Public contracts play a vital role in the financial health of a country and the lives of its citizens by generating revenues and providing essential goods, works, and services. Public contracts cover all economic sectors and types of agreements, including procurement, licenses and concessions and the sale of public property. It has been estimated that public contracts procuring goods, works, and services alone are worth approximately USD 9.5 trillion per year.(Kenny, 2012)
Therefore, it is critical that public contracts should be fairly awarded and offer good value-for-money. However, in many countries around the world, public contracting has been identified as the government activity most vulnerable to wastefulness, mismanagement, inefficiency, and corruption.(World Bank, 2011)
Citizens, media, and civil society want to know why a school was not built, why medicines are so expensive, why a road is in disrepair after only one year, or how many local workers the new mine will be hiring. To answer these questions requires access to information contained in contracts and documents related to their procurement and performance. But, in many countries there is limited public information about how contracts are negotiated, what has been contracted for, how they are being performed, and who is responsible. Sometimes even parliamentarians and supreme audit institutions are prevented by confidentiality clauses from understanding how the government is allocating public resources. Likewise, there are few chances for citizens to monitor public contracts.
It is increasingly recognised that ‘open contracting’ is required for governments to be held accountable for the use of public resources.(OECD, 2007) Disclosure and participation are critical tools to improve the management of public resources and open contracting refers to norms and practices for increased disclosure and participation in public contracting. It covers the entire process, including formation, award, execution, performance and completion of public contracts, and the full range of contract types, from basic procurement to joint ventures, licenses and production sharing agreements. Open contracting practices can be implemented at all levels of government and can apply to all public contracting, including contracts funded by combinations of public, private and donor sources.
This topic has been developed by the Open Contracting Partnership, whose steering group is currently made up of the following organisations: Colombia Compra Eficiente, Construction Sector Transparency Initiative (CoST), Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), Integrity Action, Oxfam America, the Philippines Government Procurement Policy Board, Transparency International and World Bank Institute.
Examples in Practice
Brazil provides citizens education on public budgets
Brazil publishes an annual Citizen’s Budget. However it also backs this up with several other innovative communication streams.
To better explain to citizens what the budget is, its importance and other aspects of the subject, a radio program titled Moment Budget is produced to provide information to the listener in a simple and direct language.
The Virtual School of the Federal Budget Secretariat (SOF) was created in 2008 by the Ministry of Planning, Budget and Management. It provides online courses on the understanding public budgets. Courses are aimed at both government employees and members of the public, and civil society. By 2011 the Virtual School graduated approximately 2000 citizens.The government also created a specific Public Budget Primer for children, available as a booklet and a website. In the form of a comic, the booklet provides an introduction to the idea of the Public Budget in relation to children and their concerns.
Denmark’s Model License for Exploration & Production of Hydrocarbons contains a standard provision on disclosure
In a survey of more than 150 conﬁdentiality clauses in oil and mining contracts worldwide found only one recognizes that the public interest in information should outweigh the company’s interest in conﬁdentiality. Denmark’s Model License of 2005 for Exploration & Production of Hydrocarbons contains a standard provision on disclosure, stating: [Information can be disclosed if] no legitimate interest of the Licensee requires the information to be kept confidential; essential public interests outweigh Licensee’s interest in maintaining confidentiality; information of a general nature is furnished in connection with issuance of public statements […]
Ethiopia launched a new Procurement Proclamation which requires disclosure of contracting information
In Ethiopia there has been strong support for procurement transaparency from the Commissioner, Federal Ethics and Anti-Corruption Commission. This support was strengthened when the Ethiopian Roads Authority, the Ministry of Health, the Ministry of Education, and the Ministry of Water and Energy—signed memoranda of understanding with the Construction Sector Transparency Initiative (CoST) to participate as a pilot country. A senior representative of the Public Procurement and Property Administrator Agency (PPPAA) joined the initiative’s multi sector group. alongside other representatives from government – from the Federal Ethics and Anti-Corruption Commission, Roads Authority, Ministry of Urban Development and Construction- as well as from the private sector and civil society.
