Systemic corruption and public procurement in developing countries: are there any solutions?
| Pages | 131-147 |
| Published date | 04 June 2018 |
| DOI | https://doi.org/10.1108/JOPP-06-2018-009 |
| Date | 04 June 2018 |
| Author | Sope Williams-Elegbe |
| Subject Matter | Public policy & environmental management,Politics,Public adminstration & management,Government,Economics,Public finance/economics,Taxation/public revenue |
Systemic corruption and public
procurement in developing
countries: are there any solutions?
Sope Williams-Elegbe
Department of Mercantile Law, Faculty of Law, Stellenbosch University,
Stellenbosch, South Africa and African Public Procurement Unit, Stellenbosch,
South Africa
Abstract
Purpose –Corruption affectsdevelopment and quality of life of citizens in affected countries.The increase
in anti-corruption measures globally reflects a consensus that corruption is pervasive and costly. Public
procurement is one area in which corruption manifests because of the sums of money involved; the
asymmetry of information;and the bureaucratic nature of decision-making, which presents opportunitiesfor
abuse. In developing countries, procurement corruption is rife because of institutional weaknesses, lack of
enforcedaccountability mechanisms and culture of silencein relation to public sector malfeasance.
Design/methodology/approach –This paper examines procurement corruption in countries with
systemic corruption, using Nigeria as a case study, to determine how to reduce public procurement
corruption.
Findings –The paper will highlight prevalentcorrupt schemes in public procurement in Nigeria, examine
the reasons for the failureof state anti-corruption institutions and analyze the kinds of initiativesthat reduced
procurement corruption and increased accountability in other countries and the utility of adopting such
mechanismsin the Nigerian context.
Keywords Public procurement, Developing countries, Systemic corruption
Paper type Research paper
Introduction
There is little gainsaying the fact that corruption in Nigeria has reached epidemic
proportions (Smith, 2007, p. 113, Apampa, 2005). Corruption is systemic (or endemic)
“where bribery, on a large or small scale, is routine in dealings between the public sector
and firms or individuals. Where systemic corruption exists, formal and informal rules
are at odds with one another; bribery may be illegal but is understood by everyone to be
routine in transactions with the government. Another kind of equilibrium prevails, a
systemic corruption “trap”in which the incentives are strong for firms, individuals, and
officials to comply with and not fight the system”(World Bank, 1997). According to
Klitgaard, “a distinguishing characteristic of systemic corruption is that the many parts
of the government that are supposed to prevent corruption have themselves become
corrupted –budgeting, auditing, inspection, monitoring, evaluation, and enforcement”
(Klitgaard, 2004). This affects the efficacy of normal anti-corruption enforcement and
makes the anti-corruption task much more difficult (Klitgaard, 2004).
The systemic nature of corruption in Nigeria can be seen in the country’s consistently
low scores in the Corruption Perceptions Index (Table I) as well as the shocking results of
the 2013 Global Corruption Barometer, which tracks public opinion on corruption, and the
sheer number of corruption scandals and allegations reported during the past decade
Public
procurement in
developing
countries
131
Journalof Public Procurement
Vol.18 No. 2, 2018
pp. 131-147
© Emerald Publishing Limited
1535-0118
DOI 10.1108/JOPP-06-2018-009
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1535-0118.htm
(Okonjo-Iweala,2012, pp. 81-94). Although these do not give a completepicture, they provide
a snapshot of what the corruption landscape in Nigeria looks like. There is also a growing
body of academic and other literature, which traces the origins of corruption in Nigeria and
highlights, examines and decriesthe extent to which corruption manifests in Nigeria (Salisu,
2000;Oji and Oji, 2010;Smith,2007;Okonjo-Iweala, 2012;Rotberg, 2009;Smith, 2009).
As can be seen from Table I, there is no appreciable improvement in perceptions of
corruption in Nigeria in the highlighted period. Further, in 2013, the latest edition of the
Global Corruption Barometerreported that 72 per cent of Nigerians felt that corruption was
on the increase, with the view that the most corrupt institutions were political parties (94
per cent), police (92 per cent), legislature (73 per cent) and civil service (69 per cent). This
paints a wholly dismal picture of Nigerians’experience of and interaction with the
government and providesa clue as to the high level of public disillusionmentwith the public
sector and a feeling that there is little that ordinary citizens can do in the fight against
corruption (Global Corruption Barometer, 2013; Smith, 2009). The results of these surveys
are supported by the research by Persson et al., which revealedthat in developing countries
with systemic corruption, the problem of corruption seems to have become worse with
efforts to curb it (Persson et al., 2013). That certainly seems to be the case in Nigeria where
public sector corruption scandals in the past decade now involve no less than millions of
dollars or billionsof naira (Obuah, 2010)[1].
One of the main areas in which corruptionmanifests is in public procurement (Williams-
Elegbe, 2012, p. 25; Okonjo-Iweala, 2012,p.88;Suberu, 2009, p. 266; Ware et al.,2007;
Klitgaard, 1988;Rose-Ackerman,1999;Thai, 2005). In Nigeria, “access to and manipulation
of the government-spending process has become the gateway to fortune”(Salisu, 2000).
Thus, corruption in the public sector is hugely dependent on the manipulation of the
procurement framework and the public financial management system more generally.
Despite legislative intervention to curb the abuses in the public procurement system,
through the passage of the Public Procurement Act in 2007 (PPA),which mandates the use
of competitive processes in public procurement, criminalizes a wide range of procurement-
related offences and creates a procurement regulatory institution (Williams-Elegbe,2012a,
2012b) it is clear that public procurement in Nigeria continues to beplagued by corruption,
fraud and unethical practices.
It is important at this juncture to mentionthat despite an extensive (and comprehensive)
legal and institutionalframework against corruption in Nigeria (Bello, 2014;Okogbule,2006;
Mbago, Ntayi, and Muhwezi, 2016), very little progress has been made in the fight against
Table I.
Nigeria in the
Corruption
Perception
Index 2005-2015
Year Rank Score
2005 152/158 1.9/10
2006 142/163 2.2/10
2007 147/179 2.2/10
2008 121/180 2.7/10
2009 130/180 2.5/10
2010 134/178 2.4/10
2011 143/182 2.4/10
2012 139/174 27/100
2013 144/175 25/100
2014 136/174 27/100
2015 136/168 26/100
Source: Transparency International
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