There could have been a chance for public procurements to become cleaner, but the current bill is not making significant steps to improve the situation. Transparency International examined the proposed bill about the amendment to the Public Procurement Act. The organization’s recently published study, entitled “Corruption risks in public procurement” (available here in Hungarian) deals with regulation problems extensively.

An amendment has been made to Act CVIII of 2011 (the Public Procurement Act, PPA) – but probably this won’t be of any help to us, Hungarian citizens. Transparency International Hungary (TI) examined how the Parliament would amend the Public Procurement Act, as parliamentary sessions dealt with the bill last week. Indeed, there would be a need for a well-thought-out and overarching improvement.

Caveats in the actual regulations and lack of public consultation concerning the amendment

When it comes to public procurement procedures in Hungary, neither efficient monitoring, nor effective revision is guaranteed. Hence, according to research results, 65-75% of public procurement procedures are corrupt. Such a systematic, regular corruption increases the costs of procurements by 25%. This is one of the reasons why it is unacceptable that the ministry issuing the bill has provided merely 2 days (out of which one fell on a holiday: the 1st of May) to review the PPA and other procurement-related legislations. That is, no chance was left for in-merit consultation. Subsequently, the bill was introduced on the 10th of May.

What does the bill not touch upon?

TI thinks that the bill does not even help to decrease corruption related to public procurement. Conflict of interest rules have not become more objective, fulfillment of contracts is not monitored any more efficiently. Electronic public procurement procedures are not any closer to being introduced – although this would be a highly effective tool to curb corruption – and the relationship between the Public Procurement Authority and the Public Procurement Arbitration Board has not been thought over. Those who want to know what their money is spent on will not have an easier time either. This may be the principal problem.

The first step in decreasing corruption: assuring publicity

It would help cleaning the procurement market if publicity requirements of the PPA would be respected and enforced at least by the Public Procurement Authority. Not just actors of the procurement market, but every single citizen has the right to access public data related to procurements. If these could be assessed by all those who are interested through a searchable databasecontaining reliable data, we could already say that serious steps were taken against public procurement fraud.

The bill links deadlines to the contracting authority’s obligation to make data public, but if somebody does not respect these deadlines, there is absolutely no consequence: no sanctions have been introduced by the bill. Similarly as if it was forbidden to travel on the bus without a ticket, but those who do it would not have to suffer any consequences.

More on the bill about the amendment of the Public Procurement Act can be read here in Hungarian.

TI’s study entitled “Corruption threats in public procurement” draws attention to further concerns, offering solutions as well. Regulating or changing the regulations pertaining to these issues would be a crucial step in curbing corruption-related to public procurement.