Initial studies found that there was a legal between requirements for disclosure and the procuring entities’understanding of those requirements. It also revealed that the procurement law prohibited the disclosure of information relating to tender submissions and evaluations.This contributed to poor governance of projects resulting in wide differences between budgeted costs and timelines, and the actual costs and times of delivery. In 2010 a new Procurement Proclamation was issued requiring disclosure of key information related to public contracts.
CoST Ethiopia has developed an e-procurement system with the PPPAA where procuring entities will be required to disclose the CoST Project Information Standard. The Ethiopian MSG will then train the procuring entities on using the e-procurement system. This includes the Ethiopian Roads Authority who is in a good position to mainstream information disclosure due to the development of a new database and a number of disclosure policies that are already in place.
In Afghanistan the Ministry of Economy is required to publish all contracts
In Afghanistan, Presidential Decree 45 requires the Ministry of Economy to publish all contracts signed in the past three years. Mining contracts are available on the website of the Ministry of Mines.
In Colombia citizens’ oversight organizations can supervise the entire public contracting process
In Colombia, Law 850 of 2003 allows citizens’ oversight organizations to supervise the entire public contracting process, from resource allocation to the oversight of the execution and technical quality of the contracted good or service.
The Law states that citizens have the right to constitute “veedurias ciudadanas” or citizen oversight committees, which can be temporary mechanisms for CSOs to control public administration, procurement, processes, etc. The veedurias enable citizens and/or CSOs to oversee public management and the performance of administrative, judicial, electoral and political authorities, public and private entities, or nongovernmental organizations. They are responsible for executing programs, contracts, or public services.
One of the main objectives of the “veedurias ciudadanas” is to strengthen mechanisms to control corruption in public procurement and public management. The Law 489 of 1998 states that the public administration is obliged to provide support to citizens when they constitute a veedurías. This Law also establishes that controlling authorities and the judiciary should support the veedurías in order to investigate and respond to their denunciations.
In Colombia the law requires all documentation related with a public contract to be published
In Colombia, Law 80 of 1993 and Law 1150 of 2007 and associated decrees make it obligatory for all government entities, at the national, department, and municipal levels, to publish documents and information related to contracts. All documentation beginning with the preliminary studies and including the contract itself should be published, through the Public Procurement Electronic System (SECOP).
By visiting the website http://www.colombiacompra.gov.co/ users can access contracts closed in the past two years. A review by the Center for Global Development found that no information is being withheld from the public domain related to the main agents involved, the salaries paid to all personnel involved, any taxes and legal fees, or the cost per unitmaterials/inputs used.
However there are some limitations to the system. Extractives contracts are presently excluded from the system. In addition a self-evaluation done by the Intersectoral Commission of Public Contracting (CINCO) in 2008 also mentions problems related to full coverage of the system, due to lack of connectivity in some areas. Furthermore CGD’s research found that some contracts of concern appear to have been taken down from. For example there are limited contracts available related to the Bogotá Transmilenio Project which was at the centre of a contracting scandal.
In Ecuador, the introduction of an e-reverse auction in the purchase of medicines achieved an expenditure reduction of USD 327 million
In Ecuador, the introduction of an e-reverse auction in the purchase of medicines significantly reduced the overall cost of obtaining information on contracts and simplified the bidding process. In total, this process achieved an expenditure reduction of USD 327 million.
The health sector in Ecuador is made up of 4 major institutions that have around 2800 public health establishments carrying out autonomous purchases. This traditional and fragmented purchase of medicine hurts planning, efficiency and control.
The National Institute of Public Purchases -INCOP – as the directing entity of Ecuador’s public purchases, developed a process for purchasing medicines through a Reverse Auction of Medicines. By consolidating the demand they were able to get a better position in the market to and fixing prices for two years with winning bidders signing a framework agreement for two years. Health providers are then able able to purchase medicines at fixed price from the resulting electronic medicine catalogue.
The process using electronic bidding through the INCOP website allows for fair competition. In the first rounds of bidding it is estimated that savings of $327 (or 42% of the existing medicines budget). Although the bidding was carried out openly, the system still allowed a local content requirement to be included and 41% of the awarded medicine was of Ecuadorian origin. The preferences were given with the purpose of job creation, innovation and industrial development.
