1. Business in Partnership Against Corruption
How Can Multilateral Development Banks Partner with Governments, Private Sectors and Civil Societies to Improve Transparency and Accountability in Procurement
Asha Ayoung
Lead Procurement Specialist, World Bank

2. Corruption in Procurement
Corruption distorts public finance, affects the delivery of public services in health, education, transport etc and undermines efforts to reduce poverty
Public Procurement is susceptible because of high amounts of money involved and high degree of discretion that politicians and government officials have over procurement in developing countries
Risk is greater in countries with weak capacities to prevent, detect and punish corruption through: (i) checks and balances, (ii) controls and monitoring and (iii) existence and enforcement of laws and regulations
To control corruption, one needs to understand how public procurement system operates

3. How to fight Corruption in Procurement
While a well-designed and regulated system can reduce the risk of corruption, no system is totally corruption proof. To minimize risk, the Government should examine their procurement system for potential vulnerabilities by:
Carrying out a comprehensive analysis of the country’s public procurement system
Undertaking a general assessment of the risks (legal, institutional, organizational etc.) associated with the procurement process
Assessing the performance and practices of the local private sector
Developing a prioritized action plan to bring about institutional improvements

4. Potential Problems in Public Procurement System that Enable Corruption
Legislative and Regulatory Framework
The laws, regulations and implementing rules do not encourage competition, nor promote equity, transparency and accountability
Institutional Framework and Management Capacity
Central Institutions that do not have the capacity to oversee public procurement and/or conflict of interest situations
Procurement Operations and Market Capacity
Implementing agencies that are not effective and competent. A private sector that is not well organized and does not have access to the market
Integrity and Transparency of the System
Control and audit systems that are not effective, existence of inefficient and non-independent appeals mechanisms and limited access to information

5. Effective Partnerships to build Trust and Combat Corruption in Procurement
Committed Government
Donor Collaboration and Harmonization
Involvement of National Key Stakeholders in diagnostic work
Separation of Regulation from Controls and Involvement of Private Sector and Civil Society in Regulation and Oversight
Involvement of PS and CS in Handling of Complaints
Empowered beneficiaries and local communities in their project designs and procurement