1
An Assessment of Procurement System and
Capacity of Health Department, Khyber
Pakhtunkhwa
December 2012
Khyber Pakhtunkhwa Province
2
Table of Contents
3
1
Acknowledgements................................................................................................................
6
2
Abbreviations & Keywords.................................................................................................
8
3
Executive Summary.............................................................................................................
11
3.1
4
5
Graphical Presentation of Strengths & Weaknesses...............................................
14
Background
4.1
Technical Assistance………………………………………………………………………
15
4.2
Terms of Reference (TORs)………….............………………………………………….
16
4.3
Organizational Structure of Health Department, Khyber Pakhtunkhwa....................
17
4.4
Procurement Entities of Health Department Khyber Pakhtunkhwa………...............
19
4.5
Procurement Practices in Health Department, Khyber Pakhtunkhwa………….......
21
Section-1: Situational Analysis & Assessment of Existing Procurement Procedures and
Procuring Entities of Health Department Khyber Pakhtunkhwa
5.1
Assessment Methodology.....................................................................................
23
5.2
Introduction of Factors Assessed under the Methodology......................................
24
5.3
Sampling Statistics..................................................................................................
25
5.4
Limitations & Constraints..........................................................................................
26
5.5
Purview of Assessment Scores……………..………………………………………………….
27
5.6
Pillar-I: Legislative and Regulatory Framework...................................................... 30
Indicator-1:
Indicator-2:
Public procurement legislative and regulatory framework
complies with applicable obligations with regard to national
and international requirements…………………………………..
30
Existence of implementing regulations and documentation…..
59
5.7 Pillar-II: Institutional Framework & Management Capacity.................................
68
Indicator-3:
The public procurement system is mainstreamed and
well
system........................................................................................
Indicator-4:
The province has a functional normative and/or regulatory
body…….………………………………………………………......
77
Indicator-5:
Existence of institutional development capacity……………….
77
5.9 Pillar III: Procurement Operations and Market Practices.....................................
Indicator 6.
The provincial procurement operations and practices are
efficient……………………………………………………………….
68
83
83
4
5.1
Indicator-7:
Functionality of the public procurement market…………………..
89
Indicator-8:
Existence of contract administration and dispute resolution
provisions…………………………………………………………….
95
Pillar IV: Integrity and Transparency of the Public Procurement System..........
103
Indicator-9:
The province has effective control and audit systems………
103
Indicator-10:
Efficiency of appeals mechanism……………………………..
108
Indicator-11:
Degree of access to information…………………..................
114
Indicator-12:
The province has ethics and anticorruption measures in
place………………………………………………….................
115
6
Section-II:
7
Section-III: Assessment of Identified Risks & Their Mitigation Strategies....................
126
8
Section-IV: Spend Analysis of Health Sector Procurements..........................................
145
9
Section V-
147
10
Supply Chain Management of Pharmaceuticals in the Health Department..
Recommendations on Institutional Measures…………………………..........
123
9.1
Health Sector Procurement Manual..............................................................
9.2
Strengthening of the Existing Procurement Cell at DGHS KP...................
9.3
Utilization of a dedicated web-portal for the Health Department...............
9.4
Human Resource Management...................................................................
150
9.5
Inventory & Warehousing Management......................................................
152
9.6
Proposed Mission of Procurement Cell......................................................
152
9.7
Proposed Administrative Structure of Procurement Cell, DGHS, KP........
153
9.8
Individual Job Responsibilities & Qualifications of the Procurement Officials
for Procurement Cell& TORs.................………………………………………
148
149
150
165
Annexures
10.1
List of Persons interviewed........................................................................
201
10.2
Training Calendar for Health Department Khyber Pakhtunkhwa..............
203
10.3
Questionnaires used for Review Processes…………………………
206
5
List of Figures:
Figure: 5.9
Graphical Presentation of Strengths & Weaknesses of the DoH
Procurement System..............................................................................
114
Figure: 9.7.1
Organizational Organogram of Procurement Cell, DGHS KP................
154
Figure: 9.7.2
Functions of Wings in the Procurement Cell, DGHS, KP.........................
155
Figure: 9.7.3
Hierarchy of Pre/Post-Qualification Wing.........................................
156
Figure-9.7.4:
Hierarchy of Technical Wing………………………………………….
158
Figure-9.7.5:
Tendering & Coordination Wing……………………………………..
161
Figure-9.7.6:
The hierarchy of the Budget & Planning Wing…………………….
164
Figure-9.8.1:
Nature & Requirement of Individual Job Function………………..
165
Table 8.1:
Comparison of Current Budget spending with Development
Budget for the Years 2009-12……………………………………….
145
Table 8.2:
Budgets allocated for the Purchase of Drugs & Bio-Medical
Equipment for the Years 2009-12 for all District
Governments and the Provincial Government ………………… 146
Table 8.3:
Provincial vs District Budget Estimates & Actual Expenditure 147
for the Year 2012-13 …………………………………………….
Tables:
Acknowledgements
This report has been prepared by Muhammad Ali Raza, Procurement Consultant,
Technical Resource Facility (TRF), Khyber Pakhtunkhwa. The Consultant is grateful to Mr.
Farooq Azam, Team Leader TRF Islamabad and Mr. Khalid Mahmood, Procurement
Specialist TRF Islamabad without whose continuous support, facilitation and morale
boosting, formulation of this Report couldn’t have been possible. For facilitation and
6
coordination at Khyber Pakhtunkhwa, the Consultant is grateful to Dr. Muhammad
Rahman Khattak, Provincial Coordinator TRF KP and Syed Sharf ul Haq Trimizi, Project
officer TRF KP.
The Consultant is grateful for support of Mr. Ashfaq Ahmad Khan, Secretary Health
Khyber Pakhtunkhwa, Mr. Zahir Alam, former Additional Secretary DoH Khyber
Pakhtunkhwa and Mr. Sher Gul Safi, Chief Planning Officer DoH Khyber Pakhtunkhwa
whose valuable input made this Report possible. The Consultant is grateful for support of
Mr. Nadeem Bashir, Additional Secretary Finance, Department of Finance, Khyber
Pakhtunkhwa.
The Consultant is also grateful to Mr. Sharif Ahmad Khan, Director General Health
Services, Department of Health, Khyber Pakhtunkhwa, whose close collaboration and
support helped him in finalizing the said Report.
The Consultant is also much grateful to Dr. Shabina Raza, Chief Coordinator Health
Sector Reforms Unit (HSRU), DoH, Khyber Pakhtunkhwa, for giving her support and
assistance in understanding the new policy framework for the reform initiatives for DoH
Khyber Pakhtunkhwa. The Consultant wishes to thank Mr. Ali Zahir Shah, Deputy
Secretary Health Department Health Department Khyber Pakhtunkhwa for their support in
collecting information on working of Health Secretariat.
The Consultant would also like to thank Govt-Medicine Coordination Cell (Govt-MCC),
DoH Khyber Pakhtunkhwa for coordinating, as Specialized Section for Drugs and
Medicines, in designing, revising and evaluating the Standard Bidding Documents (SBDs)
for procurement of Drugs & Surgical Disposables for DoH Khyber Pakhtunkhwa and
assisting in providing a better insight through discourse on comparative analysis of
previous and current procurement practices prevalent at Govt-MCC Section, DGHS,
Khyber Pakhtunkhwa.
TRF Punjab has developed in detail the job specifications as per the proposed
organogram and relevant qualifications for staffing the proposed Procurement Unit in
Health Department Punjab. As similar job specifications were required for the newly
created Procurement Cell at Directorate General Health Services, Khyber Pakhtunkhwa
with a smaller organizational setup, the same were adopted with some amendments in this
Report to avoid duplication of effort. The Consultant duly acknowledges the valuable work
of TRF Punjab in this regard.
The Report draws upon contributions from various public and private sector institutions
and experts from KP who volunteered time, provided insights, and shared background
material. Finally, financial assistance for this technical assistance provided by DFID and
AusAid is gratefully acknowledged.
7
It is hoped this Procurement System Assessment would be helpful in identifying the gaps
in the procurement processes at DoH Khyber Pakhtunkhwa, the risks these gaps may
pose and possible mitigation for adopting the course of action to streamline the Health
Department’s Procurement Lifecycle. All this aims at bringing the System under reference
in harmony with international best practices for transparency and wider competition and
consequently provision of effective drugs and appropriate equipment for the best possible
public health service delivery.
Disclaimer
This document is issued for the party which commissioned it and for specific purposes
connected with the above-captioned project only. It should not be relied upon by any other
party or used for any other purpose.
No responsibility is accepted for the consequences of this document being relied upon by
any other party, or being used for any other purpose, or containing any error or omission
which is due to an error or omission in data supplied by other parties.
*****
8
1. Abbreviations& Key words
AMI
Autonomous Medical Institution
AAMI
Association for the Advancement of Medical Instrumentation
BHU
Basic Health Unit
BOQs
Bill of Quantities
BLIs
Base Line Indicators
CBET
Certified Bio-Medical Equipment Technician
CCE
Certified Clinical Engineer
CE
Communauté Européenne (Council of Europe)
CE
Chief Executive (Autonomous Medical Institution)
CFAA
Country Financial Accountability Assessment
cGMP
Current Good Manufacturing Practices (for Pharmaceutical Industry)
CIPS
Chartered Institute of Purchasing & Supply (UK)
CLES
Certified Laboratory Equipment Specialist
CMW
Community Midwife
CPCM
Certified Professional Contract Manager (USA)
CPO
Chief Planning Officer, Health Secretariat
CPPO
Certified Public Purchasing Officer (Canada)
CRES
Certified Radiology Equipment Technician
DAC
Departmental Accounts Committee
DFID
Department for International Development (UKAID)
DGHS
Directorate General Health Services / Director General Health Services
DHO
District Health Officer
DHQ
District Head Quarter Hospital
DHS
District Health Services/District Health Govt./Dept.
DI
Drug Inspector
DoH
Department of Health, Govt. of Khyber Pakhtunkhwa
DRA
Drug Regulatory Authority
DDWP
Departmental Development Working Party
ECRI
Emergency Care Research Institute, USA
EEC
European Economic Community
EDL
Essential Drug List
EMEA
European Medicines Agency
EPI
Expanded Immunization Program
ERP
Enterprise Resource Planning (Software)
EU
European Union
9
FABS
Financial Accounting & Budgeting System
FCPA
Foreign Corrupt Practices Act
FDA
Federal Drug Agency (United States)
FI
Financial (SAP)
FIDIC
Fédération Internationale Des Injéuneurs Conseils (International Federation
of Consulting Engineers), Geneva
FPPRA
Federal Public Procurement Regulatory Authority
KP
Khyber Pakhtunkhwa (Province)
GFR
General Financial Rules (AGPR)
GMP
Good Manufacturing Practices (for Pharmaceutical Industry)
Govt.
Govt. Of the Khyber Pakhtunkhwa
Govt-MCC
Government-Medicine Coordination Cell, DGHS
HIV
Human Immunodeficiency Virus
HMC
Hayatabad Medical Complex, Peshawar
IACCM
International Association of Commercial & Contract Management (EU/UK)
ICGFM
International Consortium on Governmental Financial Management
IFB
INOR
Invitation For Bids
Institute of Nuclear Oncology & Radiology, Abbottabad
INN
International Non-Proprietary Name
IRNUM
Institute of Radiology & Nuclear Medicines, Peshawar
KP
Khyber Pakhtunkhwa
KTH
Khyber Teaching Hospital, Peshawar
LHW
Lady Health Worker (Program)
LRH
Leady Reading Hospital, Peshawar
MoH
Ministry of Health (Federal Government)
MM
Materials Management (SAP)
MNCH
Mother Neo-natal Child Health (Program)
MS
Medical Superintendent (Administrative in charge of DHQ Hospitals)
MSD
Medical Store Depot, Health Department
NFC
National Finance Commission
NHS
National Health Service, UK
NWFP
North West Frontier Province
NIT
National Institute of Training, PPRA, Islamabad
OECD-DAC
Organization for Economic Cooperation & Development- Development
Assistance Committee
LMIS
Logistics Management Information System
PACP
Provincial Aids Control Program
PC
Project Coordinator (Vertical Programs)
PE
Procuring Entity
Public Expenditure & Financial Accountability
PEFA
10
PFM
PNAC
Public Financial Management
Provincial Health Services Academy, Peshawar
Project to Improve Financial Reporting & Auditing
Pakistan National Accreditatation Council
PPRA
Public Procurement Regulatory Authority
PPRs
Public Procurement Rules
PV
Product Vocabulary
PWD
Population Welfare Department
PDWP
Provincial Development Working Party
RHC
Rural Health Center
SAP
Systems Applications and Products in Data Processing
SBDs
Standard Bidding Documents
SID4Health
Supplier Information Database for Health, UK
SOPs
Standard Operating Procedures
TA
Technical Assistance
TRF
Technical Resource Facility
THQ
Tehsil Head Quarter Hospital
WHO
World Health Organization.
PHSA
PIFRA
3.
Executive Summary
Contextual Challenges to the Health Sector
Khyber Pakhtunkhwa is currently having the NWFP Procurement of Goods, Works and
Services Rules 2003 in vogue which seem outdated in the context of the Federal Public
Procurement Rules 2004 and the Provincial Procurement Rules of Sind & Punjab. Still the
11
Health Department Khyber Pakhtunkhwa has been engaged in the procurement of biomedical equipment and pharmaceutical products to the tune of Rs. 125 billion
approximately for the year 2012-13 under the said Provincial Rules.
In the wake of devolution of procurement functions by the 18th Constitutional Amendment
the procurement officials of the Health Department Khyber Pakhtunkhwa are very well
aware of the professional capacity needs to tackle such a voluminous purchasing
challenge. In order to get thoroughly acquainted to needs, technical possibilities and
market conditions for conducting this sensitive public sector operation, the Health
Department Khyber Pakhtunkhwa requested the Technical Resource Facility (TRF) to
initiate a Technical Assistance to strengthen its existing procurement systems and
increase the professional capacity of its procurement officials to meet the challenges of
achieving best value for money in a fair and transparent manner. The Procurement
System Assessment conducted by the TRF is therefore a way forward to indicate the
distortions in the current procurement business processes and suggest mitigating
strategies to improve the same.
Review of Existing Procurement Scenarios:
In the Review Section, the Assessment Report under reference gives the background of
Technical Assistance & a brief introduction of the TORs and the post-18th Amendment
devolution scenario in which the current procurement practices are being followed by the
procuring institutions of the Health Department Khyber Pakhtunkhwa. Though the current
District Government system has been abolished by Provincial Government vide
notification No. SO(E-I)/E&AD/4-49/2012, dated 28.12.2012, it may not have any
immediate significant change in the procurement practices prevalent in the Health
Department except for an anticipated outlay of funds at the disposal of the Health
Department for better annual procurement planning and the increased role of the Principal
Accounting Officer. However, the same is subject to any future review. The Review
Section under reference further elaborates the assessment methodology consisting of
OECD’s Base Line Indicators (BLIs) which have the capacity to be used in assessing the
national, sub-national and agency procurement systems with equal efficiency and
meticulous detail. The BLIs are based on four pillars relating to Legislative and Regulatory
Framework, Institutional Framework & Management Capacity, Procurement Operations
and Market Practices and lastly, Integrity and Transparency of a Public Procurement
System.
Strengths & Weaknesses of the Procurement System of DoH Khyber Pakhtunkhwa:
The four pillars contain various base line indicators which individually assess the strengths
and weaknesses of the Procurement System of Health Department Khyber Pakhtunkhwa
12
in terms of numerical scoring allocated to various parameters. Whereas the fourth BLI
relating to a public procurement regulatory authority in the domain of Institutional
Framework & Management Capacity could not be assessed due to absence of any such
body uptil now despite its notification by the Provincial Assembly vide Khyber
Pakhtunkhwa Public Procurement Regulatory Authority Act 2012 dated 20.09.2012, the
other BLIs were thoroughly assessed and scored against their benchmarks.
The graphical outcome of the strengths and weaknesses at page 14 of the Report
displays the state of affairs of the current procurement system of the Health Department
Khyber Pakhtunkhwa. Whereas the perfect square along the two axes shows an ideal
compliance to all the Base Line Indicators, the resulting geometric quadrilateral within the
perfect square along the same axes gives a snap of the extent of deviations or
shortcomings of the existing procurement business practices in the Department at the
Provincial level. The resulting quadrilateral shows a stronger side of the BLIs for the First
Pillar relating to Legislative and Regulatory Framework which scored well in the context of
achieving performance benchmarks largely attributed to a strong and robust regulatory
mechanisms for pre-qualification of pharmaceutical firms/bio-medical suppliers existing in
the Health Department Khyber Pakhtunkhwa and pre-notified/ well-structured
Departmental committees for bid evaluation.
The assessment of the Second Pillar relating to Institutional Framework & Management
Capacity displayed that the Province is weakest in institutional framework due to absence
of a public procurement regulatory body and lack of enforcement in developing systems
and procedures for collecting and monitoring provincial procurement statistics. Though the
planning side of the budgetary process in the Department strives to give a wellcoordinated picture of development funds appropriations against procurement initiatives,
absence of detailed procurement plans based on contract actions and lack of initiatives of
the Health Department towards imparting professional trainings in the public procurement
regulations to its employees engaged in purchasing function, has weekend this Pillar.
The assessment of the Third Pillar relating to Procurement Operations and Market
Practices gave an average impact due to absence of any planning towards matching skills
with the procurement assignments, but with somewhat sturdier private sector partnership
with the Health Department due to increase in the demand of pharmaceutical products
with the passage of time, and prevailing traditional but tested contract management
processes.
The assessment of the Fourth Pillar relating to Integrity and Transparency of the Public
Procurement System, gives an above average profile of performance for the procurement
system due to a strong vigilance and drug quality control enforcement by the Department.
13
However, absence of internal audit and a weak appeals mechanism did not let it gain any
significant score in this area.
The Assessment Report elaborates the major risks belonging to various regulatory,
institutional, process and operational aspects of the procurement life cycle in the Health
Department identified during the situational analysis. The said risks have been assessed
in terms of their relative importance, their strengths and probability of occurrence, and their
mitigating strategies duly chalked out to preserve the efficiency of the system.
In the end, certain institutional measures have been suggested for their likely
consequences for improving the efficiency of the system, e.g., a health sector procurement
supplement in the form of a Procurement Manual to be read in conjunction with the
prevailing purchasing regulations, developing a dedicated Human Resource Management
for the procurement life cycle, strengthening of the existing Logistics and Procurement
Cell at Directorate General Health Services and its functional attributes alongwith probable
staffing details, creation of a dedicated web-portal for Contract Lifecycle Management, and
recommendations on improving pharmaceutical warehousing and inventory management
operations and future strategies on procurement spend-trends of the Department.
Lastly, a Procurement & Contract Management Training calendar for the next six months
(January-June 2013) for Khyber Pakhtunkhwa Health Department procurement
professionals has been appended to render training to meet their specific capacity building
and mentoring needs.
Pillar-I
Legislative Framework
3.0
2.07
Pillar-IV
3.0
0
3.0 Pillar-II
14
Integrity & Transparency
2.0
0.91
Institutional &
Management Capacity
1.6
Province Score
Maximum Score
3.0
Pillar-III
Procurement Operations & Markets
Figure 5.9: Graphical Presentation of Strengths & Weaknesses of DoH Procurement System
In this graphic representation, scoring under each Pillar has been aggregated as a
simple arithmetical average of sub-indicators under the Pillar. The average scores for
each Pillar are compared to the maximum score of 3. The Province assessed is strongest
in Pillar I, but has weaknesses in the other three Pillars, with Pillar-II being the weakest.
15
4. Background
4.1: Technical Assistance
The Province of Khyber Pakhtunkhwa has assumed a daunting role in meeting the
challenges due to the enactment of 18th Amendment by National Assembly the form of
devolution of social sectors including health to provinces through abolition of concurrent
legislative list. As per the implementation plan, the Federal Ministry of Health has therefore
been abolished with effect from July 1, 2011 and except for Drug Licensing, Registration &
Pricing functions, export/import of goods and services to be retained as Federal functions
and keeping professional councils such as Pakistan Medical & Dental Council, Nursing
Council and Pharmacy Council as Federal entities, the initiatives like drafting and
enactment of health and procurement regulations, management of Vertical Programs and
initiation of Health Sector reforms, have become provincial subjects. The fiscal resources
for the said initiatives have also been diverted or, are being diverted to the Provinces with
more administrative control.
In the wake of the said development, the Health Department Khyber Pakhtunkhwa has to
shoulder now a far greater responsibility of providing an affordable health care system
which is easily accessible to the common man elsewhere in the Province. Administrative
and fiscal space of the Provinces has increased multi-fold with a simultaneously increase
in their responsibilities. In order to provide equitable, affordable and accessible health care
to the people, Provincial Governments need to re-align and re-adjust their health care
delivery systems, governance structures and financial allocations.
The Government of Khyber Pakhtunkhwa therefore requires adoption of a renewed
business process in procurement of Health Sector Goods to achieve an acquisition
lifecycle which addresses all the complex needs of the Health Sector purchasing while
keeping intact the requisites of integrity, transparency, fair play in the process and
providing equitable opportunity through open competition for the Health industry. The
Procurement System Assessment, initiated through the Technical Assistance of TRF
therefore strives to support the Khyber Pakhtunkhwa Health Department to establish
priorities for achieving best value for money in the purchasing perspective. The analysis
further identifies the areas wherein the Health Department may align its energies to
improve its procurement practices in view of Khyber Pakhtunkhwa Health Sector Strategy.
The enactment of Khyber Pakhtunkhwa Public Procurement Regulatory Authority
Ordinance 2012 by the Provincial Assembly has paved the way for the administrative
notification of Khyber Pakhtunkhwa Public Procurement Rules 2012 by the Provincial
Government in due course of time and has also made this assessment exercise
worthwhile in the wake of adoption of international best practices in procurement by the
16
Health Department to replace the outdated NWFP Procurement of Goods, Works &
Services Rules 2003. The Health Department therefore needs to be geared up in advance
by standardizing its procurement practices and bidding documents and prioritizing
necessary capacity building initiatives for its procurement officials in the light of
international best practices in public contracting.
4.2: Terms of Reference (TORs)
Main Objective
The main objective of this assignment is to provide support to the Health
Department, Government of Khyber Pakhtunkhwa and Health Programmes in all
issues related to procurement and to build institutional capacity in procurement
management.
Specific Objectives
Specifically the consultant will focus on:
i.
identification of weaknesses and gaps in the procurement system and
relevant supply chain issues of Health Department and health programmes of
Khyber Pakhtunkhwa through a detailed assessment;
ii.
development of action plan and strategy for implementation;
iii.
proper implementation of rules framed by the Government of Khyber
Pakhtunkhwa for ongoing procurement of goods, works and services and
consultancy services within the Health Department and health programmes;
with the prime purpose of effective, efficient and transparent procurement
system and processes;
iv.
development and adaptation of procurement documents; with proper
redressal of complaints mechanism;
v.
building capacity of procurement staff in procurement of goods, works and
consultancy services including recommendations for appropriate institutional
structures and mechanisms;
vi.
provide on-the-job support to the procurement staff in all steps of
procurement cycle;
vii. implementation of procurement monitoring mechanism and tools, within the
DOH and health programmes; and
viii. Coordination in implementation of procurement related Technical Assistance.
17
4.3: Organizational Structure of Health Department, Khyber Pakhtunkhwa
The Health Department has the following organizational structure in terms of
Procurements:
a. Health Secretariat, Peshawar:
All procurement related polices are developed and their administrative approval
conducted by the Health Secretariat. However, Secretary Health has little to do with
procurements except for acting as an approving body for the contract award
recommendations being chairman Selection (Purchase) Committee and acting as the
Principal Accounting Officer. The procurements are now totally dealt by the Director
General Health Services.
b. Director General Health
The office of the Director General Health Services procures medicines through a
Medical Coordination Cell (MCC) and bio-medical equipments/General Goods through
a newly established Procurement Cell based on the requirements received by the DG
office from various Districts & Vertical Programmes. The Procurement Cell, established
after the devolution of powers to the Provincial Government in the post-18th
Amendment era, centrally procures the bio-medical equipment for all the Districts by
conducting all the Pre-Award procurement planning, designing the Standard Bidding
Documents, conducting technical and financial evaluations, awarding the contract and
administering the post-award contractual relationships with the suppliers. The GovtMCC, on the other hand, is involved in the Pre-award planning, bidding documents
design , bid evaluation and subsequently awards the contract on unit rates prevailing
for the whole financial year for the selected drugs and surgical disposables for all the
field formations including EDOs (Health), MS DHQs, Autonomous Medical Institutions
(AMIs) etc which in turn conduct the post-award process by placing the Purchase
Orders themselves on need-bases during the whole year. Govt-MCC further aims at
supervising/coordinating the procurements conducted in the field after approval of the
Integrated PC-I which is meant to consolidate & centralize all divisional, regional and
Programme-oriented purchasing.
c. District Health Departments:
The Districts headed by EDOs (Health), are independent procuring entities and as per
the current policy of the Health Department these place Purchase Orders for
medicines/medical supplies on the basis of unit rates approved by the Govt-MCC & get
the bio-medical equipment centrally procured through the Procurement Cell at
Directorate General Health Services GHS as per the their requirements within the
available budget allocated to them. There are twenty five districts in Khyber
18
Pakhtunkhwa namely, Kohistan, Bannu, Chitral, Shangla, Tank, Haripur, Lakki Marwat,
Hangu, Karak, Dir Upper, Dir Lower, Nowshera, Swabi, Abbottabad, D.I. Khan,
Battagram, Buner, Mansehra, Tor Ghar, Charsadda, Malakand, Kohat, Mardan, Swat
and Peshawar.
d. District Headquarter Hospitals (DHQs):
Headed by the Medical Superintendents, the DHQs in all the Districts are under
administrative supervision of the EDOs (Health) but the Purchase Orders for delivery
of medicines & surgical disposables selected by the Govt-MCC under unit rate
contracting are placed by the respective Medical Superintendent DHQ.
e. Autonomous Medical Institutions (AMIs):
These Institutions are also independent procuring entities at the Provincial level
headed by Chief Executives and manage their procurements on the basis of unit rates
selected by the Govt-MCC as per their requirement & available budget within the
broader policy framework defined by the Health Department. AMIs may independently
procure around 40% of the total medicines which are not included in the Govt-MCC.
Their Board of Management governs matters related to Procurements.
f. Medical Colleges:
Medical colleges are headed by the Principals and the said entities independently
procure bio-medical equipment and laboratory chemicals for their college institutions
for educational and experimental purposes. The colleges follow a procurement
structure similar to the DGHS, with a T&E Committee, composed of concerned
Associate Professors & Professors for preparation of equipment specifications and
finalization of acquisition by a high-level Selection (Purchase) Committee headed by
the Principal of the College.
g. Health/Vertical Programmes:
Vertical Programs, also known as Stand-alone, Categorical or Disease Control
Programs, focus either on a specific disease or health issue or target a specific
demographic population. The underlying objective of Vertical Programs is to achieve
specific measurable outcomes within a given timeframe. Vertical Programs have
independent management and implementation structures headed by Program
Coordinators, which run parallel and in addition to the general health system of the
Health Department of Khyber Pakhtunkhwa. Vertical Programs have been mostly
Federally funded and procure their medicines specifically related to their scope based
on the pharmaceutical items selected by the Govt-MCC on unit rate contracting and
bio-medical equipment from special program funds. The Selection (Purchase)
19
Committee at the Health Department finalizes the procurement. Cessation of funding of
Vertical Programs through the PSDP after the tenure of 7th NFC Award in 2014 has led
to provincialize some of them while maintaining their vertical nature.
f. Special Projects: Special Projects like Aids Control obtain their funding from donors
and the Government. Their procurement methodology is similar to the Vertical
Programs.
g. HSRU: Health Sector Reform Unit, headed by Chief HSRU, is under Secretary
Health and procures its deliverables with the donor funds under the Multi-Donor Trust
Funds (MDTF), spearheaded by the World Bank. It is currently engaged in the
procurement of Management Services by hiring a Consulting firm under World Bank’s
Guidelines on Selection of Consultants. The said firm would provide integrated health
services on the basis of Public Private Partnership (PPP) to the six crises-stricken
districts in Khyber Pakhtunkhwa, namely Battagram, Buner, Dera Ismail Khan, Dir
Lower, Kohistan and Tor Ghar by upgrading the civil structures, power supplies,
transportation and bio-medical equipment etc. in the said Districts.
4.4 Procurement Entities of Health Department Khyber Pakhtunkhwa
Following is a list of the Procurement Entities of the Health Department involved in
Pre-Award, Award and post-Award activities:
1. Directorate General Health Services (DGHS), Department of Health, KP
(a) Procurement Cell
(b) Government- Medicine Coordination Cell (MCC)
2. Executive District Officer Health (EDO-H) – 25 Districts
3. District Headquarter Hospitals (DHQs) – 25 Districts
4. Vertical Programs/Projects
(a) Maternal Natal & Child Health Program
(b) National Program for Family Planning & PHC (LHW Program)
(c) EPI
(d) TB Control Program
(e) Roll Back Malaria
(f) PM’s Program for Hepatitis
(g) PACP / HIV
5. Autonomous Medical Institutions (AMIs)
20
(a) Khyber Teaching Hospital (KTH), Peshawar
(b) Lady Reading Hospital (LRH), Peshawar
(c) Hayatabad Medical Complex (HMC), Peshawar
(d) Ayub Teaching Hospital (ATH), Abbottabad
6. Medical Colleges
(a) Khyber Medical College (KMC), Peshawar
(b) Ayub Medical College (AMC), Abbottabad
(c) Khyber Girls Medical College (KGMC), Peshawar
(d) Khyber College of Dentistry (KCD), Peshawar
(e) Bacha Khan Medical College, Mardan
(f) Swat Medical College, Saidu Sharif, Swat
(g) Kohat Institute of Medical Sciences, Kohat
(h) Bannu Medical college, Bannu
(i) Khyber Medical University
7.
Health Sector Reforms Unit (HSRU), Health Secretariat, Peshawar
8.
Provincial Hospitals
(a) Mardan Medical Complex, Mardan
(c) Maulvi Ameer Shah Qadri Women & Children Hospital, GT Road, Peshawar
(d) Sifwat Gahyoor Memorial (Infectious Diseases) Hospital, Haji Camp,
Peshawar
(e) Naseer Ullah Babur Hospital, Kohat Road, Peshawar
(f) Govt Maternity Hospital, Hashtnagri, Peshawar
(g) Institute of Kidney Diseases, Hayatabad, Peshawar
(h) Govt Mental Hospital, Peshawar
(i) Khalifa Gulnawaz Memorial Hospital, Bannu
4.5: Procurement Practices in the Health Department, Khyber Pakhtunkhwa
The current procurement practices of the Health Department Khyber Pakhtunkhwa
are based on a matrix management system wherein the centralized procurements
are done by the two procuring units, namely the Govt-Medicine Coordination Cell
(MCC) and Procurement Cell located at the Directorate General Health Services
Peshawar.
The Govt-Medicine Coordination Cell (MCC) contracts out the unit rates of the
selected pharmaceutical products of the pre-qualified and lowest evaluated
responsive pharmaceutical firms and the bulk of the said products are in turn bought
by the 25 Health Districts for their respective BHUs and RHCs, Autonomous Medical
21
Institutions and Vertical Programs.
Before the establishment of Govt-MCC in 1996, medicines were provided to the
health institutions through Medical Stores Depot (MSD). The MSD was set up at
Peshawar more than 25 years ago to make bulk purchase of quality medicines in the
most economical manner ensuring their timely delivery to the Government health
institutions throughout the Province. Medicines upto Rs. 20 million were usually
purchased with no fixed time frame by the MSD and the rest by the Health
Department entities locally at different rates that stated to have led to financial
irregularities. Over a period of time, it failed to achieve its objectives and Audit raised
observations regarding mismanagement, sub-standard procurements, faulty
distribution, undue cost adjustments and storage shortages etc. MSD was finally redesignated as Government Medicine Coordination Cell (MCC) on 01.07.1996 vide
Health Department’s Notification No. SOH(V)9-5/96MCC dated 16.05.1996. The
Govt-MCC was supposed to annually conduct a centralized contracting of selected
pharmaceutical products through restricted competitive bidding engaging only those
pharmaceutical firms which were registered and pre-qualified annually by the
Directorate General Health Services. As the prevailing practice, an approved Drug
List comprising consolidated demand of medicines from all health institutions based
on last year’s purchase and with around 10% variation, is put to the above stated
restricted competitive tendering process wherein the firms with lowest rates may get
the single rate contract from the Directorate General Health Services. The said
products are in turn bought by the 25 Health Districts, Autonomous Medical
Institutions and Vertical Programs etc.
This hybrid contracting methodology under the devolution of power, gives autonomy
to the chief executives of the AMIs to the extent of procuring 40% of those
pharmaceutical products which are not included in the approved Drug List (Drug
Formulary) of the Govt-MCC; allows Program Coordinators of the Vertical Programs
to carry out procurements related to their Programs and allows Executive District
Officers (EDO) Health and Medical Superintendents DHQs to carry out their related
procurements for medicines and surgical disposables at District and District
Headquarter Hospital level respectively. The Departmental entities in the form of
Preliminary Scrutiny Committee, Comparative Statement Committee, Technical &
Evaluation Committee and finally the Selection (Purchase) Committee, as discussed
later, are part of the whole purchasing life cycle.
The Procurement Cell, created vide DGHS Notification No. 10760-67/Personnel,
dated 30.12.2011, is supposed to purchase bio-medical equipment and occasional
non-Govt-MCC drugs on the basis of requirements sent by the Health Districts and
22
DHQs. As per the said notification, the Cell is headed by a Deputy Director (Admn)
and
manned
by
an
Assistant
Director
(Admn),
Superintendent
Complaint/Coordination Cell DGHS Office, Superintendent Accounts Section, DGHS
and a Computer Operator. With the two top tiers of the Cell nowhere in sight, the
potential of the Cell seems underutilized and under-staffed keeping in view the
significantly important functions and sensitive tasks of gathering the requirements of
the Health Districts, technical specification preparation and conducting procurement
of bio-medical equipment.
Procurement demand is prepared and submitted as a component/scheme of the
Annual Development Plan (ADP) of the Health Department. The demand is
submitted to the Health Secretariat. Specifications and requirements are prepared by
the end users which get approved by the Departmental Technical Committee.
Equipment is purchased under National Competitive Bidding by the Procurement
Cell. The purchased equipment is then delivered to the hospital/district. The
Technical Committee may physically inspect the equipment before final selection
according to the specifications mentioned in the tender. The Technical Committee,
headed by the Director General Health Services is composed of concerned Head of
Department of the medical institution and executive engineer of electro-medical
workshop etc. Purchases recommended by the Technical Committee are approved
by the Departmental Purchase (Selection) Committee. Purchase of minor equipment,
purchase of special drugs and medicines which are not a part of the regular hospital
supply are purchased through the process of local purchase.
5
Section-1: Situational Analysis & Assessment of Existing
Procurement Procedures and Procuring Entities of Health
Department Khyber Pakhtunkhwa
5.1 Assessment Methodology
Under the auspices of the joint World Bank and OECD Development Assistance
Committee (DAC) Procurement Round Table initiative, developing countries, bilateral
and multilateral donors worked together to develop a set of tools and standards that
provide help in assessing the quality and effectiveness for improvements in
procurement systems. The Round Table initiative culminated with the December
2004 adoption of the "Johannesburg Declaration" including a commitment for the
adoption of the Baseline Indicators (BLIs) as the agreed international standards for
assessment of national, sub-national and agency procurement systems.
23
The application of the BLIs used in the subject Assessment is based on a review of
the existing regulatory framework and the procurement related institutional and
operational arrangements in Health Department Khyber Pakhtunkhwa. The BLIs are
based on four main pillars and consist of 12 indicators. Each indicator has been
further divided into four to six sub-indicators and each having a table containing four
scenarios. Each baseline sub-indicator is preceded by a short text explaining those
aspects that the sub-indicator has attempted to assess and some considerations
about the nature and importance of the item in question. Through this short text the
relevant aspects have been reviewed whether the acceptable standard has been
achieved or not. After the description of the sub-indicator, scoring against a particular
scenario has been done in the table. The scoring system ranges from 3 to 0 for each
baseline sub-indicator. A score of 3 indicates full achievement of the stated standard.
A score of 2 has been given when the system has exhibited less than full
achievement and needs some improvements in the area being assessed and a score
of 1 has been given for those areas where substantive work is needed for the system
to meet the standard.
A rating of 0 has been considered as the residual indicating a failure to meet the
proposed standard. The score for each sub indicator has been a whole number from
0 to 3. Based on subjective professional judgment by the assessor, the BLI scores
will therefore be part of a narrative report providing information on changes that are
underway, but have not yet impacted the system sufficiently to change the score.
This narrative discussion has enabled the said assessment to provide information
that could not be easily reflected in numeric scoring.
The assessment through BLIs aims at providing a basis upon which Khyber
Pakhtunkhwa Province can formulate an institutional and capacity development plan
to improve its procurement system with a long-term goal to meet internationally
recognized standards which would enable greater effectiveness in the use of public
funds to meet Provincial obligations. The methodology includes a numeric scoring
with defined criteria that will provide a qualitative grading of the Health Department’s
procurement system by identifying its strengths and weaknesses. By aggregating the
scores at the pillar level a graphical profile of strengths and weaknesses of the
Procurement system of Health Department Khyber Pakhtunkhwa has been obtained
and is displayed at the end of Section-5. The information resulting from the said
assessment would provide the Province with information it can use to monitor the
performance of its current system and the success of the reform initiatives in
improving its business processes.
24
5.2 Introduction of Factors assessed under the Methodology
This part of the report relates to the assessment of procurement systems within the
Department of Health, Government of the Khyber Pakhtunkhwa. The assessment
was conducted as required by the TORs of the Technical Assistance-52:
Strengthening the Procurement Systems through Support and Capacity Building of
Health Department, Khyber Pakhtunkhwa for identifying gaps in the provincial
legislative framework and Departmental business processes with particular focus on:
i.
ii.
iii.
iv.
v.
vi.
vii.
viii.
Existing procurement procedures and steps being followed by the DoH entities
Extent of applicability of NWFP Procurement of Goods, Works & Services Rules
2003 in the procurement system of the DoH Khyber Pakhtunkhwa
Review of each step of the procurement cycle of the Health Department from
planning till the award of contract
Evaluation of levels of public access and transparency in the procurement
process, contract management mechanisms and techniques in vogue.
Review of the Supply Chain of the Department of Health Khyber Pakhtunkhwa
and identification of gaps, if any, and their plugging measures.
Review of Procurement documentation currently used by the Department of
Health.
Establish supplier’s issues and concerns related to procurement process and
obtain their opinions for more effective procurement.
Review of contract management and disputes resolution.
Following were the four main pillars under which the above stated factors were
assessed through various Base Line Indicators:
a) Existing legal framework that regulates procurement in the Province;
b) Institutional architecture of the Procurement System;
c) Operation of the System and competitiveness of the national market; and
d) Integrity of the Procurement System.
5.3 Sampling Statistics:
The information collected is based on document reviews, key informant interviews,
collection of data from existing records, and perspective observations. The interviews
were carried out with around 15 personnel related to the DoH, one District, four
Vertical programs and Pharmaceutical & Bio-medical equipment suppliers etc. The
25
interview were carried out with respect to the BLI sub-indicators and on specific
questionnaires developed for data collection.
5.4 Limitations & Constraints:
1.
The reliability and integrity of information collected for the Assessment was
based on the record & information provided by the Health Department.
2. Indicator-4 of Pillar-II relates to the existence of a Public procurement Regulatory
Authority in the Khyber Pakhtunkhwa Province. Until the said regulatory body is
starts functioning and exerts its influence on the Procurement System of the
Health Department for a significant outcome, it remains out of the subject
discussion and has therefore been rated as zero.
26
5.5 Purview of the Assessment Scores:
Pillar &
Indicator
Sub-Indicator
Score
Sub-Indicator
Pillar I: The legislative and regulatory framework
Indicator 1: Public procurement legislative and regulatory framework complies with applicable obligations with
regard to national and international requirements
1(a): Scope of application and coverage of the legislative and regulatory framework
2
1(b): Procurement methods
2
1(c): Advertising rules and time limits
2
1(d): Rules on participation
2
1(e): Tender documentation and technical specifications
3
1(f): Tender evaluation and award criteria.
3
1(g): Submission, receipt, and opening of tenders
2
1(h): Complaints
2
Indicator 2: Existence of implementing regulations and documentation
Averaged
for Pillar &
Indicator
2.07
2.25
1.83
2(a): Implementing regulations that provide defined processes and procedures not
included in higher- level legislation
1
2(b): Model tender documents for goods, works, and services
2
2(c): Procedures for prequalification
3
2(d): Procedures suitable for contracting for services or other requirements in which
technical capacity is a key criterion
1
2(e): User’s guide or manual for contracting entities
2
2(f): General conditions of contracts for public sector contracts covering goods,
works, and services consistent with national requirements and, when applicable,
international requirements
2
Pillar II: Institutional framework and management capacity
0.91
Indicator 3: The public procurement system is mainstreamed and well integrated into the public sector governance
system
2.75
Indicator 4:
3(a): Procurement planning and associated expenditures are part of the budget
formulation process and contribute to multiyear planning
3
3(a): Procurement planning and associated expenditures are part of the budget
formulation process and contribute to multiyear planning
3
3(c): No initiation of procurement actions without existing budget appropriations
3
3(d): Systematic completion reports are prepared for certification of budget execution
and for reconciliation of delivery with budget programming
2
The province has a functional normative and/or regulatory body
0
4(a): The status and basis for the normative and/or regulatory body is covered in the
legislative and regulatory framework
0
4(b): The body has a defined set of responsibilities
0
4(c): The body’s organization, funding, staffing, and level of independence and
authority sufficient and consistent with the responsibilities
0
4(d): The responsibilities should also provide for separation and clarity so as to avoid
conflict of interest and direct involvement in the execution of procurement
transactions
Indicator 5: Existence of institutional development capacity
0
0
27
5(a): The province has a system for collecting and disseminating procurement
information including tender invitations, requests for proposals, and contract award
information
0
5(b): The province has systems and procedures for collecting and monitoring
provincial procurement statistics
0
5(c): A sustainable strategy and training capacity exists
0
5(d): Quality control standards are disseminated and used to evaluate staff
performance and address capacity development issues
0
Pillar III: Procurement operations and market practices
1.6
Indicator 6: The provincial procurement operations and practices are efficient
0.75
6(a): The level of procurement competence among government officials within the
entity is consistent with their procurement responsibilities
0
6(b): The procurement training and information programs for government officials and
for private sector participants are consistent with demand
0
6(c): There are established norms for the safekeeping of records and documents
related to transactions and contract management
1
6(d): There are provisions for delegating authority to others who have the capacity to
exercise responsibilities
2
Indicator 7: Functionality of the public procurement market
2.33
7(a): There are effective mechanisms for partnerships between the public and private
sector
2
7(b): Private sector institutions are well organized and able to facilitate access to the
market
3
7(c): There are no major systemic constraints (e.g., inadequate access to credit,
contracting practices, etc.) inhibiting the private sector’s capacity to access the
procurement market
2
Indicator 8: Existence of contract administration and dispute resolution provisions
2.0
8(a): Procedures are clearly defined for undertaking contract administration
responsibilities that include inspection and acceptance procedures, quality control
procedures, and methods to review and issue contract amendments in a timely
manner
2
8(b): Contracts include dispute resolution procedures that provide for an efficient and
fair process to resolve disputes arising during the performance of the contract
1
8(c): Procedures exist to enforce the outcome of the dispute resolution process
3
Pillar IV: Integrity and transparency of the public procurement system
2.0
Indicator 9: The province has effective control and audit systems
1.59
9(a): A legal framework, organization, policy, and procedures for internal and external
control and audit of public procurement operations are in place to provide a
functioning control framework
2
9(b): Enforcement and follow-up on findings and recommendations of the control
framework provide an environment that fosters compliance
2
9(c): The internal control system provides timely information on compliance to enable
management action
3
9(d): The internal control systems are sufficiently defined to allow performance audits
to be conducted
0
9(e): Auditors are sufficiently informed about procurement requirements and control
systems to conduct quality audits that contribute to compliance
1
Indicator 10: Efficiency of Appeals Mechanism
10(a): Decisions are deliberated on the basis of available information, and the final
decision can be reviewed and ruled upon by a body (or authority) with enforcement
capacity under the law
2.19
2
28
10(b): The complaint review system has the capacity to handle complaints efficiently
and a means to enforce the remedy imposed
2
10(c): The system operates in a fair manner, with outcomes of decisions balanced
and justified on the basis of available information
10(d): Decisions are published and made available to all interested parties and to
the public
3
10(e): The system ensures that the complaint review body has full authority and
independence for resolution of complaints.