In Guatemala the government has taken action where multistakeholder reviews found problems in public construction projects
Having joined the Construction Sector Transparency Initiative (CoST) in 2010, CoST Guatemala recently published their third CoST Assurance Report, disclosing information from 25 public construction projects. The first disclosure in July 2011 examined six projects including roads, sporting facilities and river dredging. An average of 53 per cent of the project information required by CoST was disclosed by the procuring entities, which marked a great improvement.
The CoST Guatemala programme has highlighted several issues that have led to government action. Following a recommendation from the assurance team procuring entities have to ensure that sufficient budget is in place before contracting firms. This is to avoid unnecessary delays in starting construction. The Multi Stakeholder Group also voiced concerns about NGOs being used to siphon offfunding intended for infrastructure projects. The General Directorate for Roads has annulled the works contract for the design and reconstruction of the Belize Bridge in Guatemala City, based on the Assurance Team highlighting the inappropriate use of procedures for contracting in emergencies such as natural disasters. Over time the average level of proactive disclosure of project information has risen from 25% in the CosT baseline study to 65%. Disclosure is becoming a routine process for CoST Guatemala.
In Mexico “social witnesses” oversee public procurement
In Mexico, since 2004, the federal government of Mexico has required the involvement of “social witnesses” in public bidding for goods, works, and services over a certain threshold value. Since 2009, participation of a social witness has been mandatory in procurements valued at more than $23 million for goods and services and US $43 million for public works. Non-government organizations and individuals may be selected as social witnesses by the Ministry of Public Administration. Their function is to propose strategies for improving transparency, impartiality and compliance with the legal framework, and must issue an alert if they detect any irregularities in the course of the procurement. At the conclusion of the procurement proceedings, the social witness issues a publicly available statement including observations and, as appropriate, recommendations. The statement is posted on the government’s central procurement website and in the file of the tender.
The “Social Witness” program is the result of an initiative of the NGO Transparencia Mexicana to facilitate the participation by civil
society as external observers in public procurements. Originally, social witnesses par!cipated as a result of guidelines issued by Ministry of Public Administration (MPA) in 2004. The guidelines stipulated that MPA keep a registry of individuals and non-governmental organizations which may participate in all stages of a procurement conducted by any institution of the Federal Public Administration.
in Mexico”, Transparency Interna!onal USA, CIPE, Transparencia Mexicana, 2011,
According to Transparencia Mexicana, the Social Witness program has signiﬁcantly reduced the costs of public contracts and has increased the
number of bidders participating in the procurement process in Mexico.
In Mongolia,civil society and professional organizations play a formal role in bid evaluation and contract monitoring
In June 2011, the Government of Mongolia amended the Public Procurement Law of Mongolia (PPLM) to include a new formal role for civil society and professional organizations in bid evaluation and contract monitoring. Private and specialized non government organizations can be selected according to the provision 35-39 of this law to perform monitoring, evaluation and auditing of customer’s activity, contract performance and quality progress and execution.
Mongolia is at the threshold of a major socio-economic transformation driven by the exploitation of its vast mineral resources. Since 2004 when the mining boom began, the economy has grown at an average rate of over 8 percent each year. Sound infrastructure is particularly critical for this vast, land-locked, sparsely populated, country In order for it to both develop and benefit from the huge new Southern mines Mongolia’s infrastructure investments will need to increase at an unprecedented pace, placing great demands public procurement systems. Procurement in Mongolia has been characterized by the familiar problems of political interference and lack of transparency, which are particularly pronounced given the small size of the formal sector and the close ties between politicians and the construction industry. As a result, time and cost over-runs in infrastructure projects are ubiquitous.Increasing the technical capacity, transparency, and accountability of public procurement is an urgent need for government systems to keep pace with the staggering transformation that is underway.
The rationale for involving CSOs in monitoring procurement emphasizes the ability of CSOs to provide feedback to government on bid evaluations and contracts and to disseminate their findings to the public. Through disseminating its observer reports, CSOs can help to inform citizens and thereby strengthen citizen ability to reward or sanction politicians and officials for their management of public resources. It is hoped that greater citizen awareness of procurement-related problems will increase public officials’ incentives to respond to CSOs’ feedback, including holding contractors accountable for their performance.
