The First Steps to Corruption-Free Procurement

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National Key Results Areas (NKRA) are the building blocks of Malaysia’s transformation, and have become something of a focus for the government as it strives towards making the country a high-income nation by 2020.

The plans – known as the Government Transformation Programme (GTP) – are rigorous and have highlighted numerous NKRA to be targeted by a whole range of corporations and teams to ensure that Malaysia makes its mark as a developed nation in the next seven years.

Despite only being just three years into the 10-year programme, the GTP has already had cause to celebrate key successes, and phase one of the process has seen important improvements and alterations made to the very infrastructure of the country.

One of the areas of focus is Government Procurement, and various issues will be addressed to improve the practice of government procurement, with a key aim being to reduce leakage in the funds allocated for national development and operations, and ensure that contracts are awarded in a fair manner.

One of the highlighted issues was the fact that highly influential individuals could circumvent the official processes, while weak benchmarking resulted in a price escalation that was not beneficial. To tackle these problems, a Parameter of Support Letter will be circulated to all civil servants to help them deal with any undue influences in their decisions, while other initiatives to be put in place include tightening the price negotiation process and developing a database for price referencing to improve market knowledge.

Another area that proves problematic is capability and compliance – there is often poor contract management due to lack of skills or lack of manpower, which allows for fraud and influence in the procurement process. To target this troublesome area, training programmes will be put in place and mini Standard and Cost Committees established in each ministry to ensure that the proper planning and practices are being implemented.

Thirdly, an area of issue is that of transparency; the perception of fairness within the procurement process is decidedly negative due to lack of information dissemination. To counter this problem, a Virtual Procurement One Stop resource will be established as a means of publishing and recording the planned and achieved procurements, and confidence will be boosted by a pact between government servants and vendors/suppliers that allowed for trust in the system and improved transparency of the various transactions.

While these plans are on-going, there have already been major achievements during phase one, most notably the introduction of the MY Procurement portal. This online resource, launched in April 2011, will serve as a centralised database for government procurement by ministries and agencies. This site displays the details of transactions, the names of companies awarded tenders, and the price of these tenders, increasing transparency in the procurement system and thus boosting confidence in the process.

Another achievement of the first phase was the implementation of the Integrity Pact into government projects, which required all parties involved to formally agree to work together with integrity to minimise the opportunity for corrupt practices.

To tackle the issue of overspending, phases one saw a market survey carried out to further research the issue, producing results that can be used in later phases for talking the problems.

Promoted

While these achievements deserve to be cherished and have served to improve the transparency of government procurement – not to mention reducing costs by minimising leakage of fund – there are still many plans in place as the GTP enters phase two.

The next steps in tackling and improving the procurement processes will include expanding and enhancing MY Procurement portal by incorporating related portals such as NETI, ePerunding, and ePerolehan. There will also be a move to take the Integrity Pact further by implementing in to Public Private Partnership projects in addition to government projects. There will be wide spread circulation of guidelines to assist with the registration and handling of middle men/lobbyists/agents to smooth and improve the process. Finally, there will be a push to ensure a tabling of an Audit General Performance Report at every Parliament session, with any outstanding issues from the report being publicly available via an online dashboard.

While there is more work ahead, it is clear there is already much to be celebrated as the GTP enters phase two of its process. Not only do these changes improve public perception and restore confidence, they will also serve to encourage more companies to do business in Malaysia and improve the economy by minimising the leaking of funds within the procurement system.

That said, changes and improvements continue to be made and the process continues to be refined as the country powers onwards to its 2020 visions.

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Source: The Expat July 2013
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