3
1
Indicator 11: Degree of access to information
11(a): Information is published and distributed through available media with support
from information technology when feasible
2.0
2
Indicator 12: The Province has ethics and anticorruption measures in place
2.14
12(a): The legal and regulatory framework for procurement, including tender and
contract documents, includes provisions addressing corruption, fraud, conflict of
interest, and unethical behavior and sets out (either directly or by reference to other
laws) the actions that can be taken with regard to such behavior
3
12(b): The legal system defines responsibilities, accountabilities, and penalties for
individuals and firms found to have engaged in fraudulent or corrupt practices
2
12(c): Evidence of enforcement of rulings and penalties exists
3
12(d): Special measures exist to prevent and detect fraud and corruption in public
procurement
1
12(e): Stakeholders (private sector, civil society, and the ultimate beneficiaries of
procurement and/or end-users) support the creation of a procurement market known
for its integrity and ethical behavior
2
12(f): The province should have in place a secure mechanism for reporting
fraudulent, corrupt, or unethical behavior
2
12(g): Existence of codes of conduct or codes of ethics for participants that are
involved in aspects of the public financial management systems that also provide for
disclosure for those in decision-making positions
2
29
5.6 Pillar I – Legislative and Regulatory Framework
Indicator-1: Public procurement legislative and regulatory framework achieves the agreed
standards and complies with applicable obligations.
The indicator covers the legal and regulatory instruments from the highest level (national
law, act, regulation, decree, etc.) down to detailed regulation, procedures and bidding
documents formally in use. This indicator is broken down into eight sub-indicators (a-h)
which are individually scored.
Sub-indicator 1(a) – Scope of application and coverage of the legislative and
regulatory framework (For Directorate General Health Services, Vertical Programs
& AMIs).
The said sub-indicator determines:
a) The structure of the regulatory framework governing the public procurement;
b) The extent of its coverage; and
c) The public access to the laws and regulations
After the abolition of concurrent legislative list through 18th Amendment in the Constitution
of Pakistan, the NWFP Procurement of Works, Goods & Services Rules 2003 promulgated
through NWFP Procurement of Works, Goods and Consultancy Ordinance 2002 are in
vogue. The said Rules originated in 2003 for procurement of civil works, supply of general
goods and consultancy services and were oriented towards construction works and related
supplies by the civil contractors and general suppliers. Though covering most of the
procurement functions at that point of time and spearheading the procurement legislation
in the Country, the said Rules now seem deficient in various aspects relating to
procedures and thus suffer structural infirmities in view of the evolution in international
Procurement Law. Clauses relating to some of the procedures in the said Rules e.g.,
submission of bid security, negotiations on financial bids and contracting methodologies
treat the subject matter inadequately and are not in line with current international best
practices or with procurement practices prevalent at the Federal level; and are also in
conflict with donor Guidelines on certain aspects. The said NWFP Procurement Rules
2003 are not designed to address the particular needs of procurement of specialized items
30
like drugs, vaccines and surgical disposables wherein product efficacy plays major role in
evaluating the quotes offered. Acquisition of Bio-Medical equipment further requires welldefined product specifications for which these rules provide no viable mechanism to
deliberate upon any product definition.
The Directorate General Health Services (DGHS), Health Department Khyber
Pakhtunkhwa located at Health Secretariat Peshawar, had been previously engaged in
procuring the medicines and bio-medical equipment through a three-page Bidding
Document alongwith an approved drug list/formulary on the basis of single Stage Single
Envelop bidding procedure. Under the judicial directives in Writ Petition No. 3192/2010
dated 15.05.2012 of the Honourable Peshawar High Court to clearly define its
procurement policy and post it on DoH website, the Department, in 2012, decided to
conduct procurement of bio-medical equipment and drugs through Two-Stage Tendering
Process under Rule-40 of the NWFP Procurement rules 2003. It therefore adopted semistructured bidding documents based on a sample WHO template for procurement of BioMedical equipment in May 2012 for conducting procurements under the said Rules.
Recently, the procurement of drugs Surgical Disposables have also been tendered in
August 2012 through the fully structured revised Standard Bidding Documents, based on
internationally recognized FIDIC templates as per the said Rules under Two Envelop
Tendering process and the unit rates for the selected drugs have been finalized and
circulated among all the related procuring entities by the Govt-MCC for the whole
Province. Similarly, Vertical Programs relating to the Maternal Natal and Child Health
(MNCH) in the Province has also taken its procurement initiative for the acquisition of
CMW Kits for the Health districts by adopting the above stated revised Standard Bidding
Documents in September 2012 under the said Rules. Accordingly, Technical & Evaluation
(T&E) Committee and Selection (Purchase) Committee, officially nominated by the office
of Secretary Health for bid evaluation and contract award, have finalized the said activity.
Surprisingly, some provincial procuring entities like the Autonomous Medical Institutions
(AMIs) e.g., Lady Reading Hospital Peshawar are still not following the business
processes under the said Rules and are acquiring non-drug surgical disposables through
the old three-page single stage single quotation system despite Honourable Peshawar
High Court’s order on Suo Moto action in Writ Petition No. 3192/2010 dated 15.05.2012 to
adopt a clear procurement policy by using the detailed Standard Bidding Documents.
The NWFP Procurement Rules 2003 draw their strength from Section 45 of the North
West Frontier Province Procurement of Goods, Works & Consulting Services Ordinance,
2002. The adequacy of the structure of the said regulatory framework is enshrined in the
NWFP Procurement Rules 2003 and may be rated as bare minimum for procurement
activities in the Health Department. That is why Standard Bidding Documents, based on
internationally recognized FIDIC templates, have been adopted and customized as per the
31
requirements of the health sector purchasing. The regulatory framework in the form of
NWFP Procurement Rules 2003 contain as an Appendix, the General Principles for
Evaluation of Application for Pre-Qualification and Technical Bids for Post-Qualification,
which elaborate the evaluation process of the bids received in three stages. These
Principles, as their name suggests, are just procedural guidelines for the evaluation
committees to harmonize their efforts towards achieving their goal through some standard
practices. The regulatory impact of the said principles is not defined in the Procurement
Rules 2003.
The uniformity of coverage of the current legal framework in the form of NWFP Rules 2003
is therefore not fully applicable on the procurement activities related to health-sector goods
initiated by the Health Department entities using public funds. Presently, no administrative
approval is in place for excluding any autonomous entity related to Health Department KP
from adoption of Standard Bidding Documents and two envelop tendering as per Rule 40
of NWFP Procurement Rules 2003. This may contribute to unpredictability and distortion in
the new business processes adopted by the Health Department and may add to excessive
costs in the operation of the procurement system.
NWFP Procurement of Works, Goods & Services Rules 2003, while having been
published in NWFP Local Government Planning Manual in 2003, are neither publicly
accessible on any web-portal of Health Department KP nor on the Government of Khyber
Pakhtunkhwa website which displays only North-West Frontier Province Procurement of
Goods, Works, Services and Consulting Services Ordinance, 2002. It is worth mentioning
that the said website hosts more than 900 different public rules, regulations, acts & laws
made since 1798 till 2008 spanning over two hundred years. While having met
procurement officials of many autonomous entities of Health Department, it was revealed
that they seldom have the copies of the NWFP Procurement Rules 2003.
Scoring criteria
Score
The legislative and regulatory body of norms complies with all the following conditions:
(a)
Is adequately recorded and organized hierarchically (laws, decrees, regulation
procedures,) and precedence is clearly established. All laws and regulations are
published and easily accessible to the public at no cost.
(b)
All laws and regulations are published and easily accessible to the public at no cost
(c)
It covers goods, works and services (including consulting services) for procurement
using national budget funds.
The legislative and regulatory body of norms complies with (a) plus one of the above
conditions
3
2
32
The legislative and regulatory body of norms complies with (a) of the above conditions.
1
The system does not substantially comply with any of the above conditions. .
0
Sub-indicator 1(b) – Procurement Methods:
This sub indicator assesses whether the legal framework includes:
a) a clear definition of the permissible procurement methods; and
b) the circumstances under which each method is appropriate.
The legal framework provided by the NWFP Procurement of Works, Goods and Services
Rules 2003 makes, under Rule 7, open competitive tendering the default method of
procurement in Khyber Pakhtunkhwa Province. All procurements exceeding financial
thresholds of Rs 5 million for contracts of non-development works, and those exceeding
Rs 10 million for contracts of development works need pre-qualification or postqualification of suppliers or contractors with unlimited participation. Pre-qualified
suppliers or contractor offer their technical and financial proposals as per Rule 40 under
the Two Envelop Single Stage Tendering procedure which is a restricted tendering
process if only pre-qualified bidders participate as opposed to post-qualification.
However, opportunity to get pre-qualified in Khyber Pakhtunkhwa Province Health
Department is open to firms all across the Country. Rule 35 further defines the types of
contracts with estimated costs ranging from Rs 40,000 to Rs 5,00,000 to attract Request
For Quotation (RFQ) procedure with a minimum of three quotations / bids and
prohibits fractioning of contracts to avoid open competition. The Health Department
Khyber Pakhtunkhwa abides by the stated financial thresholds for competitive bidding.
Rule 36, 38 & 39 define the non-competitive procedures relating to Single Source
Procurement, Repeat Orders and Restricted Tendering respectively under specific
circumstances. Financial negotiations are allowed under Rule 37 upon approval from the
Procuring Entity to safeguard against quoting of exorbitant prices in Single Source
Selection procedure. Currently financial negotiations are considered inconsistent with
the appropriate international standards for competitive bidding and are apparently not
being used by the Health Department Khyber Pakhtunkhwa. Interestingly, the language
regarding prohibition of financial negotiations in the Khyber Pakhtunkhwa Public
Procurement Rules 2012 expected to be notified by the Government soon, also seems to
bear the seeds of NWFP Procurement Rules 2003 and is considered lenient compared
to the Federal PPRA Rules 2004.
There is no specific law or set of rules supplemental to procurement of health-sector
goods. Drugs & surgical disposables are purchased in line with the Drug Act 1976 and
33
NWFP Procurement Rules 2003. As per Rule 4 the NWFP Procurement Rules 2003,
procurement of essential items & goods of immediate nature, in case of emergency, is to
be carried out by a committee consisting of District Coordination Officer, District
Revenue & Estate Officer and Executive District Officer (Finance & Planning) by utilizing
non-competitive contracting methods under Rules 36, 38 & 39 of the NWFP
Procurement Rules 2003. The said procedure is not being followed by the AMIs and
direct administrative sanction of Secretary Health is the sole means to tackle urgent
procurements through frequent purchase orders in emergency situations from the
Emergency Relief Package (ERP) Funds. Sometimes, in case of more emergencies,
funds from the regular budgets for the AMIs are transferred to the ERP funds with
approval of the Competent Authority. The above said transient practice is not in line with
the afore-stated Rule 4 which may be due to the peculiar nature of emergencies in the
hospitals owing to the law & order situation in the Province and wherein timely decisionmaking of such committees may be of little use. However, this may also relate to the
absence of a revised procedural setup after the devolution of powers to the Provinces
under the 18th Constitutional Amendment.
Appropriate hierarchical levels have been established in the Health Department Khyber
Pakhtunkhwa through various Departmental committees consisting of health sector
professionals namely, Pre-Qualification Committee, Scrutiny Committee, Comparative
Statement (CS) Committee, Technical & Evaluation Committee and lastly the Purchase
Committee to examine the bids under a competitive bidding method. Composition of the
said committees for a typical activity regarding procurement of drugs and medicines is as
under:
34
Committee Composition for Govt-MCC Procurements of Drugs
Pre-Qualification Committee:
S.No
Designation
1.
Additional Secretary (Dev) Health KP / DGHS KP / Medical
Superintendent LRH Peshawar / Director Admn, DGHS KP
Chairman
2.
Professor of Surgery LRH Peshawar
Member
3.
Professor of Medicines LRH Peshawar
Member
4.
Deputy Secretary (Budget), Health Department, Peshawar
Member
5.
Chief Drug Inspector Peshawar
Member
6.
Deputy Director Pre-Qualifications
Member
7.
Pharmacist, Govt-MCC, DGHS
Member
8.
Drug Inspector, EDO (Health) Peshawar
Member
Functions:
1. Visit business premises of manufacturers and importers of pharmaceutical products
and bio-medical equipment all across the Country.
2. Submit Inspection Report to the Chairman Technical & Evaluation Committee within
three days of inspection for evaluation of firms for pre-qualification.
A typical Pre-Qualification Committee is mostly composed of 4-6 members selected from
among the designations mentioned above for different industrial estates in the Province
and the Committee may further divide the areas amongst sub-committees made from its
members.
Technical Bids Scrutiny Committee:
S.No
1.
2.
3.
4.
5.
Designation
Deputy Director Administration DGHS KP
Drug Inspector, EDO (Health) Peshawar
Chief Pharmacist Lady Reading Hospital Peshawar
Section Officer (Drugs), DoH, Peshawar
Pharmacist Govt-MCC, DGHS
Functions:
Chairman
Secretary Member
Member
Member
Co-opted Member
35
1.
Carry out preliminary screening of the Technical bids received from the pre-qualified
bidders and develop their risk profiles in view of the documentation contained in the
Technical Bids.
2.
Point out the deficiencies in secondary documentation and recommendation to the
Technical & Evaluation Committee for taking appropriate action in this regard.
3.
The committee after carrying out the preliminary screening, submits the report to the
Chairman Technical & Evaluation (T&E) Committee for detailed evaluation of the Technical
Bids by the T&E Committee.
4.
With the recent, introduction of the new Standard Bidding Documents for procurement of
Drugs & Surgical Disposables, the Scrutiny Committee does all the preliminary screening
and risk profiling of the Bidders and the products offered by them by sifting out relevant
data required by the SBDs, getting the secondary documentation completed by the bidders
and preparing bidders’ corporate and product snapshots on the standard prescribed
Evaluation Proformas for the four specific categories of suppliers, namely manufacturers of
general products, manufacturers of biological products, importers of general products and
importers of biological products. The Preliminary Scrutiny Committee then submits
screened profiles of bidders and their products to the T&E Committee thereby informing
them of bidders’ preliminary compliance with the technical evaluation criteria with
recommendations on certain technical aspects of the bids for taking decision. This
facilitates the T&E Committee to conduct a detailed evaluation of the technically qualified
bidders.
Comparative Statement (CS) Committee
S.No
1.
2.
3.
4.
Designation
Deputy Director Personnel DGHS KP
Deputy Secretary Budget DGHS KP
Section Officer Drugs Health Department KP
Pharmacist, Govt-MCC KP
Chairman
Secretary Member
Member
Member
Functions:
1. Prepares a Comparative Statement (CS) of quotations after public opening of the
financial bids of the technically qualified bidders by the Technical & Evaluation (T&E)
Committee.
2. Submits the CS to the Chairman Technical & Evaluation Committee for approval of
Selection (Purchase) Committee.
Technical & Evaluation (T&E) Committee:
S.#
1.
Designation
Additional Secretary(E&A), Govt: of Khyber Pakhtunkhwa
Chairman
36
2.
3.
4.
5.
6.
7.
8.
DGHS KP
Professor of Medicine, LRH
Professor of Surgery, LRH
Representative from Pharmacy Department, University of Peshawar
Senior Hospital Pharmacist, Kohat / Bio-medical Engineer DGHS KP
Deputy Secretary (Drugs)
Medical Superintendent, LRH, Peshawar
Secretary Member
Member
Member
Member
Member
Member
Member
Functions:
1. Carries out evaluation of different manufacturers and importers of drugs/bio-medical
equipment for pre-qualification for the purpose of Govt-MCC or DGHS Procurement Cell as
and when required.
2. Submits pre-Qualification Report to the Chairman Purchase Committee for approval.
3. Constitutes Technical Bids Scrutiny Committee or Comparative Statement Committee for
preparation of Comparative Statement for approval of the Purchase Committee.
4. Co-opts any person considered relevant to the process of evaluation.
5. Opens financial bids for selecting the lowest rates for drugs and bio-medical equipment
quoted by pre-qualified firms under centralized rate selection régime.
6. Carries out clinical trials of drugs of various brands/types prior to selection of the drugs by
the Technical Bids Scrutiny Committee of Govt-MCC and instrument testing of bio-medical
equipment.
7. Performs any other task, if assigned.
8. Requires two third of its members to convene its meetings.
Selection (Purchase) Committee:
S.No
1.
2.
3.
4.
5.
6.
7.
8.
9.
Members
Secretary Health, Khyber Pakhtunkhwa
Additional Secretary Health (Dev), Khyber Pakhtunkhwa
Director General Health Services, Khyber Pakhtunkhwa /Officer
Incharge
Professor of Medicine, HMC
Professor of Surgery, LRH
Professor of Gynaecology & Obstetrics
Professor of Pharmacology from any public sector Medical College.
Chief Pharmacist, Lady Reading Hospital Peshawar
Chief Drug Inspector, DGHS, Peshawar
Chairman
Vice Chairman
Secretary
member
Member
Member
Member
Member
Member
Member
Functions:
1) Approves pre-qualification of firms for Govt-MCC.
2) Approves pre-qualification of suppliers of Bio-Medical Equipment
3) Selects & approves pharmaceutical and bio-medical products and their rates from technically
qualified firms for Govt-MCC and Procurement Cell.
37
4) Co-opts any person considered necessary for carrying out the purpose of the
Committee.
The above said committees are officially notified by Secretary Health annually though their
composition mostly remains the same with addition or replacement of some technical or
administrative entity. These committees tend to reasonably control and minimize the
discretion of individual agencies or procurement officials in using the methods that limit
competition.
Committee Compositions for Procurement Cell Procurements for Bio-Medical
Equipment etc.:
Equipment & Instruments Committee:
S.No
Designation
1.
Additional Secretary (Dev) Health KP
Chairman
2.
Chief Drug Inspector Peshawar
3.
Bio-Medical Engineer
Secretary
Member
Member
4.
MS HMC
Member
5.
MS KTH
Member
6.
MS LRH
Member
/
Functions:
1. Pre-Qualification of firms producing non-drug surgical disposables & Bio-Medical equipment.
2. Visit business premises of manufacturers and importers of pharmaceutical products
and bio-medical equipment
3. Submit Inspection Report to the Chairman Technical & Evaluation Committee within
three days of inspection for evaluation of firms for pre-qualification.
Inspection Committee:
S.No
Designation
1.
Senior Planning Officer-I
Chairman
2.
Concerned MS of Hospital
3.
Concerned EDO (H) of the District
Secretary
Member
Member
4.
Concerned Engineer of electro-Medical workshop
Member
/
38
Functions:
1. Inspect the equipment purchased under the Development Schemes/Projects/Programs.
2. Check the installation & Commissioning of equipment
3. Check the operationalization of the equipment & submit report to the Provincial
Technical committee & Provincial Purchase Committee.
4. Check record of payment in respect of procurement of equipment by the
MS/EDO(H)/PM/PD/Coordinator
5. Recommend disciplinary action against the MS/ EDO(H)/PM/PD/Coordinator
concerned in case of payment before the supply or operationalization of the equipment.
Technical Committee:
S.No
Designation
1.
Director Public Health, DGHS, Peshawar
Chairman
2.
3.
Concerned Head of Department of LRH & KTH or their Secretary
representatives not below the rank of Associate Professors & KCD Member
in case of dental departments.
Executive Engineer Electro-Medical Equipment Workshop
Member
4.
Any other co-opted member expert in the field
/
Member
Functions:
1. Preparation of Technical Specifications
2. Evaluation of Technical Bids
3. Inspection of Samples (if required) before final selection
4. Submission of final Technical & evaluation report within prescribed period to the
Purchase Committee for final approval.
5. Ensure technical Evaluation of non-Govt-MCC drugs / drugs not quoted by bidders /
included in PC-I, to ease process of procurement of drugs
Purchase Committee:
S.No
Designation
1.
Secretary Health
Chairman
2.
Director General Health Services
3.
Chief Planning Officer, Health Department
Secretary
Member
Member
4.
Project Coordinator/MS/EDO (H)
Member
/
39
5.
Assistant Project coordinator
Member
6.
Any Co-opted member
Member
Functions:
The Committee shall follow the procurement guidelines of the NWFP Procurement rules
2003 and World Bank Guidelines for procurement of MTDF Project.
Scoring criteria
Score
The legislative and regulatory body of norms complies with all the following conditions:
(a)
(b)
(c)
(d)
Allowable procurement methods are established unambiguously at an appropriate
hierarchical level along with the associated conditions under which each method may be
used, including a requirement for approval by an official that is held accountable.
Competitive procurement is the default method of public procurement.
3
Fractioning of contracts to limit competition is prohibited.
Appropriate standards for international competitive tendering are specified and are
consistent with international standards
The legal framework meets the conditions of (a) and (b) plus one of the remaining
conditions.
The legal framework meets the conditions of (a) and (b).
The legal framework fails to substantially comply with any three of the conditions a) through d).
2
1
0
Sub-indicator 1(c) – Advertising Rules and Time Limits
This sub indicator assesses whether:
a) the legal framework includes requirements to publish contract awards as a matter of
public interest and to promote transparency;
b) there is wide and easily accessible publication of business opportunities; and,
c) there is adequate time provided between publication of opportunities and submission
date, consistent with the method and complexity of the procurement, to prepare and
submit proposals.
Rule 11(3) of the NWFP Procurement Rules 2003 permits the Tender Inviting Authority to
provide atleast fourteen days as minimum time between publication of Notice for PreQualification in two national dailies and the submission of Pre-qualification documents. In
case of any clarification sought by a contractor or supplier, the Tender Inviting Authority
responds to the said request atleast seven days prior to the deadline of submission of the
40
application to pre- or post-qualify. The Health Department abides by the stated time limits
in the pre-qualification procedures.
Rule 20 (1) of the said Rules allows a minimum of thirty days between date of publication
of the Tender Inviting Notice (term used in the Rules for the Invitation For Bids) and
submission of bids / proposals. However, its sub-clause (2) authorizes head of the
Procuring Entity to reduce this mandatory time for reasons to be recorded in writing. As
observed, this sub-clause has been used to reduce this time to fourteen days or even one
week in most of the procurement instances by the procuring entities of the Health
Department either owing to meeting an acquisition deadline or some administrative
expediency to avoid lapse of appropriated funds. On one side this reflects that the
planning side of the Department is either inadequately managed or ad-hoc based and on
the other side the standard time gets reduced wherein the prospective bidders could have
adequately prepared their bidding documents to quote well-thought prices, had more time
be given to them.
Although content of the Invitation of Bids (IFB) included sufficient information to enable
potential bidders to determine their ability and interest in bidding, the recently introduced
Standard Bidding Document for procurement of Pharmaceutical Products for Govt-MCC
DGHS for the year 2012-13 witnessed many revisions in the Technical Evaluation Criteria
till the last minute due to the deliberations between the bidders and the Health Department
in the subsequent Pre-Bid Meetings which, due to paucity of time in acquiring
pharmaceutical products, could neither be circulated properly among the bidders through
an addendum published in a newspaper nor could reasonable time be given to them to
reflect these changes in their Bidding Documents; hence majority of bids faced infirmities
in their secondary documentation despite the posting of the revised Standard Bidding
documents on the newly created DHIS web-link for the Govt-MCC.
The silence of NWFP Procurement Rules 2003 on providing a minimum time limit to
bidders for incorporating any such changes made by the client after the Pre-Bid Meeting
has considerably compromised the objective of promoting transparency in the bidding
process and has reduced the quality and level of competition expected. If multi-national
firms having their business components abroad are expected to compete, as many of
them have participated through their pre-qualified local offices, this is a serious factor to
consider. The law and regulations should establish the criteria for setting the minimum
time between advertisement and submission of bids/proposals through some
administrative notification for competitive bidding, atleast for the time till the notification of
the draft Khyber Pakhtunkhwa Public Procurement Rules 2012 by the Government.
41
Scoring Criteria
The legal framework meets the following conditions:
(a)
(b)
Score
Requires that procurement opportunities other than sole source or price quotations be
publicly advertised.
Publication of opportunities provides sufficient time, consistent with the method,
nature and complexity of procurement, for potential bidders to obtain documents and
respond to the advertisement. Such timeframes are extended when international
competition is sought.
(c)
Publication of open tenders is mandated in at least a newspaper of wide national
circulation or in a unique Internet official site, where all public procurement
opportunities are posted, that is easily accessible.
(d)
Content of publication includes sufficient information to enable potential bidders to
determine their ability and interest in bidding.
The legal framework meets the conditions of (a) and (b) plus one of the remaining
conditions.
The legal framework meets the conditions of (a) plus one of the remaining conditions.
The legal framework only meets the conditions of (a) above.
3
2
1
0
Sub-indicator 1(d) – Rules on participation:
This sub indicator assesses the participation and selection polices to ensure that they are
non discriminatory. As a general principle under this sub-indicator, firms, including prequalified multinational firms/importers or suppliers, should not be excluded from
participating in a tendering process for reasons other than lack of qualifications. Those
exclusions from the tendering process that are not based on the qualifications of the firm,
may arbitrarily limit competition and may result in inefficient procurement and higher
prices.
The Department of Health Khyber Pakhtunkhwa annually pre-qualifies manufacturers,
importers or supplier of bio-medical equipment and pharmaceutical products and surgical
disposables whether the said entities are local or multi-national. All such firms are
therefore eligible for participation in the competitive bidding process for supplying the
above mentioned goods. The policies of the Health Department in this regard are nondiscriminatory and result in creating a pool of pre-qualified firms from whom the
Department strives in good earnest to procure quality pharmaceutical products and
equipment. However, it was observed that in certain procurement activities initiated by the
Directorate General of Health Services, Vertical Programs and AMIs, technically qualified
42
bidders were excluded on account of Rule 34 of the NWFP Procurement Rules 2003, from
further competition when less than three such bidders survived the technical evaluation
phase. Right to audience under Rule 32 of the said Rules was also not accorded to the
surviving technically qualified bidder(s) in the referred cases to present a detailed analysis
of workability of his bid before the Department. A new procurement process therefore was
re-initiated ensuring minimum of three technically qualified bidders till the end by relaxing
the evaluation criteria despite the fact that in re-bidding, participation of a minimum of only
two bidders is required at the time of bid submission under Rule 34 of the said Rules. An
analysis below of these persistent practices in the light of interpretation of afore mentioned
Rules 34 & 32, therefore reveals a distorted interpretation of the Rule 34 and tends to limit
competition and induce rigidity in the business process resulting in inefficient procurement
and higher prices.
Rule 34 of the NWFP Procurement of Works, Goods and Services Rules 2003 states as
under:
“34.
Modes of Procurement: (1) Except as otherwise provided by these rules, a
Procuring Entity for the Procurement of Goods, Works or Services shall adopt tendering
proceedings.
(2) For the purpose of transparency, fair competition and efficiency, the Procuring entity
shall cause evaluation of offers, proposals or tenders only where a minimum of three
responses have been received, unless the Head of the Procuring Entity authorizes
the evaluation of less than three tenders after publishing a Notice Inviting Tenders for
a second time in the newspapers of wide circulation and for cogent reasons to be
recorded in writing of the Procuring Entity authorizes the evaluation of less than three
tenders.”
The above mentioned Rule 34 states the condition of submission of a minimum of three
quotations / responses by the bidders in the first round of invitation for Bids. These bids (a
minimum of three for the purpose of transparency, fair competition and efficiency) are
required to be submitted to the Procurement Entity at the Bid submission stage and the
same will then be scrutinized in Stage-I through Preliminary Screening as per General
Principles For Evaluation of Application for Pre-Qualification & Technical Bids for PostQualification (Appendix to the Rules 2003). Subsequent to the Preliminary Screening,
detailed evaluation is conducted by the Technical & Evaluation Committee in Stage-II as
per the above said General Principles. Whosoever, emerges as the lowest evaluated
responsive bidder, will be awarded the contract. The above stated Rule 34 and the
General Principles do not, at any stage, mention that all the three bidders who initially
submitted their bids have to emerge as technically qualified till the end. The said Rule also
does not state that any one bidder, who has emerged among the crowd as the sole
43
technically qualified bidder during the Preliminary Screening / Technical Evaluation, has to
be excluded from the competition only because other bidders have been rendered
technically disqualified during the said preliminary screening or technical evaluation. The
guiding principle behind retaining in the competition the sole technically qualified bidder, is
embedded into the international best practice adopted world-wide by all the donor
institutions and OECD countries in their procurement régimes, whereby a technically
qualified bidder is not penalized for the disqualification or absence of the other bidders,
i.e., he should not be disqualified for a mistake he has not committed.
Rule 32 of the NWFP Procurement of Works, Goods and Services Rules 2003 mentions
the discretion of the Tender Accepting Authority to reject all tenders, proposals, offers or
quotations at any time prior to the acceptance of a tender, proposal, offer or quotation.
This rejection is based on the assumption that the bid is unworkable. However, before
rejection of tender on the said basis, the stated Rule mentions that the Tender Accepting
Authority has to give an opportunity to the said bidder, upon his request, to demonstrate
the workability of his bid. As a matter of opinion, Justification of rejection of a workable bid
of a technically qualified bidder by the Tender Accepting Authority would be difficult if his
price quotation is well within the budget allocated or nearly matches the unit rate
previously received by the client. The legal as well as audit implications of excluding such
a single technically qualified bidder for no cogent reason by the Procuring Entity may
have to be measured against delaying the purchasing process leading to subsequent
acquisition of the intended items on increased market prices and a belated health service
delivery.
There may be cases in which the legal framework may allow restrictions that require
purchasing from or associating with domestic firms, or mandate the inclusion of a
minimum locally manufactured content. Many countries also allow price preferences for
domestic firms. Excessive price preferences or other concessions for domestic bidders
may therefore deter effective competition and reduce gains in efficiency.
Though the NWFP Procurement Rules 2003, under which the procurement of
pharmaceutical products and Bio-medical equipment
are purchased, do not bar
participation of any foreign or local firm, these do require mandatory pre-qualification vide
NWFP Government Notification No. SOH(V)9-5/96(MCC), dated 20th May 1996 of all
foreign/multi-national and local pharmaceutical drugs manufacturers & distributors
(distributors now banned by the Honourable Peshawar High Court vide Para 9 of the Writ
Petition No. 2478/2010 - Daily Mashriq Vs Secretary Health & Others) by the Health
Department Khyber Pakhtunkhwa as a condition to participate in a bid which may become
an entry barrier for many foreign firms as importers which have no pre-qualification profile
with the DGHS Khyber Pakhtunkhwa. The foreign firms must register with the Sales Tax
44
Department as importers and get pre-qualified accordingly with the Health Department
Khyber Pakhtunkhwa. However, keeping in view of the restrictions of Import Policy Order
2012-13, prior verification of current Good Manufacturing Practices (cGMP) and
pharmaceutical raw material source gradation by the DGHS to achieve drug efficacy, prequalification requirement seem to out-weigh the merits of an open no-barrier competition.
Interestingly, in some procurement activities, it has been observed that the said prequalification requirement for suppliers not registered with the Health Department Khyber
Pakhtunkhwa has been waived of by the concerned procurement entity on depositing of
double the amount of the bid security to entertain them on-the-spot for post-qualification at
the time of bid submission. Except for the supply of drugs, medicines and surgical
disposables where pre-determination of manufacturing quality is essentially required to
ensure product efficacy, there is no harm in considering the un-registered suppliers of nonpharmaceutical products provided the option of their post-qualification at the time of bid
submission is already mentioned in the Standard Bidding Documents to ensure
transparency and wider competition. A strict interpretation of the Rule 8 regarding prequalification of suppliers further suggests that the criteria set by the Health department for
the said process are not pre-qualification but are rather registration and industrial process
verification by the Department.
Rules 9 & 10 of the NWFP Procurement Rules 2003 provide for the conditions under
which a supplier’s bid can be rejected or he can be debarred from current or future
procurement activities e.g., his failure to perform in earlier contracts, making a cartel,
submitting a false information or his inducement to procurement officials. These Rules are
then supplemented by the allied laws like Drug Act 1976. However the stated Rules offer
little in regard to grievance redressal in response to any administrative debarment of a
supplier on procurement matters. The Provincial Quality Control Board Khyber
Pakhtunkhwa under Section-11 of the Drug Act 1976 deals with the drug quality control
issues and subsequent prosecution of drug manufacturer/seller etc. and the concerned
Licensing Board, constituted under Section-5 and Registration Board constituted under
Section-7 of the Drugs Act 1976, also deals with cancellation of registration and licensing
of drug manufacturers.
This has therefore significantly reflected upon the existing complaint-handling procedures
and appeal forums with limited procedural & appropriate forum definition by the Health
Department in offering a due process to the barred/blacklisted supplier regarding rebuttal
of any such allegations on him pertaining to submission of false documentation, breach of
contract or any other procurement related issues. Hence, various complaints against
debarments, disqualifications and tender rejections at the DGHS, Vertical Programs and
the AMIs in the Health Department Khyber Pakhtunkhwa are being filed with different
forums including the Honourable Peshawar High Court, NAB and the Provincial
45
Ombudsman Secretariat (under section 31 of the Khyber Pakhtunkhwa Provincial
Ombudsman Act 2010) instead of utilizing the appropriate forum like the office of the
Secretary Health. An independent Provincial Drug Court has been recently been notified
in October 2012 and awaits appointment of judges with so far no functional Terms of
Reference in sight. Apart from deciding the cases of spurious drugs and cancellation of
drug licenses, its utility to fill the gap of a proper Provincial Appellate Forum for
procurement-related grievances is yet to be seen.
Scoring Criteria
Score
The legal framework meets the following conditions:
(a)
Establishes that participation of any contractor or supplier or group of suppliers or
contractors is based on qualification or in accordance with international agreements;
requires the use of pass/fail basis for determining qualifications to extent possible;
limits domestic price preferential, if allowed, to a reasonable amount (e.g.15% or
less); and requires justification for set asides that limit competition.
(b)
Ensures that registration if required does not constitute a barrier to participation in
tenders and does not require mandatory association with other firms.
(c)
Provides for exclusions for criminal or corrupt activities, administrative debarment
under the law subject to due process or prohibition of commercial relations.
(d)
Establishes rules for the participation of government owned enterprises that promote
fair competition.
The law and regulations meet the conditions of (a) and (b) plus one of the remaining
conditions.
The law and regulations meet the conditions of (a) plus one of the remaining conditions.
The law and regulations do not meet the conditions of a) through d) above.
3
2
1
0
Sub-indicator 1(e) – Tender documentation and technical specifications
The sub indicator assesses the degree to which the legal framework specifies the content
of tendering or solicitation documents to enable suppliers to understand clearly what is
requested from them and how the tendering process is to be carried out.
Whereas Rule 23 of the Federal Public Procurement Rules 2004 clearly outlines a detailed
list of components to structure the Standard Bidding Documents (SBDs) for any
competitive bidding, the NWFP Procurement Rules 2003 do not particularly specify the
content of the tendering documents as to enable suppliers to understand clearly what is
46
required from them and how the tendering process is to be carried out. However, Rule 11
of the NWFP Procurement Rules 2003 dealing with the Pre & Post-Qualification
proceedings for the suppliers and contractors includes certain information regarding
instructions for preparing and submitting the pre or post-qualification applications, a
summary of the required terms and conditions of the contract to be entered into a result of
the procurement proceedings, documentary evidence required to be submitted by the
bidders in this regard and lastly, manner and place for submission of the said applications.
Rule 14 of the NWFP Procurement Rules 2003 further enumerates contents of invitation to
pre or post-qualify and invitation to tender which include the name & address of the
Tender Inviting Authority, nature, quantity and place of delivery of the goods to be
supplied, the desired time for the supply of goods, the criteria & procedure to be used for
evaluating the qualifications of suppliers or contractors, price for pre-qualification or tender
documents, terms and conditions for payment of mobilization advance and finally the place
and deadline for the submission of tenders. The General Principles for Evaluation of
Application for Pre-Qualification & Technical Bids for Post-Qualification (Appendix to the
NWFP Procurement Rules 2003) also indicate some parameters relating to the technical
and financial evaluation of bidders.
In the absence of any standard instructions for structuring the Standard Bidding
Documents in the NWFP Procurement Rules 2003, the procuring entities of the Health
Department of Khyber Pakhtunkhwa have, over the time, grouped together all the above
mentioned indicators of the Pre-Qualification documents and General Principles for bid
evaluation, to evolve a document to be used simultaneously to serve the purpose of three
documents i.e., (a) the Tender Inviting Notice (b) the bidding document for purchasing of
goods and (c) the contract template for contractual privity. Thus, in a way, Rule 11, Rule
12 & the said General Principles (Appendix to the NWFP Procurement Rules 2003)
together establish the minimum content of the tender documents and require that content
is relevant and sufficient for bidders to be able to respond to the client’s requirements.
Until recently, in Khyber Pakhtunkhwa the Directorate General Health Services, the
Autonomous Medical Institutions and the Vertical Programs have been using this evolved
3-in-1 bidding document for purchasing both pharmaceutical products and bio-medical
equipment using Single Stage Single Envelop procedure. However, the Health
Department Khyber Pakhtunkhwa conducted procurement of Bio-Medical equipment in
April 2012 with the help of a more detailed version of Bidding Documents for adopting Two
Envelop Tendering procedure.
In August 2012, the said Bidding Documents were thoroughly revised and standardized in
accordance with the FIDIC templates for procurement of goods and fine-tuned to
47
procurement of pharmaceutical products i.e., drugs, medicines and biological vaccines as
per Rule 40 of the NWFP Procurement of Works, Goods & Services Rules 2003 under
Two Envelop Single Stage Bidding process and whose technical evaluation is underway.
Similarly, Vertical Program relating to the Maternal Neo-natal and Child Health (MNCH)
Khyber Pakhtunkhwa has also taken its procurement initiative for the acquisition of
Community Mid-Wife (CMW) Kits for its 25 health districts through the above said revised
Standard Bidding Documents (SBDs) in September 2012 under the said Rules.
These Standard Bidding Documents (SBDs) for procurement of Drugs and Surgical
Disposables for the first time in the procurement stream of the Health Department Khyber
Pakhtunkhwa offer a proper documentation structured on international contracting
standards displaying two sections, one for fixed conditions and the other for variable
conditions of contract. The Part-I of the Standard Bidding Documents relating to the fixed
conditions constitute Instructions To Bidders (ITB) and General Conditions of Contract
(GCC). Part-II of the said Documents constitute Invitation For Bids (IFB), Bid Data Sheet
(BDS) reflecting any changes in reference to the Instructions To Bidders in Part-I of the
SBDs, Special Conditions of Contract (SCC) reflecting any changes in reference to the
General Conditions of Contract (GCC) in Part-I of the SBDs, Technical & Financial
Evaluation Criteria with particular reference to acquisition of pharmaceutical products and
bio-medical goods, Inspection Checklist / Performa for Pre-Qualification of Pharmaceutical
manufacturing units pre-qualified by DGHS Khyber Pakhtunkhwa, Specialized/Biological
Drugs List & Drug Formulary approved by the DGHS, Specifications & Rate Table, Supply
Schedules, Technical Specifications for general medicines, biological drugs & bio-medical
equipment and ancillary Services, Standard Bid Forms and finally the list of eligible
countries whose bidders can participate in the bidding process for supplying goods to
DGHS Khyber Pakhtunkhwa.
The Standard Bidding Documents recently adopted by the Directorate General Health
Services Khyber Pakhtunkhwa for procurement of pharmaceutical goods including drugs
and surgical disposables contain sufficient information to enable the submission of
responsive bids and to establish the basis for a transparent evaluation and award process.
Specifications relating to biological drugs and general medicines included as an annexure
in the Standard Bidding Documents through the approved Drug Formulary seem to be
generic and refer to international standards associated with the World Health Organization
(WHO) and US Food & Drug Administration (FDA) for their assessment in the Technical
Evaluation Criteria.
Though a methodology to determine gradation of pharmaceutical raw material source with
respect to the quality for product efficacy (i.e., excellent, good or satisfactory grade etc)
has not yet made its way into the Technical Evaluation Criteria in the recently adopted
Standard Bidding Documents mentioned above for the want of finalization of the draft
48
policy on raw material source pricing and quality pending for approval by the Federal
Government, other technical criteria have incorporated to ensure maximum possible
efficacy of the product. The said criteria include past performance of the bidder through
supply orders to major health institutions, market experience of the bidder through date of
drug registration of a general medicine with Federal Drug Regulatory Authority (DRA) and
percentage of market share of a biological drug, credibility of the bidder through Good
Manufacturing Practices (GMP) certification based on performance and drug
manufacturing standards set by the World Health Organization (WHO), US Federal Drug
Agency (FDA), European Community’s Directive 93/42/EEC (Annex-II, Article 3), Pakistan
National Accreditatation Council (PNAC) etc.
To ensure drug efficacy the technical expertise of the staff of the bidder in the areas of
plant management, quality control and quality assurance with an edge given to atleast five
years pprofessional experience in pharmaceutical production, has been given due
weightage with particular focus on handling and maintenance experience of cold chain for
transportation of temperature-sensitive biological/specialized drugs from manufacturing
facility situated locally or abroad to the end-user.
It has been ensured in the Technical Evaluation Criteria that even if the source gradation
is at the moment not possible due to pending policy formulation at Federal level, atleast
the source of pharmaceutical raw material or of a medicine supplied in a finished form
against a quoted item should be ascertained / verified through import documentation e.g.,
product related Customs Goods Declaration, Bill of Lading or Commercial Invoice showing
the country of origin accompanied by a bio-assay or an analysis for the said raw material /
finished product in the form of an Analytical Certificate or Quality Assurance Certificate
duly issued by the concerned Drug Registration Authority (DRA) of the country from where
imported, e.g., the current GMP (cGMP) certificates issued by renowned DRAs like
USFDA, European Medicines Association (EMA), Medicines & Healthcare Products
Regulatory Agency (MHRA), UK, Therapeutic Goods Administration (TGA), Australia,
Pharmaceutical Medical Agency (PHARMAC), New Zealand, Pharmaceutical & Medical
Devices Agency (PMDA), Japan, Swiss Agency For therapeutic drugs (Swiss-medic),
Switzerland, Health Canada, Health Sciences Authority (HAS), Singapore National
Administration of Drugs and the Food & Medical Technology (ANMAT), Argentina etc., all
having recognized international standards for full quality assurance system for
pharmaceutical products. In the case of recently drafted Standard Bidding Documents for
procurement of cancer medicines for Begum Nusrat Bhutto Oncology Services in Khyber
Pakhtunkhwa for 2012-13 by Hayatabad Medical Complex, IRNUM, INOR and Abbottabad
Teaching Hospital’s Oncology Department, the Technical Evaluation criteria has been
introduced which contains highly-scored raw-materials sources certified from Category-A
DRAs consisting of the above mentioned DRAs, and those lesser-scored certified by
49
Category-B DRAs of China, India, Pakistan, Brazil, Egypt, Korea, Malaysia and Jordon
etc. Various Pre-Qualification Criteria have also been omitted in view of the PostQualification in the said SBDs.
With an estimated outlay of Rs. 629 million allocated for procurement of drugs out of the
total Rs 1.2 billion for health sector related procurements for the current fiscal year in
Khyber Pakhtunkhwa, the procurement of medicines in general and biological drugs in
particular attained a significant place on the priority list of the Health Department. The
need for specialized Bidding Documents customized for procuring the said pharmaceutical
products and related bio-medical equipment was therefore direly felt. Directorate General
Health Services made substantial efforts towards achieving the said objective in
collaboration with TRF Khyber Pakhtunkhwa.
