To ensure that the massive sums involved in public procurement are not vulnerable to corruption, by guaranteeing procurement information is accessible and that procurement processes are clearly specified and followed.
Public procurement spending averages between 13–20% of gross domestic product (about $US9.5 trillion every year) – but currently 20-25% of this is estimated as being lost to corruption.
Corruption distorts competition and can reduce the quality and sustainability and safety of public projects and purchases. As a consequence, trust in governments can be eroded when goods and services purchased fail to meet public needs. With huge sums of public money at stake, it is vital that governments effectively control corruption in public procurement budgets. According to the UN Office on Drugs and Crime, “a procurement system that lacks transparency and competition is the ideal breeding ground for corrupt behavior.”
In Australia, public procurement is estimated at AU$200-300 billion, but in recent years, a number of procurement scandals have eroded trust in government.
In Victoria, an investigation is underway in to alleged multi-million dollar corruption schemes in the Department of Education. At the Federal level, confusion over the procurement of submarines has thrown spotlight on importance of transparency and clarity in procurement processes. Even items as innocuous as printer cartridges have been responsible for a $1.2m scandal in South Australia involving 21 companies and 11 government bodies. Governments at State and Federal level are also committed to increase investment in infrastructure, adding to the prospect of increased procurement by public sector agencies in tandem with the private sector…
Position Paper 6 – January 2016