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Viewing cable 08LAGOS3, NIGERIA: GOVERNMENT PROCUREMENT AS IMPLEMENTED IN LAGOS

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Reference ID Created Released Classification Origin
08LAGOS3 2008-01-03 13:15 2011-08-25 00:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Consulate Lagos
VZCZCXRO3922
RR RUEHMA RUEHPA
DE RUEHOS #0003 0031315
ZNR UUUUU ZZH
R 031315Z JAN 08
FM AMCONSUL LAGOS
TO RUEHC/SECSTATE WASHDC 9670
INFO RUEHUJA/AMEMBASSY ABUJA 9413
RUEHZK/ECOWAS COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC
RHMCSUU/DEPT OF ENERGY WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHDC
RUEAIIA/CIA WASHINGTON DC
RHEFDIA/DIA WASHINGTON DC
UNCLAS LAGOS 000003 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
STATE FOR AF/W 
COMMERCE FOR KBURRESS 
ENERGY FOR PERSON, GAY 
TREASURY FOR DPETERS, RHALL, RABDULRAZAK 
STATE PASS USTR FOR LISER, AGAMA 
STATE PASS TRANSPORTATION FOR KSAMPLE 
STATE PASS OPIC FOR ZHAN, MSTUCKART, JEDWARDS 
STATE PASS TDA FOR EEBONG, DSHUSTER 
STATE PASS EXIM FOR JRICHTER 
STATE PASS USAID FOR NFREEMAN, GBERTOLIN 
 
E.O. 12958: N/A 
TAGS: ECON EFIN EINV NI
 
SUBJECT: NIGERIA: GOVERNMENT PROCUREMENT AS IMPLEMENTED IN LAGOS 
STATE 
 
 
1. (U) Summary: The Lagos state government presently has no 
specified office overseeing procurement; each ministry or agency 
executes its own annual budget. The Ministry of Economic Planning 
and Budget acts as a "due process" office; it monitors and evaluates 
contracts and projects to ensure that value for money is obtained. 
Contracts worth 2 million naira (USD 15,400) or more must be 
approved by the State tenders' board as well as by the governing 
board of the user agency. End summary. 
 
2. (U) The Lagos State Government began modernizing its manual paper 
based expenditure control and accounting system in 2001 under the 
state governance capacity building project (SGCBP) of the World 
Bank, by installing and operating an Integrated Financial Management 
Information System (IFMIS) designed by Oracle. 
 
3. (U) However, the installation of the Oracle financial modules did 
not fundamentally change the state's financial management system. 
The state has no specified office overseeing procurement. Most line 
ministries continue to own projects. Each ministry prepares its own 
budget, detailing planned procurements. The annual budgets prepared 
by the ministries are coordinated by the Ministry of Economic 
Planning and Budget (MEPB). 
 
4. (U) After the budget is approved, ministries can begin 
procurement. The State procurement process starts with the receipt 
of tenders from intending vendors by the executing agency/user 
ministry, which shortlists and submits relevant documents to the 
MEPB. All contracts for construction, supplies, general stores etc 
that are worth 500,000 naira (USD 3,800) or more are awarded and 
approved by the user ministry or agency. While all contract sums 
worth 2 million naira (USD 15,400) or more must be approved by both 
the governing board of the user agency and the state tenders' board. 
 
 
5. (U) The MEPB, the "due process" office, has responsibility for 
evaluating and monitoring progress of awarded contracts and 
projects. The MEPB adopted a four-pronged approach to ensure 
transparency in its project management activity. It monitors 
projects through, (1) independent private monitors, (2) a project 
monitoring committee consisting of Lagos State cabinet members 
(chaired by the MEPB), (3) MEPB economic planning department and (4) 
MEPB Central Projects Coordinating Department and the executing 
agency/user ministry, which do the prepayment evaluation. 
 
6. (U) The MEPB notifies procuring agencies about results of its 
project monitoring and issues a certification for payment if 
satisfied with the project execution. The independent monitors' 
reports are forwarded to the Governor, to provide an unbiased 
project assessment. 
 
7. (U) Budget items that are perquisites of office, such as housing 
for commissioners and civil servants, vehicle loans, pensions and 
gratuities, are exempt from the procedure. 
 
8. (SBU) Comment: Enforcement of procurement processes in Nigeria 
remains lax, especially at sub-national levels. The process in most 
states and ministries is usually characterized by inflated rates and 
insider dealings that fuel corruption. With the current procurement 
process, it is evident the Lagos State government has to do more to 
ensure the desired transparency and accountability. End comment. 
Blair