It was therefore during the re-design and introduction of the revised Standard Bidding
Documents for procurement of pharmaceutical products in compliance with the
international contracting templates and health related acquisition Guidelines of the World
Bank, WHO and USFDA that the Directorate General Health Services has actively
demonstrated its sensitivity towards achieving highest grade for biological drugs keeping
in view their life saving impact and assurance against disease relapse.
Special provisions in the Technical Evaluation Criteria of the said Bidding Documents, in
consultation with pharmaceutical sector specialists in the Health Department, have thus
been introduced for the first time in the form of mandatory bio-equivalence studies to be
provided by the suppliers or manufacturers for anti-Tubercular products (TB Vaccines),
requirement of pre-qualification of suppliers by the WHO for EPI vaccines (BCG, Measels,
Tetanus and Pentavalent: DPT-HepB-Hib), mandatory Sustained Viral Response (SVR)
studies containing clinical trials performed with reference standards on efficacy of Hepatitis
B & C vaccines (consisting of conventional and Pegylated Interferon therapy) and having
their clinical data demonstrating published efficacy & disease relapse period in atleast one
indexed journal of international repute with considerable readership impact. Unfortunately
however, the Surgical Disposables, earlier procured by Govt-MCC, DGHS in the last many
years and intended to be acquired through the revised Standard Bidding Documents, have
been handed over to the AMIs like Lady Reading Hospital Peshawar to use the obsolete
three page bidding document for their procurement of non-drug surgical disposables in the
current financial year through administrative approval from Health Secretariat, thus still
leaving some effort in harmonizing the procurement business practices based on the
revised Standard Bidding Documents.
Rule 33 of the NWFP Procurement Rules 2003 concerning description of goods,
construction or services ensures generic and unbiased technical specifications to be
50
included in the tender documents. The Bidding Documents designed in April 2012 for
procurement of bio-medical equipment and the revised Standard Bidding Documents for
procurement of pharmaceutical products and CMW kits for Govt-MCC, DGHS and MNCH
Program respectively contain generic and neutral technical specifications of goods in
compliance to the above said Rule. The Technical Criteria for the Bio-medical equipment
contain US Food and Drug Administration (FDA) 510K, European Community (CE) MDD
or Japan Industrial Standards (JIS). The global certifications for the said equipment require
certifications from authentic certifying bodies like Association for the Advancement of
Medical Instrumentation (AAMI), International Certification Commission (ICC) and the
United States Certification Commission (USCC) etc. Further, the participating firms should
have their technical resources to have expertise based on CCE, CBET, CRES, CLES
Certifications etc.
Rule 33(2)(a) further requires recognition of standards which are equivalent when neutral
specifications are not available.
Scoring Criteria
Score
The legal framework meets the following conditions:
(a)
Establishes the minimum content of the tender documents and requires that
content is relevant and sufficient for tenderers to be able to respond to the
requirement.
(b)
Requires the use of neutral specifications citing international standards when
possible.
(c)
Requires recognition of standards which are equivalent when neutral
specifications are not available.
The legal framework substantially meets the conditions of (a) plus one of the remaining
conditions.
The legal framework meets the conditions of (a).
The content of the bidding documents is totally or largely left at the discretion of the procuring
entity.
3
2
1
0
Sub-indicator 1(f) – Tender evaluation and award criteria
This sub indicator assesses:
a) the quality and sufficiency of the legal framework provisions in respect to the objectivity
and transparency of the evaluation process; and,
b) the degree of confidentiality kept during the process to minimize the risk of undue
influences or abuse.
51
Rules 23 to 29 in Chapter IV (Tender Evaluation) of NWFP Procurement Rules 2003
indicate requirements for providing pre-disclosed and objective criteria essential for
efficiency, fairness and transparency in the evaluation of tenders. General Principles for
Evaluation of Application for the Pre-Qualification & Technical Bids for Post-Qualification
(Appendix to NWFP Procurement Rules 2003) give three different stages for evaluation of
bids or proposals. In Stage-I these make tender evaluation less subjective by providing
screening criteria for preliminary scrutiny, indicators of compliance, eligibility and
responsiveness. The General Principles render the said indicators quantifiable by making
pre-qualification criteria (for pharmaceutical firms and suppliers of bio-medical equipment)
an integral part of the tender evaluation for a detailed technical evaluation.
The General Principles further attach value to the legal status of the bidders by defining
commercial acceptability, public and private sector status for participating entities and
probable joint ventures for assessing the corporate relationship of the bidder. In Stage-II,
the Principles extensively comment on the financial and technical capabilities and relevant
experience (including past experience) of the bidders and further define the major
features, groups of factors and distribution of points of the scoring criteria that recognizes
several factors collectively to give the client confidence about whether a criterion has been
met in terms of technical compliance by and commercial soundness of the bidder.
After having defined the evaluation criteria, the General Principles, in Stage-III, opt for
factors constituting additional information for final determination of qualified bidders. The
revised Standard Bidding Documents being used by the DGHS and Vertical Programs in
Khyber Pakhtunkhwa duly incorporate the above stated features and factors influencing
the evaluation criteria in the light of the said Rules and General Principles to offer an
objective assessment of the capabilities of the bidders.
Rule 28 of the NWFP procurement Rules 2003 give indicators for determining the lowest
evaluated responsive bidder with lowest price in mind. The same has been adopted by the
DGHS Khyber Pakhtunkhwa for selecting the lowest unit rates in centralized contracting
for the pharmaceutical products in Govt-MCC and lowest item rates for the bio-medical
equipment of all those suppliers/manufacturers in the Procurement Cell at DGHS who
have complied with the technical & commercial evaluation criteria. So far the merit point
average technique for evaluating the best value for money has not been applied in the
above stated revised Standard Bidding Documents. Merit Point Average technique
assigns significant marks to the non-price factors and the aggregate of marks is indicative
of a percentage of marks for price, thereby tilting the balance of evaluation for the quality
rather than price. It is hoped that future bidding documents of the DGHS may incorporate
the merit point average mechanism for bid evaluation.
52
Confidentiality and regulated communications with the bidders during the evaluation period
have been duly advised under Rule 26 of the NWFP Procurement Rules 2003 to stop any
abuse and undue interference in the process. Rule 25 binds the evaluation committee to
complete evaluations within 15 days of the bid opening and allowing a further extension of
ten days. However, procurement record of the DGHS shows that the earlier evaluations
got completed more than a month or so though administrative approvals for extensions
were not usually taken. Generally the prices/quotations become a public property after
opening of financial bids. However, it has been observed that the Directorate General
Health Services keeps them confidential till the announcement of the lowest selected rates
for Govt-MCC by mostly retaining the members nominated in the preliminary scrutiny
committees for initial profiling of the technical bids in the subsequent committees like
Comparative Statement Committee and working with a very limited number of highly
trusted Key Punch Operators/steno typists proficient in typing skills for entering the
voluminous price data against thousands of selected items for Govt-MCC. The inherent
risk in such business practices has the potential to amplify the bias of a committee
member thereby vitiating the jeopardizing the integrity of the procurement cycle. The high
impact of this risk leads to a potential conflict of interest.
Though Rule 42 binds the client to promptly inform the selected bidder, there is no
provision in the NWFP Procurement Rules 2003 for disclosing the information related to
the evaluation process and results to the participating or interested parties after the
evaluation is complete. The Health Department has therefore no proprietary mechanism
for such disclosure of information except for displaying in the end the final results of
contract award on the website owned by the EPI Vertical Program. The SBDs for
procurement of cancer medicines have been recently posted as of 31.12.2012 on the
Health Department’s website in Tenders section.
Scoring Criteria
Score
The legal framework mandates that:
(a)
The evaluation criteria are relevant to the decision, and precisely specified in
advance in the tender documents so that the award decision is made solely on
the basis of the criteria stated in the tender documents.
(b)
Criteria not evaluated in monetary terms are evaluated on a pass/fail basis to
the extent possible.
(c)
The evaluation of proposals for consulting services gives adequate importance
to the quality and regulates how price and quality are considered.
3
53
(d)
During the evaluation period, information relating to the examination,
clarification and evaluation of tenders is not disclosed to the participants or to
others not involved officially in the evaluation process;
The legal framework covers the conditions of (a) and (b) plus one of the remaining conditions.
The legal frame work covers (a) but does not fully cover the other conditions.
The legal framework does not adequately address any of the conditions (a) through (d) above
2
1
0
Sub-indicator 1(g) – Submission, receipt and opening of tenders
This sub indicator assesses how the legal framework regulates the process of reception of
tenders and tender opening.
Rule 18 of the NWFP procurement Rules 2003 provides for public opening of tenders for
proper receipt and safe custody of the bids as a means of increasing transparency to an
open tendering exercise. The said Rule further provides for extension in bid submission
time where certain changes in the bidding documents resulting due to the deliberations
between the Procuring Entity and the prospective bidders during the Pre-Bid Meetings
need to be communicated to the bidders and reasonable time to be given to them through
extension in bid submission time for reflecting their thoughtful response by incorporating it
in the bidding documents before bid submission. This practice has not been strictly
followed by the Directorate General of Health Services with respect to the acquisition
activity for pharmaceutical products despite requests from the prospective bidders; hence
receipt of various bids with limited and inadequate response to the changes carried out
during the Pre-Bid meetings. As the said Rule provides no specific time for any time
extension in this regard, a five to seven days period after proper communication of the
changes in the bidding documents to the bidders seems to be adequate to deal with such
an issue.
Rule 19 of the NWFP procurement Rules 2003 explains the procedure for submission of
sealed bids to the Procuring Entity. DGHS, AMIs and Vertical Programs have constituted
Bid opening committees in this regard where minutes of meeting, the names and
addresses of the bidders and the tender prices (and any withdrawals or modifications to
tenders duly submitted) alongwith status of responsiveness are read aloud and recorded.
Records are retained and available for review and audit purposes. Opening of technical
bids is done immediately after the deadline for submission of tenders which diminishes the
possibility of loss or alteration of proposals or submissions.
54
Rule 20 (1) provides for minimum of thirty days time for submission of tenders. The current
practice in the Health Department relating to the said legal provision deviates on account
of Rule 20 (2) which allows reduction in the time to any number of days as authorized by
the Head of the Procuring Entity in the wake of any lapse of allocated funds for the
procurement activity under consideration or an exigency. Such practices not only reflect
badly on the planning side of the Department but may raise questions on the transparency
of the open competitive process which has been made restrictive by curtailing the
mandatory participation time thereby defeating the very purpose of providing adequate
time for bid preparation and submission considered as one of the international best
practices. Rule 20 (2) may therefore be considered as a defective legal provision which
has the inherent characteristic for abuse of procurement process.
The Directorate General Health Services currently controls the majority of contracting
actions of the AMIs and Vertical Programs in the Health Department despite allocation of
40% of the procurement to the AMIs regarding procurement of pharmaceutical products
after devolution of powers to the provinces whereby autonomy to the procuring entities
associated with the Health Department Khyber Pakhtunkhwa was granted. The AMIs
have been administratively directed by the Health Secretariat to get only those medicines
procured under the allotted 40% share which have not been included in the list of
medicines procured through Govt-MCC, DGHS in medical emergencies or otherwise.
Reduction in bid submission time for all such contracting activities associated with these
entities is being carried frequently in consonance with the similar practice prevalent in the
DGHS.
Rule 21 provides for public opening of financial bids wherein bidders or their
representatives must be permitted to attend. The Health Department complies with the
said Rule and proper record of financial bid opening publicly is maintained.
Rule 17 (2) provides for the Pre-Bid meeting wherein opportunity to the prospective
bidders is given through instructions by the Department to bring clarity on how to submit
responsive bids and to minimize the prospects of rejection of otherwise compliant bids by
inadvertent mistakes. The revised Standard Bidding Documents give elaborate
Instructions To Bidders in this regard. Guidelines on conducting Pre-Bid Meetings have
recently been intimated to the procurement officials of the Health Department by the TRF.
Scoring Criteria
The legal framework provides for the following conditions:
Score
3
55
(a)
(b)
Public opening of tenders in a defined and regulated proceeding immediately following
the closing date for bid submission.
Records of proceedings for bid openings are retained and available for review.
(c)
Security and confidentiality of bids is maintained prior to bid opening and disclosure of
specific sensitive information during debriefing is prohibited.
(d)
The modality of submitting tenders and receipt by the government is well defined to
avoid unnecessary rejection of tenders.
The legal framework provides for (a) and (b) plus one of the remaining conditions.
The legal framework provides for (a) plus one of the remaining conditions.
There is no requirement in the legal framework for public opening of tenders.
2
1
0
Sub-indicator 1(h) – Complaints
The purpose of this indicator is to assess whether the legal framework establishes;
a) the right to review;
b) the matters that are subject to review;
c) the timeframe for such reviews; and,
d) the different steps in the review process.
Rule 43 of the NWFP Procurement Rules 2003 offers opportunity to an aggrieved bidder
to file an application for review of the decision/order of the Procuring Entity awarding a
contract provided the contract has not already entered into force. The review application
should clearly mention the date of acceptance of tenders, material defects and nonobservance of rules in the contract award letter. However, the reason assigned for review
under the said Rule seems restrictive as it only addresses a situation whereby a bid has
been accepted by an unauthorized procuring entity. In the current scenario of acceptance
of bids in the DGHS and its allied procuring entities, proper Purchase Committees have
been formed and notified which have the sole authority to accept or reject a bid. The
opportunity for review under Rule 43 therefore seems irrelevant in this regard. Confidence
in a procurement system is a powerful incentive to competition. A fundamental part of this
is the establishment of the right to review procurement decisions by an efficient and
functionally independent process which should include opportunity to protest against
exclusion of a pharmaceutical firm/bio-medical equipment supplier on account of any prequalification or post-qualification during bid evaluation conducted by the Department which
in Firm’s view, has caused grievance. Further to it, the Rule does not offer any protest
against unlawful exclusion of a technically qualified bidder by the Procuring Entity through
56
abuse of Rule 32 of the NWFP Procurement Rules 2003 who remained as the only one
left after the detailed technical evaluation. Rule 43 stated above also does not provide any
opportunity to a bidder who feels aggrieved on account of a biased application of technical
or commercial evaluation criteria by the Technical Evaluation Committee.
The first review exists at the level of the Secretary Health who considering the nature and
gravity of the complaint, either reviews the decision of the Procuring Entity himself or
immediately creates a committee to review the same. The review committee, usually
headed by Special Secretary Health or any Technical member, mostly comprises
members who are not part of the referenced purchasing process, and is fully authorized to
review the Procuring Entity’s decision. This attempts to assure the independence of the
complaint review body and to eliminate any conflict of interest.
However, the quasi-judicial review stated above is not independent of the procuring
agency having direct interest in the procurement process under reference and with no
counter-part appellate review in the form of any Health Appellate Tribunal in sight. This
infirmity currently present in the system often tempts the aggrieved bidders to directly seek
remedy at forums like Provincial Ombudsman, Provincial NAB or Honourable Peshawar
High Court etc. or any other forum independent of the procuring agency (but not defined in
the NWFP Procurement Rules 2003) without resorting to office of the Secretary Health as
the first appropriate forum for a quasi-judicial/administrative review. Hence, a foray of
complaints and litigations at inappropriate forums against the decisions of the Health
Department. The proposed provincial appellate authority under Section-9 or the functional
Federal Appellate Board under Section-9A of the Drug Act 1976 deal with drug
registration, licensing and supplier disqualification issues etc. and do not cover
procurement related complaints.
Scoring Criteria
Score
The legal framework provides for the following conditions:
(a)
The right to review for participants in a procurement process.
(b)
Provisions to respond to a request for review at the procuring agency level with
administrative review by another body independent from the procuring agency that
has the authority to grant remedies and includes the right for judicial review.
3
57
(c)
(d)
Establishes the matters that are subject to review.
Establishes timeframes for issuance of decisions by the procuring agency and the
administrative review body.
The legal framework provides for (a) and (b) plus one of the remaining conditions.
The legal framework provides for (a) plus one of the remaining conditions.
The right for review of the proper application of the procurement process is not provided in the
legal framework.
2
1
0
Indicator 2. Existence of Implementing Regulations and
Documentation.
This indicator verifies the existence, availability and quality of implementing regulations,
operational procedures, handbooks, model tender documentation, and standard conditions
of contract. Ideally the higher level legislation provides the framework of principles and
policies that govern public procurement. Lower level regulations and more detailed
instruments supplement the law, make it operational, and indicate how to apply the law to
specific circumstances. This indicator consists of six sub-indicators (a-f).
Sub-indicator 2(a) – Implementing regulation that provide defined processes and
procedures not included in higher-level legislation
This sub indicator aims at verifying the existence, clarity, accessibility and
comprehensiveness of regulations to the law that further detail and clarify its application.
The NWFP Procurement of Works, Goods & Consulting Services Ordinance 2002 &
NWFP Procurement of Goods, Works & Services Rules 2003 currently governing the
procurements at the provincial level in the Health Department constitute higher level
legislation for providing the legal framework for the same in a variety of applications. The
NWFP Procurement of Goods, Works & Services Rules 2003 do not get regularly updated
as the responsibility for their updation by the concerned entity is not clearly defined
anywhere.
The recently revised Standard Bidding Documents created in view of procurement of
pharmaceutical products and bio-medical equipment for Directorate General Health
Services constitute the implementing regulations that provide defined processes and
58
procedures not included in the higher-level legislation with respect to Technical &
Commercial criteria. However, the technical evaluation is currently not based on Merit
Point scoring as the same takes into account the impact of non-price factors alongwith
minimum price to get the combined evaluation score – highest of which gets the contract.
Scoring Criteria
There are regulations that supplement and detail the provisions of the procurement law that
meet the following requirements:
(a)
(b)
(c)
They are clear, comprehensive and consolidated as a set of regulations available in a
single and accessible place.
Score
3
They are updated regularly.
The responsibility for maintenance is defined.
The regulations meet the conditions of (a) plus one of the remaining conditions.
2
The regulations exist but there is no regular updating, the responsibility for updating is
not clearly defined or there are many important omissions in the regulations or
inconsistencies with the law.
1
There are no regulations or the existing ones do not meet substantially any of the requirements
listed above.
0
Sub-indicator 2(b) – Model tender documents for goods, works, and services
Model documents of good quality promote competition and increases confidence in the
system. Potential contractors or suppliers are more willing to participate when they are
familiar with the documents and their interpretation.
The recently introduced revised Standard Bidding Documents for pharmaceutical products
are based on FIDIC templates customized to health sector requirements and contain the
requisite clauses which can be incorporated into contracts to enable the bidders to value
the cost and risk of mandatory clauses when performing a contract for the government. In
consultation with pharmaceutical sector specialists at the Directorate General Health
Services, TRF has standardized the Bidding Documents for medicines and bio-medical
equipment in the light of international best practices based on performance benchmarks of
World Health Organization (WHO), US Federal Drug Administration (FDA), EU Directive
93/42/EEC and Pakistan National Accreditation Council (PNAC) etc. for the health sector.
Similar Standard Bidding Documents are being used for Vertical Programs like MNCH &
59
EPI in the Health Department Khyber Pakhtunkhwa for procurement of CMW Kits &
general goods respectively except for procurement of non-drug surgical disposables and
non-drug surgical disposables for like Lady Reading Hospital where an outdated three
page bidding document has been used despite the availability of revised Standard Bidding
Documents. This reflects the vague policy of the Directorate General Health Services on
mandatory usage of Standard Bidding Documents for ongoing procurements and
demonstrates distortion in adopting the standardized business practices.
The Health Sector Reforms Unit (HSRU) Khyber Pakhtunkhwa - Health Department’s
planning interface for carrying out the World Bank funded project for outsourcing of health
sector management services delivery in six selected districts of Khyber Pakhtunkhwa, is
utilizing World Bank’s Standard Bidding Documents based on Cost & Quality based
Selection (CQS) method.
Scoring Criteria
There are model invitation and tender documents provided for use for a wide range of
(a)
goods, works and services procured by government agencies;
(b)
There is a standard and mandatory set of clauses or templates that are reflective of
the legal framework, for use in documents prepared for competitive tendering.
(c)
The documents are kept up to date with responsibility for preparation and updating
clearly assigned.
Score
3
Model documents and a minimum set of clauses or templates are available, but the use
of such documents is not mandatory or regulated. The documents are not updated
regularly.
2
Model documents are not available, but a set of mandatory clauses is established for inclusion
in tender documents.
1
There are no model documents and the procuring entities develop their own
documents for with little or no guidance.
0
Sub-indicator 2(c) – Procedures for pre-qualification
This sub-indicator covers the existence of procedures for pre-qualification of participants in
a particular procurement.
Rule 7 of the NWFP Procurement Rules 2003, discussed earlier at Sub-indicator 1(b) for
Procurement Methods, makes open competitive tendering the default method of
procurement in Khyber Pakhtunkhwa Province and attracts pre- or post-qualification of
bidders as is being done at the Directorate General Health Services. Till now prequalification of manufacturers and suppliers of bio-medical equipment or pharmaceutical
60
goods has been initiated as a separate exercise by the DGHS usually conducted annually
well before initiation of any scheduled procurement activity by the Health Department.
For the pre-qualification of firms manufacturing or supplying different commodities like biomedical equipment, bedding clothing, medical gases, chemicals, kits, reagents,
disinfectants, insecticides, medical/office furniture, vehicle repair & related spare parts
etc., the Department requires through a detailed Inspection Checklist a firm’s corporate
profile, valid registration from Registrar Companies showing manufacturing / supplier
status; or any valid agency agreement between importer & manufacturer duly attested by
the embassy of the country of origin in Pakistan or of Pakistani embassy in that country.
The Department also ensures that the firm is registered with FBR for payment of Income
Tax and Sales Tax and gets audited by a chartered accountant firm. Firm’s annual import
statement and sales record are also taken into account.
The pre-qualification criteria for drug manufacturers or suppliers, compared to ones for
bio-medical equipment, is based on somewhat more complex requirements geared at
determining the pharmaceutical product efficacy achievable only through strict
implementation of a series of complex Good Manufacturing Practices (GMP) at the local
and foreign business premises alike and is verified through a significantly detailed
Inspection Checklist containing firm’s corporate profile, type of activity being carried out by
the company i.e., formulation of Active Pharmaceutical Ingredients (API) and Non-Active
Pharmaceutical Ingredients (excepients), repacking or basic manufacturing, annual sales
and import record, GMP compliance certificate and / or any other certification from
USFDA, WHO, ISO or PNAC etc. and related audit report, detail of technical personnel in
plant, production quality control and formulation development sections, manufacturing
information including usage of pharmaceutical raw materials, dosage form and production
capacity, SOPs regarding requisite operations in syrup, tablets, capsules, dry powder,
ointment and liquid injectable manufacturing sections and lastly operations regarding the
related inventory management, warehousing and supply chain of pharmaceutical products.
The GMP Certification is therefore achieved through regular but surprise inspections by a
typical Pre-Qualification Committee designated for a specific region and consisting of
members from among Health Department designations like Additional Director (Dev) Health
KP / Director General Health Services KP / Medical Superintendent AMI Peshawar / Director
Admn, DGHS KP,
Professor of Surgery AMI Peshawar, Deputy Secretary (Budget), Health
Department, Chief Drug Inspector Peshawar, Deputy Director Pre-Qualifications, XEN Bio-medical,
Pharmacist Govt-MCC DGHS, Drug Inspector, EDO (Health) Peshawar or any other as
designated. The said Pre-Qualification Committee submits Inspection Report to the Chairman
61
Technical & Evaluation Committee DGHS within three days of inspection for evaluation of
firms for pre-qualification.
Below is the typical annual calendar of activities regarding pre-qualification of firms for
Govt-MCC, DGHS, Khyber Pakhtunkhwa initiated from the office of Section Officer
(Drugs), Health Department:
S.No Pre-Qualification Activity
1
2
3
4
5
6
7
Date
(each
year)
Advertisement for application for pre-qualification
1st January
Last date for submission of application
24th January
Compilation of activities
30th January
Assessment of Documents attached with applications
20th February
Visit of business premises by Pre-Qualification Inspection Upto
25th
Teams & submission of their reports
March
Compilation of list of Pre-Qualified firms and its submission to Upto
30th
T&E Committee for verification & approval
March
Circulation of approved list of pre-qualified firms
1st week of
April
With the introduction of the revised Standard Bidding Documents for procurement of drugs
for Govt-MCC in September 2012, criteria or benchmarks set for the Pre-qualification of
manufacturers and suppliers of pharmaceutical products have been incorporated therein
to combine them with the Technical Evaluation Criteria. However, keeping in view the
complex nature of procurement of general medicines/biological drugs, pre-qualification as
a separate process has been retained by the Health Department as a policy decision
todate to make the said procurement more efficient by limiting the number of participants
and ensuring only qualified participants to be included thereby saving departmental
resources consumed in bid evaluation. This may help in excluding certain pre-qualification
aspects to be removed from the Technical Evaluation Criteria and introducing postqualification aspects instead to save repetition of effort and evaluation time.
Scoring Criteria
Score
Procedures exist that define pre-qualification which:
(a)
Provide for limitations on the content of pre-qualification criteria that are based on
the needs of the specific procurement.
3
(b)
(c)
Specify the use of pass/fail for application of qualification criteria.
Provide guidance on when to apply a pre-qualification procedure.
62
Procedures exist that cover (a) plus one of the remaining conditions.
Procedures exist that cover (a).
Procedures for the application of pre-qualification procedures do not exist.
2
1
0
Sub-indicator 2(d) – Procedures suitable for contracting for services or other
requirements in which technical capacity is a key criterion
NWFP Procurement of Goods, Works and Services Rules 2003, despite the name given to
them do not include any regulations on hiring of consultancy services. This may be
attributable to the time of promulgation of the said Rules when hardly any regulations
existed in Pakistan on services contracting. Rule 40 of the above said Rules offers a Two
Envelop Tendering procedure which relates to procurement of construction work or supply
and installation of goods, equipment or tenders where post-qualification procedures is
being followed. Though the technical capacity and quality have been considered key
criteria for detailed evaluation in the General Principles for Evaluation of Applications for
Pre-Qualification & Technical Bids for Post-Qualification (Appendix to Rules), nonexistence of any consultancy regulations make it irrelevant for the same. Directorate
General Health Services or its subsidiaries including Vertical Programs, Health Projects
like AIDS Control and AMIs therefore do not have any existing regulations for consultancy
services. Any Technical Assistance acquired by them is governed under the Donor
Guidelines whose assistance is extended to them in this regard.
To address this deficiency, the Provincial Government has notified through Governor KP
an Inter-Departmental Consultant Selection Committee (IDCSC) for selection of design
and engineering consultants for the government departments. The Committee is
composed of line members from Finance Division, Planning & Development Division,
C&W Department and functional members from the department for whom the consultant is
being hired. In the light of certain administrative instructions and SOPs, the IDCSC
develops specific Preliminary Scope Statement, Project Appraisal Document, TORs and
RFP Documents for the intended activity.
Health Sector Reforms Unit (HSRU), Health Secretariat Khyber Pakhtunkhwa, on the
other hand, has recently adopted World Bank’s standard bidding templates, which have
been customized with the help of TRF for developing Request For Proposal (RFP)
Documents to acquire Management Consultancy services for revitalizing and
strengthening the health service delivery in six crises affected districts of Khyber
63
Pakhtunkhwa, namely Battagram, Buner, Dera Ismail Khan, Dir Lower, Kohistan and Tor
Ghar under Public Private Partnership. The said project is being funded by the Multi Donor
Trust Fund (MDTF) through World Bank and therefore the World Bank Guidelines for
Hiring of Consultancy Services, revised in 2011, are being followed by the HSRU. The
said Guidelines adequately contain the methodology of a scored evaluation of technical
qualification against stated criteria in order to select the highest qualified proposal by
combining the relative weights allocated to technical capacity and price. Such donor
funded scenarios derive their authority from Rule 4(3) of the NWFP Procurement Rules
2003 where donor Guidelines would prevail over local laws but the condition of Rule 4(3)
for observing the lower financial limit of Rs 40,000 for ascertaining the mode of
procurement in the donor funded projects is not being followed. There seems little
coordination between the Health Department & the IDCSC for any probable selection of
management or design consultant for the HSRU for undertaking responsibilities of reforms
of health sector due to lack of ownership of the said restructuring component by the
Directorate General Health Services, Khyber Pakhtunkhwa.
Scoring Criteria
Score
The legal framework and its implementing regulations provide for the following:
(a)
(b)
Conditions under which selection based exclusively on technical capacity is appropriate
and when price and quality considerations are appropriate.
3
Clear procedures and methodologies for assessment of technical capacity and for
combining price and technical capacity under different circumstances.
Implementing regulations meet a) above but leave b) to the discretion of the procuring entity.
Implementing regulations leave the possibility of use of technical capacity in selection but
neither the law nor the regulations elaborate on the procedure.
Neither the law nor implementing regulations cover this procedure.
Sub-indicator 2(e) – User’s guide or manual for contracting entities
2
1
0
64
This sub-indicator covers the existence of a user’s guide or manual for contracting entities.
Neither the NWFP Procurement Rules 2003 nor the Health Department offer any User
Guide or Procurement Manual which could act as an implementation tool to help provide
Department’s procurement officials with information that incorporates the law, policy and
procedures for turning policy into practice. Procedures for registration and pre-qualification
of firms supplying bio-medical equipment and pharmaceutical products are in place but
have not been translated into any manual so far. With the creation of a centralized
Logistics & Procurement Cell at DGHS level, it is expected that the Health Department in
consultation with TRF may develop a Procurement Manual or more precisely a Health
Sector Supplement to be read in conjunction with public procurement rules for
procurement of pharmaceutical products and bio-medical equipment to create
consistency of their application within the government procurement system. Development
of Technical Evaluation Guidelines for pharmaceutical products and bio-medical
equipment are underway by TRF which are expected to find their way into the said
proposed Supplement containing a calendar of monthly customized training activities of
the procurement officials and to provide an easy desk reference for users.
Scoring Criteria
(a)
There is a unique procurement manual detailing all procedures for the correct
administration of procurement regulations and laws.
(b)
The manual is updated regularly;
(c)
Score
3
The responsibility for maintenance of the manual is clearly established.
There is no unique manual but there is an obligation for the procuring agencies to have
one that meets conditions (b) and (c).
2
There is no manual and no obligation to have one but many procurement agencies have an
internal manual for administration of procurement.
1
There is no manual or requirement to have one.
0
Sub-indicator 2(f) – General Conditions of Contracts (GCC) for public sector
contracts covering goods, works and services consistent with national
requirements and, when applicable, international requirements
This sub-indicator deals with General Conditions of Contracts that set forth the basic
provisions which will be included in a contract with the government.
65
The bidding documents used earlier by the Directorate General Health Services and its
subsidiaries did not have any standard General Conditions of Contract but had a threepage contract document that simultaneously served as an Invitation For Bids, a Contract
Template for establishing privity and Terms & Conditions. The new Standard Bidding
document recently adopted by the Health department for procurement of pharmaceutical
products contains the consistent and mandatory General Conditions of Contract (GCC)
based on FIDIC templates duly recognized world-wide. Any changes in the GCC are
thereby brought about in the Special Conditions of Contract (SCC) to reflect the
commercial codes that deal with contracts between parties for contract performance. The
GCC and resultant SCC therefore duly provide information that enables participants to
understand the allocation of risk between parties to a contract as well as other obligations
including impact on price that the signatories to the contract will incur. Exception to this is
the procurement of non-drug Surgical Disposables still being done on Single Envelop
Single Stage by the AMIs with the above stated three-page primeval contract document,
abandoned by the DGHS itself.
Scoring Criteria
Score
Both of the following apply:
(a)
There are GCC for the most common types of contracts and their use is mandatory.
3
(b)
The content of the GCC is generally consistent with internationally accepted practice.
There are GCC for the most common types of contracts, consistent with international
practice, but their use is not mandatory.
2
There are GCC for the most common types of contracts but they do not conform to
internationally accepted practice and their use is not mandatory.
1
There are no GCC and individual agencies use the form of contract of their choice.
0
Pillar-II: Institutional Framework & Management Capacity
Pillar-II looks at how the procurement system as defined by the legal and regulatory
framework in Khyber Pakhtunkhwa Province is operating in practice through the
institutions and management systems that are part of the overall public sector governance
in the Province.
66
Indicator 3. The public procurement system is mainstreamed and
well integrated into the public sector governance system.
This indicator looks at the procurement system to:
a) determine its suitability to discharge the obligations prescribed in the law without gaps
or overlaps;
b) whether the necessary links with other sectors of government affecting procurement
exist;
c) whether procurement operations are constrained by other external institutional factors;
and
d) whether the managerial and technical capacity of the system are adequate to do
procurement without unnecessary cost or delay.
This indicator deals with the degree of integration of the procurement system with other
parts of government and particularly with the financial management system given the
direct interaction between the two, from budget preparation and planning to treasury
operations for payments.
There are four sub-indicators (a-d) to be scored under indicator 3.
Sub-indicator 3(a) – Procurement planning and associated expenditures are part of
the budget formulation process and contribute to multiyear planning
The Planning Cell of the Health Secretariat, Khyber Pakhtunkhwa, under the supervision
of the Chief Planning Officer (CPO), plans for the schemes by formulating Annual
Development Programme (ADP). Work on preparation on ADP starts in January of the
each financial year. Demands for inclusion of schemes are received on prescribed formats
from districts, autonomous institution, programme managers and public representatives.
The demands for new schemes are analyzed/scrutinized in light of government policies
and Department’s priorities at various levels. The draft ADP, after approval of Minister
Health, is sent to P&D Department for approval. A number of meetings are in at P&D level
on the draft ADP. After scrutiny/analysis by the P&D Department , the draft ADP is placed
for approval of Chief Minister. Afterwards, the draft is placed before cabinet and the
provincial legislature for approval. In ADP both ongoing and new projects are included.
The following types of schemes are included in ADP:1. Account-Head-42:
Brick & Mortar: For construction of new health facility, upgradation of health
facility, addition/alteration in the existing health facility)
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2. Account-Head-36:
For purchase of equipment/instruments/furniture for a health facility or
programme. For activities to achieve certain targets/goals. Such soft
component projects like control of TB/hepatitis program/EPI etc involves staff
salaries purchase of medicine/equipment and other operating costs.
After approval of the ADP from the Provincial Assembly, the schemes PC-Is are prepared
and approved from competent forums.
1. Departmental Development Working Party (DDWP): Schemes upto Rs.60.000
million.
2. Provincial Development Working Party (PDWP): Scheme upto Rs. 5 billion.
(however scheme involving federal share or donor funding are sent to the
Federal Govt. for approval (CDWP/ECNEC) irrespective of cost of the
scheme).
After approval of the scheme, administrative approval of the scheme is issued and the
allocation of scheme reflected in ADP is released by the Finance Department. The funds
released by the Finance Department are placed at the disposal of the concerned in
executing agency. Funds on capital side (construction) are placed at the disposal of C&W
Department and funds on the revenue side (equipment/furniture/medicine/salaries etc) are
placed at disposal of concerned DDO.
The following procedures are followed for procurement of equipment/medicine approved in
the PC-I of the schemes:
1. Funds for purchases are placed at the disposal of DDO/Project Director.
2. Technical, purchase and Inspection committees are notified for the purchases.
3. The specification for equipment/item to be purchased are prepared by a technical
committed constituted for the purpose.
4. The equipment/items to be purchased are advertised in newspapers.
5. Comparative statements are prepared after receipts of bids.
6. The bids received are technically/financially examined by a technical committee.
7. Purchase Committee meeting is held to approve bids in light of the Technical
Committee SOPs and NWFP Procurement Rules 2003. The bids which are not
approved are re-advertised.
8. The Purchase Orders of the approved item/s are given to the selected firms.
9. After supply of the item/s by the firm, Inspection Committee inspects the supplied
items in light of the approved specification.
10. In case of satisfactory report of the Inspection Committee, payment is made by the
68
DDO to the firm.
Any distortion in the procurement planning and subsequent budget formulation process is
seen in the Province when politically motivated schemes or schemes based on
expediency / urgency are introduced for construction of some new facility i.e., a cardiac
center etc or upgradation of the existing medical facility i.e., from BHC to Category-C
Hospital etc. In such cases, the realization of the Standardization List specified for an
upgraded facility results in erection of structures or procurement of more sophisticated
equipment which do not match with the disease burden or outpatient load for that
particular area where such facility is intended to be created. Hence best value for money
may not be achieved in this regard as the said requirements are not properly envisaged at
the time of their consolidation at the Department level which makes the cost data for
budget allocation less reliable. Politically triggered schemes are also one of the reasons
for inclusion of non-ADP budgetary estimates that are most of the time not realized due to
some reason. Around 25-30% of the development budget does not get spent every year
and has to be surrendered by the Department thereby losing its development impact.
Periodical updation of the budget by the Department is not frequent to reflect any revised
changes that take place in timing of contracts. However, the Health Department predicts
the cost of similar goods, works or services in future budget years based on experience of
the actual cost of goods, works and services provided in earlier years and may project the
same from 10-20%. To the extent of pharmaceutical goods and medical furniture, it may
be near to actual costs as the product development cost and market prices for the said
products do not change much. For bio-medical equipment significant variation in the price
may occur for the machines and assemblies where technical specification change
frequently due to rapid advancements in technology. It has been observed that the prices
for the similar bio-medical items have remained almost same to the ones bought earlier
which means that the neither the technical specifications of such items have been updated
by the Department nor sufficient market research has been conducted in this regard. This
may pose a moderate risk in the costing scenario prepared by the Health Department
procuring entities.
There is visible contribution from the Planning Cell towards the ADP document in terms of
support to the health budget planning and its formulation for health sector. However, the
Health Department in general and the Directorate General Health Services in particular do
not prepare any activity-specific Procurement Plan in a standardized format to depict
planned and actual dates for initiation and closure of contract actions for procuring the
intended goods indicated in the ADP above. Lump sum estimated amounts are allocated
in advance in ADPs. This shows a rather weak linkage of contracting processes with the
budget planning and may tend to compromise Department’s capability to understand the
69
timing of major contracts, to predict cash flow needed to make timely payments to the
suppliers (often delayed due to late inspections of equipment) and to reduce the extra
costs associated with delayed contract completion. TRF has helped HSRU in preparing a
standard Procurement Plan on the internationally agreed-to prescribed format for
procurement of Management Services to provide integrated health services on the basis of
Public Private Partnership (PPP) to the six crises-stricken districts in Khyber
Pakhtunkhwa. A similar Procurement Plan can be utilized by the DGHS as well for its
activities related to procurement of bio-medical equipment.
Scoring Criteria
Score
There is a regular planning exercise instituted by law or regulation that:
• starts with the preparation of multiyear plans for the government agencies, from which
annual operating plans are derived.
• followed by annual procurement plans and estimation of the associated expenditures.
3
• and culminates in the annual budget formulation.
Procurement plans are prepared in support of the budget planning and formulation
process.
The majority of procurement plans are prepared based on the annual and multiyear operating
plans independently from budget allocation but they are revised to meet the forward budget
estimates for the sector or agency allocations before expenses are committed.
2
Procurement plans are normally prepared based on the annual and multiyear operating plans.
Links with budget planning are weak and plans are not required to match the budgetary
allocation available before expenses are committed.
1
There is no integrated procurement and budget planning of the nature described. Procurement
plans are drawn without obvious and direct connection with the budget planning exercise and
there is no requirement to match procurement plans with availability of funds before expenses
are committed.
0
Sub-indicator 3(b) – Budget law and financial procedures support timely
procurement, contract execution, and payment.
This sub-indicator assesses the degree to which budget law and financial management
procedures are adequate to meet procurement needs.
(a)
Budget funds are committed or appropriated within a week from the award of the
contract to cover the full amount of the contract (or amount to cover the portion of the
contract to be performed within the budget period).
70
(b)
There are published business standards for processing of invoices by the
government agencies that meet obligations for timely payment stated in the contract.
(c)
Payments are authorized within four weeks following approval of invoices or monthly
certifications for progress payments.
No timelines for committing budget funds for award of contracts have been prescribed by
any Provincial budget manual for utilization by the Health Department’s Planning Cell as
these are already committed in the development budget. The current budget, prepared on
the basis of needs reflected earlier by the Department and is allocated in lumpsum to the
Health Department from where it is disbursed to the procuring entities by Section Officer
Budget. However, the Planning Cell, in addition to the Accountant General of Pakistan’s
General Financial Rules (GFR), makes use of the two manuals namely, Manual for
Development Projects and Planning Commission Guidelines for Project Management
published by the Planning & Development Division Islamabad to offer published business
standards for processing of invoices.
The Manual for Development Projects alludes to Para 105 of GFR-Vol-I, AGPR Rules,
which directs the public sector authorities not to leave unpaid the indisputably payable
amount as far as possible, and that money paid should, under no circumstances, be kept
out of accounts a day longer than is absolutely necessary. The GFR also states that
it is no economy to postpone inevitable payments and it is very important to
ascertain the budget estimates and then liquidate and record the payment of all actual
obligations at the earlier possible date. GFR further calls attention to the fact that the
Principal Accounting Officer shall make prompt On-Account payments to suppliers
and contractors against their invoices or running bills within the time given in the
conditions of the contract which shall not exceed thirty (30) days, as stipulated in Rule 43
of Federal Public Procurement Rules (PPR), 2004 issued by the Finance Division
vide SRO 432(1) / 2004 dated 8th June, 2004.
Though the development budget funds are already appropriated against the amount of
contracts to be awarded to the successful suppliers in various schemes through the ADP
and are available, the timelines for payments to suppliers generally seem to exceed the
contractual timelines prescribed above as Departmental inspection of Bio-Medical
equipment is not conducted for months reasons and despite creation of liability under Rule
3 of the NWFP procurement of Works, Goods & services Rules 2003. This has been dealt
in detail in Sub-Indicator 7(c ) & Sub-Indicator 8(a). The procurement, budget and financial
management systems therefore need to interact in a way that once procurement decisions
are made and contract actions are completed these should trigger the corresponding
actions on the budget and financial side in due time for timely disbursements.
71
Scoring Criteria
Budget and financial procedures in place meet the requirements of a) to c) above.
Budget and financial procedures in place meet the requirements of a) but there are no published
business standards. Authorization of payments is generally timely.
Procedures in place take longer than stated in a) and conditions b) and c) are not generally met.
The procedures in place do not meet the requirements in a material way.
Score
3
2
1
0
Sub-indicator 3(c) – No initiation of procurement actions without existing budget
appropriations.
This indicator assesses whether there are safeguards in the system precluding initiation of
procurement actions unless funds have been allocated to the procurement in question. For
this the following requirements should be in place:
(a)
The law requires certification of availability of funds before solicitation of
tenders takes place.
(b)
There is a system in place (e.g. paper or electronic interface between the
financial management and the procurement systems) that ensures
enforcement of the law.
AGPR’s GFR Para 12 indicates the certification of availability of funds before solicitation of
tenders takes place. The schemes in the ADP contain development funds which have
been allocated to the procurement in question and therefore show availability of funds
before solicitation of tenders. The current budget is further made available for procurement
of pharmaceutical products on emergency basis to the Health Department for providing to
the EDOs (Health). It sometimes happens that a Non-ADP scheme gets introduced into
the ADP if need arises. Funds to such schemes are provided through re-appropriation
within the sector. As PIFRA’s electronic interface has yet not been able to ensure initiation
of financial management of contract actions by the Health Department, paper-based
management of the said procurement activity is prevalent.
72
Scoring Criteria
The system meets requirements (a) and (b) above.
The system meets requirement (a) but requirement (b) is not fully enforced due to weaknesses in
the system.
The system meets requirement (a) only.
There system does not meet requirements (a) and (b).
Score
3
2
1
0
Sub-indicator 3(d) – Systematic completion reports are prepared for certification of
budget execution and for reconciliation of delivery with budget programming.
