Pilot project aims to make companies come clean over public contracts

The Czech Republic has been selected for a corruption fighting pilot project which could have a major impact if it eventually expands to cover the massive public sector tenders market.

Photo: hin255 / FreeDigitalPhotos.net

As the Chinese proverb goes, every long journey begins with a single step. And both the Ministry for Regional Development, which manages programmes pumping European funds, and the local branch of Transparency International, the organization combatting corruption and promoting good government, are hoping that a Czech pilot project will pay off in the long term. The Czech Republic has been selected by the European Commission to push ahead with a specific three year pilot project as part of a series of Europe-wide moves to counter corruption, especially that touching on the use of European funds.

The specific Czech project covers the operation of a so-called integrity pact under which the company winning a public tender or contract automatically allows in independent checkers to supervise how the work is being fulfilled. Basically, the contract winner must agree to open up all its books to make sure there is no corruption or sharp practice involved.

Ivana Dufková, photo: archive Transparency International

The Czech tender to be subject to this close scrutiny has already been selected with the Czech branch of Transparency International signed up to carrying out the checks. The tender itself is a fairly small one in cash terms – to provide information technology for managing the operation of European funds.

But it’s perhaps not a coincidence that information contracts for the government and its many agencies have been one of the most problematic areas for Czech public tenders over the last decade with countless stories of rigged contracts, overspending, and technology that in the last instance often fails to fulfill the tasks initially demanded of it. Transparency International’s Ivana Dufková explained how the integrity pact should work out for the IT tender winner expected to be selected within a few weeks.

“They will have to open the whole process of implementation of public procurement. It means that they will have to provide access to the documents and reports and all the processes that are connected.”

And while this is a fairly modest beginning, there are hopes that integrity pacts will have a much wider role in the Czech Republic in the future and a visible impact on cutting the final cost of many major infrastructure projects.

Photo: European Commission

“We really do believe that if this project is successful – and we hope it will be successful – that this tool will be used more widely, not just in EU funds but also in public procurement because the experience from other countries shows that it does not only help to decrease the cost but also helps to increase the trust of the public in the procurement process. In many countries public procurement seems to be something that is not transparent so we hope that this tool will be used for public procurement, not for each and every one but maybe in big public procurement cases.”

Public contracts represent around 17 percent of total Czech national spending, one of the highest proportions in Europe, so wider use of integrity pacts would have an impact. Whether there is enough cost-effective know-how and expertise to allow a wider roll-out is a question that still must be answered.