Government urges compliance with procurement law and the use of NeST

Dar es Salaam. The government has directed all public institutions to strictly comply with the Public Procurement Law and adopt the National e-Procurement System of Tanzania (NeST) to enhance efficiency and ensure value for money in public spending.

Finance Minister Dr Mwigulu Nchemba said this when receiving the Public Procurement Authority’s annual performance report for the 2023/24 financial year.

He emphasized that the law clearly outlines that any deliberate decision to procure outside the electronic system is a criminal offence. If convicted, the offenders face penalties, including up to three years in prison.

Dr Nchemba highlighted Tanzania’s progress in procurement practices that prioritise value for money, particularly compared to other SADC countries.

"During the Covid-19 pandemic, Tanzania effectively utilised Sh1.3 trillion by investing in development projects, including the purchase of CT scan machines, MRIs, and ambulances for nationwide distribution," he said.

He urged the Public Procurement Regulatory Authority (PPRA) to ensure procurement focuses on the use of local raw materials, thereby reducing reliance on imports and boosting job creation within the country.

"If institutions face any challenges, they should seek guidance from PPRA,” Dr Nchemba said. He further directed PPRA to provide necessary training to system users, ensuring they are equipped with adequate knowledge of the system.

Additionally, Dr Nchemba called for increased public awareness, encouraging Tanzanians to register as suppliers and participate in public procurement processes.

He stressed that without registering in the NeST, Tanzanians cannot benefit from the preferential opportunities afforded to them under the Public Procurement Law.

The minister also raised concerns that some institutions are not allocating 30 percent of their procurement budgets for special groups, undermining the government’s efforts to uplift every Tanzanian.

He reminded institutions that the government tenders, which account for over 70 percent of the national budget, should be accessible to everyone, including women, youths, the elderly, and people with disabilities.

"These groups are encouraged to form collectives of 5-20 people to apply for tenders specifically set aside for them," he said.

Further, he emphasised that compliance with the law is essential for supporting Tanzanians from middle and lower economic backgrounds, helping them benefit from national resources.

He directed PPRA to continue educating the public and strengthening the principles of integrity, accountability, and compliance with the procurement law.

In another development, the minister commended the NeST for improving internal control within purchasing institutions, aligning with President Samia Suluhu Hassan's directive to manage the government expenditures, particularly in project implementation.

He acknowledging the system’s contributions to transparency and accountability, and emphasised the need for capacity building and raising public awareness to ensure widespread adoption.

Dr Nchemba noted that the full benefits of the system would be realised when ordinary citizens can access affordable goods and services, ensuring value for money.

He also urged the PPRA Board of Directors to expedite the completion of the NeST's remaining modules by the end of the 2024/25 financial year and continue providing support to system users.

“The 2024 Procurement Act and its regulations will curb inefficient spending, but your Board must ensure the law is well understood by more stakeholders, particularly low-income citizens and social groups, who have faced the challenges of accessing the government tenders,” he said.

PPRA Board Chairperson Leonada Mwagike reported that local experts working on the NeST had saved Sh14.94 billion through audits and Sh2.7 trillion through monitoring.

Additionally, 153 tenders worth Sh5.29 billion were awarded to special groups.

"The PPRA has also improved service delivery by establishing six regional zones in Mwanza, Dar es Salaam, and Arusha," she said.