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Goods means all articles and materials (other than cash and documents) which come into the possession of a local government for their use and includes, but not limited to, Raw material; Construction materials; Livestock; Spares and spare parts; Seeds, seedlings and implements; Water Supply items; Electrical items; Books, registers and forms; Motor vehicles, tractors, general machinery etc.; Stationery and printing items, drawing materials, office furniture, office equipments, hospital furniture; Medicines, medical equipments; Hardware, tools and implements; Building materials; Roads dressing materials etc.

Services means services of intellectual nature performed by individual Consultants or Consulting firms having necessary specialized professional expertise, experience and relevant qualification.

2.2 Procurement Cycle: The Procurement Process for goods, works and/or services typically consists of the following cycle of activities, undertaken in the order stated below. Detailed functions and responsibilities of various functionaries under each of these steps are explained in the Procurement management section of this manual: Need identification

Developing specifications

Estimating Costs and securing approvals, funding Diagram

Determining Procurement Strategy

Deciding the Procurement Procedure

Identifying suppliers/service providers Preparing the Request for Quotation/ Tender proposals Diagram

Allowing time for submission

Issue of tender documents


Receipt and Opening of Tenders

Procurement strategy

Clarifying Receipts if needed

Evaluation and award of contracts

Publishing and Contract Management

Receipt and certification of goods/services

Evaluation and closure of contract.

2.3 Procurement Plans: Planning and adhering to procurement of various items in an orderly manner ensures an effective method of budget execution and expenditure management. Procurement by any LSG is to be undertaken in adherence to the following essential Conditions:

(a) Ensure that specific budget provision is available to meet expenditure in the financial year in which it is to be incurred.

(b) Assess bulk requirement of goods, works and services for procurement at the beginning of the financial year and initiate action for procurement in accordance with the procedure applicable.

(c) Procurement is made to the best advantage of the annual plan implementation after Comparison of Competitive prices.

(d) Purchase of office equipment and furniture is in economic lost keeping in view the annual requirements.

(e) Miscellaneous items of goods, works and services not covered by bulk requirements are to be purchased according to the actual requirement at different points of time during the financial year provided the value of goods, works and services so purchased is small and expenditure is met from within the sanctioned budget. lots keeping in view the annual requirements.

2.4 The procurement plan details should include:

i. The particular contracts for the goods and/or services required to carry out the project during the financial year.