1 / 7

Preventing Corruption in Construction Projects: The experience of the Integrity Pact

Preventing Corruption in Construction Projects: The experience of the Integrity Pact Michael H. Wiehen 1 November 2008. The TI Integrity Pact (IP) Mutual commitment/pledge by principal and bidders to refrain from all acts of bribery (and by winning bidder, "throughout execution phase")

brynn-landry
Download Presentation

Preventing Corruption in Construction Projects: The experience of the Integrity Pact

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Preventing Corruption in Construction Projects: The experience of the Integrity Pact Michael H. Wiehen 1 November 2008

  2. The TI Integrity Pact (IP) • Mutual commitment/pledge by principal and bidders to refrain from all acts of bribery (and by winning bidder, "throughout execution phase") • Commitment by bidders to disclose all payments to third parties • Sanctions for violators (bidders and staff of principal) • Loss of Contract • Loss of bid or performance bond • Liability for Damages (to principal and competitors) • Debarment • Civil, criminal, administrative sanctions for staff • Arbitration • Monitoring by Civil Society (external expert monitor)

  3. Through Monitoring, Civil Society plays a key role in holding government and bidders to task • Monitor must have full access to all documents and parties • Advantage of IP: • Bidders can refrain from paying bribes in the knowledge that their competitors are covered by the same pledge – a controlled environment • Demand: • Normally government departments impose the IP; • but companies, about to bid for a major government contract, can also approach the principal and demand the use of an Integrity Pact

  4. Track Record of the IP: • Several hundred IPs in place, globally • Feedback generally very positive • Compliance rate high • Significant savings in numerous cases (10-60%) • Sanctions applied (debarment – Italy) • Bidders usually quickly convinced of benefits • Critical importance of Monitor (prevention and repression aspects)

  5. Selected Examples of Integrity Pacts: • Germany - Berlin International Airport - All contracts • Initiative: Airport Company (history of corruption) • IP mandatory • IP covers Bidding and Execution phases • Monitor: independent external expert, selected and supervised by TI-G • M has access to all documents (of Principal and bidders) and all meetings, can meet bidders • M monitors content and process • In case of suspicion: M seeks correction from (i) Management (ii) Board Chair (iii) Publ.Prosecutor • To date, 37 major contracts awarded, no problems • Bidders raised no complaints • No evidence of cost savings yet

  6. Mexico - El Cajon Hydroelectric Dam (largest ever in M.) • Unilateral Integrity Declarations by Principal and Bidders, submitted to TI-Mex • Monitoring of bidding/contracting process only • by Social Witness (independent and technically competent expert) - appointed by TI-Mex and representing TI-Mex • TI-Mex itself maintained contact with bidders and monitored bid evaluation (bidders: “highest risk“) • Social Witness published final assessment report • Result: Winning bid 8% below estimate • Result: Government decided to apply IP, appoint Social Witnesses for additional projects (La Yesca) • PowerCy modified its procurement processes and experiences more competition and lower prices

  7. Proven Impact of Integrity Pact- reduced investment costs- better quality construction- longer lasting infrastructure- encouraging competitive bids- increased confidence of bidders- increased trust of citizens in public administration and in NGOs

More Related