Implementing the PPLM, especially the requirement for CSO oversight of bid evaluations and contract performance, will be challenging for both the Government and CSOs. Sustainable funding arrangements that are shielded from political interference will be essential for the success of civil society monitoring will be crucial. Mongolia has also opted into the Global Partnership for Social Accountability (GPSA) to enable Mongolian civil society groups to apply for financial support from the international donor community to monitor public contracting In addition, Mongolian agencies have entered into memoranda of understanding with civil society groups to monitor their public contracting.
[Source: World Bank]
In Peru public land for sale must be advertised for a minimum of 90 days
In Peru, a land auctioning process has been in place since the 1990s and since then 235,500 ha of public land has been auctioned for nearly US$50 million.About 20 of the country’s 50 main agro-export companies have received land through these auctions.
Where a government agency, ministry, regional or local government wishes to divest public land, the intention to divest the land is published, along with the minimum investment required and the minimum bid price for the land, in the official gazette, local and international newspapers, and a government Web site for a minimum of 90 days. Likewise, if an investor approaches the government, the evaluated proposal is published for a minimum of 90 days to allow other potential investors to present offers.
Bids are ranked by price offered and the amount of projected investment. Each auction takes 4-5 months and data on the minimum bid value of the land, the investment commitment, and data on land size are publicly available. Business plans are also made public Redress can be remedied if the property was expropriated. If within one year of the conclusion of the court process the expropriated property is not used for its planned purpose, it automatically reverts to the original owner.
Peru’s success in divesting public land through auctions is credited to the transparency of the process as well as to oversight from a high-powered and independent technical committee representing private and the public sectors.Competitive bidding for land provides a mechanism by which the host government achieves better terms and is able to extract some of the surplus created by the project, while eliminating direct negotiations between private buyers and public officials. However, the extent to which business plans incorporate community benefits, or how social and environmental concerns are considered during the awarding of investment projects, remains unclear.
In Sierra Leone the law requires that oil contracts must be awarded through competitive auctions
Sierra Leone has a long history of mining as its major economic activity. The mining sector provides employment and livelihood to over 135,000 workers, the overwhelming majority of whom are engaged in artisanal, small-scale mining operations. Artisanal mining constitutes an estimated 84 percent of total diamond exports from Sierra Leone.Sierra Leone does not currently produce any petroleum, but there are offshore prospects.
The petroleum sector is regulated by the Petroleum Exploration and Production Act of 2001. Under this Act, Sierra Leone developed a model petroleum agreement which provides a 10 percent royalty, a 37.5 percent income tax rate and annual rental between $30 and $100 per sq. km. A revised Petroleum Exploration and Production Bill was submitted to parliament in July 2011 that included several clauses seeking to improve transparency, including a requirement that oil contracts be awarded only through competitive auctions, that contracts be published and that payments be disclosed in accordance with the terms and procedures of EITI.
Paragraph 39 of the Petroleum (Exploration and Production) Act form 2011 states that “A Minister may, following a transparent, fair and competitive process and on the advice of the Directorate, grant a petroleum licence to two or more applicants who offered the most favourable terms and conditions to the State.”
In Slovakia, government contracts are published online
Corruption in public procurement in Slovakia has been a long-standing problem. Problems in public procurement occur through the manipulation of tenders before or after the awarding of the bid, for example by limiting competition through setting unreasonable conditions, or not fully enforcing contracts, or changing them significantly after tendering. One key example was the ‘Notice Board Scandal,’ a high profile procurement scandal which took place in 2007 when the Ministry of Development published a tender request for construction services totalling 119.5 million Euros on a small notice board in the hallway inside the ministry building where few could see it. A firm that was known to have close ties to the head of the ruling party won the contract. More than a year after the fact, the scandal came to light and was invalidated by the Slovakian Office of Public Procurement.
Slovakian law was overhauled in response to the 2011 update of the EU Procurement Directives and the concern over high profile public procurement scandals. Major reforms included:
- The introduction of e-procurement, in which dissemination of tenders, tender documents, the submission of bids and the publication of notification of awards is done publicly through a single portal;
- The introduction of reverse auction mechanisms for procuring goods and services
- Mandatory publication of all public contracts on a centralized online government contract repository.
