Published Paper Details:

Public sector organisations undergo a procurement process to select a competent consultant and character to carry out the construction work using pre-determined selection criteria or guideline as stated by the public procurement Act 2007. The Act objectives are to provide the best value for money, economy, transparency, accountability and competition among bidder(PPA 2007). However, it must be noted that the Act has not taken into account the transaction costs incurred with participation in the tender processes due to the varied activities undertaken by clients, consultant and contractors. The aim of the study is to assess the effects of procurement governance transaction costs with respect to contracting business and tendering process. A multi-stage stratified random sampling procedure was used in selecting the respondents from construction firms within some selected states of the North-west zone of Nigeria ( sokoto, kaduna and kebbi) that are registered in the bureau of public procurement database of contractors that have participated in any federal government tendering process as respondents of the study. One hundred and thirty five (135) responses were retrieved from various respondents. Using structural equation model (SEM), an analytical tool, using procurement governance and transaction cost as independent variable, with tendering process as intervening variable and contracting business as dependent variable, the result of research shows that transaction cost variable and procurement governance has significant influence toward contracting business, procurement governance variable has indirect influence toward contracting business through tendering process with significance influence. The research recommended that both client and contractors can reduce procurement governance effect by promoting: fairness in the award of contract to the lowest bidder; harmonious relationship between project client and contractor; sound knowledge on construction project procurement by both parties and more attention on how they can improve their bidding strategies based on the procurement governance guidelines.