The Federal Government’s development of the National Anti-Corruption Plan (Plan) is occurring at a time when Australia’s implementation and compliance with the United Nations Convention against Corruption, and the OECD’s Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (OECD Convention), have both been reviewed (reported in June and October 2012 respectively).
The development of the Plan was committed to in 2011 and the public consultation and submission process continued well into 2012. The key objective of the Plan is to strengthen Australia’s existing governance arrangements by developing a ‘whole of government’ approach to anticorruption. A discussion paper released as part of the consultation process outlined the Commonwealth’s current multi-agency approach to corruption and the interaction between the different levels of government in this area. The goal is one of ensuring a coordinated approach to anti-corruption in the future.
As we await the release of the Plan by the Attorney-General’s Department, it is an ideal time for federal government agencies to consider the review of their current policies and processes which deal with the prevention of corruption. It is envisaged that the Plan is likely to require ongoing consultation in relation to the effectiveness of anti-corruption measures. One area that has particular importance is government procurement. It is an area in which corruption risks are higher. In the current climate and with the anticipated release of the Plan, departments and agencies should consider taking a proactive approach to reviewing their anti-bribery arrangements.
Commonwealth Procurement Rules
The 2012 Commonwealth Procurement Rules (CPRs) came into effect on 1 July 2012. All departments and agencies that are subject to the Financial Management and Accountability Act 1997 (Cth) (and relevant Commonwealth Authorities and Companies Act 1997 (Cth) bodies) are required to comply with these CPRs.
The CPRs assist departments and agencies to design transparent and robust processes in the area of Australian government procurement by combining good practice with Australia’s international obligations. The CPRs set down and articulate the mandatory requirements for officials performing duties in relation to procurement and the additional rules that exist at or above the relevant procurement threshold.
Procurement is highly vulnerable to corruption, collusion, fraud and manipulation, especially if the goods and/or services being procured are being obtained from countries that are considered to be high-risk for corruption purposes. Unless departments and agencies are frequent users of procurement processes, there is also the possibility that a lack of training and familiarity with procurement policies and processes may also lead to a higher risk of corruption. The fact that there are often confidentiality issues associated with government work also increases the lack of transparency and possibility for corrupt practices to taint procurement policies and processes.
The release of the Plan and its recommendations will almost certainly require departments and agencies to consider their current procurement policies and processes and how these align with developments in regimes around the world. This is especially so given the context of the broader awareness of the need to increase anti-corruption efforts around the globe, partly as a consequence of the UK’s Bribery Act and the enforcement activity under the US’s Foreign Corrupt Practices Act, each of which have set standards for many other domestic anti-corruption regimes to follow.
In October 2012, the OECD released a report on Australia’s implementation of the OECD Convention in Australia. The Report has criticised Australia’s enforcement of foreign bribery laws and extensive failures in Australia in the handling of reporting of corruption and dealing with cases.
In relation to public procurement, the Report observes the decentralised procurement regime in Australia where the Chief Executive of each agency has a duty to oversee procurement decisions. It notes the concern that in the absence of government-wide guidelines, individual departments and agencies may overlook instances of corruption through the manner in which they exercise their discretion to debar from procurement processes those companies that have been involved in domestic or foreign bribery.
It is recommended that all departments and agencies review their current approach and policies relating to procurement and consider whether they adequately address the risk of corruption.