In the Slovak Republic, Act No. 546/2010 Coll. supplementing Act No. 40/1964 requires all public contracts, with certain limited exceptions, to be published online. To avoid secret contracts, any unpublished contracts are declared to be unenforceable. The Government Public Procurement Office manages Slovakian procurement rules. This office publishes the official Public Procurement Journal, legal interpretation of the Public Procurement Act, maintains a register of procurement documents and operates the procurement portal, which is called EVO.
These reforms have made it significantly easier for organizations and people outside the government to access public data about procurement. Previously access tender documents and other procurement data was granted primarily through requests under Freedom of Information Laws (FOI). If requests were not granted and appeals could take so long that the information was no longer relevant.
Now, through EVO all of that information is published including the contract itself and information on the bids received and the process of contracting.
The availability of data has lowered the barriers to entry for participating in the oversight process. This has enabled much greater public participation in uncovering suspect procurements. Before the reforms, exposing corruption relied on whistleblowers alerting journalists or watchdogs of suspicious proceedings. Now more tips come from local activists and individuals. For example teachers, highlighted information about large Ministry of Education procurements for flowers and alcohol and the Ministry of Finance conducted an audit.
Opening up the information makes it possible compare contractors and look at patterns across cities and institutions. Local people who may know who the mayor is friends with, and which local businesses have relationships with people of influence are able to spot issues that a researcher farther removed from the process might not be able to.
Despite these positive developments corruption in Slovakian public procurement remains a challenge. While the availability of data has been a positive step, there remain barriers to using it, and where there is no real threat of enforcement, transparency and disclosure are limited in their ability to bring about effective change. Researcher using the data say that rationalizing the manner in which the data is released and formatted would make it easier to use, reducing the cost of finding corruption and increasing the likelihood that improper processes will be uncovered. The NGOs TI-Slovakia and Fairplay Slovakia maintain an online Open Contracts website built off the procurement data scraped and structured from public sources. This portal visualizes procurement expenditures by procurers, suppliers, sectors and regions as well as provides downloadable structured procurement data in bulk. Having data available in these formats also enabled TI-Slovakia to conduct broader analyses than were previously possible.
Standardised data formats, bulk downloading, structured formats like XML would make it easier to use the data. Another key problem is that there are no data licenses attached to public data so it is not clear how it can be used. Additional information about pre-tender requirements would also be valuable.
Formal mechanisms and institutional means of sanction also need to be strengthened. The Sunlight Foundation concludes that “Most significantly, transparency alone, it appears, cannot change deeply ingrained corrupt practices in a short time span. Transparency can only highlight the problem, and provide tools for oversight and investigation. Enforcement mechanisms, both formal and informal, must be brought to bear to sanction those whose transgressions are revealed by transparency-enabled oversight.”
[Source: Sunlight Foundation case study]
In the Democratic Republic of Congo, all contracts relating to natural resources are required to be published
Decret No 011/26 du 20 mai 2011 portant obligation de publier tout contrat ayant pour objet les resources naturelles. Contracts are available on the website of the Ministry for Energy and Mines.
In the Philippines, both government and private sector are active at training monitors
The government Procurement Policy Board holds trainings for monitors wishing to understand more about the procurement process and related laws and regulations. The Makati Business Club is an active participant in a Coalition Against Corruption. The coalition provides training and on the Government Procurement Reform Law for volunteers so they can participate as observers in Bids and Awards Committees.
In the Philippines, citizens participate in all stages of the procurement process and may also observe implementation
The Philippines Procurement Law mandates citizen participation in all stages of the procurement process, from pre-bid conference, opening of bids, bid evaluation, post-qualification and award of contract. Under this system, procuring entities are required to invite outside organizations to sit in on meetings of their Bid and Awards Committees (BACs). Observers may also observe contract implementation, and citizens are able to file complaints with the local ombudsman if they suspect irregularities.
