Jamaica Bar Association Conference: November 17-19, 2017 ==================================================================== Theme: “Anti-money laundering, Anti-Bribery and Anti-Corruption” Presenter: Dirk Harrison, Contractor General of Jamaica -------------------------------------------------------------------------------------------------------------------Why do some persons/companies resort to unethical practices?
Professor Anthony Clayton in “A New Approach: National Security Policy for Jamaica 2013 – Towards a Secure & Prosperous Nation [Tier 1 Threats (Clear and Present Dangers – Corruption, fraud, extortion and money laundering, pg. 20]” wrote:
“…a contract to build a road might provide an opportunity to reward political affiliates, and shoddy construction would ensure that the road surface would crumble, which would then allow the issuing of another contract to resurface the road. This is one of the reasons why Jamaica has, simultaneously, one of the most dense road networks in the world, and one of the worst road networks in the world in terms of the percentage of road in good condition. The 1993 and 1994 World Development Reports on Infrastructure and Development show that Jamaica has a road density of 1,881 km per million persons, the second highest road density network in the world; but that only 10% of the road network was in good condition, one of the lowest percentages in the world, which reflects chronic problems with bad construction and poor maintenance, in part due to the practice of preferentially assigning contracts to favoured contractors, with inadequate oversight. Another related area of 1
concern is the placing of public works contracts, as a number of these have gone to organizations that are fronts for organized crime. This means that the main source of income for some of Jamaica’s criminal organizations is probably tax dollars, rather than narco-trafficking or extortion.
In all such cases, the taxpayer is doubly cheated; corrupt officials and criminals collude in the theft of public funds, and the infrastructure that results is often more expensive , badly built, or not built at all.
Another, less obvious route involves placing contractors under the pressure to take on unnecessary labour. About 80% of all major construction projects in Jamaica come via the government, so all major contractors understand the need to maintain good relations with the party in power, and some are particularly close to key decisionmakers in one or both of the parties. If a contractor is awarded a large contract, he may then be expected to take on additional labour from other organizations that are affiliated to the party in power. This may take the form of providing site ‘security’, construction materials and casual labour, all of which will come with an additional overhead. This means that the construction is significantly more expensive than it should have been; the difference is the cost of corruption.”
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Ladies and gentlemen, bribery, fraud and corruption have long pervaded the construction industry in a number of countries and the activities which facilitate these corrupt practices are not always clear to anticorruption officials and law enforcement personnel.
In particular, the scale and complexity of many construction projects, together with the number of parties participating, the geographic locations where they are performed and the legal systems to which they are exposed, can make them especially prone to bribery, corruption and other unethical practices. Activities in certain cultural circles, which might be regarded as essential to getting the job done, and a lawful means of doing so, may well be seen elsewhere as dishonest, or unlawful. It is therefore important to appreciate the effect such activities may have on operations both at the source of the project and in other jurisdictions.