This sub-indicator is a measurement of the feedback mechanism needed to ensure that
information on contracts covering major budget expenditures is provided to the budgetary
and financial management systems in a timely manner to support the overall public
financial management system.
When the payment bill is deposited with the AG/District Accounts Officer, it gets processed
and the payment to the firm by AGPR. The expenditure is booked in the PIFRA System.
The stated information is reconciled and sent back to the AGPR for finalization of
appropriations to accounts. The said process is further extended for reconciliation and
appropriation of running and final bill payments to suppliers’ accounts and indicates the
completion of major contracts by PIFRA. However, giving a complete picture on the
project sign-off or closure remains out of scope of this financial management system in
the absence of any Materials Management Module in the procurement system of the
Health Department.
As discussed earlier, health budget for procurement is directly appropriated to the EDO
(Health) after its sanction from DGHS, Peshawar for ADP Schemes. However, for current
budget some EDOs (Health) do not even feel the need of the said sanctioning from DGHS
and directly get reimbursed from the DCO. This year 8 out of 25 districts did not seek the
sanction of Directorate General Health Services for disbursement of their health budgets
for procurement. In this case, the DGHS may not have any information on the
procurements made at the district level. This exposes the inherent weakness of the
financial management system regarding disbursements on procurement in some instances
73
as it does not make the budget sanction mandatory by the DGHS.
Scoring Criteria
Score
The procurement system is sufficiently integrated with the financial management and budgetary
systems to provide information on the completion of all major contracts.
3
Information on completion of the majority of large contracts is submitted as described
above.
2
Information on the completion of contracts is erratic or is normally submitted with considerable
delay after the fiscal budgetary period.
1
The procurement system does not generally provide this information.
Indicator 4.
0
The province has a functional normative/regulatory body.
Indicator-4 relates to the existence of a Public Procurement Regulatory authority in the
Khyber Pakhtunkhwa Province.
Draft Khyber Pakhtunkhwa Public Procurement of Goods, Works and Services Bill 2012
has been approved by the Provincial Assembly & the Governor Khyber Pakhtunkhwa and
notified on 20.09.2012 as Khyber Pakhtunkhwa Public Procurement Regulatory Authority
2012. Khyber Pakhtunkhwa Public Procurement Rules 2012 are now pending signatures
of Chief Secretary Khyber & and their implementation in all the Government departments
in the Province. Creation of this regulatory authority would lead to emergence of the
procurement functions within the public sector and their proper discharge, independence
of the regulatory function, the effectiveness of performance and the degree of coordination
between responsible organizations. Until the said regulatory body is manned with officials
to function it will not have any utility and does not come under the scope of discussion
under reference at present. The scoring for this indicator therefore remains zero for the
said purpose.
Indicator- 5:
Existence of institutional development capacity.
The objective of this indicator is to assess the extent to which the Province or Department
has systems to support and monitor the performance of the entire system, and to
74
formulate and implement improvement plans.
Sub indicator 5(a) – The Province has a system for collecting and disseminating
procurement information, including tender invitations, requests for proposals, and
contract award information.
The objective of this indicator is to determine
a) the existence and capacity of the procurement information system in the Province;
b) the accessibility of the information system;
c) the coverage of the information system; and,
d) whether the system provides one stop service (to the extent feasible) where those
interested can find information on procurement opportunities and outcomes.
Health Department does have a Planning Cell which has a capacity for analysis, feedback
mechanisms and planning for implementation of improvements. However, such capacity
exists for the purpose of annual planning, budget formulation and associated expenditures
and does not generate any annual or multi annual procurement plans. The District Health
Information System (DHIS), an Information Technology arm of the DGHS Khyber
Pakhtunkhwa disseminates quarterly provincial reports based on health-related data and
posts subsequent analysis on its website for the twenty five districts of Khyber
Pakhtunkhwa.
Health Department also publishes on its website selected procurement information for
public access. Rule-31 (c to g) of the NWFP Procurement Rules 2003, in order to promote
competition and transparency, provides for access to general public only upon request, the
information relating to participating bidders on their qualification / disqualification,
comparative Evaluation Summary, grounds of their rejection under Rule-32 (for sole
technically evaluated bidder) or under Rule-8(2) (for non-submission of secondary
documentation).
For posting the Standard Bidding Documents for procurement of bio-medical equipment
and pharmaceutical products for Govt-MCC for the year 2012-13, temporary web-links
were created on DHIS website and published in the IFB for access by the prospective
bidders. However, the DGHS neither has a dedicated web-link or an automated ERP
Contract Management system like Prodagio® or Share Point® software programs which
are dedicated solely to the collection and dissemination of information focused on
procurement nor does it offer any one-stop services related to information on procurement
opportunities and outcomes.
75
Scoring Criteria
There is an integrated information system that provides as a minimum, up-to-date information as
described above and is easily accessible to all interested parties at no or minimum cost.
Score
3
Responsibility for its management and operation is clearly defined.
There is an integrated system of the characteristics described that provides up-to-date
information for the majority of contracts at the central government level but access is limited.
2
There is a system but it only provides information on some of the contracts and the system
accessibility is limited.
1
There is no procurement information system except for some individual agency systems.
Entities keep information on contract awards and some statistics.
0
Sub-indicator 5(b) – The Province has systems and procedures for collecting and
monitoring national procurement statistics.
For purposes of this sub-indicator, the focus is on data available on procurement
undertaken using provincial budget funds.
As statistical information on procurement is essential to evaluate the policies and the
operation of the system, it also provides a means for monitoring performance and
compliance in a legal and regulatory framework. Unfortunately, the Directorate General
Health Services (DGHS) has not yet been able to force the Districts, Vertical Programs
and AMIs to send their annual requirements to the Divisional Office in Peshawar well in
advance for the sake of generating any statistical information to be used as a tool for
procurement planning and market analysis. This non-compliance, though administrative in
nature, may be attributable to lack of existence of any system in operation to collect data
on:
i) procurement by method,
ii) duration of different stages of the procurement cycle,
iii) awards of contracts,
iv) unit prices for most common types of goods and services;
v) any other information that allows analysis of trends, levels of participation, efficiency
and economy of the purchases and compliance with requirements.
76
This may be attributable largely to a mix of centralized and decentralized procurement
systems simultaneously at the Divisional and District levels. Resultantly, the credibility of
any such information on procurement conducted by the Health Department, especially by
the DGHS and its subsidiaries has been compromised as it has not been verified by any
audit and no routine analysis of any such information is carried out except for upgradation
of the approved formulary/medicine list by the Govt-MCC, DGHS.
Scoring Criteria
Score
The country has a system that meets the four requirements (a) through (d) listed above.
3
The country has a system that meets (a) plus two of the remaining conditions.
2
The system is in place to meet (a) plus one of the remaining conditions.
There is no statistical data collection system in place.
1
0
Sub-indicator 5(c) – A sustainable strategy and training capacity exists to provide
training, advice and assistance to develop the capacity of government and private
sector participants to understand the rules and regulations and how they should be
implemented.
The purpose of this sub indicator is to verify existence of permanent and relevant training
programs for new and existing staff in government procurement.
Until recently, no dedicated training programs related to procurement skill enhancement
were conducted in the Health Department Khyber Pakhtunkhwa as there was no strategy
existing at the departmental level to envisage such needs to generate and maintain the
supply of qualified procurement staff. The Health Services Academy in Peshawar seems
to have its major focus on management training to the doctors. The ongoing USAID
DELIVER Project in Khyber Pakhtunkhwa is involved on the nation-wide supply chain of
contraceptives through its Logistics Management Information System (LMIS), besides
catering to the training needs of the Districts’ staff in the LMIS discipline. The said training
component does not address the specific requirements of a procurement life cycle.
Keeping in view the magnitude of funds involved and sensitivity of time in getting the best
value for money and product efficacy, this neglected area poses far greater risk than
77
anticipated.
Scoring Criteria
Score
There is a training and capacity building strategy that provides for:
(a)
Substantive permanent training programs of suitable quality and content for the needs of
the system.
(b)
Evaluation and periodic adjustment based on feedback and need.
(c)
Advisory service or help desk to absolve questions by procuring entities, suppliers,
contractors and the public.
There is a training and capacity building strategy that provides for a) above.
The existing program is of poor quality and insufficient to meet the needs of the system and there
is no procurement help desk or advisory service.
No formal training or help desk programs exist.
3
2
1
0
Sub-indicator 5(d) – Quality control standards are disseminated and used to
evaluate staff performance and address capacity development issues.
The purpose of this sub-indicator is to verify existence, relevance and comprehensiveness
of the quality assurance and standards for processing procurement actions and to ensure
their systematic application to provide for monitoring of performance..
Although these types of standards will vary widely between different administrative levels,
they should as a minimum:
(a)
Provide quality assurance standards and a monitoring system for procurement
processes and products
(b)
Provide for a staff performance evaluation process based on outcomes and
professional behaviors.
78
(c)
Ensure that operational audits are carried out regularly to monitor compliance with
quality assurance standards.
Though the NWFP Procurement Rules 2003 do mention response time for prequalification and tender submission, no quality control standards with respect to
purchaser’s performance evaluation exist or have been disseminated at the level of Health
Department to verify the existence of any such standards which might include response
times to reply to inquiries, or length of time to prepare tender documents after receipt of a
requirement. It is due to this fact that time and again the courts feel the need to interfere
on related matters in the Province regarding issues of product efficacy and spurious drugs
bought through procurement procedures which could not assure quality. The Provincial
Quality Control Board Khyber Pakhtunkhwa under the Health Department has a robust
mechanism for detecting, seizing and prosecuting spurious or sub-standard medicines in
the market but its operation may be a post-procurement measure and is not directly
related to procurement of drugs by the Department.
No monitoring system so far existed for assuring quality of procurement process or staff
performance in this regard including any performance based incentives for achieving
efficiency in procurement processes. Ironically, the only quality assurance mechanism
existing at Departmental level is the pre-qualification process by which mercantile and
manufacturing expertise of suppliers and manufacturers of bio-medical equipment, drugs
and surgical disposables is judged by the Department.
So far, at the level of Department of Health, to assess & evaluate purchaser’s performance
no mechanism has been developed for conducting the internal audit and any observations
from the external audit have not been translated into a lesson i.e., developing some
tangible form of operational standards to avoid emergence of similar observations on
procurements in future. The external audit conducted by the AGPR also seems to have
developed expertise on revenue receipt audit and not on expenditure audit, resulting in
observations by audit which are based not on non-observance of procurement procedures
by the procuring agency but on the probable financial improprietary, as viewed by audit.
The interesting examples in this regard are the audit observations wherein the Health
Department is asked to explain why the lowest evaluated responsive bid was selected
instead of instead of the lowest priced bid. Similarly, any drug procured through open
competition by Govt-MCC, if found costlier than the market, has also been objected by the
Audit. Such an instance is beyond the control of the Department and has been identified
as a risk alongwith its mitigation strategy in the Assessment Report.
Scoring Criteria
Score
79
The procurement system complies with (a) through (c) above.
3
The procurement system complies with (a) and (b) above but there is no regular auditing to
monitor compliance..
2
The procurement system has quality standards but does not monitor nor use the standards for
staff performance evaluation.
1
The system does not have quality assurance or staff performance evaluation systems.
0
Pillar III. Procurement Operations and Market Practices
This Pillar looks at the operational effectiveness and efficiency of the procurement system
at the level of the implementing entity responsible for issuing individual procurement
actions. It looks at the market as one means of judging the quality and effectiveness of the
system when putting procurement procedures into practice. This Pillar is distinguished
from Pillars I and II in that it is not looking at the legal/regulatory or institutional systems in
a Province but more at how they operate.
Indicator-6. The Province’s procurement operations and practices
are efficient.
This indicator looks at the efficiency of the operations and operational practices as
implemented by the procuring agencies.
Sub-indicator 6(a) – The level of procurement competence among government
officials within the entity is consistent with their procurement responsibilities.
The purpose of this sub-indicator is to assess the degree of professionalism and
knowledge of those responsible for implementation of procurement activities that:
(a)
there are defined skill and knowledge profiles for specialized procurement jobs.
(b)
there is systematic matching of skills against requirements for competitive
recruitment.
(c)
staff required to undertake procurement activities on an ad hoc basis have the
knowledge they need to undertake the activity or have access to professional
80
staff that can provide this knowledge.
The procurement for pharmaceutical products, surgical disposables, bio-medical
equipment and goods of general nature at the Directorate General Health Services
(DGHS), Vertical Programs, AMIs and Health Projects is being conducted in a traditional
way by the related officials & staff who are supposed to carry out the activity through
drafting of the Tender Inviting Notice for publication, updating the Formulary or the list of
bio-medical equipment, preparing the list of general items and submitting the same to the
authorized departmental committees, comprising sector specialists from pharmacy,
medicine, surgery and bio-medical engineering fields for review, approval and subsequent
purchasing.
The business functions stated above have so far ranged from clerical errands to the
administrative approvals & scrutiny in a repetitive way to establish traditional purchasing
practices. The Director General Health Services and the Chief Executives of the AMIs
seemed proficient in current procurement processes in the health sector. However, none
of the above personnel seemed to have any formal skill and knowledge profile for
specialized procurement jobs as per the above stated Sub-indicator 6(a) as neither there
has been any dedicated effort to develop such profile on any professional footing through
customized procurement trainings in the Health Department nor has there been any
academic pursuit of getting a degree, diploma or certificate in procurement management.
Very few officials of the Health Department Khyber Pakhtunkhwa have attended the twoday training in public procurement on PPRA Rules 2004 in National Institute of Training
(NIT) PPRA Office Islamabad in recent years. In the absence of any public procurement
regulatory authority in Khyber Pakhtunkhwa for initiating a formal training on public
procurement in the Province, NIT in Islamabad is therefore the only venue available which
offers the procurement officials of Health Department Khyber Pakhtunkhwa to align their
purchasing functions with international best practices in public sector contracting but has
largely remained unexplored so far. The Directorate General Health Services though, in
July 2011, initiated a one-time effort on capacity building of drug inspectors, Provincial
Quality Control Board, and Drug Testing Laboratory Khyber Pakhtunkhwa under in terms
of inspection and drug sampling protocols in a four-day workshop through Drug Control
Strengthening Project which focused on quality of the product but not on its acquisition
methodology.
Posting out of officials dealing with procurement from the concerned sections in the Health
Department have also made the fair implementation of procurement procedures
ineffective. Recently, establishment of a Logistics & Procurement Cell in DGHS has been
an important step in initiating centralized purchasing of bio-medical equipment and general
81
items on the basis of requirements generated by the districts, but no formal officials have
been dedicated for posting to the said Cell. This may be attributed to lack of any
systematic matching of skills against requirements of competitive recruitment for the
procurement function in the Health Department which is considered as a secondary
function vis-à-vis provision of health services as the primary function.
The variance in professional efficiency and operational practices of the procurement staff
appointed to undertake procurement activities on an ad hoc basis has therefore resulted in
delayed award of contracts and occasional misprocurement due to procedural lapses.
The maturity assessment of the procurement function of Health Department Khyber
Pakhtunkhwa typically considers the dimensions like strategic planning and objectives,
organization design, strategic sourcing and category management, buying operations,
supplier management, contract management, risk and governance management,
performance management, knowledge / information management and organizational
capability (skills). The Department has yet to develop defined skills for the above said
dimensions of the procurement functions through specialized capacity building of their
officials.
Scoring Criteria
The system meets the requirements (a) through (d) listed above.
The system meets (a) plus one of the remaining conditions.
The system only meets (a) above.
The system does not meet any of the requirements.
Score
3
2
1
0
Sub-indicator 6(b) – The procurement training and information programs for
government officials and for private sector participants are consistent with demand.
This sub indicator assesses the sufficiency of the procurement training and information
programs in terms of content and supply.
(a)
Training programs’ design is based on a skills gap inventory to match the
needs of the system.
(b)
Information and training programs on public procurement for private sector are
offered regularly either by the government or by private institutions.
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(c)
The waiting time to get into a course (for public or private sector participants) is
reasonable, say one or two terms.
Though the NWFP Procurement Rules 2003 remain a precursor to Federal PPRA Rules
2004 and almost both tend to share best practices in transparency and contracting
techniques, as earlier discussed above in indicator 6(a) the Health Department has neither
designed any dedicated professional program based on any of the above stated set of
Procurement Rules to develop procurement skills of its officials nor has there been any
academic pursuit of getting a degree, diploma or certificate in procurement management
by the concerned.
The strategic initiatives taken on provision of health service delivery for the masses in the
Province also seems devoid of any training programs and awareness workshops for the
suppliers in the private sector to educate them for submitting responsive bids. No training
calendar has ever been developed by the Health Department or the Provincial Health
Services Academy (PHSA) in Peshawar to cater to the needs for procurement related
trainings at regular intervals. PHSA could have been a valuable venue for such events for
maturing Departmental resources into assets for the procurement function with its faculty
members as Master trainers on public procurement as well.
Scoring Criteria
The training and information programs available meet all the requirements listed in (a)-(c) above.
The training programs are sufficient in terms of content and frequency (waiting time) for
government participants but there are few information programs for private sector..
There are training programs but they are deficient in terms of content and supply.
There is no systematic training or information program for public or private sector
participants.
Score
3
2
1
0
Sub-indicator 6(c) – There are established norms for the safekeeping of records and
documents related to transactions and contract management
The ability to look at implementation performance is dependent upon the availability of
information and records that track each procurement action. A system for safe-keeping of
records and documents should include the following:
(a)
The legal/regulatory framework establishes a list of the procurement records
that must be kept at the operational level and what is available for public
83
inspection, including conditions for access.
(b)
The records should include:
Public notices of bidding opportunities
Bidding documents and addenda
Bid opening records
Bid evaluation reports
Formal appeals by bidders and outcomes
Final signed contract documents and addenda and amendments
Claims and dispute resolutions
Final payments
Disbursement data (as required by the Province’s financial
management system).
(c)
There is a document retention policy that is compatible with the statute of
limitations in the Province for investigating and prosecuting cases of fraud and
corruption and with the audit cycles.
(d)
There are established security protocols to protect records either physical or
electronic.
Safekeeping of records and documents related to transactions and contract management
is vital to the functioning of both internal & external control systems and for reviewing the
past contracting actions preserved as organizational process assets. The Health
Department Khyber Pakhtunkhwa and its subsidiaries have kept the procurement record in
safe custody for access to external audit and inspection by other agencies. Separate file
for each supplier/manufacturer has been maintained with respect to his contract actions in
most of the cases instead of a master file, containing the proceedings from Tender Inviting
Notice (TIN) to contract award. In the absence of a streamlined filing system in
Procurement Cell & Govt-MCC section, finding administrative
approval regarding a particular procurement activity becomes the sole specialty of the
section assistant. However, the overall sanctity of the preserved record is intact.
Rule 31 of the NWFP Procurement Rules 2003 binds the Tender inviting Authority to
maintain record of procurement proceedings related to the nature of procurement activity,
detail of participating suppliers/contractors and their contract price, information relative to
any qualification, disqualification or rejection of bidders under Rule 32 of the said Rules,
summary of comparative evaluation of bids and name of Lowest Evaluated responsive
Bidder who has been awarded the contract. No visible security protocols established
administratively, either physical or electronic, were observed in the department.
However, unlike Rule 46 of the Federal PPRA Rules 2004 whereby all procuring agencies
have to retain the related record for a minimum period of five years, the NWFP Rules 2003 do not
assign any such period. Despite the absence of a statute, the Department has kept procurement
documents since 1996 or earlier since the creation of Govt-MCC stuffed in cupboards in an un-
84
indexed form.
Scoring Criteria
The procurement system complies with the requirements (a) through(d) listed above.
The procurement system complies with requirements (a), plus two of the remaining conditions.
The procurement system complies with (a) but not with the rest.
There is no mandatory list of documents or retention policy leaving it to the discretion of the
procuring entity.
Score
3
2
1
0
Sub-indicator 6(d) – There are provisions for delegating authority to others who
have the capacity to exercise responsibilities.
Delegation of authority and responsibility is key to having a well functioning system
especially when procurement is decentralized.
Delegation should be undertaken in accordance with the following:
(a)
Delegation of decision making authority is decentralized to the lowest
competent levels consistent with the risks associated and the monetary sums
involved.
(b)
Delegation is regulated by law.
(c)
Accountability for decisions is precisely defined.
In the absence of any specific provision in NWFP Procurement Rules 2003 for delegation
of financial powers, the provisions of the North West Frontier Province Delegation of
Financial Powers under the Financial Rules & the Powers of Re-Appropriation Rules 2001
are observed vide which the function of the Procuring Agency has been duly delegated
from the Health Secretariat to the Directorate General Health Services for central rate
contracting for drug rates and subsequently to the AMIs, Vertical Programs, Health
Projects and EDOs of the districts for issuing purchase orders through need-based
decentralized contracting for pharmaceutical products mentioned in the approved
Formulary & bio-medical equipment (exclusive of non-drug surgical disposables and
general items etc. which are procured by the subsidiaries). Though the decentralization is
governed administratively, little accountability could be visible for the decisions taken by
the DGHS subsidiaries in terms of identifying or consolidating their procurement needs for
annual procurement planning – hence over-specified bio-medical equipment is collecting
dust in some districts & Teaching Hospitals /medical units in the absence of both the
85
personnel trained to run the said machines and the intended end user.
Scoring Criteria
The system meets all requirements listed in a) – c) above.
Score
3
The law establishes delegation and accountabilities but the system concentrates
decisions at a high level creating congestions and delays.
2
Delegation is regulated in very general terms creating a need to clarify accountability for decision
making.
1
Delegation is not regulated by law and left at the discretion of the procuring entity. There is lack
of clarity on accountability.
0
Indicator-7: Functionality of the public procurement market.
The objective of this indicator is primarily to assess the market response to public procurement
solicitations. There are three sub indicators (a-c) to be scored.
Sub-indicator 7(a) – There are effective mechanisms for partnerships between the public
and private sector.
The investment friendly policies of the Provincial Government of Khyber Pakhtunkhwa, the Health
Department being a reliable purchasing client and the increasing interest of the foreign donors in
helping the Department eradicate & roll back diseases like Polio, Measles, HIV/AIDS, Malaria and
neo-natal tetanus etc through various Vertical Programs and Health Projects in the Province, have
generated considerable demand for bio-medical equipment, medical furniture, medical kits,
surgical disposables and pharmaceutical products etc. in the Province. This has attracted either
various pharmaceutical firms to establish their manufacturing premises in Khyber Pakhtunkhwa or
compete in the tendering process from other provinces to create a public procurement marketplace
and consequently a partnership wherein the government is the buyer and the private sector is the
supplier of the needed goods, works or services amounting to around Rs 1.25 billion annually.
However, most of the suppliers were of the view that they just wanted an introduction in the
Government business otherwise supplying pharmaceuticals to the Health Department consumed
much time and was not worth doing business compared to the their retail operations in private
sector market, private hospitals and other autonomous institutions like Railway and , armed forces
etc.
86
Such an arrangement has led to a dire need for some dialogue between the Health Department
and the private sector with regard to practices by the Department relating to pre-qualification and
tendering that had undermined the competitive effectiveness of the private sector in some areas.
Though Rule 11 of NWFP Procurement Rules 2003 mentions some response time to the applicant
for pre-qualification, there is no minimum time specified in Rule 17 of the said Rules for
communicating the prospective bidders of changes, clarifications or amendments in the bidding
documents. Misuse of Rule 20(2) regarding reducing the mandatory period of 30 days to any
number of days without a cogent reason has potentially restricted the competitive environment for
which no forums are available in the Health Department for its dialog the private sector on
deliberating upon any such practices. Similarly, the Standard Bidding Documents, after getting
advertised or posted on web, can only be amended or changed by the approved Technical &
Evaluation Committee as per approved administrative SOPs but the same are amended by the
Directorate General Health Services without intimation to the said Committee. The above said
operational lacunae have raised concern among competitors from the private sector. However, the
private sector has recently relied upon the Health Department as a partner-in-development under
the public private partnership arrangements for providing management consultancy services for
revitalizing and strengthening the health service delivery in six crises affected districts of Khyber
Pakhtunkhwa by the Health Sector Reforms Unit (HSRU), Health Department Khyber
Pakhtunkhwa. But it should be kept in mind that the said partnership has been ensured under the
Multi-Donor Trust Fund (MTDF) by the World Bank. An effective, reliable and transparent
mechanism for sustaining such a partnership from the Department itself has yet to come.
The Department, despite its arm-twisting prowess, has also not been able to create a forum for
initiating dialogue with the local pharmaceutical industry on eradication of spurious drugs. Such
dialogue could have initiated self-correcting actions by the drug associations themselves in the
private sector in taking measures to identify counterfeit medicines supplied in the market and
taking punitive measures against the unscrupulous manufacturers and suppliers with the help of
the Department. Any one-sided effort on the part of the Department so far by prosecuting the
unscrupulous suppliers, introducing alpha-numeric bar code stickers for supply of genuine drugs
to the Department or any other measures without the private sector stakeholders’ buy-in, has
resulted in futility.
Scoring criteria
(a)
(b)
Score
Government encourages open dialogue with the private sector and has several
established and formal mechanisms for open dialogue through associations or other
means.
The government has programs to help build capacity among private companies, including
for small businesses and training to help new entries into the public procurement
marketplace.
3
87
(c)
The government encourages public/private partnerships and the mechanisms are well
established in the legal framework to make possible such arrangements.
The system meets (a) plus one other condition above.
The system only provides for (a) above.
There are no obvious mechanisms for dialogue or partnership between the public and private
sector.
2
1
0
Sub-indicator 7(b) – Private sector institutions are well organized and able to
facilitate access to the market.
This sub-indicator looks at the capacity within the private sector to respond to public
procurement in the Province.
Pharmaceutical firms, bio-medical equipment suppliers and general item suppliers from
the private sector are the usual small and medium enterprises (SMEs) which are the
business partners of the Health Department. Around two hundred registered and prequalified firms possess the necessary organizational capacity to access the information
and other services to promote their participation in the tendering process initiated by the
Department all the year round. The pharmaceutical sector, at the moment, seems to be
well organized and competitive in terms of its professional staff and manufacturing
capabilities with respect to the firms pre-qualified with the Department on stringent criteria
and is keen on competition.
However, some areas of competition, like biological drugs & vaccines for Hepatitis B & C
and Tuberculosis etc., are monopolized by certain multinational suppliers owing to their
probable dominance in global research. Standard Interferon anti-viral therapy for
combating Hepatitis C has been pioneered since 2002 by a few multi-national companies
like M/s Roche Pharma Ltd and M/s Schering Plough Ltd etc. M/s Roche Pharma Ltd have
further initiated the observational Sustained Virologic Response (SVR) Studies for
Biosimilar Pegylated Interferon on multi-continental representative samples since 2007 for
non-responders and relapsers to the treatment of standard interferon and has created
some reference standards for head-to-head clinical trials whereby some SVR reports have
been published in indexed medical journals of international repute. Local companies like
BF Biosciences and Getz Pharma seem to give a fair amount of competition to the said
multi-nationals but seem deficient in providing head-to-head clinical trials based on a
longer duration. As the said aspect seems to limit the competition, the same is not being
considered in technical evaluation. The Technical Evaluation criteria also contains
pharmaco-kinetic & pharmaco-dynamic in-vivo Bio-Equivalence studies for Anti-Tubercular
drugs for determining proof of sustained response against the disease through continuous
serum efficacy have been made mandatory for technical qualification of the bidders for
88
specialized drugs.
The Directorate General Health Services has ensured that in order to achieve high
efficacy of the specialized product such reference standards should become part of the
Technical Evaluation Criteria of the revised Bidding Documents for procurement of
specialized drugs for the Govt-MCC for the year 2012-13. The above stated reference
standards have restricted the participation of many new entrants supplying or
manufacturing specialized drugs dealing with Interferon therapy who have been agitating
against the inclusion of the said reference standards. However, despite resistance, the
Directorate General Health Services has taken a firm stand on achieving high quality
biological products keeping in view the sensitivity of the prevailing situation regarding
Hepatitis C and Tuberculosis and has strived to ensure supply of quality biological drugs
by retaining the reference standards like SVR Reports for Interferon therapy and BioEquivalence Studies in the revised Standard Bidding documents.
Scoring Criteria
Score
The private sector is competitive, well organized and able to participate in the competition
for public procurement contracts.
3
There is a reasonably well functioning private sector but competition for large contracts is
concentrated in a relatively small number of firms.
2
The private sector is relatively weak and/or competition is limited owing to monopolistic or
oligopolistic features in important segments of the market.
1
The private sector is not well organized and lacks capacity and access to information for
participation in the public procurement market.
0
Sub-indicator 7(c) – There are no major systemic constraints (e.g. inadequate
access to credit, contracting practices, etc.) inhibiting the private sector’s capacity
to access the procurement market.
This Sub-indicator has been assessed through a survey form (Annexed) distributed
among various suppliers of pharmaceutical products and bio-medical equipment. The
majority of feedback revolved around the pre-qualification exercise conducted by the
Health Department annually to assess the efficacy of the industrial processes of the
manufacturers and supply chain mechanisms adopted by the importers or suppliers. The
89
suppliers of the bio-medical equipment and surgical instruments were mostly the importers
of the said equipment and were of the view that annual pre-qualification exercise for them
was redundant in view of the nature of supply, process involved and definition of the
product which remained almost constant due to established market practices and fixed
product definition with anticipated upgrades. They were of the view that manufacturers and
importers of the pharmaceutical products needed to be checked frequently during the year
and through surprise visits as well, to randomly verify the quality of daily, weekly or
monthly batches of medicines and drugs turning out of production locally.
The importers of the drugs & surgical disposables, on the other hand, were of the view that
the Batch Certificate on Form-7 under Rule 14(d)(i) of Drugs (Import & Export) Rules 1976
from the competent health authority of the country of export or from manufacturer and
submitted by the importers fulfilled the need for ascertaining the source of raw material
and quality of the product, hence their annual pre-qualification was not needed.
Regarding private sector’s access to credit by the Health Department in the form of any
mobilization advance, no such facility is provided in the contract clauses for procurement
of bio-medical equipment, pharmaceutical products or general items etc. Certain suppliers
maintained that the banks usually extended credit line facility to only those suppliers
whose import volume was large enough to comply with their corporate risk coverage;
hence not many of the importers could get any leverage from banks for opening Letter of
Credit and had to import directly from the manufacturers by sending cash in advance to
cover the risk of manufacturers but in turn risking their investments.
Certain suppliers of the pharmaceutical products or bio-medical equipment had the strong
impression on the survey scale of intensity that their bid securities were not timely
released despite definite time period given in the bidding documents for their return and
even after submission of Performance Security in case of selection of their pharmaceutical
products through central rate contracting by the Govt-MCC at Peshawar. They had to wait
for the Purchase Orders to be issued from the EDOs to get their bid securities back and
remained at the mercy of the EDOs (Health) for receiving any Purchase Orders. The
suppliers were of the view that results of the drug samples obtained by the Department
were not timely conveyed by the Drug Testing Laboratories leading to delay in their final
payments. This not only affected their investment circulation but reduced their financial
capability for participating in other contracts.
Many suppliers informed in the survey that they were originally distributors of
pharmaceutical products, including drugs, surgical disposables, medical supplies and biomedical equipment on behalf of the majority of the major local and multi-national
manufacturers
90
in pharmaceutical sector but due to a recent decision of the Peshawar High Court vide
Para 9 of the Writ Petition No. 2478/2010 (Daily Mashriq Vs Secretary Health & Others),
they were barred from participating on behalf of manufacturers. The said decision directs
the Health Department to purchase drugs only from original manufacturers or genuine
importers. However, in the new set-up the manufacturers are still having distributors in the
guise of suppliers serving their interests as the manufacturers traditionally either do not
have the reach-out potential for marketing of their products to the extent the distributors
have with their dedicated expertise, or do not yet want to develop the same.
This scenario has created not only a dichotomy for the Health Department which is in
realization of the actual situation and may be keeping silent for a while in violation the
Honourable High Court’s decree but also for the distributors working in the garb of
authorized suppliers who now face a risky situation in terms of their financial investment
with manufacturers having absolutely no coverage for the bid securities and performance
securities deposited on behalf of the manufacturers. The inherent risk in this situation has
emerged out of lack of their agency agreement with the manufacturers with whom they
club together for supply of pharmaceutical products without any contractual privity.
Resultantly with investment getting riskier, they are getting reluctant to participate on
behalf of the firms in the public sector affecting the competition of manufacturing firms as
well. The hue and cry raised by the representatives of the pharmaceutical companies
recently regarding increase in the bid security from Rs. 100,000 to Rs 500,000 by the
Directorate General Health Services Khyber Pakhtunkhwa as a primary qualification for
participation in Govt-MCC procurement of drugs for the year 2012-13 reflected the above
mentioned state of affairs. The T&E Committee evaluating in detail the Technical bids for
the above mentioned procurement activity has categorically instructed all the participating
firms that the Department would not allow anybody else except bidding firms’ regular
employees with their salary slips to submit firms’ bids and their present at the time of firms’
financial bid opening for the year 2013-14.
Inclusion of KIBOR rate of interest in the contracting provisions for paying 2% of the
delayed amount to the seller by the government is considered to reasonably distribute the
risk associated with untimely payment upon performance of contract and helps offset the
cost of doing business with the government. However, the previous contractual
arrangements between the Health Department Khyber Pakhtunkhwa and the suppliers
demonstrates that the pharmaceutical/bio-medical engineering firms participating in
tenders have long conceded their stated right by not pressing upon the Health Department
to include the above mentioned provision in the contract. Hence the survey displays an
alarming trend of delayed payments to the sellers by the Department forcing the suppliers
to adopt undesirable practices for release of their payments and a possible constraint to
competitive bidding.
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Scoring Criteria
There are no major constraints inhibiting private sector access to the public procurement market.
Score
3
There are some constraints inhibiting private sector access to the public procurement
market, but competition is sufficient.
2
There are multiple constraints inhibiting private sector access to the public procurement market
which often affect competition levels.
1
There are major constraints that discourage competition and the private sector firms are
generally reluctant to participate in public procurement.
0
Indicator- 8: Existence of contract administration and dispute
resolution provisions.
This indicator’s objective is to assess the quality of contract administration practices which
begin after contract award and continue to acceptance and final payments. This is an area
that many procurement systems fail to consider. It is also a period where many issues
arise that can affect the performance of the contract and impact on service delivery. This
indicator covers three sub-indicators (a-c) to be scored.
Sub-indicator 8(a) – Procedures are clearly defined for undertaking contract
administration responsibilities that include inspection and acceptance procedures,
quality control procedures, and methods to review and issue contract amendments
in a timely manner.
This sub-indicator addresses all of the following procedures which are important aspects of
contract administration:
(a)
Procedures for acceptance of final products and for issuance of contract
amendments are part of the legal/regulatory framework or are incorporated as
standard clauses in contracts.
(b)
Clauses are generally consistent with internationally accepted practices (see
IFI standard contracts for good practice examples).
(c)
Quality control (QC) procedures for goods are well defined in the model
contracts/documents or in the regulations. QC is carried out by competent
officers, inspection firms or specialized testing facilities. (DTL)
(d)
Supervision of civil works is carried out by independent engineering firms or
92
qualified government supervisors and inspectors.
(e)
Final payments are processed promptly as stipulated in the contract.
The Health Department had been using, until recently, a traditional contract template for
procurement of bio-medical equipment and pharmaceutical products which contained some
essential provisions dealing with payments, fraudulent practices, item delivery, product’s
shelf life or warranty and notices with basic level of treatment for each of them with respect
to risk mitigation. Little did the template offer any credible procedure to resolve contractual
disputes through arbitration considered vital for credibility of review procedures.
With the introduction of revised Standard Bidding Documents based on FIDIC Standard
Templates and customized for specialized operation related to the supply of health sector
goods in August 2012, the internationally agreed-to standard contractual provisions found
their way in the procurement business processes for contract administration like Statement
of Works (SOW), Performance Reporting, Period of Performance, Roles & Responsibilities,
Seller’s Place of Performance & Delivery, Pricing & Payment Terms, Inspection &
Acceptance criteria, Warranty & Product Support, Limitation of Liability, Penalties,
Incentives, Insurance & Performance Bonds, Sub-Contractor Approvals, Change Request
handling and Termination and Alternative Dispute Resolution (ADR) Mechanism for
supplies and including Fees & Retainage for any civil works etc if required. Service Level
Agreement (SLA) elaborating maintenance requirements and training needs has therefore
become a standard appendage to the main contract.
Instead of a single 100% payment method at the end of each accepted supply, a dual
payment régime was introduced in the Special Conditions of Contract of the Standard
Bidding Documents based on 80% payment at the time of supply and 20% after the
acceptance of product by the Client upon fulfillment of other contractual obligations.
This dual payment régime aims at easing out the agony of the supplier who had been
constantly waiting for the Quality Assurance Report of the Drug Testing Laboratory (DTL)
for approval of the sample taken by the Department for making payments. In the wake of
absence of any enforcement clause for payment by the Department in some prescribed
period in the NWFP Procurement Rules 2003, Section 22 of the Drugs Act 1976 provides
a mandatory period of two months for furnishing the same. The process may take upto
one and a half month for injectables as the prepared media in the Sterility Test may take
atleast 14 days to show any positive growth thereby leading to another two weeks to
duplicate the test to ensure the said growth. The tablets or capsules may take not more
than two weeks if all goes well. This is the minimum time that the supplier has to bear out
with the Department for receiving its payment if no other bureaucratic hurdles are created
afterwards to extort any gratification from the supplier.
93
However, any genuine delay by the DTL should not undermine the significance of the
sampling for assuring Quality Control (QC) conducted by the Health Department as the
said procedure derives its strength from the Drug Act 1976 & standard SOPs developed
for the Pre-Qualification process and is used at the supply stage by involving the DTL to
ensure product quality. In this regard, an interesting observation has been reported by the
DHIS Provincial Report of the 1st quarter 2012 stating that 100% of the drug samples
collected are those being manufactured locally by local companies and no sample has
been taken from any multi-national pharmaceutical firm. This requires some soul
searching on the part of the members of the Govt-MCC Selection (Purchase) Committee
to make the right decisions regardless of the cost for bulk purchases in the government
hospitals.
Though the dual payment clause may now theoretically reduce the disbursement time
during contract administration, the 60 days mandatory period for drug sampling and testing
practically reduces the probability of any timely payment based on contractual terms. The
suspension of the KIBOR Clause by the Department through the inactivating ‘Condition
Subsequent’ in the Special Conditions of Contract (SCC), as mentioned above in SubIndicator 7(c) has, under Common Law, created a precedence in favour of the Client and
may pose a contractual risk for the seller. The same may therefore needs to be mitigated
through supplementing any regulation for the said additional time in the much awaited KP
Public Procurement Rules 2012 conforming to the time period in the drugs Act 1976 for
the health sector to establish credibility of the Department.
Scoring Criteria
Contract administration procedures provide for (a) to (e) above.
Score
3
Contract administration procedures provide for (a) plus three of the remaining
requirements.
2
Contract administration procedures provide for (a) plus two of the remaining requirements.
1
Contract administration procedures do not meet the requirements of (a) to (e) above.
0
Sub-indicator 8(b) – Contracts include dispute resolution procedures that provide
for an efficient and fair process to resolve disputes arising during the performance
of the contract.
In order to avoid long delays while resolving disputes, a good resolution process should be
94
defined in the contract that provides for fair and timely resolution. The following describes
current good practice with regard to dispute resolution.
(a)
There is an Arbitration law in the Province.
(b)
The law is consistent with generally accepted practices for neutrality of
arbitrators, due process, expediency and enforceability.
(c)
The Province accepts as a matter of course international arbitration for
international competitive bidding.
(d)
Provisions for Alternative Dispute Resolution (ADR) are standard in contracts.
(e)
ADR provisions conform to the international standard wording (may refer to IFI
standard bidding documents for sample of good international practice).
Rule 43 of the NWFP Procurement of Goods, Works & Services Rules 2003 provide for
the appeal procedure for the bidders who feel aggrieved by the Procuring Entity and
want to file an application for review of the decision. Unless the PE entered into a
contract. The aggrieved bidder may file an application to:
•
•
•
•
Head of PE if Tender Accepting Authority is other than Head of Procuring Entity
Secretary Industries if Tender Accepting Authority is Head of Procuring Entity
Secretary Law if Tender Accepting Authority is Secretary Industries
District Coordinating Officer if procurement made with District Government funds
Though said Rule binds the aggrieved bidder to accept the decision of Reviewing
Authority as final and not to challenge it in any court of law said condition has been
rendered ineffective by the superior judiciary whereby no contractual provision can stop
an aggrieved bidder from approaching a court for redressal of his grievances. The
different review tiers mentioned in the said Rule may not be applicable now in the postdevolution scenario and need revision.
The Arbitration Act 1940 deals with domestic arbitration proceedings and applies to
recognition and enforcement of domestic awards but is not based on the UNCITRAL
Model Law. A Bill for a new consolidated arbitration law based on the UNCITRAL
Model Law was presented to the Parliament on 27 April 2009 and is still pending
before the National Assembly. The Bill aims to consolidate law relating domestic
arbitration, international commercial arbitration, recognition and enforcement of foreign
arbitral awards as well as settlement of international investment disputes. However,
even the Arbitration Act 1940 is consistent with generally accepted practices for
neutrality of arbitrators, due process, expediency and enforceability. The same has
been included in the recently revised Standard Bidding Documents for procurement of
pharmaceutical products for Govt-MCC.
95
Pakistan Engineering Council (PEC) has issued the first edition of its ‘Rules on
Arbitration & Conciliation’ drafted in March 2009. PEC has modeled its rules for
conciliation on the principles and lines of United Nations Commission on International
Trade Law (UNCITRAL) taking into consideration essential elements of Pakistan
Arbitration Act, 1940 and relevant provisions of PEC Regulatory Régime. Section 283
of The Companies Ordinance 1984 also facilitates dispute resolution through
arbitration. However, for establishing credibility among the foreign donors/buyers,
arbitration forums like International Chamber of commerce (ICC), international Court of
Justice Hague, UNCITRAL model Rules on Arbitration and FIDIC Contract Dispute
Resolution mechanism have been added in the said Standard Bidding Documents for
the public-private partnership arrangements to acquire management consultancy
services for revitalizing and strengthening the health service delivery in six crises
affected districts of Khyber Pakhtunkhwa by the Health Sector Reforms Unit (HSRU)
under the Multi-Donor Trust Fund (MTDF) by the World Bank.
Talking on the Country level, Section 49 of the Federal PPRA Rules 2004 provides for
the arbitration but leaves it to the procuring agencies to devise any methodology for
that. The ‘Rules of Arbitration & Conciliation 2009’ are well drafted by Pakistan
Engineering Council. Adjudicators stand appointed in the judicial branches of the public
sector for dispute resolution. Alternate Dispute Resolution Committees (ADRCs) to the
extent of the Federal Board of revenue (FBR) for resolving the disputes outside the
courts have already reduced the work load on the Supreme Court and are a standard
practice in the contracts.
In comparison, on the Provincial level Alternate Dispute Resolution (ADR) mechanism
has yet to make its mark in the procurement business processes adopted by the Health
Department. In the absence of any standard mechanism for arbitration under Rule 43
of the NWFP Procurement Rules 2003 and lack of any provincial appellate authority,
the aggrieved bidders are free to file complaint against a procurement process
elsewhere ranging from DGHS to Honourable Peshawar High Court as earlier
discussed in Sub-indicator 1(d) regarding Rules on participation despite right of
independent audience granted by the Secretary Health. This has created a contractual
risk in terms of dispute resolution and the Department may definitely consider, in
addition to making spontaneous departmental review committees, adopting the general
principles set by the Supreme Court of Pakistan for recent dispute resolutions through
the above mentioned Alternate Dispute Resolution Committees (ADRCs) for settling a
large volume of taxation related cases in Federal Board of Revenue (FBR), Islamabad.
Mediation can be another less hostile mode for dispute resolution outside the courts
which the Department may adopt in certain cases.
96
Scoring Criteria
The system meets all the good practice standards (a) to (e) above.
