Impact of Competitive Bidding in Achieving Value for Money in Public Organization

Abstract

Procurement is an important sector in the Tanzania economy at large. Technically, 70% of Government budget expenditure is on procurement of goods, works and services (PPRA, 2011).Value for Money concept is one among the main pillar of public procurement that ensures value is achieved during procurement transactions utilizing public funds. The main objective was to study the effectiveness of procurement procedures towards ensuring the achievement of value for money in public procurement. In order to accomplish this objective, a set of specific research objective were formulated that included the effect of fairness of competitive bidding in the achievement of value for money, the level of transparency guarantee in achieving value for money in a public sector and the legal framework for competitive bidding adequate in achieving of value for money. Procurement aims to ensure that the right good works or services are delivered to the right place, in the right quantity with the right quality at the right cost [price] in the right time. In fact procurement using the framework contract has been established to ensure that the 5R’s of procurement are obtained. The sample of the study consisted of 62 respondents drawn from a population that was made with members from PMU,Tender Board members,Other heads of departments and members user departments. The researcher used questionnaire to collect the data. The researcher used Microsoft excel to make the necessary calculations of the data which helped him to derive the frequencies and percentages which were the presented in diagram.These findings were discussed to arrive at conclusions which included that the Tanesco Arusha got the Specialised Items in the right quality and at the right time but at a price higher than what was has had been agreed in the initial contract.