Hence, there is always a need to ensure that the integrity of the public procurement process is held in the highest esteem. Sophia from the TV sitcom Golden Girls Fame, would probably say “imagine Jamaica in 2017, some foreign contractors allowed to enter Jamaica to do business, they get waivers and special duties. Their construction company has sister companies and the equipment once used on one project is allegedly moved to another project, lowers or makes negligible operation costs/ or them the foreign investors but not so for the local contractors� Table 1. Particulars of Contracts Awarded above J$500,000.00 (2009 – 2016) Reporting Period
Total Number of Contracts Awarded
Total Value of Contracts Awarded (JA$)
Total Value of Contracts Awarded (US$)
2009
11,256
$15,508,086,974.00
$175,252,423.71
2010
10,455
$14,307,249,677.00
$163,735,977.08
2011
11,152
$16,143,777,148.00
$187,543,879.51
2012
9,399
$25,752,214,653.20
$289,383,241.41
2013
8,622
$45,445,481,023.75
$450,982,246.94
2014
8580
$58,885,410,309.95
$529,449,831.95
2015
10,194
$101,723,780,556.03
$867,136,480.74
2016
11,473
$82,375,350,441.02
$658,265,546.12
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Table 2. National Contracts Commission Endorsed Contracts (2011 – 2015) No. Year Works
Value of Works $J
2015
145
9,139,132,963
2014
191
2013
No. Goods 174
Value of Goods $J
Value of Services $J
No. Services
Total No. Total Value of of Endorsed Endorsed Contracts Contracts $J
14,916,718,060 144
13,122,081,457 463
37,177,932,480
16,497,976,969 196
8,826,188,224
128
11,277,836,441 515
36,602,001,634
180
11,769,078,879 144
8,737,706,750
244
11,874,847,397 568
32,381,633,026
2012
148
10,314,568,600 151
4,628,846,414
213
9,289,546,639
512
24,232,961,653
2011
175
14,137,796,921 162
8,052,332,407
218
7,821,048,775
555
30,011,178,103
Consequently, based on the scales of economy, a local contractor cannot compete with overseas investors who benefit from waivers. As a result, it has the effect of giving an unfair advantage to overseas investors/contractors. I reiterate based on the scales of economy, local contractors cannot compete making it unfair. The result and effect has socio-economic and political implications, leading to persons breaking the rules, breaching procurement guidelines and purportedly colluding. Globalization has significantly affected the construction and engineering industry. The emerging markets and countries, where many mega construction and infrastructure projects are carried out, generally have less developed legal systems and processes for controlling bribery and corruption. So in recent years, the international spotlight has focused on many of these regions, with governments of more developed economies seeking to impose controls on parties operating in these new and relatively uncharted territories. Having said that what is framework that exists here in our region, legal framework.
The Public Procurement Policy and Legal Apparatus in Jamaica The Public Procurement Process in Jamaica is guided by Several Policies and Various Legislation, namely: 4
1. The Contractor General Act, 1986 2. The Public Bodies Management & Accountability Act, 2001 3. The Corruption Prevention Act, 2001 4. The Public Sector Procurement Regulations, 2008 5. The Financial Management and Audit Act 6. The Handbook of Public Sector Procurement Procedures 7. The Public Procurement Act, 2015 (not enforced)
The Government of Jamaica Procurement Guidelines was first issued in 2001 and has had the benefit of several revisions within the last 15 years. Importantly, this Handbook establishes the standards by which all government contracts are to be awarded and, same is publicly accessible. It therefore translates into all interested parties being made aware of the rules governing public procurement in Jamaica.
As it relates to the administration of the public procurement process, the OCG is the principal Government entity, which is mandated by law to provide oversight for public procurement. In providing such oversight, the OCG is mandated within the parameters of the Contractor General Act to execute the following functions as outlined in Section 4 of the Contractor General Act:
(a) To monitor the award and the implementation of government contracts with a view to ensuring that-
(i) such contracts are awarded impartially and on merit; (ii) the circumstances in which each contract is awarded or, as the case may be, terminated, do not involve impropriety or irregularity; (iii) without prejudice to the functions of any public body in relation to any contract, the implementation of each such contract conforms to the terms thereof; and
(b) to monitor the grant, issue, suspension or revocation of any prescribed license, with a view to ensuring that the circumstances of such grant, issue, suspension or revocation do 5
not involve impropriety or irregularity and, where appropriate, to examine whether such license is used in accordance with the terms and conditions thereof.
Fraud and Corruption The GoJ requires that all Public Officers and individuals engaged in the procurement process, including Bidders and contractors under GoJ-financed contracts, observe the highest standard of ethics during the procurement process and in the execution of contracts. Within the context of GoJ’s Procurement Policy the following terms are outlined:
(a) Corrupt Practices which involve the offering, giving, receiving or soliciting of anything of value to influence the action of a Public Officer in the procurement process or in the execution of a contract.
(b) Fraudulent Practice such as misrepresentation of facts in order to: influence a procurement exercise; manipulate the tender process; or the execution of a contract to the detriment of the GoJ. This includes collusive practices among Bidders (prior to or after bid submission), designed to establish bid prices at artificial, non-competitive levels and to deprive the GoJ of the benefits of free and open competition.