The system meets (a) plus three of the remaining good practice standards.
The system meets (a) plus two of the remaining good practice standards.
The system does not use ADR as a normal dispute resolution mechanism in public
contracts.
Score
3
2
1
0
Sub-indicator 8(c) – Procedures exist to enforce the outcome of the dispute
resolution process.
In order to be effective, the contract not only must provide for fair and efficient dispute
resolution procedures, it must also provide for enforcement of the outcome of the dispute
resolution process. The following are some basic conditions.
(a)
The country is a member of the New York Convention on enforcement of
international arbitration awards.
(b)
The country has procedures to enable the winner in a dispute to seek
enforcement of the outcome by going to the courts.
(c)
The country has a process to monitor this area of contract administration and
to address performance issues.
The current good practices for timely resolution of the disputes lie in the free judiciary in
the country for enforcement of the contract law. There is no specialist arbitration court in
Pakistan. The High Court and such other superior court in Pakistan as may be notified by
the Federal Government in the Gazette has jurisdiction over recognition and enforcement
of foreign awards. The judiciary in Pakistan is familiar with the laws governing both
domestic and international arbitrations.
The Arbitration Act 1940, supplemented by the Contract Act 1872, accepts the
international arbitration as Pakistan itself is a member of the forums regarding international
dispute settlement like Board of the ‘Forum for International Conciliation and Arbitration
(FICACIC).’ There are well informed arbitration law firms to help enforce the settlement
through the judiciary within the Country.
Pakistan is a member of the various other dispute resolution institutions like World Bank’s
‘International Center for Settlement of Investment Disputes (ICSID)’ which helps in the
97
conciliation and arbitration of international investment disputes. The International Chamber
of Commerce (ICC) is active through ICC Pakistan; however, presently it does not provide
any arbitral services.
Pakistan became a signatory to the United Nations Convention on the Recognition and
Enforcement of Foreign Arbitral Awards, 1958, known as ‘New York Convention’ on 30
December 1958. The Recognition and Enforcement (Arbitration Agreements Foreign
Arbitral Awards) Act 2011, known as ‘The Convention Act’, implements the New York
Convention in Pakistan and is limited to the enforcement of ‘foreign arbitral awards’. The
New York Convention was first implemented in Pakistan vide the Recognition and
Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Ordinance, 2005 which
was subsequently re-promulgated from time to time before the enactment of the said
Convention Act 2011.
Pakistan is party to the Geneva Protocol on Arbitration Clauses of 1923 and Geneva
Convention on the Execution of the Foreign Arbitral Awards of 1927. Pakistan is also a
signatory to the ‘Washington Convention’ which is a Convention on the Settlement of
Investment Disputes between States and Nationals of Other States of 1965.
It is important to note that in the absence of clear definitions of ‘domestic arbitration,’
‘domestic award,’ and ‘foreign arbitral award’ under the arbitration laws of Pakistan, the
scope and ambit of the aforementioned laws is unsettled. Accordingly it is possible that a
particular arbitration agreement or arbitral award may attract the application of the
Arbitration Act 1940 and/or the Convention Act 2011.
Scoring Criteria
The procurement system in the country meets the requirements of a-c above.
The country meets two of the three conditions above.
The country meets condition a).
The country does not meet any of the requirements.
Score
3
2
1
0
98
Pillar IV. Integrity and Transparency of the Public Procurement
System.
Pillar IV takes aspects of the procurement system and governance environment and seeks
to ensure that they are defined and structured to contribute to integrity and transparency.
Indicator -9:
The Province has effective control and audit systems.
The objective of this indicator is to determine the quality, reliability and timeliness of the
internal and external controls preferably based on risk assessment and mitigation.
Equally, the effectiveness of controls needs to be reviewed in terms of expediency and
thoroughness of the implementation of auditors’ recommendations. The assessment
should rely, in addition to their own findings, on the most current Country Financial
Accountability Assessment (CFAA) or other analysis including PEFA/PFM assessment
that may be available. This indicator has five sub indicators (a-e) to be rated.
Sub-indicator 9(a) – A legal framework, organization, policy, and procedures for
internal and external control and audit of public procurement operations are in
place to provide a functioning control framework.
The procurements conducted by the Health department Khyber Pakhtunkhwa have been
annually audited by the external auditors of the office of the Provincial AGPR. Such an
expenditure audit exercise for oversight of the procurement function derives its legitimacy
from the national legislation establishing the office of the Federal AGPR as constitutional
head for the said state organs even after Post-18th Amendment.
However, an Internal Audit mechanism has not been in place in the Health Department for
establishing internal controls for periodically producing recommendations to the heads of
the individual procuring entities based on their findings. TRF has already suggested
creation of an Internal Audit mechanism in its Health Sector Strategy Document for the
Province, complemented by internal control and management procedures that provide for
checks and balances within an agency for processing of procurement actions.
Procurement Audit is an expenditure audit and owing to its process peculiarities, is
different from the Revenue Receipt Audit. Due to its specialized nature, the Health
Department therefore needs develop a skilled Internal Audit workforce with special focus
on Procurement Audit. TRF has suggested the Directorate General Health Services some
99
capacity building measures on Procurement Audit in the annexed Training Calendar to
abreast the Departmental audit officials with the universally applicable expenditure audit
skills to scrutinize individual contract actions in the procurement activities.
Special Audits are also an infrequent feature for internal checks and balances on Health
Projects, Vertical Programs or any particular aspect of DGHS procurements and are called
when required administratively or for investing any complaints. These audits address
specific risks and check any controls available for their mitigation and preservation of
financial proprietary.
Scoring Criteria
Score
The system in the country provides for:
(a)
Adequate independent control and audit mechanisms and institutions to oversee the
procurement function.
(b)
Implementation of internal control mechanisms in individual agencies with clearly defined
procedures.
(c)
Proper balance between timely and efficient decision making and adequate risk
mitigation.
(d)
3
Specific periodic risk assessment and controls tailored to risk management.
The system in the country meets a) plus two of the above.
2
The system meets a) but controls are unduly burdensome and time-consuming hindering
efficient decision making.
1
Controls are imprecise or lax and inadequate to the point that there is weak enforcement of the
laws and regulations and ample risk for fraud and corruption.
0
Sub-indicator 9(b) – Enforcement and follow-up on findings and recommendations
of the control framework provide an environment that fosters compliance.
The purpose of this indicator is to review the extent to which internal and external audit
recommendations are implemented within a reasonable time. This may be expressed as
percentage of recommendations implemented within six months, a year, over a year or
never implemented.
Enforcement and follow-up of recommendations of External Audit by AGPR on past
procurements has to be linked with a monitoring and evaluation function which,
unfortunately, is hardly existent as reflected by the continued business practices on which
some audit observations were made. The audit observations, as seen from the record of
the DGHS, were also not based on the standard international contracting practices which
show lack of external auditors’ skills in expenditure audit. Among some glaring examples
of such practices, one pertains to a distorted interpretation of Rule 34 (2) of the NWFP
Procurement of Goods, Works and Services Rules 2003 whereby any surviving
100
technically qualified bidder is denied further evaluation/participation due to reduction in
the number of bidders from a minimum of three during technical evaluation. The said Rule
requires a minimum of three bidders at the time of submission of bids. Interestingly, the
DGHS procurement officials refer to the distorted requirement by the AGPR to include at
least three technically qualified bidders in the Comparative Statement, failing which any
sole technically qualified would also be disqualified.
Another example relates to inadvertent submission of technical and financial bids in the
same envelop in a Single Stage Two Envelop Bidding process under Rule 40 of the said
Rules 2003, whereby the submitting firm is considered disqualified. Rules 19-22 of the
NWFP Procurement Rules 2003 dealing with the marking and sealing of bids are also
silent on the issue. International best practices in contracting consider such omissions as
minor if the bidder has no objection if his financial bid gets revealed due to mistake of the
bidder. The Audit also makes observations on competitive procurement of some surgical
disposables which were quoted higher than the prevalent market price. The said items
usually have no labeling and their price quotation was beyond the control of the
department in the event of competitive bidding.
Scoring Criteria
Score
Internal or external audits are carried at least annually and recommendations are responded
to or implemented within six months of the submission of the auditors’ report.
3
Audits are carried out annually but response to or implementation of the auditors’
recommendations takes up to a year.
2
Audits are performed annually but recommendations are rarely responded to or
implemented.
1
Audits are performed erratically and recommendations are not normally implemented.
0
Sub-indicator 9(c) – The internal control system provides timely information on
compliance to enable management action.
The following key provisions should be provided:
(a)
There are written standards for the internal control unit to convey issues to
management depending on the urgency of the matter.
(b)
There is established regular periodic reporting to management throughout the
year.
(c)
The established periodicity and written standards are complied with.
The Sub-indicator 1(b) related to Procurement Methods, has earlier dealt adequately with
101
the appropriate hierarchical levels existing in the Health Department regarding internal
controls over procurement management through various departmental Committees all
having written standards. The said Committees, namely Pre-Qualification Committee,
Scrutiny Committee, Comparative Statement (CS) Committee, Technical & Evaluation
Committee and lastly the Purchase Committee, consist of health sector professionals for
examining bids under a competitive bidding method. Their composition has also been
described in the said Sub-indicator. Though the periodic reporting to management based
on a procurement life cycle throughout the year is infrequent as prescribed time limit for
such periodicity is not very well defined in the administrative SOPs, the presence of a prequalification calendar initiating such a procurement makes it an obvious attempt on the
part of the Health department to initiate yearly procurement cycle on time.
Scoring Criteria
All requirements (a) through (c) listed above are met.
Requirement (a) plus one of the above are met.
Only requirement (a) is met.
There is no functioning internal control system
Score
3
2
1
0
Sub-indicator 9(d) – The internal control systems are sufficiently defined to allow
performance audits to be conducted.
There are written internal control routines and procedures to be adhered to by the auditors
through internal audit and control manual.
Unfortunately, no internal audit control mechanism exists so far in the Health Department
as earlier discussed in Sub-indicator 5(d) regarding Quality Control standards for
evaluating staff performance and addressing capacity development issues and as
discussed in Sub-indicator 9(a) regarding provision of a functioning control framework for
public sector procurement.
Scoring Criteria
There are internal control procedures including a manual that state the requirements for this
activity which is widely available to all staff.
Score
3
102
There are internal control procedures but there are omissions or practices that need some
improvement.
There are procedures but adherence to them is uneven.
The internal control system is poorly defined or non-existent.
2
1
0
Sub-indicator 9(e) – Auditors are sufficiently informed about procurement
requirements and control systems to conduct quality audits that contribute to
compliance.
Perusal of the audit observation in the Health Department reveals that in view of the
traditional procurement practices conducted by the Department the auditors get the
information based on the said practices. There is hardly any system in place to ensure that
auditors working on procurement audits receive adequate training on expenditure audit or
are selected following the criteria that explicitly requires that they demonstrate sufficient
knowledge of the subject as described in Sub-indicators 5(d) & 9(b) regarding any Quality
Control standards disseminated and used to evaluate staff performance and address
capacity development issues in terms of procurement management.
The annexed Training Calendar proposed by the TRF contains some capacity building
based on short training workshops for procurement audit through which the auditors may
receive formal training on procurement requirements, principles operations, laws and
regulations and processes.
Scoring Criteria
There is an established program to train internal and external auditors to ensure that they
are well versed in procurement principles, operations, laws, and regulations and the
selection of auditors requires that they have adequate knowledge of the subject as a
condition for carrying out procurement audits.
Score
3
If auditors lack procurement knowledge, they are routinely supported by procurement
specialists or consultants.
2
There is a requirement that the auditors have general knowledge of procurement
principles, operations, laws, and regulations but they are not supported generally by
specialists in procurement.
1
There is no requirement for the auditors to have knowledge of procurement and there is no
formal training program and no technical support is provided to the auditors.
0
103
Indicator 10. Efficiency of appeals mechanism.
The appeals mechanism was covered under Pillar-I with regard to its creation and
coverage by the legal regulatory framework. Indicator 10 further assesses a range of
specific issues regarding efficiency in contributing to the compliance environment in the
Province and the integrity of the public procurement system. There are five sub indicators
(a-e) to be scored.
Sub-indicator 10(a) – Decisions are deliberated on the basis of available
information, and the final decision can be reviewed and ruled upon by a body (or
authority) with enforcement capacity under the law.
This sub indicator looks at the process that is defined for dealing with complaints or
appeals and sets out some specific conditions that provide for fairness and due process.
(a)
Decisions are rendered on the basis of available evidence submitted by the
parties to a specified body that has the authority to issue a final decision that
is binding unless referred to an appeals body.
(b)
An appeals body exists which has the authority to review decisions of the
specified complaints body and issue final enforceable decisions.
(c)
There are times specified for the submission and review of complaints and
issuing of decisions that do not unduly delay the procurement process.
Sub-indicator 1(h) has earlier assessed in detail the above stated processes covered
under Rule 43 of the NWFP Procurement Rules 2003 which offers opportunity to an
aggrieved bidder to file an application for review of the decision/order of the Procuring
Entity awarding a contract - provided the contract has not already entered into force. The
survey of the supplier feedback indicates that they sometimes get the impression of
harassment by the concerned officials for pursuing any complaint and no specified
provincial appellant forum exists to redress the said issue. The Client feedback, on the
other side, interestingly indicates the frivolity prevalent among the bidders and the
frequency with which they lodge complaints on every bidding process. Both the feedbacks
reflect the legal aspects of compliance risks which relate to weak enforceability of
regulations.
104
Scoring Criteria
The Province has a system that meets the requirements of (a) through (c) above
Score
3
The Province has a system that meets (a) and (b) above, but the process is not
controlled with regard to (c).
2
The system only provides for (a) above with any appeals having to go through the judicial
system requiring a lengthy process.
1
The system does not meet the conditions of (a) –(c) above, leaving only the courts.
0
Sub-indicator 10(b) – The complaint review system has the capacity to handle
complaints efficiently and a means to enforce the remedy imposed.
This indicator deals specifically with the question of the efficiency and capacity of a
complaints review system and its ability to enforce the remedy imposed.
In relation to capacity and efficiency of the grievance redressal system, the Health
Department Khyber Pakhtunkhwa is usually quick enough to arrange representations
before the Departmental Committee instituted in this regard. Keeping in view the outdated
procurement regulations in vogue and traditional administrative practices being carried
out, the capacity to handle complaints efficiently is directly proportional to the magnitude of
procurement and sensitivity of allegations involved. This Sub-indicator is closely related to
sub indicator 10(a) which also refers to enforcement and therefore any administrative
indecision regarding compliance gets potentially risky thereby involving the Department
into further litigation.
Scoring Criteria
Score
The complaint review system has precise and reasonable conditions and timeframes for
decision by the complaint review system and clear enforcement authority and mechanisms.
3
There are terms and timeframes established for resolution of complaints but
mechanisms and authority for enforcement are unclear or cumbersome.
2
Terms and timeframes for resolution of complaints or enforcement mechanisms and
responsibilities are vague.
1
There are no stipulated terms and timeframes for resolution of complaints and responsibility
for enforcement is not clear.
0
105
Sub-indicator 10(c) – The system operates in a fair manner, with outcomes of
decisions balanced and justified on the basis of available information.
The system needs to be seen as operating in a fair manner. The complaint review system
must require that decisions be rendered only on relevant and verifiable information
presented and that such decisions be unbiased, reflecting the consideration of the
evidence presented and the applicable requirements in the legal/regulatory framework.
The internal controls provided by the Departmental Committees on registration, prequalification and technical evaluation of bidders in the Health Department Khyber
Pakhtunkhwa have a fairly elaborate hierarchical and written mechanism of taking
decisions on the related issues. Being a sensitive sector dealing with health service
delivery for the common man on the street and having little allowance for any error leading
to fatalities, the outcome of decisions seems to be significantly justified on the basis of
available information and balanced in terms of suspension of drug licenses, crackdown on
spurious drugs in the Province despite political influence, and selection of efficacious drug
through competitive process. A survey into the medicine sale licenses issued by the
EDOs (Health) and the actual number of outlets selling medicines would give an insight
into the problem of sale of substandard or unregistered drugs since it is most likely that
these drugs or a majority of them originate from unlicensed sale points. The internal
controls provided by the Departmental Committees may therefore be judged on the said
criterion as well. With the available remedies provided for in the legal/regulatory framework
under Rule 43 of the NWFP Procurement Rules 2003 and administrative SOPs,
representations by the aggrieved parties are handled in such a way that these have often
resulted in unpublished remedies that were relevant to the implementation of the process
relating to pre-qualification and bid evaluation etc.
Scoring Criteria
Procedures governing the decision making process of the review body provide that
decisions are:
(a)
based on information relevant to the case.
(b)
balanced and unbiased in consideration of the relevant information.
(c)
can be subject to higher level review
(b)
result in remedies that are relevant to correcting the implementation of the
process or procedures.
Procedures comply with (a) plus two of the remaining conditions above.
Procedures comply with (a) above.
Score
3
2
1
106
The system does not comply with any of the above.
0
Sub-indicator 10(d) – Decisions are published and made available to all interested
parties and to the public
Decisions are public by law and posted in easily accessible places (preferably posted at a
dedicated government procurement website in the Internet).
As discussed in detail in the in Sub-indicator 6(c) regarding the established norms for the
safekeeping of records related to transactions and contract management and in Subindicator 11(a) regarding publication of information and its distribution through available
media, Health Department Khyber Pakhtunkhwa publishes on the website of the EPI
Program the some procurement information for public access of the participating bidders
on their qualification/disqualification, comparative evaluation Summary, grounds of their
rejection under Rule-32 for sole technically evaluated bidder and under Rule-8(2) for nonsubmission of secondary documentation. Specific procurement activities are advertised
through IFBs and on DHIS website but Technical Evaluation Reports are not published.
Scoring Criteria
All decisions are publicly posted in a government web site or another easily accessible place
Score
3
All decisions are posted in a somewhat restricted access media (e.g. the official gazette of
limited circulation).
2
Publication is not mandatory and publication is left to the discretion of the review
bodies making access difficult.
1
Decisions are not published and access is restricted.
0
Sub-indicator 10(e) – The system ensures that the complaint review body has full
authority and independence for resolution of complaints.
This indicator assesses the degree of autonomy that the complaint decision body has from
the rest of the system to ensure that its decisions are free from interference or conflict of
interest. Due to the nature of this sub indicator it is scored as either a 3 or a 0.
The Health Department Khyber Pakhtunkhwa has an administrative hierarchy headed by
Secretary Health and is run by the Rules of Business set by the Government for running
day to day governance through administrative SOPs and official guidelines. Secretary
Health is also the Head of the Selection (Purchasing) Committee and is part of the
107
purchasing process. The process provided for complaint redressal in Rule 43 of the NWFP
procurement Rules 2003 is not being followed. Any complaint from the aggrieved person
against his decision or against the decision of the Technical & Evaluation (T&E)
Committee is submitted to Secretary Health or routed to him through Provincial Health
Minister or Director General Health Services for grievance redressal.
In the absence any independent provincial appellate authority, Secretary Health keeping in
view the nature of complaint, either immediately conducts review of the earlier decision
himself or creates a review committee comprising members which are not part of the
referenced purchasing process, headed by Special Secretary Health or any Technical
member and fully authorizes them to review the Procuring Entity’s decision. This process
tends to assures the independence of the complaint review body and to eliminate any
conflict of interest.
The creation of a provincial appellate authority is indicated in Section-9 of the Drug Act
1976 but unfortunately its intended functionality is related to drug registration/licensing
issues only and is not meant to serve as an appellate tribunal for redressing procurement
related grievances. The Khyber Pakhtunkhwa Public Procurement Rules 2012 have been
enacted by the Provincial Assembly four years after tabling of the Bill. Keeping in view the
speed of legislative enactments by the Provincial Assembly, not much optimism may be
attached to the creation of any Provincial Appellate Authority under Section-9 of the Drug
Act 1976. But if it happens at some point of time, its Terms of Reference can be extended
to include redressal of procurement-related grievances as well; hence such a step by the
Provincial Government will significantly help in establishing the degree of autonomy and
independence required for such state organs.
Scoring Criteria
The complaint review body is independent and autonomous with regard to resolving
complaints.
NA
NA
The complaint review body is not independent and autonomous with regard to resolving
complaints.
Score
3
2
1
0
108
Indicator-11: Degree of Access to Information.
This indicator deals with the quality, relevance, ease of access and comprehensiveness of
information on the public procurement system.
Sub-indicator 11(a) – Information is published and distributed through available
media with support from information technology when feasible.
Despite limited access allowed by Rule-31 (c to g) of the NWFP Procurement Rules 2003
for providing information to general public, the Health Department publicly disseminates
the information relating to the participating bidders on their qualification or non-submission
of qualification, comparative evaluation Summary, and grounds of their rejection under
Rule-32 and under Rule-8(2). Specific procurement activities are advertised through IFBs
and on DHIS website but Technical Evaluation reports are not published.
As earlier discussed in Sub-indicator 1(a), NWFP Procurement of Works, Goods &
Services Rules 2003, while having been published in NWFP Local Government Planning
Manual in 2003, are not publicly accessible on any web-portal of Health Department KP,
or as a matter of fact on the Government of Khyber Pakhtunkhwa website which displays
only North-West Frontier Province Procurement of Goods, Works, Services and
Consulting Services Ordinance, 2002 but hosts more than 900 different public rules,
regulations, acts & laws since 1798 till 2008 spanning over two hundred years. This may
lead to transparency issues as there are no means available for finding any public
information on procurement regulations through a user-friendly point of access. Though
some of the information relating to the technical aspects of the product may contain
proprietary, commercial, personal or financial information, the timely public disclosure of
information on completion of the tendering process with respect to the above said Rules
31 & 32 of the NWFP Rules 2003, need a dedicated web-portal for easy public access.
Necessary SOPs for achieving the said purpose could not found in this regard.
Scoring Criteria
Information on procurement is easily accessible in media of wide circulation and availability.
The information provided is centralized at a common place. Information is relevant and
complete. Information is helpful to interested parties to understand the procurement
processes and requirements and to monitor outcomes, results and performance.
Information is posted in media not readily and widely accessible or not user friendly
for the public at large OR is difficult to understand to the average user OR essential
information is lacking.
Information is difficult to get and very limited in content and availability.
There is no public information system as such and it is generally up the procuring entity to
publish information.
Score
3
2
1
0
109
Indicator 12. The Province has ethics and anticorruption measures in
place.
This indicator assesses the nature and scope of the anticorruption provisions in the
procurement system. There are seven sub indicators (a-g) contributing to this indicator.
Sub-indicator 12(a) – The legal and regulatory framework for procurement, including
tender and contract documents, includes provisions addressing corruption, fraud,
conflict of interest, and unethical behaviour and sets out (either directly or by
reference to other laws) the actions that can be taken with regard to such behavior.
This sub indicator assesses the extent to which the law and the regulations compel
procuring agencies to include fraud and corruption, conflict of interest and unethical
behavior references in
The tendering documentation.
The Health Department Khyber Pakhtunkhwa has made part of the earlier bidding
documents the provisions addressing corruption, fraud, conflict of interest, and unethical
behaviour which remain integral part of the revised Standard Bidding Documents as well.
The said provisions also set out that the punitive damages ten times the amount of
contract price can be imposed with regard to such behavior. The revised Standard Bidding
Documents include the definitions of what is considered fraud and corruption and the
consequences of committing such acts. This sub indicator is related to sub indicator-2(b)
on content for model bidding documents but is not directly addressed in that sub indicator.
National Accountability Bureau has set the threshold of Rs 50 million or above for
intimating all the proceedings of a procurement activity and has made it enforceable
through its regulatory framework. Whereas all accountability focus seems to be on the
public officials, there is a need for bringing in an anti-corruption legislation for
unscrupulous suppliers as well who try to bribe the government officials. The US Foreign
Corrupt Practices Act (FCPA) levies fines & penalties on the foreign sellers for bribing US
public sector procurement officials acquiring goods and services under the Federal
Acquisition Regulations. Inference can be drawn from the said Act in creating a similar
legislation at home.
Scoring Criteria
Score
The procurement law or the regulations specify this mandatory requirement and give
precise instructions on how to incorporate the matter in tendering documents. Tender
documents include adequate provisions on fraud and corruption.
3
The procurement law or the regulations specify this mandatory requirement but leaves no
precise instruction on how to incorporate the matter in tendering documents leaving this up to
the procuring agencies. Tender documents generally cover this but without consistency.
2
110
The legal/regulatory framework does not establish a clear requirement to include language in
documents but makes fraud and corruption punishable acts under the law.
1
Few
tendering
documents
appropriate
dealing with
fraud andbehavior
corruptionand its
The legal
framework
doesinclude
not directly
addresslanguage
fraud, corruption
or unethical
consequences. Tender documents generally do not cover the matter.
0
Sub-indicator 12(b) – The legal system defines responsibilities, accountabilities, and
penalties for individuals and firms found to have engaged in fraudulent or corrupt
practices.
NWFP Procurement of Goods, Works & Services Rules 2003 do not expressly define
responsibilities, accountabilities, and penalties for individuals and firms found to have
engaged in fraudulent or corrupt practices. However, Provincial Anti-Corruption
Department and National Accountability Bureau’s provincial arm address the sanctions for
such actions by the public servants. The provisions regarding conflict of interest express
action against the concerned officials but do not spell out the ways and means by which
such conflict of interest arises. Anti-corruption laws contain provisions to stop intervention
in procurement matters by any active or formal public officials for a reasonable period of
time after leaving office, in ways that benefit them, their relatives, and business or political
associates financially or otherwise. But the said provisions disconnected with the
infirmities of the procurement processes and need to be re-aligned with revised business
process contained in the newly enacted provincial procurement rules for vindication of the
innocent.
Scoring Criteria
re
The legal/regulatory framework explicitly deals with the matter. It defines fraud and corruption in
procurement and spells out the individual responsibilities and consequences for government
employees and private firms or individuals found guilty of fraud or corruption in procurement,
without prejudice of other provisions in the criminal law.
Sco
3
The legal/regulatory framework includes reference to other laws that specifically deal
with the matter (e.g. anti corruption legislation in general). The same treatment is given
to the consequences.
2
The legal/regulatory framework has general anti corruption and fraud provisions but does not
detail the individual responsibilities and consequences which are left to the general relevant
legislation of the country.
1
Few legal/regulatory
tendering documents
include
appropriate
language
dealing with fraud and corruption
The
framework
does
not deal with
the matter.
0
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Sub-indicator 12(c) – Evidence of enforcement of rulings and penalties exists.
This indicator is about the enforcement of the law and the ability to demonstrate this by
actions taken.
Perusal of the record of the contravention cases and subsequent disqualifications of the
retailers and manufacturers of the pharmaceutical products has revealed Khyber
Pakhtunkhwa Health Department’s resolve to eradicate spurious drugs and ban
unscrupulous drug suppliers and manufacturers by stringent pre-qualification proceedings
and frequent surprise raids on sale and manufacturing outlets. Though not an easy
indicator to score in terms of contravention cases made and percentage of them
prosecuted owing to the political influence exerted on the Department, the said figures
however indicate a significant portion of cases get treated for suspension of drug licenses
and disqualification during pre-qualification proceedings in the wake of a big challenge
posed by spurious drugs flooding the local market.
Scoring Criteria
Score
There is ample evidence that the laws on corrupt practices are being enforced in the
country by application of stated penalties.
3
There is evidence available on a few cases where laws on corrupt practices have been
enforced.
2
Laws exist, but evidence of enforcement is weak.
There is no evidence of enforcement.
1
0
Sub-indicator 12(d) – Special measures exist to prevent and detect fraud and
corruption in public procurement.
This sub indicator looks to verify the existence of an anticorruption program and its extent
and nature or other special measures which can help prevent and/or detect fraud and
corruption specifically associated with public procurement.
There is no special anti-corruption program to prevent and detect fraud and corruption in
public procurement except for inviting Provincial NAB authorities in the T&E Committee
meetings which is a self-defeating approach to make the external reviewers part of the
internal process. Transparency International has yet to make an impact in the Province for
monitoring a transparent and efficient procurement system and for providing public
112
information to promote accountability and transparency. There are no public seminars
conducted by the Provincial Government in general or Health Department in particular on
exposing collusive practices in procurement, or any awareness campaigns, focusing on
public sector purchasers and private sector suppliers, as part of efforts to change social
behavior in respect to corrupt practices and creating zero tolerance towards them.
Scoring Criteria
Score
The government has in place a comprehensive anticorruption program to prevent, detect and
penalize corruption in government that involves the appropriate agencies of government with a
level of responsibility and capacity to enable its responsibilities to be carried out. Special
measures are in place for detection and prevention of corruption associated with procurement,
3
The government has in place an anticorruption program but it requires better coordination or
authority at a higher level to be effective. No special measures exist for public procurement.
2
The government has isolated anticorruption activities not properly coordinated to be an
effective integrated program.
1
The government does not have an anticorruption program
0
.
Sub-indicator 12(e) – Stakeholders (private sector, civil society, and ultimate
beneficiaries of procurement/end-users) support the creation of a procurement
market known for its integrity and ethical behaviors.
This indicator assesses the strength of the public in maintaining a sound procurement
environment.
Health Department Khyber Pakhtunkhwa has demonstrated its resolve to fight corruption
in the procurement processes. Vigilance Societies composed of government officials from
different offices and civil society entities for all the 25 Districts have been formed by the
department in compliance with the orders of the Honourable Peshawar High Court,
Peshawar passed in Suo Moto Writ Petition No. 3129/dated 28-02-2012, 27-06-2012 & 1209-2012, for providing oversight to exercise any social control by some respected or
credible civil society groups. A typical Vigilance Committee for a District is composed of:
Sr.
No.
1
2
3
4
Designation
District Coordination Officer
Executive District Officer (Health)
Executive District Officer Agriculture
Medical Superintendent DHQ: Hospital
Chairman
Secretary/Member
Member
Member
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5
6
7
8
9
10
All Sub Divisional Magistrates in the District
Tehsil Municipal Officer in the District
District Food Controller
President District Bar
President Bazaar Union
President District Press Club
Member
Member
Member
Member
Member
Member
Functions:
1- The Vigilance Committee would make surprise raids specially at night time on all
district, tehsil and jail hospitals to check the services provided, the presence of the
medical officers, the paramedical staff and all allied facilities and deficiencies or
absence from duty shall be reported to the DG Health Services/Secretary Health in
the prescribed manner and one copy should be faxed to the Registrar Peshawar
High Court, Peshawar directly.
2- The committee would check particularly in the night-shift any un-authorized staff,
personating as a medical officer and if found so, to be proceeded against under the
law immediately and be given punishment which he deserves.
3- The Committee would furnish fortnightly report of its activities regularly to the
Secretary Health/DG Health Services with copy to the Registrar, Peshawar High
Court, Peshawar besides report as mentioned in No.1 & 2 of its TORs.
The Honourable Peshawar High Court is very active for establishing and reinforcing social
audit and control through the joint effort of the Provincial Government and civil society
groups. However, the Government still lacks on its own at a larger scale, initiatives on
welcoming such groups to generate quality debates towards creating an environment
where integrity and ethical behavior is expected and deviations are not tolerated. Public
seminars on aspects related to transparency and open competition in public procurement
are rarely seen by the Health Department.
Scoring Criteria
(a)
There are strong and credible civil society organizations that exercise social audit and
control.
(b)
Organizations have government guarantees to function and cooperation for their
operation and are generally promoted and respected by the public.
(c)
There is evidence that civil society contributes to shape and improve integrity of public
procurement.
There are several civil society organizations working on the matter and the dialogue with
the government is frequent but it has limited impact on improving the system.
T
Score
3
2
114
There are only a few organizations involved in the matter, the dialogue with the government is
difficult and the contributions from the public to promote improvements are taken in an
insignificant way.
1
There is no evidence of public involvement in the system OR the government does not want to
engage the public organizations in the matter.
0
Sub-criteria 12(f) – The Province should have in place a secure mechanism for
reporting fraudulent, corrupt, or unethical behavior.
The Health Department Khyber Pakhtunkhwa provides information on all procurements
exceeding Rs 50 million to NAB through a system for reporting fraudulent, corrupt or
unethical behavior that provides for confidentiality. However, the Department itself reacts
quickly to reports as verified by subsequent actions taken to address the issues reported
by any other agency through traditional ways. A probable automated ERP Contract
Management System seems to be the need of the hour to be installed at the level of the
Logistics & procurement Cell, DGHS to provide real-time access to the flow of acquisition
processes, their completion timings and personnel involved in disposing of the related
contract actions.
Scoring Criteria
Score
There is a secure, accessible and confidential system for the public reporting of cases of fraud,
unethical behavior and corruption.
3
There is a mechanism in place but accessibility and reliability of the system undermine
and limit its use by the public.
2
.
There
is a mechanism in place but security or confidentiality cannot be guaranteed
There is no secure mechanism for reporting fraud, unethical behavior and corruption cases
1
0
.
Sub-criteria 12(g) – Existence of Codes of Conduct/Codes of Ethics for participants
that are involved in aspects of the public financial management systems that also
provide for disclosure for those in decision making positions.
Submission of Annual Confidential Reports (ACRs) is a regular feature of the reporting
mechanism for a Code of Conduct/Ethics that applies to all gazetted provincial public
officials meeting financial disclosure requirements. However, no separate requirements for
officials involved in public procurement are in place to deter them from committing any
115
financial improprietary.
Scoring Criteria
(a)
There is a code of conduct or ethics for government officials with particular provisions for
those involved in public financial management, including procurement.
(b)
The code defines accountabilities for decision making and subjects decision makers to
specific financial disclosure requirements.
(c)
The code is of obligatory compliance and consequences are administrative or criminal
The system meets requirements (a) and (b) but is only a recommended good practice
code with no consequences for violations unless covered by criminal codes.
T
There is a code of conduct but determination of accountabilities is unclear.
There is no code of conduct.
Score
3
2
1
0
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6.
Pharmaceutical Supply Chain of Health Department, Khyber
Pakhtunkhwa
The Supply Chain of pharmaceutical products and bio-medical equipment to the
procurement entities of the Health Department, Khyber Pakhtunkhwa was studied through
visits to the selected sites e.g., Pharmaceutical warehouses of EDO (Health) Abbottabad,
Mansehra and Peshawar, Medicine Store of District Headquarters Hospital Abbottabad,
MNCH Vertical Programs, Peshawar, Warehouses of Lady Reading Hospital (LRH)
Peshawar, Hayatabad Medical Complex Peshawar, Khyber Teaching Hospital (KTH)
Peshawar, IRNUM Peshawar, Khyber Medical College Peshawar and Khyber College of
Dentistry Peshawar. Apart from physical observation on-site, a questionnaire, based on
the international best practices by the WHO was provided to the Stores management for
filling up. The information so received, reveals that that most of the said practices
regarding storage and inventory
are not being carried out as per internationally
recognized guidelines laid out by the WHO. The rest of the warehouses in other districts in
the Province could not be visited due to the travel advisory. However, the concerned
EDOs (Health) were conveyed the said questionnaire for their feedback telephonically and
through email. Various EDOs (Health) were interviewed who were present during the
monthly capacity building and training sessions on procurement
As observed, the supply chain of the bio-medical equipment is of not much an issue
compared to the pharmaceutical products which require specific storage environments and
distribution protocols and therefore will be the focus of ensuing discussion. By looking at
the representative inventory in-practice samples mentioned above, the following
observations on the storage & warehousing, inventory management, product requisition,
distribution and physical verification of the pharmaceutical goods were made:
Receipt of Goods:
EDO (Health), being the administrative head and the Drawing & disbursing officer (DDO)
of the District, issues the Purchase Orders for the medicines whose unit rates have been
selected by the Govt-MCC at DGHS, Peshawar. The purchases made by the EDO
(Health) are normally based not on the requirements conveyed by the primary health
facilities like BHUs and RHCs etc in his district but on a drive to consume the budget
allocated for the purchase of medicines and surgical disposables. The medicines are
supplied by the supplier selected by the Govt-MCC to the EDO Health’s warehouse from
where these are distributed to the said primary health facilities, civil hospitals, BHUs and
RHCs etc..
Medical Superintendent (MS) of a District Headquarter Hospital is under administrative
supervision of the EDO (Health) but remains Incharge/Drawing & Disbursing Officer (DDO)
of the DHQ at the District and separately issues Purchase Orders for the medicines of the
firms selected by the Govt-MCC at DGHS. The medicines are supplied by the supplier
selected by the Govt-MCC to the DHQ’s Medicine Store from where these are provided to
117
the wards. The requirement of the DHQ is based on the indents received from the Hospital
wards which are prepared by the Incharge nurse. The indents, after getting checked by the
Registrar and counter-verified by the MS, go to the Hospital Medicine store and the
medicine stock is issued thereof to the wards.
The Autonomous Medical Institutions (AMIs) also receive their medical supplies from the
Govt-MCC approved suppliers and use procedures similar to the DHQs. The Medical
colleges, on the other hand, usually do not purchase pharmaceutical products except for
chemicals used in laboratories and mostly focus on procurement of bio-medical
equipment. These have their dedicated equipment warehouses from where the same are
distributed to the concerned sections for installation.
Storage & Stacking of Medicines:
Pallets for storing the medicines were observed to be in acute shortage in the warehouses
of all the health facilities like AMIs, EDO (Health) Stores, Vertical Programs and to some
extent in DHQs. The stacking of the all medicines was not done on dedicated pallets and
mostly were placed on the floor without any consideration of the humidity. The
pharmaceutical warehouses/Medicine Stores of the EDO (Health), DHQ Abbottabad and
AMIs were air-conditioned and contained deep freezers for storing vaccines and biological
drugs. However, the purpose-built specialized deep-freezers with temperature display
could only be seem at the HMC, Peshawar. The pharmaceutical warehouse of MNCH at
Peshawar was in a deplorable condition with all the medicines placed on dirty floor and
with neither any temperature control of the room nor any deep-freezer and did not employ
any dedicated person for checking the dosage, strength and packaging of the goods
received.
Due to lack of any dedicated space in AMIs, the medicines are also stacked there on each
other adjacent to walls and without any clear therapeutic classification in the corridors
which converted into the part of warehouses before transferring them into the stores. LRH
has its analgesics (narcotics) in lock & key and maintains strict protocols on their issuance.
Inventory Management: Abbottabad and Mansehra Districts contains a good inventory
management system and their pharmaceutical warehouses at the District and DHQ level
are well-maintained but the record keeping is manual. However, distribution of
pharmaceutical products in reefer containers to primary health facilities in the outer
reaches of the districts is not done by the EDOs (Health). Distribution is not an issue for
the DHQs and AMIs as the said medicines need to be consumed within the facility where
they are received.
Except for the warehouses of EDO Abbottabad and EDO Mansehra, no specific
quarantine area was observed in the stores of other districts, AMIs, DHQs and Vertical
Programs due to lack of space, to be designated for receipt of goods, segregation and
checking the arrived medicines. However, staff is there to receive the goods and place the
goods in the warehouse after reconciling the batch number of the medicine, its name,
118
strength, quantity, expiry date and date of receipt with the details mentioned in the
Purchase Order. The ledger system is maintained by keeping the order, delivery challan
and receipt invoice details. Though the record showed the date of dispatch to primary
health facilities in districts, it did not show the documentation of the date of actual delivery
of the medicines to the intended facilities by the EDOs (Health) and Vertical Programs.
The AMIs and DHQs keep an estimate of the average working stock for each product with
a fixed amount of safety (buffer) stock. SOPs for stock Management were made available
by the AMIs only based on quarterly re-ordering frequency. No such arrangement is
available with EDOs (Health).
Hayatabad Medical Complex, Peshawar runs a computer-based inventory management
systems on Oracle platform for its main pharmacy attached to five other satellite
pharmacies within the facility premises. The said program displays the following
information with options to generate reports:
•
•
•
•
•
•
•
•
•
•
•
Medicines Monthly Balance Sheet (Summary)
Medicines Monthly Balance Sheet (Detail)
Daily Unit Indent Page
Main Pharmacy Monthly Consumption
Main Pharmacy Indent Detail
Satellite Pharmacy Monthly Consumption
Satellite Pharmacy Indent Detail
Main Pharmacy Unit Ledger
Satellite Pharmacy Unit Ledger
Short Expiry Summary (Financial Year-wise / Financial Year-wise + Source-wise)
Main Pharmacy Stock-Receiving Challan
In HMC, the stocks from the regular pharmacy are exchanged with the ERP pharmacy
when the need arises.
Requisition of Stock:
There is no appropriate procedure for a primary health facility for requisitioning medicines
from the pharmaceutical warehouses of EDOs (Health) and Vertical Programs. The Store
Incharge usually guides the primary facility supervisors to place orders and then pushes
the stock to the said facilities on estimations based on earlier consumptions without
considering any current variation in disease burden in their areas. As informed by Dr.
Zafeer Ahmad, EDO (Health) Abbottabad, a computerized consumption and evidence
based inventory management system, created by him in 2002 was not followed after his
transfer from the said post, and upon his return, nothing remains of the said system.
However, the AMIs hold an adequate procedure for consumption-based requisitioning of
medicines through ward incharge indents duly verified by Registrar and counter-verified by
Chief Pharmacist. Indent requisitions from wards are initially based on generic names or
119
INNs (International Nonproprietary Names) till the time the Ward incharges get acquainted
to the brand names selected for the particular year.
Consumption Reporting of Medicines:
Except for the AMIs and DHQs, no daily, weekly or monthly consumption reporting of the
medicines by the subsequent health facility/end-user was observed in any of the EDOs
(Health) or Vertical Programs. AMIs & DHQs have an appreciable mechanism of reporting
back to the wards the inventory of dead items (pharmaceutical products not requisitioned
since long by wards and viable to get expired) at their regular Stores.
Physical Verification of Stocks:
Physical stock is verified internally on need-basis or on quarterly basis. AMIs like LRH and
KTH have different stores e.g., Regular Store (for receipt of medicines etc), Issue Store
(for issuing medicines to wards), Local Purchase Store (for purchasing non-Govt MCC
medicines or short-stock), General Store (for receipt and issue of general
items/linen/surgical disposables etc.), A&E Store (for purchasing accidents and
emergency medicines) and C&W Store (for maintenance items etc). The blank carton /
packing of the medicines is later reconciled with those issued to the wards. The Indent
register kept by the chief Pharmacist is therefore reconciled with the Expense Register
kept by the Ward Incharge Nurse. Annual external audit is also conducted with
observations usually on non-prescribed methods of stacking the medicines. As informed
by the AMIs, the pilferage of medicines may take place at the level of wards as the patient
is not available to participate in any reconciliation exercise, or by the distributer in the garb
of supplier, who gets the stock from the manufacturer and sells the expensive medicines in
the open market at half of the Govt-MCC controlled rate.
7 Assessment of Identified Risks & Their Mitigation Strategies:
The assessment of the procurement system of the Health Department by using the above
stated BLIs, has revealed the following risks which are assessed here and their mitigation
is suggested. The assessment also includes some risks identified by the Fiduciary Risk
Assessment (FRA) of health sector of Khyber Pakhtunkhwa PK earlier this year. Risks are
categorized accordingly as High, medium and low risk in terms of their impact on the
procurement system, organizational responsibility and probability of occurrence.
120
7.1 Regulatory Risks
1. Risk: Absence of Regulatory Framework for the Provincial Procurement
System
There is no overseeing Public Procurement Authority in the Province and the existing
NWFP Procurement of Goods, Works & Services Rules 2003 are not comprehensive
enough to address all competitive procurement methods like Single Envelop Single
Stage Bidding and Two Stage Two Envelop Bidding methods.