In the extractives sector, although there is currently a moratorium on new mining operations, the Philippines Mining Law requires a “multi-partite monitoring team” to be operational before the mining project can receive an environmental compliance certificate. This body is to be composed of representatives of the national government, affected communities, indigenous communities, an environmental civil society organization, and the project proponent. In addition Philippine agencies have entered into memoranda of understanding with civil society groups to monitor their public contracting.
However the system has struggled to respond to the volume of procurements, because of resource limitations for the CSOs involved and the lack of trained staff. According to some estimates civil sector oversees less than 1 percent of procurement proceedings and are not likely to see the misconduct, since they are not present during the pre-bidding parts of the process where misconduct most likely occurs. The degree to which CSO observers are granted a meaningful and participatory role varies greatly depending on the procuring entity.
To date the civil sector observer system has been seperate from the ICT enabled e-procurement of PhilGEPS. ICTs can enable asynchronous and remote observation, which can significantly ease the resource burden of observation and allow for more targeted risk assessment.
In the UK potential opportunities that might be advertised in the future are published, so that all companies can view the pipeline of opportunities
In the UK, Contracts Finder now has details of the potential opportunities over the next few years. Termed “pipelines,” they are intended to help businesses prepare for opportunities that might be advertised in the future.
In Victoria, Australia disclosure requirements are part of the standard terms and conditions for contracts
In Victoria, Australia, current policy and rules require that private parties be made aware of contract disclosure requirements at the time of tender. This is included in the Standard Tender and Contract Terms on Disclosure for contracts over $100,000 Policy adopted in 2002 by the Victoria Government Purchasing Board.
Liberia publishes information on bids and contracts
In Liberia the Land, Mines and Energy Ministry publishes information on the number of bids received, bidding requirements, and winning bids. Most mineral development agreements are published, and the Ministry is launching a Mineral Cadaster Information Management System.
Many countries have developed electronic databases of public contracting information
Mongolia addresses contracting specifically in its Right to Information Law
In Mongolia, the Law on Information Transparency and Right to Information, Article 10, states “The principles of transparency, fairness, efficiency, economy and accountability shall be upheld in the procurement policy and such policy shall be made available in an easily accessible manner on the website of the organization, and made public through other means.”
Documents required to be published are bid invitations and regulations concerning bid selection processes; criteria for the selection of bidders as well as of criteria under which a contractor was selected; brief information on successful or unsuccessful bidders as well as the detailed reasons, conditions and legal grounds for selections; reports on the procured goods and services, including procurement audit and reports, conclusions and other monitoring reports.
Mongolia addresses contracting specifically in its Right to Information Law
In Mongolia, the Law on Information Transparency And Right To Information, Article 10, with regard to procurement, requires publication “in an easily accessible manner” of bid documents, bid invitations and regulations concerning bid selection processes; criteria for the selection of bidders as well as of criteria under which a contractor was selected; brief information on successful or unsuccessful bidders as well as the detailed reasons, conditions and legal grounds for selections; reports on the procured goods and services, including procurement audit and reports, conclusions and other monitoring reports.
New York City’s Checkbook NYC website integrates budgets and contracts
New York City, which spends roughly $70 billion annually, has long had a central budget to combat waste and fraud. In 2010 it set up a transparency initiative; Checkbook NYC website , enabling the public to keep an eye on New York City’s spending with detailed, up-to-date information about revenues, expenditures, contracts, payroll, and budget in an easy-to-use, dashboard format. A subcontractor reporting system on the City’s Payee Information Portal, rolled out in 2012, requires all vendors with contracts over a certain dollar amount to report their subcontractors online.
Checkbook NYC was released for use and modification under an open source license to encourage programmers and governments that adopt the system to contribute improvements and additional features for release in future versions.
Seventeen countries have joined the Global Partnership for Social Accountability
The GPSA is a coalition of donors, governments and civil society organizations (CSOs) that aims to improve development results by supporting capacity building for enhanced citizen feedback and participation. The GPSA will contribute to country-level governance reforms and improved service delivery. To achieve this objective, the GPSA provides strategic and sustained support to CSOs’ social accountability initiatives aimed at strengthening transparency and accountability.
