FUTA Overview

Awarding Contracts to Lowest Bidder Could be Counterproductive -FUTA Don

A professor of Quantity Surveying and Construction Administration has posited that the Nigerian Construction Industry will continue to face project delivery problems because due diligence and objectivity are not followed in the selection of contractors for construction projects. Professor Isaac Aje made the submission while delivering the 131st Inaugural lecture of the Federal University of Technology Akure with the topic: Dynamics of Construction Contractors' Selection: Ad hoc and Post hoc Analyses on Tuesday July 27, 2021. He said the practice of   automatic selection of the lowest tenderer, which has become the norm in the industry, is risky and cannot guarantee efficient project performance in terms of cost, time and quality.  The professor said some contractors deliberately underquote for projects and as such perform shoddy jobs or even abandon projects midway. Citing the reason for incessant building collapse in the country, he said the inability of contractors to achieve high quality performance is caused by low bidding price after qualification. And since it is difficult to request for additional funds, Contractors usually decide to cut corners by lowering the quality of work in order to compensate for inadequate pricing.

He said given the key role contractors play in construction project procurement  it is very important to exercise great care in their selection. According to him, the probability of construction failure is quite high for individual contractors so it is important for project owners to confront and manage these risks if they wish to achieve good project results. He said it is imperative for stakeholders in the construction industry to ensure that contractors who possess relevant financial, technical, and managerial capabilities to deliver construction projects are selected for contract awards in Nigeria. The lecturer stated that given the complex nature of construction projects in terms of technicality and administration, there is the need for the engagement of competent professionals to effectively manage every aspect of construction projects so that the dreams and aspirations of clients can be transformed into workable documents and reality.

The don described the pre-qualification as a pre tender screening process which provides a client with a standing list of potential contractors to be invited for a specific project. He listed the major criteria for contractor's pre-qualification to include: Financial capability, technical ability, managerial capability, health and safety records, and contractors past performance. To this end he said construction practitioners involved in pre-qualification should ensure that relevant information relating to the criteria for contractor's pre-qualification are requested from the candidate contractors while their past clients should also be required to provide relevant information concerning them.

 Aje recommended  that the pre-qualification guidelines issued by the Budget Monitoring and Price Intelligent Unit (BMPIU) should be reviewed  by allowing stakeholders in the industry to have input while training workshop should be organized for public officers saddled with the responsibilities of contractor's pre-qualification and construction consultants. He also recommended a more refined method of awarding contracts to the optimum tenderer whose tender figure is realistic enough to complete the project.

Speaking in his capacity as Chairman of the occasion, the Vice Chancellor Professor Joseph Fuwape described Professor Aje as an erudite scholar and productive researcher who has contributed enormously to his field of specialization. He said Aje has provided academic leadership in the University and has also been involved in over 50 notable construction projects across Nigeria both at pre and post contract levels