Impact: High
Probability of Occurrence: Low
Mitigation strategy: The Khyber Pakhtunkhwa Public Procurement Regulatory Authority
Bill 2012 regarding establishment of Khyber Pakhtunkhwa Public Procurement Regulatory
Authority and promulgation of Khyber Pakhtunkhwa Public Procurement Rules 2012 has
been enacted by the Provincial Assembly but is pending notification by the Chief
Secretary. Establishment of a KP PPR Authority will lead to strengthening of a competitive
procurement régime. In this regard, a Health Sector Procurement Supplement containing
supporting regulations, sector-specific Bid Evaluation Guidelines, User Notes and
Standard contract templates etc on public procurement customized to the specific healthsector requirements may be prepared and appended to the new Khyber Pakhtunkhwa
PPRA Rules 2012 (expected to be notified soon by the KP Government soon) and named
as Health Sector Supplement to Khyber Pakhtunkhwa Public Procurement Rules
2012 (HSKP PPRA) to be read in line with the allied laws and Sector-driven specifications
for procurement of Drugs, Medicines and Bio-Medical Equipment. TRF may contribute
towards preparing a Health Sector Procurement Supplement for DGHS KP if desired.
2. Risk: Weak Grievance Redressal mechanism leading to lack of oversight
As observed from the prevalent practice in DGHS KP, no specified Grievance Redressal
mechanism exists. Furthermore, the aggrieved parties do not find the environment
conducive for lodging any complaint perceiving possible backlash from the Department.
This has seriously compromised the monitoring capacity of the Department to address
such issues.
Impact: High
Probability of Occurrence: High
Mitigation strategy: Weak Grievance Redressal mechanism is being replaced by the
Khyber Pakhtunkhwa Public Procurement Regulatory Authority Bill 2012 containing a
robust Grievance Redressal mechanism. This mechanism seems independent of DoH KP
to ensure transparency and has two tiers of grievance redressal, one at the level of
Procuring Entity (as earlier existed) and the other at the level of KP Public Procurement
121
Regulatory Authority. Counter-review in the form of an appellate tribunal is still a missing
goal for the Department.
3. Risk: Vague Technical specifications of Bio-Medical Equipment and Inadequate
Need Assessment by Districts for Budgetary Allocations for the Bio-medical
equipment & pharmaceutical products.
Yearly centralized procurement of unit rates for pharmaceutical products by the GovtMCC is to be completed from 31st July to 30th June for District Health entities including
DHQs, THQs and RHQs where less expensive drugs are bought but more volume is
involved. Funds for the same are appropriated by the Provincial Government to the
District Governments under the Local Government Ordinance 2012 which release
quarterly disbursements for purchases of medicines to the EDOs (Health). They in turn
have to get sanction of DGHS against the said funds. In the absence of any Annual
Procurement Plan, quarterly purchase lists are consolidated by the EDOs (Health) and
instead of buying in each quarter due to small or variable amount of funds disbursed for
basic medicines, purchasing is done by them on bi-yearly or three-quarterly basis to
make the lumpsum purchases with more funds and attracting more suppliers. This
sometimes leads to shortage of medicines at Districts at a particular time. The same
exercise is carried out at Teaching Hospitals and becomes an acute problem where lives
saving drugs are required. Historical pattern of a medicines purchase cycle is not being
followed. Similarly, somewhat erroneous budgetary allocations at the Provincial level
due to lack of specifications of bio-medical equipment leads to unrealistic allocation on
estimates for the said specifications. This seems to be consequence of non-participation
by Sector Specialists/bio-medical engineers and end-users/doctors who were not made
part of the annual budgetary exercise based on which Standard Bidding Documents
could be designed.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: DGHS needs to call for estimates of yearly requirements in advance
based on previous years’ trends for pharmaceutical products, Bio-medical equipment and
medical supplies from all the EDOs (Health) to formalize the total annual estimates against
the budgetary allocations. Procurement support with respect to launching a procurement
lifecycle based on nearly accurate estimates has already provided by TRF by replacing in
August 2012 the traditionally structured three-page bidding document earlier used by the
Health Department with thoroughly revised Standard Bidding Documents (SBDs) for
procurement of pharmaceutical products and CMW Kits, Bio-Medical equipment, medical
furniture and generalized Items for Directorate General Health Services, Vertical Programs
and AMIs. The Logistics & Procurement Cell at DGHS in collaboration with Govt-MCC
122
may continue centralized acquisition of rates for all the District procuring entities, based on
yearly estimates provided by the EDOs (Health).
4.
Risk: Absence of Sector-specific Guidelines
It was observed that any Sector-specific guidelines read in conjunction with NWFP
Procurement Rules 2003 and Drug Act 1976 were not available. The current
procurement practices are being carried out in Province without identifying the Sector
Specialists for the Bio-Medical equipment, Drugs (General & Specialized), Surgical
Disposables and medical furniture. Consequently, they are not involved in framing the
relevant technical specifications, acquisition guidelines and the above stated
regulations.
Impact: High
Probability of Occurrence: Moderate
Mitigation Strategy: Health Sector specific guidelines in conjunction with relevant
procurement rules and Drug Act 1976 may be developed in consultation with the available
Sector Specialists at DGHS KP which may become a part of PPRA Rules 2012 through a
Supplement suggested above.
5.
Risk: Unauthorized Extension in Drug Pricing by DGHS
Whereas the medicine prices are valid from 31st July to 30th June as acquired through
centralized rate contracting via open competition at Govt-MCC, often without getting
prior permission from the selected suppliers, the Directorate General Health Services
extends the prices of drugs and medicines upto another three to six months as has been
done till 30th November 2012. Though it may be beneficial to the Department to acquire
products at old rates, in anticipation to such events the pharmaceutical manufacturers
may load their prices at the outset thereby creating an undesirable price increase.
Impact: Low
Probability of Occurrence: Moderate
Mitigation Strategy: Regulations regarding limitation on extension in purchasing time
should be enacted by the DGHS through administrative notification & and future
procurements may be planned well ahead of the annual milestones.
123
6. Risk: Internal Audit not available
Internal Audit mechanism for procurement activities is totally lacking. This has also
jeopardized the potential of the Health Department to evaluate the existing procurement
procedures. Further, repair, maintenance and POL heads utilized by the District
procuring entities are not being properly audited. Donor transferred equipment including
vehicles, furniture and other assets are also not being recorded against any
Departmental inventory list. As there is no internal audit mechanism to monitor the
procured assets during the Project Closure phase, adherence to internal controls for
safeguarding such assets is not possible.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: Internal Audit functions need to be established in DoH KP as an
inherently y governmental function and has to be carried by the state functionaries from
within the DoH KP. A short training/capacity building on Procurement Audit is intended to
be conducted by TRF as indicated in the Training Calendar annexed herewith for the
procurement officials of DGHS KP and Health Secretariat, KP.
Districts visits may be needed to gauge the magnitude of such asset transfers and related
inventory management. Similarly, internal audit mechanisms need to be introduced for the
repair, maintenance and POL. Inventory management system may also be designed. TRF
has submitted draft TORs for a proposed TA to Director General Health Services in this
regard. To build capacity on Assets Management for audit verification purposes, a formal
training on Inventory & Warehousing Management is intended to be carried out as
indicated in the Training Calendar for DGHS KP for the procurement officials of DGHS,
AMIs & Vertical Programs.
7.
Risk: Consultant Guidelines & Consultancy requirements not available
It was also observed that no definite guidelines for consultants were available with the
Health Department. There was also no governing law which required or created the
need for hiring a consultant. Any need analysis in this regard by the Department was
also missing.
Impact: Moderate
Probability of Occurrence: Low
Mitigation Strategy: TRF has provided its Manual on Hiring of Consultancy Services to
the Health Department. An Interdepartmental Consultants Selection Committee (IDCSC)
exists at the Provincial Secretariat level for hiring engineering and design consultants.
124
Related SOPs may be obtained from them. Federal PPRA Consultancy Guidelines and
SOPs may also be introduced for customizing them to project specific needs at Directorate
General Health Services. Consultant Need Analysis may be done within the policy
framework mutually agreed by the DGHS KP and TRF owing to Department’s needs
based on various Situational Analyses conducted by TRF thereof. Health sector specific
guidelines for hiring of consultants may therefore be prepared in light of the above. HSRU
has recently adopted World Bank Guidelines on hiring of Consultants which may also be
utilized by the DGHS if required.
TRF Islamabad has conducted a short one-day training on hiring of consultancy services
in the Health Sector for the Health Department, KP on 6th November 2012.
8. Conflict in the Governing Law Vs the Federal Law
The NWFP Procurement of Works, Goods & Services Rules 2003 are in conflict with the
Federal PPRA Rules 2004 in many aspects, especially in negotiations on financial bids,
which cause major deviations from standard national and international procurement
practices and open the venue for misuse of public funds.
Impact: High
Probability of Occurrence: Moderate
Mitigation Strategy: Draft Khyber Pakhtunkhwa Public Procurement of Goods, Works
and Services Bill 2010 has been approved by the Provincial assembly and the Governor
KP and now pending signatures of Chief Secretary KP for its notification and
implementation in all the departments in KP. Subsequent to it any substantial conflict
between Federal and Provincial procurement practices is expected to be reduced. In the
meanwhile, international best practices on procurement under NCB may be adhered to
while executing procurements at DGHS KP and avoiding the conflicting procurement
provisions by DoH KP. The international best practices on procurement under NCB are
now being followed in the revised Standard Bidding Documents for procurement of Drugs.
7.2 Process Risks
Risk 1: Outdated Bidding Documents are still being used
Revised Standard Bidding Documents for the purchase of Bio-Medical Equipment, drugs
and medicines at DGHS KP have been introduced under NWFP Procurement of Works,
Goods and Services Rules 2003 but earlier three-page traditional Bidding Documents
are still being utilized for procurement of non-drug surgical disposables which has
125
created distortion in the purchasing business processes at the Departmental level.
Impact: High
Probability of Occurrence: Moderate
Mitigation Strategy: Revised Standard Bidding Documents (SBDs) have been introduced
by the TRF for procurement of Bio-Medical equipment and drugs. Any exclusion in this
regard by any procuring entity of the Health Department may be eliminated to ensure
standardization of the business processes and to bring transparency to the system.
Risk 2: Committee Members are repeated in Subsequent Committees leading to
Conflict of Interest
It was observed that members nominated in the preliminary scrutiny committees for
initial profiling of the technical bids were repeated in the subsequent committees like
Comparative Statement Committee, T&E Committee and Purchase Committee etc. for
the same activity. The inherent risk in such business practices has the potential to
amplify the bias of a committee member thereby vitiating and jeopardizing the integrity of
the procurement cycle. The high impact of this risk leads to a potential conflict of
interest.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: Members once nominated in a committee may not be nominated in
another committee designated for a subsequent operation in the same procurement cycle.
Any such nominations eventually do not hold validity in the eye of law when challenged
owing to the probability of perpetuation of bias against a particular bidder and thus leading
to conflict of interest. Though the NWFP Procurement Rules 2003 are silent on the issue,
Section 11-A of the Drug Act 1976 provides an inference to avoid such practices.
Risk 3: Different Purchase Committees exist for purchase of Bio-Medical
equipment & Chemicals for provincial Hospitals
Different Provincial hospitals have constituted their own Purchase Committees for
procuring bio-medical equipment and laboratory chemicals instead of getting it procured
from the DGHS Procurement Cell which is doing the same exercise for Districts with
some expertise available in procurement functions. This poses a risk of duplication of
functions in processes and may lead to wastage of resources.
Impact: High
Probability of Occurrence: Moderate
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Mitigation Strategy: All such purchases should be done at Procurement Cell’s level and
hospitals’ purchase committees should be done away with.
7.3 Institutional & Professional Capacity Building Risks
Risk: Restricted application of Revised Standard Bidding Documents due to lack
of expertise
Though revised Standard Bidding Documents (SBDs) have been prepared for the
procurement of medicines and bio-medical equipment, their application may be
restricted owing to lack of professional capacity in terms of development of
specifications and evaluation process and internal resistance from the Department in
adopting the new format. The bidders may pose another challenge in accepting the said
SBDs out of fear of unknown if frequent awareness sessions and Pre-Bid Meetings are
not conducted to expose them to the new system.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: Training not only on PPRA Rules but also on Technical
specifications may be conducted. It may need experts for making agreed benchmarks.
Technical Evaluation Guidelines developed during the evaluation of bids at DGHS KP are
being refined to include them in the proposed Health Sector Procurement Supplement for
the Department. Such a document may be very helpful in the capacity enhancement of the
related procurement officials.
Exposure to new Procurement Rules 2012 has already been provided vide the training on
the draft KP PP Rules 2012. An ongoing training program aiming at the capacity
enhancement of the procurement officials of the Health Department KP has been initiated
and is expected to be consisted of 8-10 such trainings till June 2013. Draft PPRA Rules
2008 have been forwarded to the Chief Secretary KP for their administrative notification
after having been signed by the Governor KP. Updating of standard procurement
documents have already been achieved through introduction of the revised Standard
Bidding Documents for procurement of Drugs and bio-medical equipment.
Regular coaching, mentoring and on-job knowledge sharing is being done by the TRF at
the Departmental, District and Program levels in Khyber Pakhtunkhwa while giving
procurement support by guiding on procurement planning, designing of the Standard
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Bidding Documents, on participation in Pre-Bid, bid submission and financial bid opening
meetings and providing technical and legal support during bid evaluation.
The following three major areas seek intervention of TRF in the capacity building area for
the Health department KP. In this regard, a Training Calendar addressing the following
disciplines has been prepared for the Health Department.
a) Public Procurement Rules – Comparison of international best practices
b) Designing of Standard Bidding Documents and Bid evaluation.
c) Supply Chain of pharmaceutical products including cold chain for biological drugs.
Keeping in view the above capacity needs, the following tentative training modules will
therefore be followed (but not limited to) by TRF KP in consultation with TRF Islamabad:
1)
2)
3)
4)
5)
6)
7)
8)
9)
Comparative Assessment of NWFP procurement Rules 2003 with Federal PPRA
Rules 2004 / KP PP Rules 2012
Procurement Life Cycle
Bidding Document Design & Evaluation of pharmaceutical products/bio-medical
equipment
Inventory & Warehousing Management
Customs Clearance procedures and carrier pricing for Multi-modal Transportation
(Supply Chain) of pharmaceutical products
Procurement Audit
Contract Management
Comparative Contracting Practices in Donor-funded Projects
Procurement of Consultancy Services, RFP design and Consultant Evaluation
Involvement of PHSA, Peshawar in Procurement Training: The Provincial Health
Services Academy, located in Peshawar can be made a stakeholder in training on
procurement topics as a part of the health management courses for the health managers.
USAID’s Deliver Project has recently initiated a logistics management course at PHSA
venue. TRF, in collaboration with the Procurement Cell of Directorate General Health
Services, may arrange courses on public procurement at the PHSA venue by developing
master trainers from PHSA to subsequently make this training stream an integral part of
the Health Department’s managerial capacity building by the said Academy.
6.5 Safeguards and Residual risks w.r.t procurement monitoring
128
Risk: Procurement Monitoring largely remains unattended in the Department
There is no monitoring of the procurement processes to appraise them for their impact
on the efficiency of the Department in the said area.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: TRF Islamabad has got approved TORs from DGHS KP for a
relevant consulting exercise on pilot monitoring on procurement which addresses certain
aspects of the residual risks. Initiation of this exercise is expected soon.
6.6 Operational Risks
1. Risk: Expiry of medicines due to absence of dedicated list for life-saving
drugs in Autonomous Medical Institutions (AMIs) / Tertiary Health Institutions:
Though the NWFP Procurement Rules 2003 mention generic names for the goods to be
procured, in case of life saving drugs, it is hardly applicable. It was observed from the
record and feedback of the officials and medical staff of the tertiary Health Institutions
e.g., Teaching hospitals in Peshawar that in instances of severe medical emergencies,
locally purchased drugs were found in-effective and the patients had to be
recommended imported medicines from internationally reputed brands. Both the local
and imported brands use the Active Pharmaceutical Ingredient (API) of the same
percentage which may have been ratified during the pre-qualification process, but the
grade of the Pharmaceutical raw material and its source of origin are the deciding
factors for determining a medicine’s efficacy during treatment and for a life saving drug it
all the more becomes important in the case of a severe medical emergency. This could
be illustrated by the fact that a 10 mg of Valium from Roche, Switzerland using an AGrade API immediately relieves the squeaking patient of his suffering where a local
medicine with similar API fails to respond adequately. The price plays an important role
here as the medicine with the same API having lowest price gets selected. The multinational drug manufacturers therefore do not compete due to much low prices offered by
the local companies and are thus restricted by the competition. The local medicines
procured in this regard remain unused and expire thus leading to wastage of public
resources.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: In the case of life saving drugs, open competition may be invited to
bring all the local and multi-national pharmaceutical manufacturers who manufacture the
above stated drugs with the certified A-Grade API imported from OECD countries and
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certified by an internationally accredited body like USFDA, WHO, EU or a DRA like
Swissmedic etc. and all of the above to be verified at the time of post-qualification. Open
competitive bidding with raw material source from restricted origins for health saving
goods is expected to bring desired efficacy of the product.
2.
Risk: Procurement Planning not available
As no centralized procurement planning is done at DGHS KP level, the related health
budget is usually overstated and duplicated for medicines/bio-medical equipment by
various health entities in the Province. Any supplementary grant thus requested reduces
the credibility of the budget. This creates problems for the release of funding as it is
based on creation of commitments obligated through the budget at a time when public
funds are not available.
Impact: High
Probability of Occurrence: Moderate
Mitigation Strategy: Quarterly procurement and financial planning may be introduced.
An extensive meeting with the CPO Health Secretariat with the Financial consultant may
be required.
3. Risk: Sub-standard Supply Chain
There is no existing standard mechanism for receipt & storage of medicines & biomedical equipment at District level. No Just-In-Time (JIT) delivery was observed. Cold
chain for supply of biological products though projected by respective suppliers but is not
visible. No healthcare procurement guidelines are available on procedures for installing,
commissioning and handing over of equipment and their subsequent inspections/quality
assurance through after sales service & maintenance. Guidelines on storage, inventory
management and distribution of medicines are also not specifically prepared. Traditional
supply methods are being used for supply of medicines to AMIs and Districts which tend
to compromise their quality in terms of non-observance of temperature and movement
protocols set by the WHO.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: A situational analysis may help in sorting out the weaknesses and
suggesting improvements. This may also recommend introduction of a supply chain
management system for the health sector in KP which involves inventory management
130
also. In procurement of drugs if inspection is late, the security mechanism for inventory,
return & warranty claims may be introduced. The current supply chain consisting of
distribution, storage and inventory management at various health entities has been looked
into in this Rep[ort and probable measures have been suggested. TRF has already
initiated related TORs for a Technical Assistance for a detailed Supply Chain Management
initiative which have been approved by the DGHS KP. Activity in this regard is expected
to be initiated by TRF Islamabad soon. Cold chain for supply of biological products has
been made mandatory for the suppliers of specialized products in the revised Standard
Bidding Documents for drugs. Related short-term trainings are being launched for the
DGHS, AMIs, Vertical Programs and the Districts by the TRF on business processes
involved in the supply chain.
4.
Risk: Non-existence of Engineering Estimates or Base-line Price Estimates
Rates are not based on arm-length basis as there are no Engineering Estimates or
Baseline Price estimates for pharmaceutical products or bio-medical equipment. This
may become a serious contractual issue in the wake of lack of pricing for after-sale
services where foreign technicians or similar technical support is involved. From the
official documentation, it is not clear that in the annual budgetary estimates allocations
are made and if made where are these amounts spent.
Impact: Moderate
Probability of Occurrence: Low
Mitigation Strategy: The Govt-MCC does not conduct any year-wise comprehensive
exercise of constituting Base-line Price Estimates for the purchase of Drugs and
Medicines which could be used while evaluating the prices of drugs and surgical
disposables. The Logistics & Procurement Cell at DGHS has recently been created and
not much was expected from it in conducting any similar exercise for bio-medical
equipment. In the presence of a wide range of price fluctuation for a particular medicine,
there is a probability of selection of an ineffective medicine with more margin of profit,
thereby leading to prospects of corruption in the process. Base-line estimation of drugs
and surgical Disposables may be done before initiation of every procurement activity.
Product sampling can be accompanied with at this stage to check the quality of the drug.
Market survey may be done for the said equipment. This year DGHS intends to conduct
market price analysis of the products selected for Govt-MCC before announcing the
centralized unit rates to avoid procurement of any surgical disposable/medicine at a rate
higher than prevalent in the market to avoid audit observation
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5.
Risk: No Intimation to companies regarding their failure to Pre-Qualification
Directorate General Health Services does not intimate the pharmaceutical companies
which were not pre-qualified, of the reasons of non-qualifications. The companies get to
know about it only at the moment the list of pre-qualification is released by the GovtMCC DGHS. This procedure may lead to exclusion of companies which become victims
of personal dislike thereby reducing the competition.
Impact: High
Probability of Occurrence: Moderate
Mitigation Strategy: Policy Guidelines for indicating the firm for reason of its nonqualification in the Pre-Qualification Process may be prepared by the Department to dispel
any such impression.
6. Risk: Exclusion of Pharmaceutical Companies on the basis of annual PreQualification
Pre-Qualification Proforma as developed by the DGHS is an exhaustive Checklist
looking at every aspect of the pharmaceutical manufacturer and supplier. A full-time
pre-qualification of a pharmaceutical manufacturer requires 2-3 hours upon site visit and
not more than three such manufacturers located at different places is possible per day
during office hours alongwith one to two authorized pharmaceutical suppliers in the
after-office hours in the evening, thus making it a maximum of 5 to six such entities per
day. However, the record of the DoH KP reflects a pre-qualification of around 18-25
pharmaceutical units per day which makes this vital exercise redundant in terms of
quality assurance and subsequently the procurement of efficient drugs.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: If done properly and rigorously, the pre-qualification exercise for
bio-medical suppliers minimizes the need to be conducted annually and the prequalification status of the successful firm may be renewed for three years. The Department
was of the view that the pharmaceutical manufacturing process may require continuous
vigilance coupled with surprise visits to check the production process and quality control of
processes and cannot be left unattended for more than a year. However, it was observed
that much time was consumed in the technical evaluation of a pre-qualified manufacturer
of drugs who was eventually disqualified on the basis of a sub-standard product sample
132
during the technical evaluation of bids for procurement of drugs for Govt-MCC for the year
2012-13. The Department may do a soul searching in this regard and weigh the merits of
annual pre-qualification of pharmaceutical firm against their tri-annual pre-qualification but
frequent surprise visits to their business premises. Un-announced surprise inspections by
the Health Department may also be conducted for all such manufacturers whose product
samples have been rejected on the basis of non-compliance of prescribed standards
during the technical bid evaluation for GOVT-MCC for the year 2012-13. This may help
them improve their product quality for further participation in the competition.
7. Risk: Illegal Supply Channel by the pharmaceutical companies
As the Peshawar High Court has restricted the Pharmaceutical manufacturers vide Writ
Petition No. 2478/2010 (Daily Mashriq Vs Secretary Health & Others) to supply directly
to the DGHS, the distributors still supply on behalf of the Companies but without any
legal cover. The Sales Invoice is in the name of the companies and the delivery is done
by the distributor, thereby leading to a procurement risk of an undocumented supply
chain.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: Apparently the importers and manufacturing firms are themselves
supplying the medicines; however, in reality the market structure has kept the distributors
intact by having attached to the Health Department in the disguise of authorized suppliers
on behalf of manufacturing firms or importers. The Department may hold stakeholders
meeting with the manufacturers to solve the issue. In future, pharmaceutical firms’ regular
employees with valid company identification or salary slips may be allowed to participate in
the bidding process.
8. Risk: Program specific Inventory and related specifications were not created
It could not be determined that the technical specifications for the medical equipment
mentioned in the Specifications Inventory available with the Health Department were
current and not based on the earlier equipment purchased a long time ago. Programspecific technical specifications for medical equipment were also not very visible in the
Department’s Inventory e.g., a syringe specified therein for a particular purpose in a
specific health program should be categorized accordingly alongwith its other
supplements to make its procurement more program-specific. Similarly, for drugs and
medicines, trend analysis based on disease burden and drug consumption could have
133
provided region-wise benchmarks for specific medicines inventories. Some synergy
could be developed between DGHS KP and Combined Military Hospital (CMH) for
sharing standards on average patient costs per disease treatment and ancillary costs
which could help in procurement planning.
Impact: High
Probability of Occurrence: Moderate
Mitigation Strategy: Although the technical and operational levels of RHQs, THQs and
DHQs vary with respect to the concentration of urban population and exact two
counterpart entities do not match in functionality owing to different geographical locations
& disease burdens, three sample lists for the medical equipment and medicines could be
categorized for formalizing Inventories of Technical specifications to become more
program-specific for a typical BHQ, THQ and DHQ etc. These three sample list containing
inventories of technical specifications may have a sample Bill of Quantities (BOQs) for
each Heath facility whose details can be modified keeping in view particular District's
requirements. This may make the procurement planning process less time consuming with
the procurement staff when such sample lists are readily available. This can also lead to
design the Bill Of Quantities (BOQs) more comfortably
9. Risk: Absence of End-User Feedback to Gauge Procurement Efficiency
As observed, no customer or end-user feedback from the Health Districts was acquired
on regular basis to assess the supplier performance in terms of product efficacy, timely
delivery and replacement of batches of medicines. This may pose a serious threat in
terms of supplier profiling, lack of which has the potential of compromising the
procurement process. The Clinical Efficacy Form, developed for such type of feedback
or reporting from a Departmental whistle-blower was rarely observed.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: Proper mechanism for receipt of Clinical Efficacy Form depicting
supplier performance or lack of performance may be framed to get regular feedback from
Procuring entities.
10. Risk: Purchase of lowest Price Goods with little availability of Spare Parts and
Service Facility
The specifications of the Bio-Medical Equipment are designed in such a way that many
134
vendors with hardly any service/maintenance facility in Pakistan also become eligible to
compete on low prices and may pose risk of product obsolescence after purchase. The
evaluation criteria in the existing bidding documents for procurement of bio-medical
equipment reflect the strength of the firm’s technical and financial capabilities but do not
emphasize on after-sales services. If the technical specifications are closely scrutinized,
it is revealed that certain items with narrow specifications have been included to benefit
specific suppliers with prearranged incentives.
Impact: High
Probability of Occurrence: Moderate
Mitigation Strategy: Marking/weightage for past performance and prolonged Market
presence of the supplier in the Evaluation Criteria may be increased.
11. Risk: Lack of Technical Resources to Assess the technical Capabilities of the
Equipment:
The Technical & Evaluation Committee does not assign any dedicated resource during
the technical evaluation for assessing the technical capabilities of a bio-medical
equipment, especially where meta software components are also an integral part of the
machinery.
Impact: Moderate
Probability of Occurrence: Moderate
Mitigation Strategy: TRF Islamabad may be requested to arrange a similar workshop on
technical capabilities of bio-medical equipment as earlier done commendably on
pharmaceutical product specifications
12. Risk: Lack of Ownership of the Procurement Activity conducted by the HSRU,
KP:
The DGHS strongly objects to the ongoing procurement of Management Services of a
consulting firm being hired by the HSRU for the six districts for providing integrated
health services on the basis of Public Private Partnership (PPP). Directorate General
Health Services is of the view that any such activity has to be conducted by the
Directorate and not by HSRU, which is a policy & reforms wing of Health Department.
Lack of ownership by DGHS KP towards such activity may lead to issues of acquisition
of such model, its monitoring and its subsequent roll-out in other health districts of KP.
Impact: High
Probability of Occurrence: High
135
Mitigation Strategy: Inter-Departmental communication needs to be improved. A
communication strategy may be mutually formulated among the donors, HSRU and DoH
KP for chalking out the responsibility of initiating such development components in future.
13. Risk: Absence of Mechanism of Consolidation of Bid Securities issued by the
EDO (Health):
DGHS is not in the knowledge of the receipt of all the Bid Securities furnished by the
suppliers to the Health Districts against individual supplies. This may pose a risk of
unaccounted or missing bid securities, thus leading to a process risk in procurement.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: TRF has included in the revised Standard Bidding Documents for
procurement of Drugs & Surgical Disposables the submission and consolidation of all the
Bid Securities and Performance Guarantees at Govt-MCC level in DGHS Peshawar.
14. Risk: Re-Evaluation of Pre-Qualification Criteria during Bid Evaluation consuming
considerable time:
The Preliminary Scrutiny Committee observed recently during the preliminary
examination of the technical bids received for procurement of drugs for Govt-MCC that
during the technical bid evaluation, almost all the business practices relating to
manufacturing/import of pharmaceutical products and their physical/chemical
characteristics were assessed during the pre-qualification process, were re-assessed
during bid evaluation consuming lot of precious time. Rule 40 of the NWFP Procurement
of Goods, Works & Services Rules 2003 provides for Two Envelop Tendering in case of
the post-qualification procedure wherein only those aspects of bids need to be evaluated
which could not be assessed earlier. Re-evaluation of Pre-Qualification Criteria during
Bid Evaluation may pose a process risk in procurement cycle.
Impact: Moderate
Probability of Occurrence: Low
Mitigation Strategy: Certain Pre-qualified aspects of the bidders, as decided by the
Competent Authority, may not be assessed by the Technical & Evaluation (T&E) Committee
during post-qualification to save time for bid evaluation.
136
15. Risk: Reasonable Time not provided to bidders after Pre-Bid Meetings:
It was observed that majority of the bidders in the procurement activity for Govt-MCC for
the year 2012-13 submitted irrelevant/unnecessary documents in bulk quantity which, on
one hand, shows the irresponsible and negligent behavior of the bidders and on the
other hand, reflects that the Department did not educate the bidders how to properly fill
up the bidding documents and what documentation should have accompanied their bids.
The scrutiny of the said documentation and sifting out the relevant one consumed
considerable time of the Examiners/Evaluators. In this regard, feedback was received
from the majority of the bidders regarding non-communication of the second Pre-Bid
meeting’s date and time by the Department for amendments and therefore inadequate
time given to them for incorporating the said changes in their bidding documents. As a
result this led to submission of many bids which were not in conformance to the Client’s
requirements and the bidders claimed to have no idea what documents were exactly
required to be submitted. This may pose a serious process risk in terms of transparency
and procedural non-compliance.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: Sufficient time of atleast five to seven days may be given to the
participating bidders after any Pre-Bid or subsequent Pre-Bid meeting for communicating
the said amendments to bidders through public advertisement so that the bidders may
properly incorporate the said changes in their bidding documents to make them fully
responsive to Client’s requirements.
16. Risk: Lack of Detailed Evaluation of Technical Bids by the T&E Committee:
It was observed that due to lack of timelines given by the Competent Authority, the T&E
Committee had to briefly peruse the corporate and product snapshots (resulting out of
the preliminary screening of the technically qualified bidders) submitted by the
Preliminary Scrutiny Committee on the same day when the financial bids were being
opened. Not giving enough time for detailed evaluation of the technical bids may lead to
inadequate processing by the T&E Committee’s technical experts/professionals, of the
technical aspects indicated by the Preliminary Scrutiny Committee and may lead to
subsequent process infirmities and omissions related to product quality assurance.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: The unresolved technical aspects indicated by the Preliminary Scrutiny
Committee always need to be carefully examined in detail by the technical experts included in
137
the T&E Committee for taking concrete and informed decisions on them. The technical experts
included in the T&E Committee are senior surgeons who can assess the quality of
sutures/catguts/surgical disposables, hepatologists who can assess the SVR Studies for
Interferon Therapy for Hepatitis B&C & other biological vaccines, professors of medicines and
senior pharmacists who can assess the pharmaceutical product efficacy and its impact on
patients, and bio-medical engineers to gauge the performance of an equipment against its
functional and conformance specifications. Leaving the areas indicated by the Preliminary
Scrutiny Committee unaddressed by the T&E Committee due to paucity of time may
compromise the quality of evaluation. The planning of the procurement life cycle may be done
in such a way that T&E Committee gets enough time to conduct the detailed examination of
the technical bids. The administrative SOPs issued by the Department may determine the
minimum number of days required by the T&E Committee to perform its specialized functions
accordingly.
17. Risk: Amendments in the Standard Bidding Documents by Competent Authority:
It was observed that amendment in the Standard Bidding Documents were usually not
done by the Competent Authority as per the Standard Operating Procedures.
Impact: High
Probability of Occurrence: High
Mitigation Strategy: The administrative SOPs may be followed so that proper procedures
regarding transparency and fair practices in procurement may be executed by the Department.
8. Spend Analysis of Health-Sector Procurement:
Review of past years of Health procurement statistics and the new fiscal environment reveals
greater volumes of responsibility and load that will be placed on the healthcare procurements of in
years to come.
The statistics of the last three years in Table 8.1 reveals that the final grants could not be fully
utilized by the Health Department, either due to squeezed timelines or less than accurate
estimation of the budgetary appropriations. However, the most important trend seen here is the
significant two-fold increase from 2009-10 to 2-11-12 in the health budget for procurements which
shows a greater responsibility for the Health Department.
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Table:8.1
Comparison of Current Budget spending with Development Budget for the Years 2009-12
2009-10 (Rs in Million)
2010-11 (Rs in Million)
%Age
Share
Total
Budget
of the
KP
Provinc
e
Health
Departmen
t Budget
%Age
Share
5,940.7
4.64
149,000
7,837.25
5.26
67,783.6
8
7,364.79
10.87
83,621
7,825.11
9.36
13.32
58,500.0
0
6,571.24
11.23
71,542.
4
6,467
9.04
1,586.68
14.93
0.000
0.000
0.00
0.000
0.000
0.00
6,644.32
246.50
3.71
9,283.68
793.54
8.55
12,078.
6
1,358.11
11.24
129,815.2
2
10,191.8
7.85
195,741.
7
13,305.5
6.80
232,62
15,662.36
6.73
%Age
Share
Total
Budget
of the
KP
Province
Health
Departme
nt Budget
4,024.8
5.03
127,958
49,815.22
6,167.05
12.38
Provincial
ADP
32,546.41
2
4,333.87
Special
Program
/PSDP
10,624.48
Foreign
Project
Assistance
TOTAL
A+B
Total
Budget of
the KP
Province
Health
Departme
nt Budget
80,000
BDevelopment
Budget
A - Current
Revenue
Budget
2011-12 (Rs in Million)
Table 8.2 shows that the pharmaceutical products including drugs and surgical
disposables keep on getting the biggest share in procurement spending during the last
three years and require more transparency in procedures to bring best value for money.
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Table 8.2
Budgets allocated for the Purchase of Drugs & Bio-Medical Equipment for the
Years 2009-12 for all District Governments and the Provincial Government.
Expenditure Heads
All District Governments
2009-10
2010-11
2011-12
244,525,407
368,877,723
349,059,040
A03927-purchase of drug and medicines
110,554,182
100,423,840
99,350,800
A03942-Cost of other stores
126,116,002
201,791,583
191,559,690
7,412,273
65,969,270
57,547,820
A09404-Medical and laboratory equipment
187,200
315,010
246,010
A09409-Medical stocks
62,150
87,010
95,710
0
0
A09411-General utility chemicals
65,200
108,010
91,010
A09412-Specific utility chemicals
60,200
100,000
85,000
A09413-Drapery, fabrics, clothing and
allied
A09470-Others
55,200
65,000
65,000
13,000
18,000
18,000
280,949,240
379,145,400
481,855,920
A03927-Purchase of drug and medicines
27,633,100
118,293,000
132,003,000
A03942-Cost of other stores
50,204,270
52,622,600
34,962,960
A03970-Others
203,111,870
208,229,800
314,889,960
525,474,647
0
748,023,123
830,914,960
A03970-Others
A09410-Life saving medical supplies
Provincial government
A09470-Others
Grand Total
The estimated and actual expenditures, mentioned in Table 8.3, on account of medicines and other
stores indicate that the districts get separate funding for the pharmaceutical products and biomedical equipment apart from the Provincial funding the current budget.
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Table 8.3:
Provincial vs District Budget Estimates & Actual Expenditure for the Year 2012-13
2012-13
Object
Head
Provincial
Budget
Estimates
A03927
PURCHASE
OF DRUG
AND
MEDICINES
A03942
COST OF
OTHER
STORES
TOTAL
Actuals
Districts
Budget
Estimates
Actuals
TOTAL
Budget
Estimates.
113,730,900
34,417,285
176,192,710
100,813,063
214,543,963
866,267,000
35,286,474
222,437,120
20,897,456
887,164,456
979,997,900
69,703,759
398,629,830
121,710,519
1,101,708,419
Actuals
135,230,348
56,183,930
191,414,278
Section-9. Recommendations on Institutional Measures
The subject Procurement System Assessment has helped in identifying various types of
risks emerging out of the Procurement System of the Health Department Khyber
Pakhtunkhwa. These risks may have the potential to compromise the quality and integrity
of the System with varied strengths and probability of occurrence. The following actions as
suggested, may lead to mitigate the said risks if adopted through institutional mechanisms:
9.1:
Formulation of a Health Sector Procurement Manual as a Supplement to
Khyber Pakhtunkhwa Public Procurement Rules 2012:
The expected Khyber Pakhtunkhwa PPRA Rules 2012 give broad outlines of public
procurement processes and do not give much detail of the processes. The Mitigation
Strategies for the regulatory, operational and process risks can therefore be incorporated
in the proposed Manual which may supplement and support the administrative regulations,
and may contain operational procedures based on revised business processes, revised
time-thresholds for payments, Standard Bidding Documents evaluation guidelines,
benchmarks for technical specifications of the products, and User Notes on various stages
of the public procurement lifecycle customized to the specific health-sector requirements
and to be read in conjunction with the expected Khyber Pakhtunkhwa PPRA Rules 2012.
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Though such a Manual requires another significant effort from the Health Department for
its notification and implementation from the Government, its benefits may outweigh the
level of effort involved. The document may provide the customized environment for the
Health sector-specific procurements and benchmarks for utilizing them in drafting
evaluation criteria for the Standard Bidding Documents.
The proposed Procurement Manual may provide for inviting to the open competition all the
local and multi-national pharmaceutical manufacturers/importers to offer quotes for lifesaving drugs prepared with the A-Grade raw materials (API/Excepients) obtained or
imported from OECD countries and duly certified by the WHO, USFDA and EU-EMEA
quality assurance standards. In the light of the Drugs Act 1976 and any recent
technological advancements, the drugs may also be defined and specified in more detail
and made part of the proposed Manual alongwith the Formulary. The Manual may further
contain conformance benchmarks based on industrial quality assurance standards for biomedical equipment by USFDA, EU’s CE-EMA or Japan’s JIS Industrial Standards,
performance benchmarks set by global certification bodies like Association for the
Advancement of Medical Instrumentation (AAMI), International Certification Commission
(ICC), the United States Certification Commission (USCC), the ISO and international
training and certification benchmarks for Bio-Medical Equipment Technicians (BMETs)
e.g., CCE, CBET, CRES and CLES Certifications etc.
The expected Khyber Pakhtunkhwa Public Procurement Rules 2013 apparently do not
have any provision for central rate contracting for pharmaceutical products as currently
being practiced by the Health Department. The Health Department may therefore need to
devise a workable purchasing strategy by incorporating in the proposed Manual the
provisions for Single Stage Two Envelop Bidding method with a specified year-long fixed
price contracting period. For bio-medical equipment, the Single Stage Two Envelop
Bidding method can easily be the one-time purchasing method. The said bidding method
will conduct merit point scoring on technical and financial bids with specified percentages
for both pharmaceutical products and bio-medical equipments.
The proposed Procurement Manual may further contain provisions relating to the integrity
pact, code of ethics and potential conflict of interest to prevent Departmental committee
members to get repeatedly nominated in subsequent committees in the preceding related
assignment or same procurement activity. Apart from the institutional measures indicated
above, the Health Department may propose more measures to fill certain process gaps it
feels are required in the smooth running of a transparent and fair mechanism for the
purchasing functions. A Model Procurement Manual for Health Sector is currently under
preparation by the TRF and would be presented to the Department in due course of time.
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9.2: Strengthening of Procurement Cell at Directorate General Health Services:
The Health Department has already established a Procurement Cell in the building of
Directorate General Health Services, Peshawar. Necessary administrative notification has
also been done in this regard. However, the staffing for the procurement functions is
minimal and below the mark showing negligence towards this very vital section which
performs centralized procurements for the bio-medical equipment on the basis of
requirements sent by the districts. The Procurement Cell may further be strengthened by
merging into it both the Govt-MCC Section and the Pre-Qualification Cell at the DGHS
level. The Cell may be entrusted with the following functions:
i)
Procurement of bio-medical equipment, pharmaceutical products, drug and non-drug
Surgical disposables on the fixed price annual central rate contracting basis using
Single Stage Two Envelop Bidding Method
ii) Initiation of the pre-qualification proceedings from a centralized location for central rate
contracting with the merger of the Govt-MCC Section and the Pre-Qualification Cell
and their subsequent association with the Procurement Cell in a more coordinated
way.
iii)
Planning and estimation functions for purchase of drugs by the Procurement Cell for
making annual Procurement Plan and designing the Standard Bidding documents
accordingly. Since the local governments after the devolution of powers have been
allowed to handle health care in the Districts, appropriation and disbursement of
related budgetary sums are sometimes not conveyed to the DGHS for their sanction
by the EDOs. The said sanction may be made obligatory for the Districts alongwith
transmission of consumption figures so that the Procurement Cell may use them for
estimation and planning.
iv) Development of technical, legal and commercial standards for health procurements for
all the health sector entities in the form of the Standard Bidding Documents (SBDs),
Product Vocabularies (PV) for bio-medical equipment based on conformance
specifications (relating to technological aspects ) and performance specifications
(relating to functional aspects).
v) Development of supply Chain/Cold Chain Guidelines for the medicines /biological
drugs /vaccines as per WHO standards and SOPs for their storage and distribution to
various desired locations.
vi) Training & Capacity Building of officials handling procurements in the DGHS, AMIs,
Vertical Programs and Districts on the specified topics on monthly basis through shortterm workshops and dedicated technical sessions. Awareness seminars for the
pharmaceutical firms and suppliers of bio-medical suppliers pre-qualified with DGHS
Khyber Pakhtunkhwa may also be arranged by the Procurement Cell for submitting
responsive bids in a reasonable way.
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vii) To assist Director General Health Services in the matters relating to co-ordination and
liaison with other Provincial bodies/departments related to procurements and
facilitation of various policies and regulations that directly or indirectly effect
procurement.
viii) Coordinate with Provincial Health Services Academy for arranging lectures on public
procurement for the purchasing officials of the DGHS.
ix) Conduct market survey for all the selected products which emerged as the lowest in
the CS Statement in order to check whether the suppliers have quoted them above
the market prices. Annual market survey of the tentative market prices may also be
conducted for helping the Planning Cell, Health Secretariat in the budgetary
estimations.
9.3: Utilization of a dedicated web-portal for the Health Department:
Instead of using EPI Vertical Program’s web-site, the Health Department Khyber
Pakhtunkhwa may utilize its own dedicated web-portal for not only posting of IFBs, SBDs
or evaluation results but also online verification of suppliers through their corporate
profiles. Currently, there exists a “Tenders” tab on the Health department website which
has recently been used only for posting the Standard Bidding Documents for procurement
of cancer medicines for Begum Nusrat Bhutto Oncology Services, Khyber Pakhtunkhwa.
The said web-link can further be designed as per the Indian Directorate General of
Supplies and Disposals (DGS&D) (http://www.dgsnd.gov.in/). The Indian DG&S
conducts e-procurements through framework agreements and re-ordering of selected
products. The DGHS Khyber Pakhtunkhwa, through its dedicated web-portal, may then
allow the various procuring entities to do on-line re-ordering of products selected by the
DGHS through central rate contracting. In future, the said function may be extended to an
entire e-procurement based on framework agreements scenario thereby reducing paper
work and creating automated record of purchases. In this regard, a contract Management
software can be acquired for creating a customized environment through configuration of
prevalent business processes on procurement and contract management for the Health
Department purchasing activities.
