Case for open contracting

THE EDITOR: We regularly read in the newspaper of alleged corruption by people in charge of the public purse.

Public procurement law contributes to a country’s socio-economic development and is the means and mechanism through which official government agencies purchase goods and services.

These products are inputs into the production of public goods and services – education, defence, utilities, infrastructure, public health and safety and so on.

Public procurement is based on value for money, defined as “the best mix of” quality and effectiveness for the least outlay over the period of use of the goods or services bought, which is achieved through competition.

Procurement laws were enacted to prevent discrimination and ensure an open, fair and competitive procurement process. In the private sector procurement is viewed as a strategic function working to improve the organisation’s profitability.

In the public sector the concept of “bottom line” is less well defined – there are no shareholders, dividends to be paid out or publicly declared profit (or loss) announcements. For this reason expenditure in the form of public spending should be open, transparent and non-discriminatory, which is required by legislation.

Corruption is a key problem facing governments and TT is not exempted. Secrecy appears to be the norm with regard to contracts and alleged corrupt practices. Nevertheless the increased use of the Freedom of Information Act by civil society groups and individuals has spurred on the average citizen to rise up and pay attention.

To get around this, the courts are being utilised to keep contracts under wraps. Governments should realise by now that they have a literate society and taxpayers are tired of being used as the feeding trough for under-the-table wheeling and dealing.

Nepotism and incompetence have led to abandonment of million-dollar contracts and we simply “move on” with little or no information provided to citizens.

Gavin Hayman, executive director of international anti-corruption group Global Witness, puts forward “open contracting,” based on transparency, disclosure and oversight.

Open contracts make it possible for citizens to understand the nature of agreements that a government has made and having the ability to monitor government and company commitments.

In many instances government spending does not get converted into tangible benefits such as financing for better roads, schools, hospitals, etc. Therefore, reforms are necessary. Today there are over 25 countries that publish contracts with others set to follow. Notably, TT is not one of them.

Open contracting makes contract information more accessible and actionable to help businesses, citizens and journalists analyse, monitor and scrutinise the process to shape better outcomes. It is a better deal for governments, which get greater value for money.

It also creates a level playing field for businesses, reducing fraud and corruption. Moreover, it provides quality goods with services for citizens and rebuilds trust of companies doing business with the government.

Civic engagement in government contracting deters fraud and corruption. Better agreement builds trust and promotes a more competitive business environment. Transparency improves the way governments give out contracts, licences or permits for major projects.

The accumulation of better data on how governments spend money lets companies know if and when it is worth the time and money to prepare an offer. This in turn creates fairer competition which can then level the playing field for companies. Most importantly, it allows for full publication of government contracts, which can expose wasteful spending and fraud.

To transform to public contracting there needs to be open contracting commitment to change, so as to obtain better results. As such, there must be transparency in procurement. Such transformation requires a bold vison and courage to go up against vested interests, since elite private interests are still all too common.

Poor public procurement systems are either the entry points or enablers for state capture by private interests. Back-room deals and divvying up secret government contracts are the epitome of closed governments and dubious public spending

Open contracting requires partnerships built on honesty, fairness and openness. There must be “a readiness to change, and a willingness to trust.” Public contracting is the vehicle to deliver on the promises of smarter, more open and more responsive government.

ROSSANA GLASGOW

via e-mail