Support is provided on two fronts: funding and knowledge. Through a global grant competition, grants str made available to CSOs for capacity building, research and knowledge dissemination, networking and programmatic activities related to social accountability in their country. The GPSA is also developing a global platform for knowledge exchange and research, especially in measuring and documenting ‘what works’ in social accountability and the impact of social accountability interventions.
Before a Call for Proposals is issued, multi-stakeholder consultations are held in each country to define thematic priority areas that CSO proposals will need to address. The countries that have formally opted in enable their CSOs to access funding are:
- The Dominican Republic
- Kyrgyz Republic
- The Philippines
[As of June 2013]
South Sudan enacted a law that makes confidentiality clauses in petroleum contracts invalid
South Sudan, Petroleum Law (2012) 78(3), declares confidentiality clauses in petroleum contracts to be invalid to the extent that they contradict disclosure requirements.
The Indian Right to Information Act makes contracts disclosable
The Indian Right to Information Act (2005) specifies that contracts are disclosable within the definition of information (subject to some limitations).
The Philippine National Textbook Delivery Programme uses citizen participation to improve accountability in public procurement
The National Textbook Delivery Program (NTDP) in the Philippines is a civil society-led initiative supported by state institutions that has focused on improving transparency in the delivery and distribution of textbooks. Civil society organisations were spurred into action because of the low level of accountability in the education sector with 40 percent of textbooks deliveries not being accounted for and 21 percent of textbooks procured by the Department of Education not being delivered to the designated schools. By effectively monitoring textbook delivery at the community level, the initiative has been able to reduce the average cost of textbooks, reduce the time spent on the process of getting textbooks to schools, and improve the quality of textbooks.
In light of the problems facing textbook procurement, senior officials at the Department of Education initiated the NTDP in order to improve transparency and accountability. They ensured the assistance of G-Watch – an independent monitoring project that undertakes research and advocacy on themes related to governance and public management – and its network of civil society organisations around the country. Several civil society organisations agreed to participate in the NTDP, for example by providing volunteers doing the monitoring work at the local level. These organisations were expected to be the government’s eyes and ears as they observed and ensured the transparency of the bidding process, inspected the quantity and quality of the textbooks being produced, and monitored that the right number of books were delivered at the right time. They reported to G-Watch as the national coordinator if textbooks were not of the right quantity or quality. G-Watch, in turn, reported that information to the Department of Education who had the power to make the contractor abide by its contract.
Monitoring actual delivery forced the publishing companies to be more efficient since failure might result in a loss of business the following year. The participation of locally based civil society organisations also invited community participation in the transparency mechanism, adding to the pressure for the Department of Education and the publishing companies to get their act together as more than one set of eyes were scrutinising their performance.
The successful implementation of the NTDP has resulted in the Secretary at the Department of Education issuing Order No. 59, ‘Institutionalising NGO and Private Sector Participation in the Department’s Procurement Process’. Another initiative to institutionalise this participatory transparency initiative is the Textbook Walk, which invites an entire community to participate in the monitoring of textbooks when they are delivered to a given school. G-Watch has conducted training for event organisers and prepared educational materials to the textbook monitoring process, and has implemented the Textbook Walk in various districts across the Philippines.
The Philippine Procurement law requires the proactive publication of key information
In 2002, the Congress of the Philippines passed Republic Act No. 9184, the “Government Procurement Reform Act,” to address the problem of a vague and complex web of overlapping procurement regulations which made the process vulnerable to manipulation.
The Act, along with its implementing rules and regulations, mandates transparency and accountability measures to help combat corruption and inefficiency in public procurement. The bill specifically stresses that information and communication technology (ICT) should play a central role in how the government meets these goals.
The Philippine Government Electronic Procurement System PhilGEPS serves “as the primary and definitive source of information on government procurement.” According to law, all public tenders, from those conducted by federal agencies to those of the smallest Local Government Unit (LGU) must pass through the PhilGEPS system.It hosts information on:
- Invitation to Bid/Request for Expression of Interest;
- Bidding Documents;
- Supplemental/Bid Bulletin;
- Notice of Award;
- Approved Contract; and
- Notice to Proceed
In addition there are procurement related documents that are required by the regulations to be made available to the bidders or the public upon request, such as the Minutes of the Pre-Bid Conference and Minutes of the Bid Opening.
