Box I: The Four Key Stages of the Public Procurement Process
PLANNING
BIDDING
BID -EVALUATION
Needs assessment
Short listing
Bid opening
Pre-qualification
Bid evaluation
Pre-bid conference
Bid evaluation report
Tendering and clarification
Award of contract
Advertising Bidding documents Procurement plan
Specifications drafting
Contract requirements
IMPLEMENTATION AND MONITORING Drafting of contract Contract implementation Contract changes Monitoring and auditing Lodging appeals
Contract requirements Evaluation criteria Initial market research
Procurement processes are also vulnerable to collusion, that is “secret agreements between parties, in the public and/or private sector, to conspire to commit actions aimed to deceive or commit fraud with the objective of illicit financial gain.”8 Collusion between government officials and bidders can result in arrangements to inhibit competition by deceiving or depriving others of their rights in order to secure an unfair advantage. Collusion among bidders can rig the bid to manipulate the award decision and can be a particular problem in smaller markets where there are fewer competitors. Public procurement can also suffer from coercion and extortion, which are other damaging forms of corruption. Extortion is the act of utilising, either directly or indirectly, one’s access to a position of power or knowledge to demand unmerited cooperation or compensation as a result of coercive threats.9 Extortion occurs when a government official demands something of value in return for assisting a company to win a bid or for taking a required action, such as making a valid contract payment. Coercion can occur when one bidder threatens another to keep them from bidding.
8 9
Fraudulent practices would also count as corruption, for example when a government official or a bidder deliberately misleads or misrepresents the facts by submitting false invoices or statements of prior work experience, or fails to share key bidding information with all bidders. Public procurement procedures are often complex and in many countries the transparency of the process is extremely limited and manipulation hard to detect. In addition, few people who become aware of corrupt activity will report it. This could be for a range of reasons: perhaps the money wasted is seen as merely the ‘government’s’ money rather than their own, there may be no easy way to report what they know, or a feeling that complaining is futile or could result in retaliation.
Id. at p. 9. Id. at p. 19.
Curbing Corruption in Public Procurement A Practical Guide
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