Corruption in aid procurement

Corruption in aid procurement

I write in response to Donna Woodward's article in The Jakarta
Post of Jan. 16, 2002 titled Bring the war home: Combating
corruption. I agree wholeheartedly with what she says, especially
that the most serious corruption is at the highest levels of the
bureaucracy.

In my article in the Post of Nov. 29, 2001, I pointed out that
millions of dollars had been lost to corruption in aid
procurement contracts, often because the design of the contract
selection panels was not sound. If a panel includes all or a
majority of members from one ministry, those people usually act
together in collusion, which is totally invisible. The result is
that contracts go to those who guarantee pay-offs to the panel
members or their "owners".

I suggest that panels should not be "inbred" from the
responsible ministry -- they should have a majority of outsiders
on them. Panels/procurement processes could be outsourced and
closely regulated, including the last-minute substitution of
members. Whereas Ms. Woodward's "good management solution" will
take time to have an impact on corruption, this change could have
immediate effect.

The government is now embarking on another major project
similar to the Social Security Network (JPS) project for the
poor. Let us hope they can avoid the procurement fiascos of the
old JPS program by implementing revised procurement procedures
for contract awards (as suggested herein).

This will be vital to the government's credibility, given the
obviously noble intentions of the President when she spoke about
addressing corruption.

ROBERT J. COCHRANE CPA

Development Assistance Consultant

UniSadhuGuna Group

Jakarta