9.4:
i)
Human Resource Management:
Regular Trainings on Procurement Management to Procurement Entities:
Professional capacity building of all the concerned EDOs (Health), MS DHQs, Chief
Executives of AMIs, Medical Superintendents of DHQs, Principals of Medical
Colleges, Program Coordinators of the Vertical Programs, Senior Hospital
pharmacists, P&D Department & Finance Department GoKP, and senior officials
from Health Secretariat, HSRU and FATA be carried out primarily on basic to
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intermediate level training modules based on regulatory and conceptual frameworks
with topics like overview of NWFP Procurement Rules 2003, Khyber Pakhtunkhwa
Public Procurement Rules 2012 and Procurement Life Cycle and then extending the
said capacity building towards advanced and technical ones based on topics like
bidding documents development/design, bid evaluation for procurement of
pharmaceutical products/bio-medical equipment and consultant selection for hiring of
management services etc. The related health officials conducting or supervising
procurement activities further be exposed to modules like Procurement Audit so that
they may safeguard their actions by avoiding the typical mistakes usually committed
during the execution of contract actions. A bi-monthly Training Calendar for the
Health Department is annexed which provides various training modules and shortterm workshops both for basic and advanced levels.
ii)
Technical Soundness of Procurement Officials: The officials and the staff
selected for the Logistics & Procurement Cell may preferably may be from the
existing HR strength that has earlier been involved in procurement and has been
trained on it or may be outsourced as per the regulatory policy of the Health
Department keeping in view the reflected needs. However the officials hired should
be technically sound in their respective areas as they shall be consulted on technical
matters by the Department and other allied agencies in formulating procurement
procedures & policies. Preferably, certifications on respective contract management,
technical and financial skills should be sought from the candidates for these proposed
posts.
ii) Projectized Remuneration: Prospects of a projectized remuneration to the officials
of the Procurement Cell may help in retaining them in the Cell for a longer period of
time and may help them in keeping their integrity intact. It was observed that during
the current evaluation of the technical bids for procurement of drugs for Govt-MCC,
the Health Department retained the Preliminary Scrutiny Committee members in the
subsequent Comparative Statement (CS) Committee for
preparation of the
Comparative Statement (CS) in order to keep the evaluation process and resulting
prices confidential. The authorities seemed apprehensive to change the composition
of the Committee members and did not expand it by adding any dedicated KPO
skilled in data entry operation. This consumed considerable time of the Department
as the nominated members did not have enough data entry speed required to punchin the names and prices of a large volume of pharmaceutical entities. On one hand it
led to conflict of interest by continuing same members in consecutive committees and
on the other side it exposed the issues relating to integrity of the staff. World-over,
projectized remuneration or honoraria in the form of project allowance for particular
projectized assignments are the norm of the day as these attract skilled personnel
and tend to preserve his integrity. DGHS Procurement Cell is geared towards
conducting projectized activities regarding procurement of bio-medical equipment and
pharmaceutical products.
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iii) Merit Point Evaluation under Single Stage Two Envelope bidding process;
The Health Department intends to conduct Single Stage Two Envelope bidding
process In the next round of bidding for the year 2013-14 for procurement of drugs
for Govt-MCC. The said contracting methodology involves cumulative scoring based
on price and non-price factors for both the quality and the price for the medicines &
bio-medical equipment. This methodology involves considerable amount of time in
calculating the said scores for around 700 medicines with varied dosages, strengths
and formations extending to around their 3000 pharmaceutical variants next year as
well. It may therefore only be adopted if the DGHS has a dedicated team of two to
three pharmaceutical experts, each accompanied by a skilled data entry operator
with proficient typing speed, and that the bidding process is initiated well in time.
9.5:
Inventory & Warehousing Management:
The current situation of Inventory and Warehousing management is far below the
required WHO standards. Instead of re-inventing the wheel, the computerized
Inventory Management software currently utilized by the Hayatabad Medical
Complex (HMC) Peshawar may be replicated in all other medical institutions which
may provide a streamlined platform for homogenized interconnectivity among the
health entities.
9.6:
Proposed Mission of Procurement Cell
Keeping in view the above stated recommendations, the Mission of the DGHS
Procurement Cell may therefore focus on five key areas
Mission:
1. Advocacy: Procurement Cell shall work collaboratively with all legislative and
regulatory authorities to ensure fair and efficient procurement practices in an open
and competitive market within the health industry.
2. Education: Procurement Cell shall provide educational opportunities designed to
improve efficiencies in the purchase, sale and utilization of all goods and services
within the health industry.
3. Ethics: Procurement Cell shall uphold the ethical conduct of business practices
within the industry and the standards adopted by the Govt. of Khyber Pakhtunkhwa
and other donor agencies for Healthcare that are intended to strengthen the
integrity of the health care supply chain.
146
4. Information: Procurement Cell shall enhance the awareness to all procuring
institutions that fall under the Health Department Khyber Pakhtunkhwa to support
the delivery of high-quality, cost effective health care.
5. Liaison: Procurement Cell shall promote meaningful dialogue between health
industry organizations engaged in purchasing and other related industry entities on
issues of mutual interest of procurement
9.7:
Proposed Administrative Structure of Procurement Cell, DGHS,
Khyber Pakhtunkhwa:
The Procurement Cell in the Directorate General Health Services (DGHS) has already been
created vide DGHS Notification No. 10760-67/Personnel, dated 30.12.2011 and is supposed to
purchase bio-medical equipment and occasional non-Govt-MCC drugs on the basis of
requirements sent by the Health Districts and DHQs.
As per the said notification, the Cell is headed by a Deputy Director (Admn) and manned by an
Assistant Director (Admn), Superintendent Complaint / Coordination Cell DGHS Office,
Superintendent Accounts Section, DGHS and a Computer Operator. The absence of the two top
administrative tiers of the Cell lastly and all of the processing of bidding documents by an office
superintendent single-handedly after the creation of the Cell has rendered its potential significantly
underutilized keeping in view the sensitive functions like requirement-gathering for need
assessment and annual planning, preparation of the technical specifications, and acquisition of
best value for money in procurement of bio-medical equipment and hospital ancillaries etc.
Keeping in view the situational analysis conducted till December 2012, it is proposed that the
Procurement Cell may have the following Wings to utilize its full potential for filling the process
gaps:




Pre/Post-Qualification Wing
Technical Wing
Tendering & Coordination Wing
Budget & Planning Wing
The Cell is proposed to be headed by a Director Procurement who will be directly reporting to the
Director General Health Services Khyber Pakhtunkhwa. The Director Procurement should be the
Secretary to the Technical & Evaluation (T&E) Committee of the DGHS and he should have the full
support of the Administration Wing in running the Procurement Cell. For technical matters, the
147
Director Procurement will be independent and may have appropriate authorization for making
technical decisions with respect to tender evaluation. However the administrative powers may rest
with the Principal Accounting officer of the Department i.e. Secretary Health.
The Procurement Cell may also be expected to ultimately house the procurement officials of the
HSRU who are currently engaged in the hiring of a management consulting firm for outsourcing the
health service delivery to the six crises affected districts of Khyber Pakhtunkhwa and can
subsequently be aligned to work under the Director Procurement, Procurement Cell, DGHS to
increase stakeholders’ acceptance threshold by the Directorate General Health Services towards
reforms carried out by the HSRU and to add to Procurement Cell’s professional capacity. Creation
of procurement skills at HSRU and at DGHS may lead to need-based exchange of procurement
personnel within the Department.
Director Procurement will manage the cases of mis-procurements or erroneous bid evaluations
and may refer such cases to the Director General Health Services for sending the same to
Secretary Health for administrative decisions. The organizational hierarchy of the Procurement
cell is as under:
Figure-9.7.1: Organizational hierarchy of the Procurement Cell
148
Following is the functional scheme of the Various Wings of Procurement Cell:
Figure-9.7.2: Details of the functions of the Wings in Procurement Cell
The Procurement cell would therefore assist Director General Health Services in the following
matters:
a. Provide technical support to Health Department in carrying out specific procurements
b. Standardize public procurement procedures & SOPs for all provincial health entities
c. Coordination & liaison with other Provincial bodies related to facilitation in procurement and
various policies / regulations affecting procurements.
149
Pre-Qualification Wing:
The organogram of the Pre/Post-Qualification Wing is as under:
Figure-9.7.3: Hierarchy of Pre/Post-Qualification Wing:
This Wing is proposed to come into being as a result of the merger of the Govt-MCC Section and
Pre-Qualification Section currently existing in the Directorate General Health Services (DGHS),
and will be solely responsible for qualifying reliable suppliers (Drug as well as Medical Equipment)
who may then participate in tenders invited by Health Department, Khyber Pakhtunkhwa. The
Wing will also keep a close liaison with the Drug Regulatory Authority of Pakistan (DRAP),
Islamabad and other organizations dealing with Supplier registrations and Quality control.
The officers of this Wing are required to be experienced in administrative as well as technical
aspect of pre/post-qualification of suppliers/manufacturers. It is proposed that at least three officers
are delegated this responsibility and one of these may also head as In-charge Pre/Postqualification Wing. These officers may be dedicated to qualitative assessment of suppliers of
Pharmaceutical
items,
Bio-medical
equipment
and
non-drug
surgical
150
instruments/disposables/insecticide/general items/equipment (eg. Medical/office furniture, Medical
gases, Waste management, and spares etc.) respectively.
The area of function of this Wing will be as follows:
The Wing may be aided by all the Pre/Post-Qualification teams who may have visited the firms
applying for Pre/Post-qualification / registration or its renewal.
Following task will be carried out in this aspect:
•
Maintain Database of Suppliers: – All suppliers, manufacturers or importers etc interested in
carrying out business with the Health Department Khyber Pakhtunkhwa will be registered with
this Wing which will maintain complete details of the suppliers in a database. This database will
be frequently distributed among all the procuring entities of the Health Department, Khyber
Pakhtunkhwa.
•
Conduct Pre -Qualifications: The Wing will use the already well-defined Pre-qualification
procedure to ensure the Good Manufacturing Practices (GMP) either before the tendering
process or may conduct Post-qualification after the opening of technical bids to ascertain the
same so that only quality products from reliable suppliers are considered for selection.
•
Conduct Post Qualifications: The Wing may maintain all record of the supplier’s performance
in terms of their successful contract executions. The Wing may also periodically check on the
pre-qualified / registered suppliers to ensure that they have maintained their quality standards
as were approved at the time of their pre-qualification.
•
Blacklisting of Suppliers: Any non-compliance or fraud committed by the suppliers at any of the
health entities may be centrally maintained and notified to all concerned, especially to Registrar
Companies or Security Exchange Commission of Pakistan (ESCP). The Wing may also ensure
that any supplier who has been requested for blacklisting/debarred from the Health Department
is judicially investigated and if required, be blacklisted for a minimum of three years from
participating in the DoH tenders. The Wing may also ensure that such suppliers do not apply
for pre-qualification under any new name or organization.
•
Suppliers Defaults: The Wing may be responsible for investigating any non-compliance of
contract terms once purchase order has been issued to a supplier. The Wing may ensure that
the allegations made are fair and that the supplier is given a fair opportunity to justify the
allegations of default and appropriate action taken. The Wing may also intervene on the issue
and try to resolve it amicably.
151
•
Suppliers Grievances:
The Wing may be responsible to attend to any of the Suppliers
grievances and to ensure provision of right of audienceto the aggrieved and appropriate
actions recommended that may be formally carried out as per DoH regulations.
•
Maintenance of Database of Suppliers:
The Wing may install and maintain database of the
Health-sector suppliers all-across Pakistan and their products. This information may be used
for monitoring suppliers’ after-sales services and their product performance for future reference
and to guide any one requiring feedback. The Wing may further liaise with DHIS at DGHS for
through any probable dedicated e-portal offering complete end-to-end Contract Management
automated solution for re-ordering medicines and equipment etc online from the suppliers
selected by the Health Department procuring entities for central rate contracting.
Technical Wing:
The organogram of the Pre/Post-Qualification Wing is as under:
Figure-9.7.4: Hierarchy of Technical Wing
This Wing may be responsible for all the technical matters of the product/services. It may comprise
a minimum of two technical persons. The officers of this unit may be professional pharmacists and
biomedical engineer/technicians with appropriate qualification and experience in Hospitals.
152
The functions of this Wing may be as follows:
•
Standardization of Products: The Wing may define the products in various categories and
accordingly may establish guidelines for their procurement. Certain regularly-used products
may be standardized for the specific health-entities and formularies may be developed for
each level of health care/programmes and criteria for estimating quantity be set as per patient
loads and seasonal/area disease prevalence.
•
Technical Specifications:
The Wing may formulate, standardize and update technical
specifications of the products for respective categories for medicines as well equipment.
•
Maintenance of Database of products: The Wing may maintain a comprehensive data
of all products available in the market with particular reference to the ones available in
Pakistan and their suppliers. This may help assist procuring entities to obtain
reference of the possible options available. The said database may be uploaded on the
dedicated e-portal for the automated Contract Management Solution
•
Dedicated Contract Lifecycle Management e-Portal at DGHS: A Contract Lifecycle
Management (CLM) software developed locally and running on a dedicated networking
server at the Procurement Cell, may help the Department to create combined online
purchasing, procedure compliance and procurement monitoring scenario. Any such
enterprise-grade Contract Lifecycle Management (CLM) software may be customized
to meet the requirements of the Procurement Cell, district Procurement Entities (PEs)
and HSRU for:
o Customized Drop-down Templates for Assets & Inventory data completion and
reporting from Districts
o Assets Management of Bio-Medical Equipment
o Inventory Control Management of drugs
o Procurement Management of all Health-sector goods & services
o Intelligent Contract Management Workflows for contract approval routing, legal
terms and conditions control
o Customized Templates for evaluation of bids submitted online to reduce burden of
paper-based tender documentation to 70%
o Contract Administration of suppliers & Health-Service Delivery Management firms
o Procurement Monitoring Tools embedded in the software for Health Managers to
gauge procedural compliance to the prevalent Provincial Public Procurement Rules
o Searchable Contract Database e.g., ECRI-SelectPlus & IMS Health for products
and their suppliers and linked to all contract data
o Ability to capture images of the primary and secondary documentation submitted
alongwith the bid and subsequent contract
153
o Creation of Vendor Interface on the CLM e-Portal wherein drop-down menus in the
Bid Content Submission Forms customized to the Technical Evaluation Criteria will
be provided so that suppliers may key-in the contents of their documentation bids
and upload the scanned documentation
o Creation of Evaluator Interface on the CLM e-Portal wherein evaluators may
scrutinize the data in the Bid Content Submission Forms & attached documentation
submitted by the suppliers/vendors/manufacturers, and subsequent calculation of
the highest ranking firm / Most Economically Advantageous Tender
o Generation of Business Intelligence Data Reports for trend-analysis, planning and
estimation of future procurement needs
Technical Comparisons: The Wing may maintain information of the technical comparison and
performance of the products. It may be responsible for developing technical evaluation criteria for
products and carrying out technical evaluations of the bids. The above can be maintained by
acquiring membership of both the ECRI-SelectPlus, data base for suppliers / products for biomedical equipment and IMS Health, data base for suppliers / products for pharmaceutical products
which are international nonprofit global organizations providing access to all medical devices /
technologies and pharmaceutical items respectively along with their manufacturers’ details,
specifications, unbiased technical comparisons and other relevant details that are very beneficial
for procurement analysis. The proposed Procurement Cell, after getting membership of the said
databases, may utilize the said information, services and technology to facilitate the Department’s
evaluators to analyze sales data of Pakistan Pharmaceutical market and to develop future
procurement business strategies.
•
Installed Base: The Wing may maintain a Health Facility-wise comprehensive installed base of
all the major bio-medical equipment earlier supplied to the Health Department and may
maintain an updated status of the performance of such equipment on periodic basis.
•
Project Management: The Wing may be the key contact point to coordinate with all Hospital
projects in terms of design, construction and medical equipment planning & procurements.
Tendering & Coordination Wing:
This Wing may have three main functions:
Being responsible for carrying out the administrative aspect of the tendering process based
on the Procurement Life Cycle carried out by the DoH.
ii) It may also be the coordination Wing for all Districts, AMI and Programs.
iii) Carry out internal audits of procurement procedures all over Khyber Pakhtunkhwa.
i)
154
iv) Monitor procedural compliance and oversight as well as to intervene in case of mis-
procurement or any system flaws.
Organogram of Technical Wing:
Figure-9.7.5: Tendering & Coordination Wing
It may comprise around three staff members who are appropriately qualified in procurement
procedures and related administrative functions.
The Wing may have 3 core functions which are as under:
a) Tender Administration & Contracts
b) Coordination with Districts
c) Coordination with AMIs and Programs
The Wing may be responsible for all the technical matters of the product/services. It may comprise
of 5-6 technical persons. The officers of this Wing may be professional Pharmacists, Biomedical
Engineers and technicians with appropriate qualification and experience in Hospitals.
155
Tender Administration Function: Following functions may be carried out related to Tender
Administration:
•
Standard Bidding Documents Preparation & Tendering Process: The Wing may be responsible
for standardizing the bidding documents for various categories of products and services i.e.,
•
Pharmaceutical drugs and Surgical Disposables
•
Medical Equipment & Spare parts.
•
Ancillary Hospital equipment like medical furniture, CMW/LHV Kits, non-Drug
Surgical disposables, insecticides and other miscellaneous items etc.
Also to prepare guidelines for standard procedures for whole tendering process from
advertisement till award of contract.
•
Consolidation of tender documents: The Wing may device a checklist for the whole tendering
procedure which may be used by all the procuring bodies as guidelines.
•
Advertisements: The Wing may be responsible for devising standard advertising format for
tendering to be used uniformly in all over the Province.
•
Tender Opening: The Wing may device a mechanism and standard procedure for tender
opening and its related regulations in accordance to the applicable regulatory régime.
•
Technical Evaluations: The Wing may define procedure for technical evaluation and its
formats. May also coordinate with the technical Wing in obtaining technical evaluation criteria
and obtain technical evaluations from them.
•
Order Executions: The Wing may define system procedures for purchase order placing and its
execution and provide support to all procuring bodies and Districts in this regards.
•
Contracts Drafts & Management: The Wing may be responsible for standardization of contract
and guidance for use by other procuring bodies. All matters related to the contract
administration may also be defined, updated and carried out by this Wing for all healthcare
procurement entities in Khyber Pakhtunkhwa. It may also assist them whenever required.
•
Records: The Wing may maintain all record and documents of the procurement being carried
out in an organized and accessible manner for monitoring and transparency.
Coordination Function: The Wing would be the only point of contact for the Districts, AMIs and
Programs which require any assistance, guidance, clarifications or any other help regarding
procurement system, procedures or documentation issues. The staff in this Wing will coordinate
with the appropriate Wing of the Procurement Cell and obtain the required information and pass on
to the querying institution. The 25 Districts in Khyber Pakhtunkhwa may be divided in three zones
or regions , each having 8 districts and handled by one person.
156
The functional jurisdiction of the Wing would comprise provision of assistance on any of the
following issues:
•
•
•
•
•
Suppliers: The Wing would liaise for providing all information on various suppliers, their prequalifications, blacklisting and other information of the suppliers including resolution of their
issues.
Tendering: All support related to tendering procedure, its documentation and contracts.
Technical: To provide all required technical information and support in terms of the
technical specifications and technical comparisons by coordinating with the Technical
Wing.
Planning: The Coordination Wing would also assist the Districts and AMIs in proper
planning of their procurements by providing guidelines and support as and when required.
Logistics: To assist the logistics and supply chain.
Oversight Functions: The Wing would also provide oversight to the Health Department’s
procuring entities at different stages of procurement lifecycle. It is recommended that the oversight
may be carried out maximum twice during the procurement process:
•
First oversight may be instituted when a procuring entity is about to issue Standard
Bidding Documents (SBDs), it should seek clearance from the Wing as to the correctness
of the said documents, confirm that the SBDs are being issued to pre-qualified/registered
suppliers only if required by the DGHS, and the Schedule of Requirements with technical
specifications conforms to the requirements of the Client as well as the evaluation criteria
and their application. The procuring entity can only then proceed after receiving an
affirmation by the Wing.
•
Second oversight may be instituted when the technical evaluation is completed by the
procuring entity and the same is submitted to the this Wing confirming that
This Wing would also act as a central repository of all contracts executed by the Health
Department procuring entities. Supplies should send a copy of their respective bids to this Wing as
well, for record and correlation purpose.
157
Budget & Planning Wing:
The organogram o the Budget & Planning Wing is as under:
Figure-9.7.6: The hierarchy of the Budget & Planning Wing
This Wing may have three main functions:
i.
Guidance on procuring institutes with regard to their budgets.
ii.
Provision of Guidelines for procurement planning with specific reference to availability of
the budgets.
iii.
Management of budgets from procuring institutes for central purchases.
The Wing may comprise of minimum 1 staff member who should be appropriately qualified in
budgeting and finance and related financial management functions.
The Wing may provide following functions:
i)
Procurement Planning: The Wing may provide guidelines for procurement planning in
accordance to the cash flow of the budget. These guidelines may be used by all the
procuring institutions.
ii) Budgeting: The Wing may define classifications of budgets for Health care procurements
and maintain these consolidated budgets from all districts, AMI and Programs.
iii) Commercial aspects of tendering: The Wing may formulate policies and guidelines for
various issues like imports, L/C opening and bank payments etc.
158
iv) Release of payments: The Wing may coordinate with Finance and Audit Department of
Government of Khyber Pakhtunkhwa to expedite timely payments for effective
procurements.
v) Logistics: The Wing may formulate logistic strategies for supplies and guide Districts, AMIs
and Vertical Programs.
9.8: Individual Job responsibilities:
It is evident that the staff of the Procurement Cell may be appropriately qualified and
experienced in the relevant areas of the procurement as defined in the Organogram
with detailed functions.
Figure-9.8.1: Nature & Requirement of the Individual Job Function
It is recommended that the In-charge of the Procurement Cell may be an officer from
the regular cadres of the civil services with appropriate qualification and experience
and well experienced in the Government working procedures; or he may be outsourced
keeping in view his technical qualifications. However for the rest of the staff in a
159
number of areas technical expertise is critical for which no compromise should be
made for any such position. The Organogram below is reproduced with indication of
Technical and administrative status of the staff that is being placed in the Wings and
sub-units of the Procurement Cell.
Following is the list of positions for which appropriate Job responsibilities have been
individually prepared and are attached under Annexure1 in section 8 of this report:
i.
Director Procurement Cell
ii.
Pre/Post-Qualification Wing: PQ
(a) In charge PQ
(b) Pre-Qualification Officer PQ-1 (Pharma)
(c) Pre-Qualification Officer PQ-2 (Bio-medical Equipment, Sterilization and
ancillary Hospital Equipment)
iii.
Technical Wing: TW
(a) In charge TW
(b) Technical Officer TW -1 (Pharma)
(c) Technical Officer TW -2 (Bio-medical Equipment & Spare parts, General
and ancillary Hospital Equipment)
iv.
Tendering & Coordination Wing: TC
(a) In charge TC
(b) Tendering
Officer
TC-1(Tender
Administration
&
Contract
Documentation)
(c) Coordination Officer TC-2 (25 districts, AMIs & Vertical Programs)
v.
Budget & Finance – BF
(a) In charge BF
(b) Planning Officer – BF-1
***
160
Procurement Cell - Job Responsibilities.
Job Title:
Director Procurement Cell
Qualifications: Graduation from an accredited four year college or university with a
degree in Strategic Procurement, Public Health (MPH), MBBS, Law,
BPharma/M.Phil (Pharma), Public Administration, Business Management
or a closely related field is strongly preferred. However, any equivalent
combination of education and experience sufficient to perform job duties
may be considered.
May also have following:
•
CIPS, CFCM, CPPO, IACCM or any certified accreditation in Public
Purchasing required, or ability to obtain such or similar training within
first year of employment through procurement training.
•
Comprehensive knowledge of Provincial Procurement Rules / Federal
PPRA and other applicable government regulations is required.
Knowledge of Donor Procurement Guidelines would be preferred.
Experience:
Minimum five years’ experience in the Procurement
Management field is preferred.
Grade:
BPS 19 or equivalent
Recruitment:
As per Govt Policy
/ Contract
Position type: Administrative / technical for Khyber Pakhtunkhwa Health Department
Jurisdiction:
Complete Province
Reports to:
For all matters to Director General Health Services, DoH, KP
Direct responsibilities:
1. To work under the direction of the Secretary Health, Govt. of Khyber Pakhtunkhwa
2. To be responsible for maintaining the goals, standards, and objectives of the
Procurement Cell in line with the Health care objectives of the Health Department, Govt
of Khyber Pakhtunkhwa.
3. To lead, direct, coordinate, and manage all administrative, technical, contractual and
operational aspects of the tendering process for health care procurements.
4. To train, motivate, coach, develop, and evaluate assigned professional, technical, and
clerical purchasing staff of the Cell for dedicated and best practice professional
working.
161
5. To stay abreast of new processes, technologies, materials, purchasing methods,
statutory requirements and market conditions. Communicate with management on any
significant factors that could affect Provincial Health Procurements.
6. To apply excellent customer service skills, establish and maintain effective working
relationships with other employees, Public officials of Health Department (Districts and
AMI & Programs) and other departments of the provincial Govt. Like Finance, PPRA,
Audit etc.
7. To approve requisitions, purchase orders, procurement expenditures and contracts for
the procurements carried out by the procurement Cell.
8. To manage and ensure timely completion of procurements within the fiscal year and
appropriated budgets.
9. To lead, manage and coach cross-functional teams through the information sharing &
strategic sourcing process.
10. To facilitate team meetings, prepare supporting documentation, conduct market
research, develop market analysis and assist with strategy development for effective
and transparent procurements.
11. To serve as a member of various cooperative and consortium procurement committees
for DoH Khyber Pakhtunkhwa.
12. To serve as lead negotiator for complex technical services/products, professional
services and Hospital projects.
13. To produce written determination for procurement transactions outside the fiduciary
levels (i.e. emergencies) for approval by the Health Department.
14. To ensure discipline and work ethics of all staff of the Procurement Cell and monitor
their performance and professionalism.
15. Attendance at work is an essential function of this position.
Responsibilities through the various Wings of the Procurement Cell:
1. To formulate, obtain, and maintain policies and procedures for the Purchasing System
and Guidelines for Health care procurement for the whole province and thereof to act
as guidance and monitoring of the same.
2. To monitor the budget for procurement and facilitate procurement planning.
3. To develop and facilitate training for DDO’s of District, AMIs and Programs in
purchasing policies, procedures and system. Thereof to advise and assist other
Districts, AMI and Programs in management of health care purchasing and contract
procedures.
4. To ensure that Quality products/service are standardized for effective health care
services.
162
5. To ensure that all suppliers/manufacturers are well scrutinized and appropriately prequalified for participating in the tenders for Health care procurement in the province.
Thereof to ensure their post qualification status on periodic basis.
6. To direct, advise, and review specifications for projects requiring extensive technical or
professional services or for complex Hospital projects.
7. To manage projects with cross-functional team members, significant challenges with
information availability, technical requirements and financial complexity.
8. To make site visits to suppliers/manufacturers to ensure that their pre-qualification
statuses are maintain as per original submissions for pre-qualifications.
9. To make periodic visits at various sites of supplies to monitor and measure
performance of supplies throughout the province as and when required.
10. To ensure quality standards are met through administration of purchasing complaints
and resolutions provided by the procuring entities of health in the Province of Khyber
Pakhtunkhwa.
11. To manage large-scale centralized purchasing, contract functions and supplies that
require items with unique requirements as to manufacturing, supply, testing, durability,
or quality characteristics.
12. To review and respond to suppliers/manufacturers protests/grievances in a judicious
manner and resolve in timely manner.
13. To measure vendor performance, cancel contract, suspend or implement debarment
proceedings on vendors not meeting performance requirements.
Note: 1.
The duties listed above are intended only as illustrations of the various types
of work that may be performed. The omission of specific statements of duties does not
exclude them from the position if the work is similar, related or a logical assignment to the
position.
Skills required in additional to qualifications:
•
•
•
•
•
Ability to communicate orally and in writing, using technical terminology with technical
writing skills is required.
Extensive judgment and originality to plan procurement strategies for large scale
acquisition programs or systems.
Comprehensive knowledge of personal computers and software packages, including
specific knowledge of MS Word, MS Excel, MS Power Point, MS Access, electronic
document management, imaging and ability to use procurement software.
Extensive knowledge of contract law and its application to the purchasing process.
Ability to manage and supervise others as team.
163
•
Ability to establish and maintain effective working relationships with co-workers,
supervisors, other DOH personnel.
Pre-qualifications Wing - Job Responsibilities.
Job Title:
In charge Pre/Post-Qualifications Wing
Qualifications: Graduation from an accredited four year college or university with any
equivalent combination of education and experience i.e., M.Phil (Pharma),
BPharma + 5 years experience, MBBS + MPH, or MBBS + 1 year
experience is strongly preferred.
May also have following:
•
•
Knowledge of extensive regulatory framework of Drug Laws is
required.
Comprehensive knowledge of Provincial Procurement Rules / Federal
PPRA and other applicable government regulations is required.
Knowledge of Donor Procurement Guidelines would be preferred.
Experience: Minimum seven years’ experience in the field of Drug Laws / public
procurement field with experience of pre/post-qualifications is preferred.
Grade:
BPS 18 or equivalent
Recruitment: As per Govt. Policy
Position type:Administrative for Pre-qualification of Suppliers/Manufacturers for Health
care procurement in Khyber Pakhtunkhwa Health Department
Jurisdiction: Complete Province
Reports to:
For all matters to In charge of Procurement Cell DoH Khyber Pakhtunkhwa.
Direct responsibilities:
1. To work under the direction of the In charge Procurement Cell DoH Khyber
Pakhtunkhwa
2. To be responsible for maintaining the goals, standards, and objectives of the
Suppliers/manufacturers dealing with Procurement Cell in line with the Health care
objectives of the Health Department, Govt. of Khyber Pakhtunkhwa.
3. To lead, direct, coordinate, and manage all technical and operational aspects of the
pre-qualifying Suppliers/manufacturers for Health care procurements.
4. To train, motivate, coach, develop, and evaluate assigned professional, technical,
and clerical purchasing staff of the Procurement Cell for dedicated and best
practice professional working.
164
5. To stay abreast of new processes, technologies, products & materials, statutory
requirements and market conditions in context to suppliers/manufacturers and
communicate with In charge procurement on any significant factors that could affect
quality and reliability of suppliers/manufacturers in Provincial Health Procurements.
6. To apply excellent customer service skills, establish and maintain effective working
relationships with other employees of the Dept. and the suppliers/manufacturers.
7. To approve Pre-qualifications, post qualifications, debarring/black listing of
Suppliers/ manufacturers for the procurements being carried out by the
Procurement Cell at provincial level.
8. To lead, manage and coach cross-functional teams through the information sharing
& strategic sourcing process.
9. To facilitate team meetings, prepare supporting documentation, conduct market
research, develop market analysis and assist with Suppliers/Manufacturers strategy
development for effective procurements.
10. To ensure discipline and work ethics of all staff of the pre-Qualification Wing and
monitor their performance and professionalism.
11. Attendance at work is an essential function of this position.
Responsibilities through the team members of the PQ Wing:
1. To formulate, obtain, and maintain policies and procedures for pre-qualification of
suppliers/manufacturers for the standardized products services to be notified to all
procuring entities of the whole province and thereof to act as guidance and monitoring
of the same.
2. To appropriately pre-qualify quality suppliers/manufacturers after scrutinizing and
issuance of certification for participating in the tenders for Health care procurement in
the province.
3. To follow up of the post qualification status of the suppliers/manufacturers on periodic
basis.
4. To make site visits to suppliers/manufacturers to ensure that their pre-qualification
statuses are maintain as per original submissions for pre-qualifications.
5. To make periodic visits at various sites of supplies to monitor and measure
performance of supplies throughout the province as and when required.
6. To maintain centralized databank of all suppliers/manufacturers and their offered
products services that can be or is being offered for purchasing and supplies [e.g., IMS
Data, ECRI-SelectPlus, Sid4health for NHS, UK or Indian Directorate General of
Supplies and Disposals (DGS&D)]
7. To obtain market information on the Suppliers/manufacturers and their performance
and maintain complete record of the same in the databank.
165
8. To attend, review and respond to suppliers/manufacturers protests/grievances in a
judicial manner and resolve in timely manner.
9. To measure and monitor vendor performance, cancel contract, suspend or implement
debarment proceedings on vendors not meeting performance requirements and ensure
that health care procuring entities are immediately informed thru proper notifications.
10. To maintain install base of all suppliers/manufacturers equipment with updated
performance record and any noncompliance or quality issues.
11. To ensure that a regular updated list of pre-qualified suppliers/manufacturers is sent to
all Health care procuring entities in Khyber Pakhtunkhwa.
12. To have liaison with suppliers/manufacturers associations/bodies and keep updated on
the developments that may affect the pre-qualification criteria of Health Department or
the in general suppliers/manufacturers performance.
13. To assist the Health care procuring entities in issues related to pre-qualification or post
qualification of suppliers/manufacturers.
Note: 1.
The duties listed above are intended only as illustrations of the various types
of work that may be performed. The omission of specific statements of duties
does not exclude them from the position if the work is similar, related or a
logical assignment to the position.
Skills required in additional to qualifications:
•
•
•
•
•
•
Ability to communicate orally and in writing, using technical terminology with technical
writing skills is required.
Extensive judgment and originality to evaluate the suppliers/manufacturers for prequalification for procurements being carried out in the whole province.
Comprehensive knowledge of personal computers and software packages, including
specific knowledge of MS Word, MS Excel, MS Powerpoint, MS Access & electronic
document management.
Extensive knowledge of contract law and its application to the purchasing process.
Ability to manage and supervise others as team.
Ability to establish and maintain effective working relationships with co-workers,
supervisors, other DOH personnel.
******
166
Pre-qualifications Wing - Job Responsibilities.
Pre-qualifications Wing - Job Responsibilities.
Job Title:
Pre-Qualification Officer - PQ-1(Pharma)
Qualifications:
Graduation from an accredited four year college or university in
Pharmacy/ Pharmaceutical Sciences, MBBS with atleast one year
experience. However, any equivalent combination of education and
relevant experience sufficient to perform job duties may be considered.
Must also have following:
•
•
Technical Knowledge of Pharmaceutical manufacturing, processes
and Raw Materials.
Comprehensive knowledge of Pharmaceutical Industry and applicable
International Good Manufacturing Practices/regulations.
Experience: Minimum five years’ experience in the field of Pharmaceutical procurement
or Industry with experience of pre-qualifications is preferred;
or
In case of no Degree in Pharmacy, minimum ten years of experience in the
field of Pharmaceutical procurement or Industry with experience of PreQualifications is required.
Grade:
BPS 17 or above
Recruitment: As per Govt. Policy
Position type:Administrative for Pre/Post-qualification of Pharmaceutical product Suppliers/
Manufacturers for Health care procurement in Khyber Pakhtunkhwa Health
Department
Jurisdiction: Complete Province
Reports to:
For all matters to In-charge of Pre-Qualification Wing of Procurement Cell of
Khyber Pakhtunkhwa Health Department.
Direct responsibilities:
1. To work under the direction of the In charge Pre/Post-Qualification Wing of
Procurement Cell Khyber Pakhtunkhwa Health Department.
2. To be responsible for maintaining the goals, standards, and objectives of the prequalification standards of Pharmaceutical Product Suppliers/manufacturers dealing
167
with Procurement Cell in line with the Health care objectives of the Health
Department, Govt. of Khyber Pakhtunkhwa.
3. To stay abreast of new manufacturing & supply processes, technologies, products
& materials, statutory requirements and market conditions in context to
Pharmaceutical Product including Insecticides suppliers/manufacturers and
communicate to the In charge Pre-qualifications Wing of any significant factors that
could
affect
quality
and
reliability
of
Pharmaceutical
Product
suppliers/manufacturers in Provincial Health Procurements.
4. To formulate, obtain, and maintain policies and procedures for pre-qualification of
Pharmaceutical Product suppliers/manufacturers for the standardized products &
services to be notified to all procuring entities of the whole Province and thereof to
act as guidance and monitoring of the same.
5. To
appropriately
pre-qualify
quality
Pharmaceutical
Product
suppliers/manufacturers after scrutinizing and issuance of certification for
participating in the tenders for Health care procurement in the province.
6. To follow up of the post qualification status of the suppliers/manufacturers on
periodic basis.
7. To make site visits to suppliers/manufacturers to ensure that their pre-qualification
statuses are maintain as per original submissions for pre-qualifications.
8. To make periodic visits at various sites of supplies to monitor and measure
performance of supplies throughout the province as and when required.
9. To maintain centralized databank of all suppliers/manufacturers and their offered
products services that can be or is being offered for purchasing and supplies. [e.g.,
IMS Data, ECRI-SelectPlus, Sid4health for NHS, UK or Indian Directorate General
of Supplies and Disposals (DGS&D)]
10. To
obtain
market
information
on
the
National
&
International
Suppliers/manufacturers of Pharmaceutical Products operating in Pakistan with
regards to their performance and maintain complete record of the same in the
databank.
11. To attend, review and respond to suppliers/manufacturers protests/grievances in a
judicious manner and resolve in timely manner.
12. To measure and monitor vendor performance, cancel contract, suspend or
implement debarment proceedings on vendors not meeting performance
requirements and ensure that health care procuring entities are immediately
informed thru proper notifications.
13. To maintain install base of all suppliers/manufacturers equipment with updated
performance record and any noncompliance or quality issues.
14. To ensure that a regular updated list of pre-qualified Pharmaceutical suppliers
/manufacturers is sent to all Healthcare procuring entities in Khyber Pakhtunkhwa.
168
15. To have liaison with Pharmaceutical Product suppliers/manufacturers
associations/bodies and keep updated on the developments that may affect the
pre-qualification criteria’s of Health Department or the in general
suppliers/manufacturers performance.
16. To assist the Health care procuring entities in issues related to pre-qualification or
post qualification of suppliers/manufacturers.
17. To apply excellent customer service skills, establish and maintain effective working
relationships with the suppliers/manufacturers.
18. To participate /represent Incharge Pre-qualification Wing in meetings, prepare
supporting documentation, conduct market research, develop market analysis and
assist with Pharmaceutical product Suppliers/Manufacturers strategy development
for effective procurements.
19. To train, motivate, coach, develop, and evaluate assigned professional, technical,
and clerical staff of the Cell for dedicated and best practice professional working.
20. Attendance at work is an essential function of this position.
Note: 1.
The duties listed above are intended only as illustrations of the various types
of work that may be performed. The omission of specific statements of duties
does not exclude them from the position if the work is similar, related or a
logical assignment to the position.
Skills required in additional to qualifications:
•
•
•
Ability to communicate orally and in writing, using technical terminology with technical
writing skills is required.
Extensive judgment and originality to evaluate the suppliers/manufacturers for prequalification for procurements being carried out in the whole province.
Comprehensive knowledge of personal computers and software packages, including
specific knowledge of MS Word, MS Excel, MS Powerpoint, MS Access & electronic
document management.
Pre-qualifications Wing - Job Responsibilities.
Job Title: Pre-Qualification Officer - PQ-2 (Bio-medical Devices, Consumables &
Ancillary Hospital Equipment)
Qualifications:
Graduation from an accredited four year college or university in
Biomedical Engineering, Electronics or physics. However, any equivalent
169
combination of education and relevant experience sufficient to perform
job duties may be considered.
Must also have following:
•
•
Experience:
Technical Knowledge of Medical Equipment Technologies and their
technical Services issues.
Comprehensive knowledge of Medical Device standards and safety
regulations particularly in context to the Supply and manufacturing.
Minimum five years’ experience in the field of Biomedical Engineering
Industry with experience of procurements of Medical Devices is preferred;
or
In case of no Degree in Biomedical or Electronics Engineering, Technical
Diploma in Biomedical or Electronics with minimum ten years of
experience in the field of Medical devices Industry and procurements is
required.
Grade:
BPS 17 or equivalent
Recruitment:
As per Govt. Policy
Position type:
Administrative for Pre-qualification of Medical Equipment Suppliers/
Manufacturers for Health care procurement in Khyber Pakhtunkhwa
Health Department
Jurisdiction:
Complete Province
Reports to:
For all matters to In-charge of Pre-Qualification Wing of Procurement Cell
of Khyber Pakhtunkhwa Health Department.
Direct responsibilities:
1. To work under the direction of the In charge Pre-Qualification Wing of Procurement
Cell Khyber Pakhtunkhwa Health Department.
2. To be responsible for maintaining the goals, standards, and objectives of the prequalification standards of Medical equipment Suppliers/manufacturers dealing with
Procurement Cell in line with the Health care objectives of the Health Department,
Govt. of Khyber Pakhtunkhwa.
3. To stay abreast of new technologies, products & services, statutory requirements
and market conditions in context to Medical Equipment suppliers/manufacturers
and communicate to the In charge Pre-qualifications Wing of any significant factors
170
that could affect quality and reliability of medical equipment suppliers/manufacturers
in Provincial Health Procurements.
4. To formulate, obtain, and maintain policies and procedures for pre-qualification of
Medical equipment suppliers/manufacturers for the standardized products &
services to be notified to all procuring entities of the whole province and thereof to
act as guidance and monitoring of the same.
5. To appropriately pre-qualify quality Medical Equipment suppliers/manufacturers
after scrutinizing and issuance of certification for participating in the tenders for
Health care procurement in the province.
6. To follow up of the post qualification status of the suppliers/manufacturers on
periodic basis.
7. To make site visits to suppliers/manufacturers to ensure that their pre-qualification
statuses are maintain as per original submissions for pre-qualifications.
8. To make periodic visits at various sites of supplies to monitor and measure
performance of supplies throughout the province as and when required.
9. To maintain centralized databank of all Medical equipment suppliers/manufacturers
and their offered products services that can be or is being offered for purchasing
and supplies. [e.g., IMS Data, ECRI-SelectPlus, Sid4health for NHS, UK or Indian
Directorate General of Supplies and Disposals (DGS&D)].
10. To
obtain
market
information
on
the
National
&
International
Suppliers/manufacturers of Medical Equipment operating in Pakistan with regards
to their performance and maintain complete record of the same in the databank.
11. To attend, review and respond to suppliers/manufacturers protests/grievances in a
judicial manner and resolve in timely manner.
12. To measure and monitor vendor performance, cancel contract, suspend or
implement debarment proceedings on vendors not meeting performance
requirements and ensure that health care procuring entities are immediately
informed thru proper notifications.
13. To maintain install base of all suppliers/manufacturers equipment with updated
performance record and any noncompliance or quality issues.
14. To ensure that a regular updated list of pre-qualified medical Equipment suppliers
/manufacturers is sent to all Healthcare procuring entities in Khyber Pakhtunkhwa.
15. To
have
liaison
with
Medical
Equipment
suppliers/manufacturers
associations/bodies and keep updated on the developments that may affect the
pre-qualification criteria of Health Department or the in general
suppliers/manufacturers performance.
16. To assist the Health care procuring entities in issues related to pre-qualification or
post qualification of suppliers/manufacturers.
17. To apply excellent customer service skills, establish and maintain effective working
relationships with the suppliers/manufacturers.
171
18. To participate /represent In charge Pre-qualification Wing in meetings, prepare
supporting documentation, conduct market research, develop market analysis and
assist with Medical Equipment Suppliers/Manufacturers strategy development for
effective procurements.
19. To train, motivate, coach, develop, and evaluate assigned professional, technical,
and clerical staff of the Cell for dedicated and best practice professional working.
20. Attendance at work is an essential function of this position.
Note: 1. The duties listed above are intended only as illustrations of the various types of
work that may be performed. The omission of specific statements of duties does
not exclude them from the position if the work is similar, related or a logical
assignment to the position.
Skills required in additional to qualifications:
•
•
•
Ability to communicate orally and in writing, using technical terminology with technical
writing skills is required.
Extensive judgment and originality to evaluate the suppliers/manufacturers for prequalification for procurements being carried out in the whole province.
Comprehensive knowledge of personal computers and software packages, including
specific knowledge of MS Word, MS Excel, MS Powerpoint, MS Access & electronic
document management.
******
Technical Wing - Job Responsibilities.
Job Title:
In charge Technical Wing
Qualifications: Graduation from an accredited four year college or university with a degree
in relevant field (Pharmacy/Biomedical Engineering or Medical technology)
or a closely related field is strongly preferred. However, any equivalent
combination of education and experience sufficient to perform job duties may
be considered.