(c) Collusive Practice in instances where a scheme or arrangement between Bidders, designed to establish bid prices at artificial, non-competitive levels, or to influence the action of any party in the procurement process or the execution of a contract.
(d) Coercive Practice - In the context public procurement, coercive practice refers to deliberately harming or threatening to harm, directly or indirectly, persons, or their property to influence their participation in a procurement exercise, or to affect the execution of a contract.
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(e) Obstructive Practice - deliberately destroying, falsifying, altering or concealing evidence material to an investigation, or making false statements to an inquiry, in order to materially impede an investigation.
In combating these practices, it is paramount that each professional associations and organizations periodically assess the nature and extent of its exposure to potential external and internal fraud, corruption and bribery risks. This process should be informed and documented, it should involve top-level management and it should evolve with the organization or entity. Documentation of this process is crucial for any defence that adequate procedures were in place. Whilst such processes may be criticized for simply generating self-serving paper trails, as opposed to genuinely seeking to identify and deal with relevant risks, the absence of well documented assessments will invariably create difficulties in the event of an investigation.
Having said that, what are some of the issues/deviations encountered in the monitoring of NonConstruction Contracts?
1. Issues surrounding bid submissions a. Receipt and opening of late bid - Tender was initially scheduled to close on a specified date and time. The deadline was subsequently extended. Tender box was not closed at the stipulated time and a bid was accepted minutes after the scheduled close, written on the Bid Receipt Record and deposited into the Tender Box. Tender Officer later opened the bid and read out the details. This is a breach of Appendix 8 of Volume 2, ‘Managing the Procurement Process’ – A8.6.1 of the GOJ Handbook of Public Sector Procurement Procedures which states that, “(a) Bids, modifications and withdrawals received after the deadline shall not be opened. Instead, the outer envelopes containing the late bids and modifications shall be opened and the names of the Bidders read aloud and recorded. The inner envelopes of all late submissions shall be returned unopened to the respective Bidders... (e) No bid shall be rejected or any opinion voiced as to its responsiveness at the Bid Opening, except for late bids.” – [Letter dated 7
November 22, 2016 to Caribbean Maritime Institute regarding Provision of Security Services]
b. Submitting multiple bids in the same tender box – This Ministry of Agriculture used one tender box to receive bid submissions for multiple procurement opportunities. This is not in keeping with Section 2, Appendix 8, A8.5.1 of the Handbook of Public Sector Procurement Procedures titled “Tender Box”, which states that “All bids received shall be deposited in the designated Tender Box specific to the tender. The Tender Box must be appropriately marked and prominently placed.” The OCG also brought it to the attention of the Ministry of Finance who also provided an opinion. The Ministry of Agriculture has since discontinued the practice. – [Various letters including letter dated October 27, 2015 to the Ministry of Agriculture]
2. Failure to provide adequate information to bidders to aid in the preparation of bids – In this instance, which was a complaint to the OCG, quotations had been requested for repair work to be done to an engine used in a specialised vessel. Although the Request for Quotation (RFQ) had indicated that there was an attached “Schedule of Supply” same was not provided to bidders.
3. Issues surrounding Bid security
a. Unstamped bid security – The Ministry of Finance issued Circular # 2 in January 2016 which gives guidance on, among other things the requirement for Tender Bonds to be stamped.
b. Entities requesting bid security to be a percentage (%) of the bid amount rather than a fixed sum.
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4. Evaluation undertaken by the members of the Procurement Committee, who later approve the recommendation – This is a breach of Volume 1, 2.2.6, of the Handbook which states that ‘Procurement Committee members who sit on an Evaluation Committee should not vote at the subsequent Procurement Committee meeting regarding the acceptance of the Evaluation Report’.