Despite the introduction of PhilGEPS and the mandate that all public procurement pass through the electronic bulletin system, journalists, watchdogs and other CSOs continue to face significant information availability problems. They report that the compliance with reporting requirements is lacking, the information tracked by government entities is incomplete, and the data that is nominally available is subject to a range of barriers to public use.
Key limitations are that PhilGEPS does not capture all of the relevant information necessary for third-party oversight, in particular lacking details of the contract management phase, in which there are opportunities for contracts to be manipulated. Furthermore full access to PhilGEPS is restricted to accredited contractors who have paid a registration fee. It does not provide a way to access bulk data to use for statistical or visual analysis. Instead, to access procurement information one must already know where to look, and must look one tender at a time.
Developments to improve the system include piloting of performance based bonuses tied to PhilGEPS compliance, and development of more comprehensive access for the public and CSOs.
The State of Minas Gerais, Brazil requires proactive disclosures about PPP projects
The State of Minas Gerais has been serving as a model for other states in Brazil on practices related to disclosure of project information, draft and final signed contracts, as well as bidding process documentation and technical background reports.
For PPP projects in Minas Gerais, Brazil, a preliminary project summary is published online during a public consultation period, along with the bidding documents, including selection criteria, and the draft of the contract, technical background papers and feasibility studies. Once the tender process is completed, full versions of contract documents are published and the project summary is updated (describing, inter alia, guarantees provided by the government). If the contract is renegotiated or amended, such variations are published once agreement is reached. Monthly performance reports are also published.
According to Resolution 72 of 2003, Article 5, web pages should be “easy to read and present content with clarity, coherence, relevance, timeliness, organization, simplicity, objectivity and truthfulness.”52 Article 7 specifies that all information contained in websites of the State’s public entities must be rigorously updated, while Article 9 establishes a communication service, “Talk to Us” (“Fale Conosco”), which facilitates the direct access to information held by public institutions.
Through this open channel, citizens can request information, and requests must be responded to within 2 working days, either by disclosing information, referring the public to another institutional source, or requesting more days to fulfil the request. All available information on projects is, however, extensively disclosed proactively.
All documents are disclosed in their original form in the public domain and are signed off by the original producer of the document. When information is extracted from the original documents and placed in a separate format, such as in the case of the project factsheet and guarantees or payment reports, the PPP Unit checks each piece of information.
[Source: World Bank, 2013, Disclosure of Project and Contract Information in Public-Private Partnerships]
The UK created a “Mystery Shopper” service to resolve complaints related to procurement processes
In 2011 The Prime Minister and Minister for the Cabinet Office announced a series of measures to open up public procurement to greater participation by small and medium sized enterprises. One of the announcements made was the launch of the Mystery Shopper service. This service exists to provide a structured mechanism for suppliers to raise concerns about public procurement practice and processes.
Suppliers can use this service anonymously to escalate issues about problems in Government supply chains to the Cabinet Office. The aim is to provide a clear, structured and direct route for suppliers to raise concerns about public procurement practice when attempts at resolving issues with a contracting authority or a first tier supplier have failed, and to help the Cabinet Office identify areas of poor procurement practice so it can work with the contracting authority to put them right and reduce the likelihood of similar issues arising in other authorities.
Reports of cases investigated are published on the Cabinet Office website.
The UK issues guidance on what information can be exempted from tenders
In the UK, tenderers for public contracts are advised to consider the Guidance on Contract Information that is Exempt from the Freedom of Information Act to evaluate whether information in the tender can be exempted under a non-disclosure agreement. Contracts are then redacted in accordance with the Freedom of Information Act and official guidance.
Transparency in public contracting is written into the South African Constitution
Section 195 of the South African Constitution states that “People’s needs must be responded to, and the public must be encouraged to participate in policy-making…Public administration must be accountable…Transparency must be fostered by providing the public with timely, accessible and accurate information.” and Section 217(1) South African Constitution Section 217(1) of the Constitution states that “when an organ of state contracts for goods and services it must do so in a manner which is fair, equitable, transparent, competitive and cost effective.