Integrity in Public Procurement

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Permanent URL: www.oecd.org/gov/ethics/procurement

Public procurement is a key policy instrument. In ordinary times it accounts for 16% of GDP, on average, in OECD member countries. It is a versatile mechanism that can also be used to pursue additional policy aims such as environment, innovation or social goals.

However, public procurement is the government activity most vulnerable to waste, fraud and corruption due to its complexity, the size of the financial flows it generates and the close interaction between the public and the private sectors.

Integrity in procurement has received particular attention in the current crisis: billions of dollars in stimulus funds and accelerated procurement procedures raise additional risks. A strong and clean recovery needs to proactively promote a level playing field and fair competition in contracting by public sector organisations.

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The OECD approach aims to enhance integrity in public procurement by mapping risks throughout the entire procurement cycle. It takes a holistic view of the public procurement cycle: from needs assessment, bid evaluation and contract award, as well as contract management and payment.

The OECD has developed a set of Principles for Enhancing Integrity in Public Procurement. The Principles were approved as a Recommendation by the highest body of the OECD, the Council, in October 2008. OECD Recommendations reflect a consensus by member countries as good practice.

The OECD supports and measures progress the implementation of the Principles through a Toolbox of existing public procurement tools used in member and non-member countries, Public Procurement Reviews and analyses of public procurement.

In 2011, all OECD member countries will report back to the Council on progress made in implementing the Principles. It will include the use of public procurement to achieve secondary policy aims (e.g. environment, social and innovation).

For more information also see:

• OECD Principles for Integrity in Public Procurement (2009)
• Policy Brief - Keeping Government Contracts Clean (2008)
• Integrity in Public Procurement: Good Practice from A to Z (2007)
• Bribery in Public Procurement: Methods, Actors and Counter-measures (2007)
• Fighting Corruption and Promoting Integrity in Public Procurement (2005)

To help countries implement the Principles for Integrity in Public Procurement, the OECD has developed a compilation of existing tools used in member and non-member countries. These aim to support public officials in designing and developing guidance and procedures at various points in the procurement cycle.

It also includes tools to ensure integrity in accelerated procurement procedures, a key concern related to the implementation of the current fiscal stimulus programmes.

The Toolbox is currently undergoing a consultation process with a broad group of key stakeholders from both OECD member and non-member countries. They include the national and sub-national governments, the business community, trade unions and civil society organisations.

Once the consultation is finished in early 2010, the Toolbox will be uploaded and regularly updated on this website. Readers are invited to send tools which have proven to be effective in their organisations to the OECD integrity unit at gov.integrity@oecd.org.

Other related documents:

• Integrity in Public Procurement: Good Practice from A to Z (2007)
• Guidelines for Fighting Bid Rigging (2008)

Public Procurement Reviews conducted by the OECD Secretariat help policy makers improve policies, adopt good practices and implement established principles and standards. It entails a comparison with practices and lessons learned in OECD and non-OECD member countries.

Recent and forthcoming publications which presents findings of OECD Public Procurement Reviews include:

• OECD Joint Learning Study on Morocco: Enhancing Integrity in Public Procurement (2008)
• OECD Joint Learning Study on Yemen: Enhancing Integrity in Public Procurement (ongoing, expected 2010)
• Improving Transparency within Government Procurement Procedures in Iraq: OECD Benchmark Report (available end of 2009)

The OECD produces analysis on public procurement and publishes thematic studies, comparative analysis and reports. Recent examples include:

Promoting the Use of Performance-Based Contacts between Water Utilities and Municipalities in Eastern Europe Caucasus and Central Asia (2009) provides five case studies of performance based contracts in the water sector (two in Armenia, one in Kazakhstan and two in Ukraine). Public-Private Partnerships: In Pursuit of Risk Sharing and Value for Money (2008) identifies possible good practices for the public sector to maximise the potential of partnerships and to ensure that they are used appropriately to maximum the public interest. OECD/SIGMA Central public procurement structures and capacity in member states of the European Union (2007) provides an analysis of the functions, structure, status within the government, and capacity of the central public procurement bodies of 22 European Union member states. It does not attempt to evaluate their respective advantages or disadvantages or to recommend particular institutional arrangements. Public procurement: The role of competition authorities in promoting competition (2007) comprises proceedings in the original languages of a Roundtable discussion on Public Procurement. The Role of Competition Authorities in Promoting Competition, held by the Competition Committee in June 2007.

OECD/SIGMA Public Procurement Review and Remedies Systems in the European Union (2007) provides a comparative analysis of the review and remedies systems of 24 European Union member states. It does not attempt to evaluate their respective advantages or disadvantages or to recommend particular institutional arrangements. Fighting Corruption and Promoting Integrity in Public Procurement (2005) captures the main points of the Global Forum: Fighting Corruption and Promoting Integrity in Public Procurement held in Paris in November 2004. It includes case studies from Europe, Asia and Latin America. The Environmental Performance of Public Procurement: Issues of Policy Coherence (2003) contains background reports on the assessment of greener public purchasing programmes, as well as their links with public expenditure management.

For more information about the OECD Principles for Enhancing Integrity in Public Procurement, the OECD Toolbox and OECD Public Procurement Reviews please contact the OECD Integrity Unit at gov.integrity@oecd.org.