Must also have following:
•
•
CIPS or any certified accreditation in Purchasing or Public Purchasing
required, or ability to obtain such within first year of employment.
Comprehensive knowledge of Pharmaceuticals and or Medical electronic
devices is required.
172
Experience: Minimum five years’ experience in the industry of Medical Engineering/
Pharmaceuticals with relevant experience of technical aspects of
procurements is preferred.
Grade:
BPS 18 or equivalent or M3
Recruitment: As per Govt. Policy
Position type:Technical aspect of Health care Product and their technologies for Health
care procurement in Khyber Pakhtunkhwa Health Department
Jurisdiction: Complete Province
Reports to:
For all matters to In charge of the Procurement Cell of Khyber Pakhtunkhwa
Health Deptt.
Direct responsibilities:
1. To work under the direction of the In charge of Procurement Cell Khyber
Pakhtunkhwa Health Deptt
2. To be responsible for maintaining the goals, standards, and objectives of the
Products and services being dealt within the Procurement Cell in line with the
Health care objectives of the Health Department, Govt. of Khyber Pakhtunkhwa.
3. To lead, direct, coordinate, and manage all technical aspects of the Products
involved in Health care procurements.
4. To train, motivate, coach, develop, and evaluate assigned professional, technical,
and clerical purchasing staff of the Cell for dedicated and best practice professional
working.
5. To stay abreast of new technologies & materials, techniques and their market
conditions in to products and services and communicate with in charge
procurement on any significant factors that could affect quality and reliability of
products/services in Provincial Health Procurements.
6. To apply excellent customer service skills, establish and maintain effective working
relationships with other employees of the Dept. and the suppliers/manufacturers.
7. To approve technical specification and other technical aspects of products/services
for standardization of products/services for all procurements being carried out by
the procurement entities at provincial level.
8. To lead, manage and coach cross-functional teams through the information sharing
& strategic sourcing process.
9. To facilitate team meetings, prepare supporting documentation, conduct market
research, develop market analysis related to products/services and assist in
strategy development for effective procurements.
173
10. To ensure discipline and work ethics of all staff of the technical Wing and monitor
their performance and professionalism.
11. Attendance at work is an essential function of this position.
Responsibilities through the team members of the Cell:
1. To formulate, obtain, and maintain policies and procedures for product/services
categorization and standardization in line with the provincial Health care delivery policy
at different level of health care facilities.
2. To notify the same to all procuring entities of the whole province and thereof to act as
guidance and monitoring of the same.
3. To appropriately review and evaluate products/services after scrutinizing and
maintaining a database of products and issuance of approvals for procurement by
tenders for Health care procurement in the province.
4. To follow up of the performance status of the products/services on periodic basis and
keeping record of the same.
5. To obtain market information on the products/services and their performance from all
over the province and maintain complete record of the same in the databank.
6. To manage Hospital Projects and coordinate the medical equipment supplies with the
design and construction of the hospital.
7. To attend, review and respond to suppliers/manufacturers protests/grievances related
to technical aspect of the product/services and in a judicial manner and resolve in
timely manner.
8. To ensure that a regular updated list of standardized products and any technical
advancements to all Health care procuring entities in Khyber Pakhtunkhwa.
9. To have liaison with suppliers/manufacturers associations/bodies and keep updated on
the developments that may affect the technical aspects of a product or development or
its performance.
10. To assist the Health care procuring entities in all issues related to technical
specification and comparisons for procurement.
Note: 1.
The duties listed above are intended only as illustrations of the various types
of work that may be performed. The omission of specific statements of duties does not
exclude them from the position if the work is similar, related or a logical assignment to the
position.
Skills required in additional to qualifications:
•
Ability to communicate orally and in writing, using technical terminology with technical
writing skills is required.
174
•
•
•
•
•
Extensive judgment and originality to understand and evaluate technical aspects of the
product/services and be able to evaluate its clinical applications and users
requirements
for procurements being carried out in the whole province.
Comprehensive knowledge of personal computers and software packages, including
specific knowledge of MS Word, MS Excel, MS Powerpoint, MS Access & electronic
document management.
Ability to use any software based program for use in technical aspects of medical
devices and drugs.
Ability to manage and supervise others as team.
Ability to establish and maintain effective working relationships with co-workers,
supervisors, other DOH personnel and Suppliers.
******
Technical Wing - Job Responsibilities.
Job Title:
Technical Officer – TW-1 (Pharma)
Qualifications:
Graduation from an accredited four year college or university with a
degree in Pharmacy or Micro-Biology/Chemistry is preferred. However, any
equivalent combination of education and experience sufficient to perform job
duties may be considered.
Must also have following:
• Comprehensive knowledge of Pharmaceutical Products and their clinical
applications is required.
• Comprehensive knowledge of Pharmaceutical raw materials and their
Manufacturing is required.
Experience: Minimum five years’ experience in the industry of Pharmaceuticals with
relevant experience of technical aspects of procurements is preferred.
Grade:
BPS 17 or equivalent or M3
Recruitment: As per Govt. Policy
Position.type:Technical aspect of Pharmaceutical Products and their technologies for
Health care procurement in Khyber Pakhtunkhwa Health Department
175
Jurisdiction: Complete Province
Reports to:
For all matters to In charge of the Technical Wing of Procurement Cell of
Khyber Pakhtunkhwa Health Dept.
Direct responsibilities:
1. To work under the direction of the In charge of Technical wing of the Procurement
Cell Khyber Pakhtunkhwa Health dept.
2. To be responsible for maintaining the goals, standards, and objectives of all the
Pharmaceutical Products, Insecticides and services being dealt within the
Procurement Cell in line with the Health care objectives of the Health Department,
Govt. of Khyber Pakhtunkhwa.
3. To formulate, obtain, and maintain policies and procedures for Pharmaceutical
product/services categorization and standardization in line with the provincial Health
care delivery policy at different level of health care facilities.
4. To prepare technical specification and other technical aspects of Pharmaceutical
products/services for standardization of products/services for all procurements
being carried out by the Procurement Cell at provincial level.
5. To notify the same to all procuring entities of the whole province and thereof to act
as guidance and monitoring of the same.
6. To appropriately review and evaluate Pharmaceutical products/services after
scrutinizing and maintaining a database of products and issuance of approvals for
procurement by tenders for Health care procurement in the province.
7. To follow up of the performance status of the Pharmaceutical products/services on
periodic basis and keeping record of the same.
8. To obtain market information on the Pharmaceutical products/services and their
performance from all over the province and maintain complete record of the same
in the databank.
9. To ensure that a regular updated list of standardized Pharmaceutical products and
any technical advancements to all Health care procuring entities in Khyber
Pakhtunkhwa.
10. To attend, review and respond to Pharmaceutical suppliers/manufacturers
protests/grievances related to technical aspect of the product/services and in a
judicial manner and resolve in timely manner.
11. To have liaison with Pharmaceutical suppliers/manufacturers associations/bodies
and keep updated on the developments that may affect the technical aspects of a
product or development or its performance.
12. To assist the Health care procuring entities in all issues related to technical
specification and comparisons for procurement of Pharmaceutical products
176
13. To stay abreast of new technologies & materials, techniques and their market
conditions in to products and services and communicate with in charge
procurement on any significant factors that could affect quality and reliability of
Pharmaceutical products/services in Provincial Health Procurements.
14. To apply excellent customer service skills, establish and maintain effective working
relationships with other employees of the Dept. and the Pharmaceutical
suppliers/manufacturers.
15. To attend/represent Incharge Technical Wing and facilitate team meetings, prepare
supporting documentation, conduct market research, develop market analysis
related to Pharmaceutical products/services and assist in strategy development for
effective procurements.
16. Attendance at work is an essential function of this position.
Note: 1.
The duties listed above are intended only as illustrations of the various types
of work that may be
performed. The omission of specific statements of duties does not exclude them
from the position
if the work is similar, related or a logical assignment to the position.
Skills required in additional to qualifications:
• Ability to communicate orally and in writing, using technical terminology with technical
writing skills is required.
• Extensive judgment and originality to understand and evaluate technical aspects of the
product/services and be able to evaluate its clinical applications and users
requirements
for procurements being carried out in the whole province.
• Comprehensive knowledge of personal computers and software packages, including
specific knowledge of MS Word, MS Excel, MS Powerpoint, MS Access & electronic
document management.
• Ability to use any software based program for use in technical aspects of medical
devices and drugs.
• Ability to manage and supervise others as team.
******
Technical Wing - Job Responsibilities.
Job Title: Technical Officer – TW-2 (Bio-medical Devices, Consumables & Ancillary
Hospital Equipment)
177
Qualifications:
Graduation from an accredited four year college or university with a
degree in Biomedical Engineering is strongly preferred. However, any equivalent
combination of education and experience sufficient to perform job duties may be
considered.
Must also have following:
•
•
•
Comprehensive knowledge of Electro-medical Products/devices (and
their Technologies & after sales services is required.
Knowledge of Clinical Application and Standards of Medical devices is
also required.
Experience in procurement and management of Spare parts of Electromedical equipment.
Experience: Minimum seven years’ experience in the industry of Electro-medical
Products/Devices with relevant experience of technical aspects of
procurements is preferred.
Grade:
BPS 17 or equivalent or M3
Recruitment: As per Govt. Policy
Position type:Technical aspect of Electro-Medical Products/Devices and their technologies
for Health care procurement in Khyber Pakhtunkhwa Health Department
Jurisdiction: Complete Province
Reports to:
For all matters to In charge of the Technical wing of Procurement Cell of
Khyber Pakhtunkhwa Health Dept.
Direct responsibilities:
1. To work under the direction of the In charge of Technical Wing of the Procurement
Cell Khyber Pakhtunkhwa Health Department.
2. To be responsible for maintaining the goals, standards, and objectives of all the
Electro-Medical Products/Devices and related services being dealt within the
Procurement Cell in line with the Health care objectives of the Health Department,
Govt. of Khyber Pakhtunkhwa.
3. To formulate, obtain, and maintain policies and procedures for Electro-Medical
Products/Devices and related services categorization and standardization in line
with the provincial Health care delivery policy at different level of health care
facilities.
178
4. To prepare technical specification and other technical aspects of Electro-Medical
Products/Devices and related services for standardization of products/services for
all procurements being carried out by the procurement entities at provincial level.
5. To notify the same to all procuring entities of the whole province and thereof to act
as guidance and monitoring of the same.
6. To appropriately review and evaluate Electro-Medical Products/Devices and related
services after scrutinizing and maintaining a database of products and issuance of
approvals for procurement by tenders for Health care procurement in the province.
7. To follow up of the performance status of the Electro-Medical Products/Devices and
related services on periodic basis and keeping record of the same.
8. To obtain market information on the Electro-Medical Products/Devices and related
services and their performance from all over the province and maintain complete
record of the same in the databank.
9. To ensure that a regular updated list of standardized Electro-Medical
Products/Devices and related services and any technical advancements to all
Health care procuring entities in Khyber Pakhtunkhwa.
10. To attend, review and respond to Electro-Medical Products/Devices
suppliers/manufacturers protests/grievances related to technical aspect of the
product/services and in a judicial manner and resolve in timely manner.
11. To have liaison with Electro-medical Products/Devices suppliers/manufacturers
associations/bodies and keep updated on the developments that may affect the
technical aspects of a product or development or its performance.
12. To assist the Health care procuring entities in all issues related to technical
specification
and
comparisons
for
procurement
of
Electro-medical
Products/Devices.
13. To stay abreast of new technologies & materials, techniques and their market
conditions in to products and services and communicate with in charge
procurement on any significant factors that could affect quality and reliability of
Electro-medical Products/Devices and their services in Provincial Health
Procurements.
14. To apply excellent customer service skills, establish and maintain effective working
relationships with other employees of the Dept. and the Electro-medical
Products/Devices and their services.
15. To attend/represent In charge Technical Wing and facilitate team meetings, prepare
supporting documentation, conduct market research, develop market analysis
related to Electro-medical Products/Devices and services and assist in strategy
development for effective procurements.
16. Attendance at work is an essential function of this position.
179
Note: 1.
The duties listed above are intended only as illustrations of the various types
of work that may be performed. The omission of specific statements of duties
does not exclude them from the position if the work is similar, related or a
logical assignment to the position.
Skills required in additional to qualifications:
•
•
•
•
•
Ability to communicate orally and in writing, using technical terminology with technical
writing skills is required.
Extensive judgment and originality to understand and evaluate technical aspects of the
product/services and be able to evaluate its clinical applications and users
requirements
for procurements being carried out in the whole province.
Comprehensive knowledge of personal computers and software packages, including
specific knowledge of MS Word, MS Excel, MS Powerpoint, MS Access & electronic
document management.
Ability to use any software based program for use in technical aspects of medical
devices and drugs.
Ability to manage and supervise others as team.
******
Tendering & Coordination Wing - Job Responsibilities.
Job Title:
In charge Tendering & Coordination (T&C) Wing
Qualifications:Graduation from an accredited four year college or university with a Masters
degree in Project Management, Procurement & Contract Management,
Business Administration, Law or a closely related field is strongly preferred.
However, any equivalent combination of education and experience sufficient
to perform job duties may be considered.
Must also have following:
• CIPS, CPCM, CPPO or any certified accreditation in Purchasing or Public
Purchasing required, or ability to obtain such within first year of
employment.
• Comprehensive knowledge of PPRA and other applicable government
regulations is required.
Experience: Minimum seven years’ experience in the Public Health sector with relevant
experience of administrative aspects of procurements is preferred.
180
Grade:
BPS 18 or equivalent
Recruitment: As per Govt. Policy
Position type:Tender Administration & Coordination of procurements with health care
procurement entities of Khyber Pakhtunkhwa Health Department
Jurisdiction: Within the Health department
Reports to: For all matters to In charge of the Procurement Cell of Khyber Pakhtunkhwa
Health Deptt.
Direct responsibilities:
1. To work under the direction of the In charge of Procurement Cell Khyber
Pakhtunkhwa Health Deptt
2. To lead, direct, coordinate, and manage all tendering process for procurements &
Coordination with Health procuring Institutes within the Health Department.
3. To stay abreast of new developments in the Procurement Cell and be able to
communicate to the other procuring institutes of health to whom they are
coordinating
4. With respect to Tendering process:
a. To be responsible for carrying out all tendering processes and concluding it
in lines with the PPRA regulations.
b. To facilitate team meetings, prepare supporting documentation, related to
tendering process and assist in strategy development for effective
procurements.
5. With respect to Coordination Functions:
a. To be responsible for providing support to all Govt procuring agencies like
the Districts, AMI’s and Program in their healthcare procurement and related
issues. This wing may be the may be the focal contact point for these
organization for obtaining any relevant information from the procurement
department and same may be provided by the concerned person by internal
coordination within the department.
b. To lead, direct, coordinate, and manage all coordination aspects of the
Procurements with the procuring agencies.
6. To train, motivate, coach, develop, and evaluate assigned professional, technical,
and clerical staff of the wing for dedicated and best practice professional working.
7. To apply excellent customer service skills, establish and maintain effective working
relationships with other employees of the Dept. and the coordinating institutes.
8. To lead, manage and coach cross-functional teams through the information sharing
& strategic sourcing process.
181
9. To facilitate team meetings, prepare supporting documentation, conduct market
research, develop market analysis related to products/services and assist in
strategy development for effective procurements.
10. To ensure discipline and work ethics of all staff of the coordination Wing and
monitor their performance and professionalism.
11. Attendance at work is an essential function of this position.
Responsibilities through the team members of the Procurement Cell:
1. To formulate, obtain, and maintain procedures for tendering and inter related activities
& to notify the same to all procuring entities of the whole province and thereof to act
focus contacts for providing guidance and support to them.
2. To manage all administrative aspect of tendering process and carry out procurements
for Health Department in and effective and timely manner.
3. To ensure that any development or new policy from the Govt. effecting tendering
procedure is duly informed to the Procurement Cell and updated information is timely
provided to all Health care procuring entities in Khyber Pakhtunkhwa.
4. To have liaison with suppliers/manufacturers associations/bodies and keep updated on
the developments that may affect the tendering process of procurement.
5. To formulate, obtain, and maintain procedures for coordination with the provincial
Health care procurement entities & to notify the same to all procuring entities of the
whole province and thereof to act focus contacts for providing guidance and support to
them.
6. To attend, review and respond to requests made by the Districts, AMI and programs
procurement relate issues and resolve in timely manner.
7. To ensure that a regular updated information of the related wing is timely provided to
all Health care procuring entities in Khyber Pakhtunkhwa.
8. To assist the Health care procuring entities in all issues related to Pre-Qualifications,
technical specification, Tendering related quarries and any other procurement related
issue.
Note: 1.
The duties listed above are intended only as illustrations of the various types
of work that may be performed. The omission of specific statements of duties does not
exclude them from the position if the work is similar, related or a logical assignment to the
position.
Skills required in additional to qualifications:
• Ability to communicate orally and in writing, using technical terminology with technical
writing skills is required.
• Extensive judgment and originality to understand the issues and be able to resolve
them for the quarrying body in the whole province.
182
•
•
•
Comprehensive knowledge of personal computers and software packages, including
specific knowledge of MS Word, MS Excel, MS Powerpoint, MS Access & electronic
document management.
Ability to manage and supervise others as team.
Ability to establish and maintain effective working relationships with co-workers,
supervisors, other DOH personnel and Suppliers.
******
Tendering & Coordination Wing - Job Responsibilities.
Job Title:
Tendering Officer – TC-1 (Tender Administration & Contracts)
Qualifications: Graduation from an accredited four year college or university with a degree
in Project Management, Business Administration, Law or a closely related
field is strongly preferred. However, any equivalent combination of education
and experience sufficient to perform job duties may be considered.
Must also have following:
•
•
•
Knowledge of PPRA regulations and Public Procurements.
Contracts Management
Administrative function and systems of Provincial Govt.
Experience: Minimum five years’ experience in the Public Health sector with relevant
experience of administrative aspects of procurements is preferred. Or
In case the candidate is not a degree holder, Minimum requirement of
Graduation with minimum ten years of experience in Administrative and
Coordination functions preferably in Public Sector.
Grade:
BPS 17 or equivalent
Recruitment: As per Govt. Policy
Position type:Tender processing function and contracts of procurements of Khyber
Pakhtunkhwa Health Department
Jurisdiction: Within Govt. of Khyber Pakhtunkhwa, Health department
Reports to:
For all matters to In charge of the Tender & coordination Wing of the
Procurement Cell of Khyber Pakhtunkhwa Health dept.
183
Direct responsibilities:
1. To work under the directions of the In charge of the Tender & coordination Wing of
Procurement Cell Khyber Pakhtunkhwa Health dept.
2. To formulate, obtain, and maintain procedures for tendering and inter related
activities of Health Care procurement being carried out by the Health Dept of
Khyber Pakhtunkhwa.
3. To formulate, obtain, and maintain various forms of contracts for tendering and
contracts management activities of Health Care procurement being carried out by
the Health Dept of Khyber Pakhtunkhwa.
4. To notify the same to all procuring entities of the Khyber Pakhtunkhwa Health Dept.
and thereof provide guidance and support to them.
5. To manage all administrative aspect of tendering process and carry out
procurements for Health Department as per PPRA regulations and in and effective
and timely manner.
6. To provide advisory function for contracts and related issues of tendering and order
placing.
7. To ensure that any development or new policy from the Govt. effecting tendering
procedure is duly informed to the Procurement Cell and updated information is
timely provided to all Health care procuring entities in Khyber Pakhtunkhwa.
8. To have active liaison with various wings of the Procurement Cell in carrying out the
tender process and its documentations.
9. To have liaison with suppliers/manufacturers associations/bodies and keep updated
on the developments that may affect the tendering process of procurement.
10. To attend/facilitate and represent Incharge Tendering & Coordination in team
meetings, prepare supporting documentation, related to tendering process and
assist in strategy development for effective procurements.
11. To guide the Health care Procuring entities in all issues and Policies related to
Public tendering Process and its documentation in a timely and effect manner.
12. Attendance at work is an essential function of this position.
Note: 1.The duties listed above are intended only as illustrations of the various types of
work that may be performed. The omission of specific statements of duties does
not exclude them from the position if the work is similar, related or a logical
assignment to the position.
Skills required in additional to qualifications:
•
Ability to communicate orally and in writing skills is required.
184
•
•
•
Extensive judgment and originality to understand the issues and be able to resolve
them for the quarrying body in the whole province.
Comprehensive knowledge of personal computers, Internet & electronic document
management.
Ability to establish and maintain effective working relationships with co-workers,
supervisors, other DOH personnel.
******
Tendering & Coordination Wing - Job Responsibilities.
Job Title:
Coordination Officer – (25 districts, AMIs & Vertical Programs)
Qualifications:
Graduation from an accredited four year college or university with a
degree in Public administration, Business management or a closely related
field is strongly preferred. However, any equivalent combination of education
and experience sufficient to perform job duties may be considered.
Must also have following:
•
•
Knowledge of PPRA regulations and Public Procurements.
Administrative function and systems of Provincial Govt.
Experience: Minimum five years’ experience in the Public Health sector with relevant
experience of administrative aspects of procurements is preferred. Or
Incase the candidate is not a degree holder, Minimum requirement of
Graduation with minimum ten years of experience in Administrative and
Coordination functions preferably in Public Sector.
Grade:
BPS 16/17 or equivalent
Recruitment: As per Govt. Policy
Position type:Coordination function of procurements with the assigned Coordinating
Institution* of Khyber Pakhtunkhwa Health Department
Jurisdiction: Within the assigned Coordinating Institution* of Health department
Reports to:
For all matters to In charge of the Tender & coordination Wing of the
Procurement Cell of Khyber Pakhtunkhwa Health dept.
Direct responsibilities:
185
1. To work under the direction of the In charge of the Tender & coordination Wing of
Procurement Cell Khyber Pakhtunkhwa Health dept.
2. To formulate, obtain, and maintain procedures for coordination with the provincial
Health care procurement entities & to notify the same to all procuring entities of the
whole province and thereof to act focus contacts for providing guidance and support
to them.
3. To attend, lead, direct, coordinate, and manage all quarries related to Procurement
received from the Assigned Coordinating Institutes & resolve the same in a timely
manner by coordination with relevant wings of the Procurement Cell of the Health
Department.
4. To be responsible for providing support to all the assigned Govt procuring agencies
in their healthcare procurement and related issues. He/she may be the focal contact
point for these organizations for obtaining any relevant information from the
procurement department.
5. To stay abreast of new developments in the Procurement Cell and be able to
communicate to the assigned Coordinating Institutes to whom they are responsible.
6. To apply excellent customer service skills, establish and maintain effective working
relationships with other employees of the Dept. and the coordinating institutes.
7. To ensure that a regular updated information of the related wing is timely provided
to all Health care procuring entities in Khyber Pakhtunkhwa.
8. To guide the Health care procuring entities in all issues related to PreQualifications, technical specification, Tendering related quarries and any other
procurement related issue.
9. To attend/facilitate and represent In charge Tender & Coordination in team
meetings, prepare supporting documentation, review issues of the assigned
procuring institutions and analysis the same and thereof assist in strategy
development for effective procurements.
10. Attendance at work is an essential function of this position.
Note: 1.
The duties listed above are intended only as illustrations of the various types
of work that may be performed. The omission of specific statements of duties does not
exclude them from the position if the work is similar, related or a logical assignment to the
position.
* Note 2: The coordinating Institution refers to the assigned districts or AMI/Programs.
Four posts are foreseen three number handling 12 districts each and the fourth
one dealing with AMIs and Programs.
186
Skills required in additional to qualifications:
•
•
•
•
Ability to communicate orally and in writing skills is required.
Extensive judgment and originality to understand the issues and be able to resolve
them for the quarrying body in the whole province.
Comprehensive knowledge of personal computers, Internet & electronic document
management.
Ability to establish and maintain effective working relationships with co-workers,
supervisors, other DOH personnel and Assigned coordinating Institutes.
******
Budget & Planning Wing - Job Responsibilities.
Job Title:
In charge Budgets & Planning
Qualifications:
Graduation from an accredited four year college or university with a
degree in Finance, Business Management or a closely related field is
strongly preferred. However, any equivalent combination of education and
experience sufficient to perform job duties may be considered.
Must also have following:
•
•
•
Knowledge of PPRA
Administrative knowledge of Khyber Pakhtunkhwa Govt Business and
financial regulations.
Knowledge of Khyber Pakhtunkhwa Govt. Financial Management system.
Experience: Minimum seven years’ experience in the Public Health sector with relevant
experience of Financial and administrative aspects of procurements is
preferred.
Grade:
BPS 18 or equivalent
Recruitment: As per Govt. Policy
Position type:Budget & Planning of procurements in Health care procuring entities of
Khyber Pakhtunkhwa Health Department
187
Jurisdiction: Complete Province
Reports to: For all matters to In charge of the Procurement Cell of Khyber Pakhtunkhwa
Health dept.
Direct responsibilities:
1. To work under the direction of the In charge of Procurement Cell Khyber
Pakhtunkhwa Health dept.
2. To lead, direct, coordinate, and manage all Budgetary and Planning aspects of the
Procurements within the DoH.
3. To train, motivate, coach, develop, and evaluate assigned professional, technical,
and clerical staff of the wing for dedicated and best practice professional working.
4. To stay abreast of new developments within the Provincial Finance Dept. and
communicate to the In charge Procurement Cell and the other procuring institutes
of health.
5. To have liaison with Finance Department and other depts. and keep updated on the
developments that may affect the financial aspects of a product or development or
its performance.
6. To lead, manage and coach cross-functional teams through the information sharing
& strategic sourcing process.
7. To apply excellent customer service skills, establish and maintain effective working
relationships with other employees of the Dept. and the coordinating institutes.
8. To facilitate team meetings, prepare supporting documentation, conduct market
research, develop market analysis related to budget & planning of the
procurements and assist in strategy development for effective procurements.
9. To ensure discipline and work ethics of all staff of the coordination Wing and
monitor their performance and professionalism.
10. Attendance at work is an essential function of this position.
Responsibilities through the team members of the Procurement Cell:
1. To formulate, obtain, and maintain procedures for Budgeting & planning of
procurement of Health care products for Khyber Pakhtunkhwa Health Department.
2. To notify the same to all procuring entities of the whole province and thereof to provide
guidance and support to them with regards to Procurement budget and planning.
3. To attend, review and respond to requests made by the Districts, AMI and programs
related to procurement Budgets issues and resolve/guide them in timely manner.
4. To ensure that a regular updated information of the financial releases of the
procurement budgets is promptly provided to all Health care procuring entities in
Khyber Pakhtunkhwa.
188
Note: 1.
The duties listed above are intended only as illustrations of the various types
of work that may be performed. The omission of specific statements of duties does not
exclude them from the position if the work is similar, related or a logical assignment to the
position.
Skills required in additional to qualifications:
•
•
•
•
•
Ability to communicate orally and in writing, using financial terminology with appropriate
writing skills is required.
Extensive judgment and originality to understand the issues and be able to resolve
them for the quarrying body in the whole province.
Comprehensive knowledge of personal computers and software packages, including
specific knowledge of MS Word, MS Excel, MS Access & electronic document
management.
Ability to manage and supervise others as team.
Ability to establish and maintain effective working relationships with co-workers,
supervisors, other DOH & Finance Department.
******
Budget & Planning Wing - Job Responsibilities.
Job Title:
Planning Officer BF-1
Qualifications:
Graduation from an accredited four year college or university with a
degree in Finance, Business Management or a closely related field is
strongly preferred. However, any equivalent combination of education and
experience sufficient to perform job duties may be considered.
Must also have following:
•
•
•
Knowledge of PPRA
Administrative knowledge of Khyber Pakhtunkhwa Govt Business and
financial regulations.
Knowledge of Khyber Pakhtunkhwa Govt. Financial Management system.
189
Experience: Minimum five years’ experience in the Public Health sector with relevant
experience of Financial and administrative aspects of procurements is
preferred.
Grade:
BPS 17 or equivalent
Recruitment: As per Govt. Policy
Position type:Budget & Planning of procurements in Health care procuring entities of
Khyber Pakhtunkhwa Health Department
Jurisdiction: Complete Province
Reports to: For all matters to In charge of the Procurement Cell of Khyber Pakhtunkhwa
Health dept.
Direct responsibilities:
1. To work under the direction of the In charge of Budget & Planning Wing of
Procurement Cell of Khyber Pakhtunkhwa Health dept.
2. To lead, direct, coordinate, and manage all Budgetary and Planning aspects of the
Procurements within the DoH.
3. To formulate, obtain, and maintain procedures for Budgeting & planning of
procurement of Health care products for Khyber Pakhtunkhwa Health Department.
4. To notify the same to all procuring entities of the whole province and thereof to
provide guidance and support to them with regards to Procurement budget and
planning.
5. To monitor the planning of procurement and their actual schedules and to escalate
any issues of concerned to the Director Procurement Cell or the Procuring
Institutes.
6. To attend, review and respond to requests made by the Districts, AMI and
programs related to procurement Budgets issues and resolve/guide them in timely
manner.
7. To ensure that a regular updated information of the financial releases of the
procurement budgets is promptly provided to all Health care procuring entities in
Khyber Pakhtunkhwa.
8. To have liaison with Finance Department and other depts. and keep updated on the
developments that may affect the financial aspects of a product or development or
its performance.
9. To apply excellent customer service skills, establish and maintain effective working
relationships with other employees of the Dept. and the coordinating institutes.
190
10. To attend/facilitate team meetings, prepare supporting documentation, conduct
market research, develop market analysis related to budget & planning of the
procurements and assist in strategy development for effective procurements.
11. Attendance at work is an essential function of this position.
Note: 1.
The duties listed above are intended only as illustrations of the various types
of work that may be performed. The omission of specific statements of duties does not
exclude them from the position if the work is similar, related or a logical assignment to the
position.
Skills required in additional to qualifications:
•
•
•
•
•
Ability to communicate orally and in writing, using financial terminology with appropriate
writing skills is required.
Extensive judgment and originality to understand the issues and be able to resolve
them for the quarrying body in the whole province.
Comprehensive knowledge of personal computers and software packages, including
specific knowledge of MS Word, MS Excel, MS Access & electronic document
management.
Ability to manage and supervise others as team.
Ability to establish and maintain effective working relationships with co-workers,
supervisors, other DOH & Finance Department.
191
10.1: List of Persons Interviewed
S.No
Department/Category
Annex-1
Designation/Institute
Name
Health Secretariat, KP
1.
Health Secretariat, KP
Secretary Health
Mr. Ashfaq Ahmad Khan
2.
Health Secretariat, KP
Special Secretary
Dr. Noor al Iman
3.
Health Secretariat
Additional
Secretary
Development (M&E)
Mr. Zahir Alam Khan
4.
Drug Section, Health Secretariat
Deputy Director (Drugs)
Mr. Ali Zahir Shah
Section Officer (Drugs)
Mr. Naseer Ahmad
Section Officer Planning
Dr. Shaheen Afridi
Chief Planning Officer
Mr. Sher Gul Safi
Senior Planning Officer
Mr. Bahr Ullah Khan
5.
6.
7.
8.
Drug Section, Health Secretariat
Planning Cell, Health Secretariat
Planning Cell, Health Secretariat
Planning Cell, Health Secretariat
Directorate General Health Services (DGHS), KP
9.
Directorate General Health Services
Director
General
Health
Services
Deputy Director (Admn)
Dr. Sharif Ahmad Khan
10.
Directorate General Health Services
11.
Directorate General Health Services
Dr. Muhammad Saleem
Directorate General Health Services
Assistant
Director
(Procurement Cell)
Pharmacist Govt-MCC
12.
13.
Directorate General Health Services
Chief Drug Inspector
Mr. Sabir Ali
14.
Directorate General Health Services
Mr. Dil Nawaz Khan
15.
Directorate General Health Services
Deputy Director PreQualification Cell
Senior Pharmacist
16.
XEN Bio-Medical
Mr. Muhammad Yaseen
17.
Electro-Medical Workshop
Health Sector Reforms Unit (HSRU)
Health Sector Reforms Unit (HSRU)
Chief HSRU
Dr. Shabina Raza
18.
Health Sector Reforms Unit (HSRU)
Chief HSRU
Dr. Siraj Khan
19.
Health Sector Reforms Unit (HSRU)
Coordinator (M&E)
Dr. Shahid Yunus
20.
Health Sector Reforms Unit (HSRU)
Assistant Coordinator HSRU
DR. Azmat Ullah
Dr. Muhammad Zafar
Mr. Welayat Shah
Mr. Muhammad Saleem
Finance Department, KP
21.
Finance Department, KP
Additional Secretary
Mr. Nadeem Bashir
22.
Vertical Programs
MNCH, KP
Program Coordinator
Dr. Khayal ur Rehman
Afridi
192
23.
MNCH
(M&E)
Dr. Abid Hussain
24.
MNCH
Director Finance
Mr. Hamid Hussain
25.
MNCH
Incharge Stores
Mr. Rangeen Khan
26.
EPI
Deputy Director – EPI
Dr. Janbaz Afridi
27.
EPI
Finance Manager
Mr. Khizar Hayat
28.
Roll Back Malaria
Program Manager
Dr. Khalid Iqbal
Districts
30.
Districts
EDO (Health) Abbottabad
Dr. Zafeer Ahmad
31.
Districts
EDO (Health) Mardan
Dr. Arshad Khan
32.
District
Mr. Khalid Rehman
33.
District
Hospital Pharmacist, DHQ
Kohat
/
Member
T&E
Committee DGHS
Drug Inspector, Peshawar
Mr. Aurangzeb Khan
Autonomous Medical Institutions (AMIs)
34.
35.
36.
37.
38.
AMI- Hayatabad Medical Complex
(HMC), Peshawar
AMI- Lady Reading Hospital (LRH),
Peshawar
AMI- Khyber Teaching Hospital
Medical Colleges
Khyber College of Dentistry, Peshawar
Associate Dean
Department)
Chief Pharmacist
Khyber Medical College, Peshawar
(Oncology
Prof. Abid Jameel
Ms Syeda Tehniyat
Pharmacist KTH
Mr. Zahid Ali Khan
Associate Professor / Member
T&E Committee (KMC, KTH,
KCD)
Dr. Javed Qazi
Stores Incharge
Mr. Khursheed Khan
Deputy Director Audit
Deputy Director Audit
Mr. Bahadur Shah
Mr. Mutahir Rehman
Hepatology Manager
Institutional
Business
Executive
Chief Executive
National Sales Manager
Mr. Zia ur Rehman
Mr. Shahid Ali
Auditor General of Pakistan, Peshawar
39.
40.
Auditor General Peshawar
Auditor General Peshawar (PAC)
Pharmaceutical Sector
41.
42.
BF Biosciences (Ferozsons Labs)
Getz Pharma (Pvt) Ltd
43.
44.
A.Y Traders, Peshawar
Leads Pharma (Pvt) Ltd
Mr. Shahbaz Khan
Mr. Shahnawaz Qureshi
193
10.2: Training Calendar for TA-52
Annex-2
Strengthening of Procurement Systems & Capacity Building of DoH Khyber
Pakhtunkhwa
December 2012
Sequence
Duration
Level
Participants
Location
Month/Year
Khyber Pakhtunkhwa
Public Procurement
Rules 2012
Day 1
2 days
Basic
Abbottabad
January 3-4
2013
Procurement Life
Cycle
Day 2
Procurement
Officials to be
nominated by
DGHS &
HSRU
Khyber Pakhtunkhwa
Public Procurement
Rules 2012
Day 1
Islamabad
January
30-31 2013
Procurement Life
Cycle
Day 2
Intermediate
Procurement
Officials to be
nominated by
DGHS &
HSRU
February 2013
Sequence
Duration
Level
Participants
Location
Month/Year
Khyber Pakhtunkhwa
Public Procurement
Rules 2012
Day 1
2 days
Basic
Senior
Management
Murree
February
3-4 2013
Procurement Life
Cycle
Day 2
Intermediate
Inventory Management
& Warehousing
Day 1
Advanced
Islamabad
February
21-22 2013
Multi-modal
Transportation
Management in Supply
Chain of
Pharmaceutical Goods
Day 2
Advanced
Inventory
/Storage
Managers of
Vertical
Programs/Pr
ojects//DHQs
/Districts
Procurement of
Consultancy Services
under QCBS Selection
Method; Bidding
Document Design and
Evaluation of Supplier
& Consultant: Contract
Management of
Management Services
Day 1
Advanced
HSRU
Peshawar
27 February
2013
March 2013
Sequence
Level
Participants
Location
Month/Year
Intermediate
2 days
Duration
Basic
Health
Department
194
Development of PC-1
& Procurement Plan
Day 1
1 day
Execution of Work
Packages through
Work Breakdown
Structure (WBS) and
Procurement Audit
Day 1
Comparative
Contracting Practices
in Donor-funded
Projects
Day 1
Procurement of
Consultancy Services
under QCBS Selection
Method
Day 1
April 2013
Sequence
Duration
Khyber Pakhtunkhwa
Public Procurement
Rules 2012
Day 1
2 days
Procurement Life
Cycle
Day 2
Contract Management
w.r.t Health Sector
Day 1
Bidding Document
Design and
Evaluation of
Suppliers of
Pharmaceuticals
and Bio-Medical
Equipment
Day 2
May 2013
Sequence
Duration
Khyber Pakhtunkhwa
Public Procurement
Rules 2012
Day 1
2 days
Procurement Life
Cycle
Day 2
Advanced
Procurement
Officials to be
nominated by
Secretary
Health,
DGHS &
HSRU
Being
worked out in
consultation
with DGHS
March 4
2013
Procurement
Officials to be
nominated by
DGHS &
HSRU
Being
worked out in
consultation
with DGHS
March 26
Level
Participants
Location
Month/Year
Basic
Procurement
Officials to be
nominated by
DGHS &
HSRU
Being
worked out in
consultation
with DGHS
April 8-9
2013
Procurement
Officials to be
nominated by
DGHS &
HSRU
Being
worked out in
consultation
with DGHS
April 22-23
2013
Level
Participants
Location
Month/Year
Basic
Procurement
Officials to be
nominated by
DGHS &
HSRU
Being worked
out in
consultation
with DGHS
May 6-7
2013
Advanced
1 day
Advanced
Advanced
Intermediate
2 days
Advanced
Advanced
Intermediate
195
Contract Management
w.r.t Health Sector
Day 1
Bidding Document
Design and Evaluation
of Suppliers of
Day 2
2 days
Advanced
Advanced
Procurement
Officials to be
nominated by
DGHS &
HSRU
Being worked
out in
consultation
with DGHS
May 27-28
2013
Pharmaceuticals
and Bio-Medical
Equipment
June 2013
Sequence
Duration
Level
Participants
Location
Month/Year
Inventory Management
& Warehousing
Day 1
2 days
Advanced
Being worked
out in
consultation
with DGHS
June 3-4
2013
Multi-modal
Transportation
Management in Supply
Chain of
Pharmaceutical Goods
Day 2
Procurement
Officials to be
nominated by
DGHS &
HSRU
Contract Management
w.r.t Health Sector
Day 1
Day 2
Being worked
out in
consultation
with DGHS
June 24-25
2013
Bidding Document
Design and Evaluation
of Suppliers of
Procurement
Officials to be
nominated by
DGHS &
HSRU
Pharmaceuticals
and Bio-Medical
Equipment
Advanced
2 days
Advanced
Advanced
196
10.3: Supply Chain Questionnaire:
Annex-3
1 – Goods Clearance & Transportation Management
Is there any system in place that can expedite the receiving of Shipment?
no
yes
If yes, please give details
At the import stage?
At the freight forwarding stage?
At the destination/Health
Facility?
2 - Inventory Management
Is there any system in place that can verify whether the medicines supplied from the
supplier are in compliance with those that have been asked? If yes, please give details:
Yes
Separate space for checking the arrived
medicine/ equipment
Is there a designated person for checking the
receipts against the list?
Is the invoice documented anywhere?
Is the dosage, strength and packaging of drugs
checked?
Are the medicine supplied are appropriately
labeled?
Are the samples from the batch of medicine
sent to drug testing laboratory to check their
potency and efficacy?
Are the medicines from the sampled batch
issued before the receipt of DTL Report?
If yes, is the said fact recorded in a DTL
Register somewhere?
No
Details
197
1.3-Is there enough space available for the storage of received pharmaceutical drugs? If
yes Please answer the following?
Yes
No
Remarks
Classified Alphabetically?
Classified Therapeutically?
Classified by Dosage form?
Is the storage space enough to facilitate
movement?
Are the medicine placed directly on floor?
If pallets are used, are they in good conditions?
Is there any mechanism for the control of
temperature and humidity in the ware house?
Is there any bin card arrangement available
with the stock of individual item in the
warehouse?
1.4-How is the integrity of drugs protected from the effect of climate during transportation
and distribution to primary Health Facilities (For Districts)?
Yes
No
Remarks
Are reefer containers used in vans, maintaining
temperatures at 2-8°C?
If not, are the drug cartons covered from
sunlight through canopy vans or parachute
tarpaulins?
2- Storage & Distribution Documentation:
2.1 - Is there any system (Bin Cards, Stock Cards etc.) that documents the storage of
pharmaceutical in the ware house?
198
Yes
NO
Remarks
Does it document the date of receiving of the
shipment?
Does it document the date of delivery of
medicine to the primary health facilities?
Does it document the batch number, name and
strength of the individual medicine?
Does it document the expiry date of each
receiving shipment/delivery?
Does it specify the quantity send to individual
Health Facility?
Does it specify the name of Health Facility to
which the medicine are sent?
3 – Inventory Management:
3.1 - Is there an inventory management system at each level of the distribution system
which provides information as minimum on the following elements?
YES
NO
Remarks
The average working stock for each Product?
The amount of safety (buffer) stock for each
Product?
The frequency of reordering for each product?
The Quantity of re-ordering for each product?
The Lead Time before replenishment of stock?
The Expiry Date of the drug?
3.2 - Are there any Standard Operating Procedures (SOPs) for stock Management at each
level of the Distribution System ?
Yes
NO
Remarks
199
3 – Internal Audit of Stocks:
3.1 - Is there any physical inventory verification conducted on the stocks and reconciled
with the records by the Health Facility?
Yes
NO
Remarks
Monthly
After every 3
months
After every 6
Months
Once a year
3.2 - If other verification exercise conducted, please specify? ______________________
3.3 - Are there independent audits of warehouse by external inspectors or auditors
/AGPR?
Yes
NO
Remarks
Any observations by Audit?
If yes, please give detail
4 – Distribution:
4.1 - Is there a system (computerized or manual) to track the movement of products from
pharmaceutical ware house to a health Facility/Ward, and which provides the following
information for medicine that have left the ware house?
Yes
Types of medicine that have left the ware
house?
Quantity of medicine that have left the
warehouse?
The person who verified the amount?
The intended recipient of these medicine?
No
Remarks
200
The time and date that medicine arrived at
appropriate facility?
Documentation of any regularities or
problem with the supplies received?
5 – Requisition of Products:
5.1 - Does the health facility have any appropriate procedure for requesting medicine?
Yes
No
Remarks
Is the medicine requisitioned on the basis of its
generic / International Non-Proprietary name
(INN)?
Requisitioned on basis of Dosage form?
Requisitioned on basis of Strength?
Requisitioned on basis of Quantity?
Is the requisition checked by responsible person
with date and signatures?
6 – Consumption Reporting of Drugs:
6.1 - Is the medicine consumption at the facility level reported back to the District/AMI?
Yes
NO
Remarks
Is it reported on daily basis?
Is it reported on weekly or bi-weekly
Is it reported on Monthly basis?
7 – Pilferage Control:
7.1 - What are the possible means of pilferage of medicines and how to check it?
Yes
Is there any mechanism to detect pilferage?
NO
Remarks
201
If yes, please give detailed measures
What may be the causes of pilferage of
drugs?
Is there any mechanism to check and report
pilferage of medicines to the higher
authorities?
8 – Recommendations:
If you were in a position of highest authority, what would be the first action that you would
take to improve the systems and processes of public sector medicine inventory
management, storage and distribution in your Organization?
202