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Procurement by Sub-recipients

UNDP has determined that direct procurement by Sub-recipients (SRs) constitutes significant organizational and operational risks to UNDP for a number of reasons, including the process itself, the amount of money involved, the risk of procuring sub-standard products, paying too much and the potential for fraud. Procurement in the framework of SR agreements should be limited to minor office supplies and other similar items of limited value.  UNDP COs should exclude from the SR agreements any funds for the procurement of health products, as this procurement must always be completed by UNDP.  Capital assets should be procured by the UNDP Country Office (CO). In no instance should the SR spend more than 10 percent of its cumulative budget or $100,000 for the duration of the SR agreement period, whichever is less, for procurement of goods and services. At the time of SR contracting, when the SR work plan and budget are agreed, the UNDP CO should ensure this is observed.

For CSOs with value for money (VfM) assessments, the procurement value is reviewed by Global Fund/Health Implementation Support team and is part of the VfM approval. The UNDP CO should undertake all high value procurements and be responsible for the contracting i.e. studies, professional services. It is only in cases where it is not feasible /practical for UNDP CO to procure centrally will such procurement be delegated to SRs and such exceptions will be approved by the UNDP CO where there is no VfM assessment approved by the UNDP Global Fund/Health Implementation Support Team.  

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