5. Improperly constituted Procurement Committee and Head of Entity taking part in the evaluation process.
[*While we cannot recall coming across this issue during our
monitoring, the MOFP issued a Circular dated July 17, 2017 re Board Members being a part of the Evaluation Committee]
6. Approval not received from the Procurement Committee, NCC and/or Cabinet, as applicable [Letter dated February 3, 2016 to GC Foster College]
7. Excessive charge for Tender Document as a means of discouraging potential bidders – matter was brought to MOF’s attention and a Circular had been issued
SERHA was charging J$10,000 for Bid documents for a Security Services tender; the amount seemed odd to the OCG. The Procuring Entity was asked to provide the rationale for the amount being charged. In response, the Procuring Entity stated that “In going to tender, the Region needs to attract a security company that will be able to effectively manage the complexities that comes with this challenging public environment”.
The Ministry of Finance has since issued a Circular in January 2016 reminding Procuring Entities, inter alia, that the cost charged for Bidding Document is to assist the Procuring Entity to recover the preparation and reproduction costs incurred.
8. Failure to use the Standard Bidding Document (see appendix 7 (A7.1) of Volume 2) and the appropriate forms of contract. In one instance the Entity used a draft version of the SBD which is not yet in Law. 9
Other cases, Entities do not properly modify and align the applicable clauses with the SBD.
9. Not using the Procurement Notice Page and including all the required clauses in keeping with MOF Circular # - matter brought to MOF attention and Circulars issued
10. Advertising with the wrong NCC category - Recommend that guidance is sought from the Technical Services Department, the NCC’s secretariat prior to advertising.
11. Improper Procurement Planning/ Inter-departmental issues within the Procuring Entity which
results in the procurement process commencing late [UTECH re Security
Services]
12. Insufficient info in the Procurement Notice
13. Evaluation criteria missing or insufficient for objective evaluation
14. Recurring services – Failure to go to tender for an extended period of time
15. Failure of entities to conduct sufficient research or due diligence prior to undertaking the procurement process, which in instances, result in the tender process being aborted due to errors in the bidding document. 16. Evaluation criteria which was outlined in the tender document not used in by the evaluation committee.
17. Variations – failure to received approval from the NCC before paying for variations under the contract.
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18. Contract Administration – contractor does not supply goods within the duration of the contract; advance payment guarantee not renewed prior to expiration [MNS- Pre-owned motor vehicle]
In addition to these challenges, these inefficiencies a finding which the jury has been sent out to retire again by the judge of the day (but the perception of perceived or actual delays related to the multi layered bureaucratic red tape associated with the registration tender and evaluation process) lend themselves in the boiling pot of stakeholder public and private sector opinion. Consequently the administration of public funds serve as a deterrent for some private contractors and professionals (experts in their field of study) who would want to do business with the government from stating in some cases it is not worth it. It is said sarcasm is the cheapest form of wit‌In that breath I wonder if the answer to the $20 question why most professionals refuse to subject themselves to the public procurement system. This reluctance is not because the same contractor is selected at the end of an evaluation process, despite the fact it is well known that the contracting company has a track record of poor workmanship, repeated cost over runs delays and variations. (Nor) is it because the system is fraught with partisan selection of contractors, on terms of favouritism and or in favour of pork barrel politics. In some quarters it is perceived and in other apparent, that this reluctance may primarily be due to the failure of the government to pay contractors on time for works completed or services rendered. So then I say aloud I am sure if you were to be asked how many of you would do business with the government, the response level would be very low and I would assume that the primary reason would be for some of the same reasons that I just mentioned. The failure of the government to honour its financial obligations with contractors on a timely basis is paramount. Are all professional groups registered? And if the answer to that question is yes, are they bound by a legislative process mandating their conduct, consequences for breaches of the code, shaming, the suspension punishment and sending to prison of their members? Are people out there calling themselves contractors? Are they paying taxes levied or are some preferring to say I 11
am a sub-contractor and they are acting in concert with the main contractor on paper doing all the work? So Miss Lou would probably blame it on Bredda Anancy. A samfie man. As I continue to digress, a select number of companies and instances are on the radar of my office, wherein, main contractors sign contracts do no work, sub-contract the work and the records of actual work are entangled in a web of conspiracy‌who to call or blame Bredda Anancy. So I ask the question again, are these some of the reasons why those who can offer professional services do not and or stay far from the public procurement process and swear never again? What should we do knowing now some of the socio-economic and socio-political spin-offs? Due diligence Adequate due diligence procedures should be performed on those persons providing construction and design services for the organization. The approach should be risk-based and proportionate with a view to mitigating identified fraud, corruption and bribery risks.
