that has been appropriated in a local economy?
“You will find out that more often than not, the money so appropriated just ends up in capital flight because the Ministries, Departments and Agencies, MDAs, will end up the procurement with foreign goods and services, leaving our local manufacturers who produce such things without patronage.
“You know that importation is not done with the local currency; importation is done with foreign currency, and this causes a lot of pressure on the foreign reserve, and it keeps depleting every day. But when we now patronise our made in Nigeria goods, there will be no need for much pressure on our forex”.
The politician also stated that the Senate, in the new proposal, increased the contract mobilisation fee from the current 15% to 25%, as a means of addressing the issue of rampant cases of abandoned projects across the country.
According to him, when contractors are mobilised with reasonable percentage of the contract sum, they will have no reason not to execute the project, but when the mobilisation fee is small, they can be tempted to leave the contract undone.
Egwu also stated that the improved mobilisation fee would facilitate timely completion of contract procurement process, which used to drag under the extant procurement Act.
He further explained that the Senate decided to remove the power of the Federal Executive Council, FEC, to approve contracts and ceded the power to the National Council on Public Procurement, NCPP.
The legislator pointed out that the National Council on Public Procurement would be made up of professionals and bureaucrats, who know the right decisions to take in order to make things work.
For instance, Egwu noted that the Senate also approved the inclusion of Nigerian institute of Architects and the Nigerian Institute of Quantity Surveyors as members of the Council.
It will be recalled that the Eight Senate, during its inauguration, promised that it would embark on legislation that would encourage local manufacturers and promote procurement of made in Nigeria goods.

Ad:See How you can turn $500 into $10,000 Click HERE For Details.