Determinants of Value for Money in Public Procurement Projects in Tanzania

Abstract

This study evaluated the factors that determine value for money in Tanzanian public procurement rural electrification projects. The study evaluated the impact of procurement planning, project standard documentation, and employee competency on value for money in Tanzanian public procurement projects. A case study research design was used in the study. 220 REA employees were the target group. The sample size was determined by the study using the judgment sampling method. The research employed a 142-person sample size. Both primary and secondary data were used in the study; primary data were gathered via questionnaires, and secondary data were gathered by reviewing documents. Multiple linear regression analysis, correlation, and descriptive statistics were used to analyze the data. With average mean values of 4.00, 3.50, 3.50, and 3.73, respectively, descriptive statistics showed that employee competency, project standard documentation, and procurement have a major contribution to the value for money. The findings of the correlation and multiple regression analysis indicated that, with p-values of 0.000 (P<0.05), the competency of the employees, the project standard document, and the procurement plan had a positive and significant influence on achieving value for money in rural electrification projects at REA. Since the P-values were 0.000, which were less than 0.05, the study concludes that value for money is positively and significantly influenced by employee competence, the project standard document, and the procurement plan. In order to achieve value for money, the study suggests that the REA management, policy makers, practitioners, and the government hire a capable project management team, use and maintain standard project documents, and establish procurement plans for each project. Since the variables under study contribute only 65.5% to VFM, the study recommends additional research be done to find other variables not covered in this study that influence VFM by 34.5%.