Sub-contracting In many jurisdictions, with Jamaica not being eliminated, the practice of sub-contracting remains one of the most problematic areas. As a matter of fact, some anti-corruption practitioners have concluded that this practice gives rise to corruption enabling practices. The reality is that persons managing tender processes for sub-contracted work and services are exposed to potential bribes from tendering sub-contractors. Indeed, the potential for bribery exists throughout the supply chain. The acceptance of material incentives, even if they emanate from the most competitive and ultimately the chosen sub-contractor, is likely to constitute bribery. This can be controlled, to some extent, where employers are involved in the sub-contract selection process carried out by their contractors. Other methods of protection include questionnaires and training schemes containing anti-bribery anti-corruption components.
Given the potential for unethical practices in this area of public procurement, the government and all stakeholders in the public procurement process should ensure that there are adequate laws and policies to promote probity in the award of government contracts through sub-contracting. 12
While we consider and work towards the adequate implementation of anti-bribery and anticorruption provisions, we also need to be cognizant of the fact that these provisions alone are unlikely to be sufficient. Hence, a mixture of contractual provisions and procedures, such as risk based due diligence, are imposed throughout the supply chain. For high risk projects, such provisions and procedures should be carefully tailored to adequately address the particular risks involved, however, they can be simplified where the risks are relatively low. Even if the employer has little involvement in the sub-contracting process itself, such measures will help to establish the defence that adequate procedures were in place.
Conceptually, public procurement is defined as the acquisition, whether under formal contract or otherwise, of works, supplies and services by public bodies. It ranges from the purchase of routine supplies or services to formal tendering and placing contracts for large infrastructural projects. 1
The objectives of all personnel involved in public procurement are to:
1. Ensure an open, transparent and compliant process; 2. Achieve continuous improvement on all categories of expenditure through a transparent and fair procurement process; 3. Achieve Value for Money in all procurement activities; 4. Promote equality of opportunity for all businesses and in particular Small Medium Enterprises and Small Enterprises; 5. Work in partnership with the private sector and other organizations to achieve value for money, quality and effective service delivery; 6. Promote innovation; and 7. Encourage environmental and social sustainability through effective procurement policies and practices. 2
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Having looked at these objectives, it should be clear to all of us that the “mission of public procurement is to ensure and enable contracting authorities meet their policy and business objectives in the delivery of better public services. The public procurement process spans the whole project life cycle from initial conception and definition of the needs of the public service through to the end of the useful life of an asset or the end of a contract.� 3
The Monetary Value of Public Procurement According to the OECD (2009) Principles for Integrity in Public Procurement Report, Governments and state-owned enterprises purchase a wide variety of goods, services and public works from the private sector, from basic computer equipment to the construction of roads and maintenance thereof. Public procurement is a key economic activity of
governments
represents a significant percentage of the Gross Domestic Product (GDP)
that
generating
world.
An
huge
financial flows, estimated on average at 10-15% of GDP across
the
effective
procurement system plays a strategic role in governments for
avoiding mismanagement and
waste of public funds. 4 In Jamaica, the value of
public procurement for 2015 was Thirty
Seven Billion, One Hundred and Seventy Seven
Million, Nine Hundred and Thirty Two
Thousand Four Hundred and Eighty Dollars.
The OCG Investigative Mandate and Autonomy The OCG under Section 15(1) of the Contractor General Act has jurisdiction to execute an investigation into any of the following circumstances:
(a) The registration of contractors; (b) Tender procedures relating to contracts awarded by Public Bodies; (c) The award of any government contract; (d) The implementation of the terms of any government contract; (e) The circumstances of the grant, issue, use, suspension or revocation of any prescribed licence; and
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(f) The practice and procedures relating to the grant, issue, suspension or revocation of prescribed licences.
