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Anti-Corruption technology in eProcurement

A number of recent reports have highlighted higher-than-expected levels of fraud, corruption and collusion in procurement activity within the EU and specifically in the UK.   A European Commission Anti Corruption Report found that, across the EU, 43% of firms believed that corruption is a problem when doing business generally. In the UK, 15% of firms highlighted the same issue.   64% think UK corrupton is widespread   The BBC website reported that corruption costs the EU economy 120bn Euros annually. 64% of UK respondents think that corruption is “widespread” in the UK with EU average being as high as 74%.   Since public procurement represents approximately 20% of the EU’s total spending, removing corruption presents a significant opportunity for reducing costs in a time of limited resources. With corruption generally more prevalent at local and regional levels, it seems clear that a action is needed to make procurement processes more transparent. It seems clear that anti corruption technology can deliver real benefits.   eProcurement itself creates a more formal and reliable audit trail for the process of issuing, clarifying, evaluating and awarding tenders. However, eProcurement platforms can do even more to help the battle against collusion and corruption through the use of anti corruption technology.   Some systems simply offer a document-based model where tender documents are distributed and collected. A data-centric eProcurement system offers a granular view of every element of the tender, who has contributed to or accessed the information. It also offers much greater insight into the procurement process so that patterns can be spotted and analysed. Who submitted what, at what price and when. From : http://www.nextenders.co.uk/anti-corruption-technology/

Going after the Small Guy

Why go after the small guy who asks for paltry sums? This is the question one is asked when one speaks about retail corruption in India. Though retail corruption in India is huge and has angered many Indians, after the ‘corruption event’ is over and forgotten, a certain sympathy crops up for the ‘small’ guy who asks for small sums.   The sympathy is certainly misplaced given the amount of retail corruption in the country. Maybe it is also because of the perception that while there is wholesale loot going on in the country, chasing the small guy is not seen as an in-thing.   The truth is that the small guy is the weakest link in the chain. The bribe chain which begins with him extends upwards. One can rant and rave about coal scam, 2G scam and about gas pricing but if there is so much of loot going on for so long, how is that the loot is going on without a word being uttered. Many government contracts are manipulated from the word GO. From the technical bid to the financial bid to the cartelisation of various vendors to the final awarding of the contract, it is a seamless operation. This is more brazen when it comes to the distribution of natural resources, as the Governments neither have the wherewithal to monitor the same nor does it have requisite experience in handling such issues.   But the silence over the big guy and his big contract depends on the amounts earned by the small guy. The petty bureaucrat and the peon is the key to the culture of silence in the Government.   It was while following up on a story on the liquor industry in Chennai that I stumbled upon a peculiar arrangement that the industry had with the state government of the day. The state government limited the number of liquor players in the state and the politicians and the key bureaucrats were paid off for restricting competition.   One would think that such an anti-competitive measure would have a lot of questions raised in courts and in the media. There was no word at all in the media and not much of a legal hassle. How could something happening in such a ‘cash rich’ industry, which is the cynosure of all eyes, get away with such murder in broad daylight?   It can happen and it happened because there was no one to squeal. No one to break the culture of silence. No one to play whistleblower. Why could not employees, or trade unions in the sector raise the issue of such an unfair business practice, one wonders?   It is because that the spoils of power are shared and the small guy is amongst the beneficiaries. The Indian government system is unique in the way it distributes the spoils of power. While those higher in the food chain get the choicest of menus, those lower also have their share of the cake.   Their share of the cake emerges when big people in the government look away when complaints are registered against the small guy. And mind you, if you get the government to act upon your complaint on the small guy, all hell will break loose.   The culture of silence will be broken and the brotherhood of the corrupt will cease to exist as we have broken their camaraderie and their mutual give and take.   This is the only way to fight the corruption in the system. The small guy is the weakest link in the system, and when we get him, he starts having a lesser stake in the system and it is only time that he starts spilling the beans. He is the one who knows the system and who knows about what all is taking place. He is silent because he gets a few peanuts and when these are denied to him, he will speak out.   Let us hit out at the weakest link in the chain.   By K V Venkatesh on IPaidABribe.com http://www.ipaidabribe.com/comment-pieces/why-do-we-need-go-after-small-guy

A case for lobbying in India

Lobbying is arguably one of the most controversial activities in modern democracies. Lobbyists provide governments with valuable policy-related information and expertise but if the activity is not transparent, public interest may be put at risk in favour of specific interests. India currently does not have a law to regulate lobbying. But recent corruption scandals involving lobbying by big businesses have increased public pressure for a law to regulate the activity.

