15 July 2011

Is government procurement in New South Wales rife with corruption?

Yesterday, the Independent Commission Against Corruption (ICAC) published two reports. One, about a survey, indicated that 41% of suppliers were concerned about fraud in the State Government.  Fair contracting is being undermined by favouritism and the leaking confidential information.  Agency employees responsible for contracting decisions are seen as influenced by gifts and benefits, with attendance at cricket matches in particular, being associated with some businesses gaining the inside running on tenders.  Nearly 55% of respondents believe that tenders are not fairly managed, with 36 per cent saying that officials accepted benefits when offered.

To address this systemic and widespread corruption  the second ICAC report recommended a review of the government procurement policy, the development of centralised arrangements, and the setting up a new complaint and investigation process.

Officials in New South Wales, as in all Australian jurisdictions, are subject to a code of conduct and procurement rules similar to the New Zealand provisions.  The problem is not a lack of controls but a disregard for the obligations officials have to good government.  Where integrity and the spirit of service to the community are defective, as the ICAC report indicates, processes are needed that compel openness.  Transparency is the default if the spirit is missing and the body is weak.