In addition to the role of the OCG, the Ministry of Finance and the Public Service (Procurement and Asset Policy Unit (PAPU) and the Auditor General are key players in the public procurement process. In the public procurement governance process, PAPU is principally responsible for the formulation of public procurement policies, the training of procurement personnel in the public sector and overall public procurement capacity development within the public sector.
Tools Used by the OCG in the Execution of its Mandate in relation to Public Procurement In realization of the rapid spread of Information and Communication Technologies (ICTs), the OCG has recognized that there are new opportunities of facilitating citizens’ participation. In response, the OCG has implemented numerous mechanisms and strategies to interact with the Jamaican citizenry. The various ICT tools and strategies that have been implemented by the OCG include, but are not limited to:
1. Query / General Feedback Form, which is an online form that allows the public to enquire about government contracts and other information that may be deemed relevant to the functions bestowed upon the OCG. The Office also utilizes other on-line forms that facilitate communication, engagement and participation between the general public. Of note, the Report Impropriety Form serves as a crucial tenet of the OCG’s information gathering strategy, it allows any citizen who may want to report an impropriety to effectively do so.
2. Additionally, the OCG also developed and uses a Post Contract Works Quality Complaint Form, in which members of the public can provide information based on government contracts that have been executed. In this regard, a contract may be executed contrary to agreed contractual arrangements between the government and its contractors, which may
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compromise the integrity of work(s) done or service rendered. As such, an informed citizen may make such observation and wish to report the matter to the OCG.
3. Impropriety Hotline - This is a direct telephone line set up by the OCG that allows for the reporting of acts of Impropriety by public officials who may be involved in an act of Impropriety in relation to the functions of the OCG and its core objective.
4. OCG’s General Electronic Mail – Through this channel, anyone who wishes to communicate with the Office can simply send an electronic mail to the OCG and whenever a mail is received through this medium a speedy response is always guaranteed by the staff members who have been assigned to manage the Office’s general e-mail. 5. In addition to the above mentioned tools, the OCG also utilize social media programmes such as Twitter and most recently Facebook to interact with the pubic and provide information regarding OCG events/activities.
Principles for Enhancing Integrity and other Ethical Standards in the Public Procurement Process Based on the provisions of the OECD (2009) Report on Public Procurement, the following are the key principles in this regard:
1. The first Principle for Enhancing Integrity in Public Procurement calls on governments to provide an adequate degree of transparency in the entire procurement cycle in order to promote fair and equitable treatment for potential suppliers. There are several things governments can do to ensure this. For example, if key decisions on procurement are well-documented and easily accessible, inspectors are able to check whether specifications are unbiased or awarded decisions are based on fair grounds. The degree of transparency also needs to be adapted according to the recipient of information and the stage of the cycle. In particular, the government should commit to protecting confidential information, such as trade secrets of tenderers, to ensure a level playing field.
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In the context of Jamaica, and the competitive environment which exists as a result of cross-border trading and the overall implications of globalization, there will always be foreign investors and contractors who will compete for public procurement opportunities. It is therefore the duty of the government as well as other stakeholders to ensure equity and probity in the award of government contracts. Simply put, there should be a level playing field for all prospective bidders of public procurement opportunities, whether they be local or international. It is grossly unfair that some international investors (contractors) are given concessionary privileges (reduced tax duties) to import equipment into the island. Local contractors can’t compete.
2. The second Principle stresses that governments should maximize transparency in competitive tendering and take precautionary measures to enhance integrity, in particular for exceptions to competitive tendering, such as extreme urgency or national security. To ensure sound competitive processes, governments should provide clear rules, and possibly guidance, on the choice of the procurement method. No matter what the procedure used, maximizing transparency is a key ethical standard which should be observed in all circumstances. In addition the Government could also set upon procedures to mitigate possible risks to integrity. In the case of hurricanes or other natural disasters where the region is experiencing increased intensity, a risk mitigation board could be set up to bring together key stakeholders to allow for clear policy directions and increased communication during the emergency, in order to ensure effective management of scare resources.