Lobbying for Parliament

Should lobbying be treated as a legitimate activity in a representative democracy? It is worth noting that no country in the world, including India, has banned lobbying. In fact, only a few countries even regulate the activity, prominent among these are the US, Canada, Australia, Germany and Taiwan. These countries treat lobbying as a legitimate right of citizens. Regulations serve as a tool to enhance transparency in the policymaking process rather than restricting access to policymakers. In fact, that is one of the key reasons why the UK regulates the lobbied rather than lobbying. Therefore, the thrust of the Indian law should be to incentivize lobbyists to identify themselves and ensure that competing groups have reasonably equal access to policymakers.

The effectiveness of the law largely depends on how it defines lobbying and lobbyists. Countries such as the US, Australia and Canada define lobbying as any communication with a legislator or a bureaucrat to influence decisions on a policy matter. However, the law generally exempts communication with parliamentary committees and responses to requests made by the government from specific individuals or groups.

In India, there is some confusion among policymakers about what constitutes lobbying. For example, during the furore over Wal-Mart’s disclosure of lobbying activities in India, Bharatiya Janata Party (BJP) leader Ravi Shankar Prasad denounced lobbying as nothing but a euphemism for bribery. In contrast, a private member’s Bill to regulate lobbying was recently introduced in the Lok Sabha by Kalikesh Narayan Singh Deo, which defined the term as “an act of communication with and payment to a public servant with the aim of influencing” legislation or securing a government contract. The Bill required lobbyists to register with an authority and declare certain information.

However, a lobbying law should not legitimize bribery or corrupt practices since it prioritizes private gain over public interest. Lobbying should be defined to include only those activities that further the ideals of participative democracy.

In countries such as the US, Australia, Canada and Poland only professional lobbyists are regulated. Taiwan, however, includes both individuals who lobby on their own behalf and professional lobbyists.

In the Indian public consciousness, lobbyists are viewed as representatives of big businesses who indulge in corrupt practices to push their agenda. However, there are a large number of advocacy groups who campaigns for policy reforms. One of the most successful campaigns was run by the Mazdoor Kisan Shakti Sangathan (MKSS)—a coalition of non-governmental organizations—for the Right to Information Act. Women’s organizations have campaigned for women-friendly laws such as the Protection of Women from Domestic Violence Act, 2005. More recently, Anna Hazare led a popular campaign for the establishment of an anti-corruption body called the Lokpal.

The influence of these groups lies in the public support they command. Therefore, there is merit in including both commercial and advocacy groups in the definition of lobbyists so that neither have undue advantage in influencing policymakers nor is there a restriction to access for any group.

Most countries require lobbyists to register with an authority and disclose information about their clients and the methods they employ to lobby. For example, in the US, lobbyists are required to make quarterly disclosures of their expenses. In Germany, law makers are required to disclose their communications with lobbyists. Countries also levy different penalties for contravention of the law. In Australia and Slovenia, a lobbyist may be prohibited from engaging with policymakers if he violates the law. In the US and Canada, a defaulting lobbyist may be fined or imprisoned. India needs to determine a regulatory model that suits its socio-political needs. Furthermore, it should tread a fine line while drafting the disclosure requirements. Too high disclosure requirements could drive lobbyists underground while too low penalties may not act as sufficient deterrent for law-breakers. It may be noted that the Right to Information Act, 2005, also stresses on voluntary disclosures by public authorities. If public authorities pro-actively disclose information, it can complement the disclosure requirements under a lobbying law. Although lobbying by various interest and advocacy groups is widespread in India, the public mostly remains unaware of it unless a scandal breaks. A law to regulate lobbying could pave the way for transparency in the policymaking process. Disclosures of expenses incurred by lobbyists and financial accounts of law makers are likely to force interest groups to engage in the legislative process through legitimate means. Universal access to information on expenses and details of communications with policymakers would give impetus to more debates in the public domain. A shift to lobbying as a means of engaging with the legislative process would further the ideals of a participative democracy.

Kaushiki Sanyal and Harsimran Kalra are, respectively, senior analyst in the Bharti Institute of Public Policy at the Indian School of Business and a public policy scholar at The Hindu Centre for Politics and Public Policy.

From the Mint Archives (2013) http://www.livemint.com/Opinion/DWZTZTfYOScT8inQuPCHAO/A-case-for-lobbying-in-India.html