3. The third Principle states that governments need to ensure that public funds are used in procurement according to the purposes intended. In this regard the importance of adequate procurement planning is executed. In so doing, budget planning should be formulated on an annual or multi-annual basis, with a detailed and realistic description of the financial and human resource management requirements. The management of public funds should be monitored by internal control and internal audit bodies, supreme audit institutions and/or parliamentary committees. When a bridge is to be built, for example, a court of 17
audit may verify not only the legality of the spending decision but also whether the planned bridge responds to a real need.
4. The fourth Principle calls on every government to ensure that procurement officials meet high professional standards of knowledge, skills and integrity. Recognizing working in public procurement as a profession is critical to reducing mismanagement, waste and corruption. Just like the medical or legal professions, public procurement officials could benefit from well-defined curricula, specialized knowledge, professional certifications and integrity guidelines. For example, if a public official sitting on a tendering commission finds that one of the tenderers is someone with whom he or she has a personal relationship, the official should be able to identify the potential conflict of interest and take action.
5. The fifth Principle requests governments to put mechanisms in place to prevent risks to integrity in public procurement. Risks to integrity can pertain to potentially vulnerable positions, activities, or projects. For instance, an anti-corruption agency could draw a “risk map” that identifies the positions of officials who are vulnerable, activities in the procurement where risks arose in the past, and the particular projects at risk due to their value or complexity. These risks can be addressed through mechanisms that foster a culture of integrity in the public service such as financial disclosure, integrity training, or the management of conflict of interest.
6. The seventh Principle calls on governments to provide specific mechanisms for the monitoring of public procurement and the detection and sanctioning of misconduct. For example, a public procurement agency could have “blinking” indicators that track decisions and identify potential irregularities by drawing attention to transactions departing from established norms for a project. Procedures for reporting misconduct could also be established, such as an internal complaint desk, a telephone hotline, an external ombudsman or an electronic reporting system that protects the anonymity of the
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individual. Governments should not only define sanctions by law but also provide the means for them to be applied in an effective, proportional and timely manner. 5
Legal, institutional and political conditions for the implementation of the Principles In order to implement the Principles, governments should ensure that the effort to enhance integrity in public procurement at the policy level is also supported by the country’s leadership and by an adequate public procurement system. The following items are commonly regarded as the essential structural elements of a public procurement system:
1. An adequate legislative framework, supported by regulations to address procedural issues not normally the subject of primary legislation; 2. An adequate institutional and administrative infrastructure; 3. An effective review and accountability regime; 4. An effective sanctions regime; and 5. Adequate human, financial and technological resources to support all elements of the system.
Concluding Remarks The proliferation of cross-border business activity has generated new opportunities for the construction and engineering industry. It has also created challenges for those charged with delivering construction and engineering projects in accordance with relevant legal requirements. One of the more pressing challenges is ensuring compliance with the increasingly stringent regulation of bribery and corruption.
In many countries, legal frameworks are either non-existent, or inadequate as a means of controlling the activities of those involved. This has led to the development of government controls with global reach in order to remotely influence project participants. Awareness of these controls amongst all levels of management and operations is now more important than ever.
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In the context of Jamaica, there needs to be greater enforcement of public procurement laws and guidelines, particularly in the construction and engineering sector where adherence to building codes are necessary. The government should also ensure that local authorities such as municipal corporations personnel are equipped with the requisite knowledge to adequately inspect buildings and other construction and engineering facilities and/or projects in a bid to achieve compliance at the highest standard.
The larger, better resourced and more experienced players are clearly expected to lead by example and often have the economic power to do so. Measures for avoiding bribery and corruption must be proportionate and must have due regard to particular risks such as those applicable in emerging markets.
Responsible, practical and transparent management and operational practices are the key to dealing with bribery and corruption. Indeed, the potential consequences for failure to accommodate these ever-expanding regulatory requirements provide a substantial incentive for participants to proactively manage fraud, bribery and corruption in the construction and engineering industry.
*Public education, sensitization requesting the Protected Disclosures Act (whistle blowing legislation).
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