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Contracts between public and private sectors operate with a ‘trust deficit’

Date

04 Dec 2020

Sections

InfoSociety

ACCA’s global survey about public procurement reveals respondents across Europe want government policies that ensure transparency to the public and that promote ethical practices

Governments around the world have faced challenges with public procurement due to the COVID-19 crisis, testing their ability and capacity to react quickly and efficiently to deliver life-saving goods and services to the public, asserts a new research report from ACCA (the Association of Chartered Accountants) New Models of Public Procurement: A Tool For Sustainable Recovery.

Surveying over 1,000 ACCA members and affiliates from both the public and private sector in over 90 markets including Europe, ACCA’s research identifies a trust deficit between public sector buyers and private sector suppliers. Globally, only 41 per cent of private sector respondents believe the public sector can be trusted to uphold its side of the deal, compared with 60 per cent of public sector respondents stating they trust their private sector counterparts.

This distrust has been exacerbated by the ‘need for speed’ approach during COVID-19, which has created opportunities for misuse and mismanagement of public sector money. Calling for modernisation of the system, the report also says that to tackle bribery and corruption, audits should be commonplace in all public procurement procedures, beginning as early as possible in the bid process to reduce the likelihood of corruption, while ensuring that the auditors remain independent during the process.

According to the 287 respondents across Western, Central and Eastern Europe 64 per cent considered that the quality of public services in their country was good or very good and just seven per cent thought it was poor or very poor – the lowest amount in the global research. In comparison, 35 per cent thought it was poor or very poor in South Asia, and 39 per cent thought it was poor or very poor in Africa.

When asked about the main challenges currently facing public procurement in their country, respondents across Europe said:

  • Excessive reliance on a few key suppliers (52 per cent)
  • Insufficient commercial skills in the public sector (43 per cent)
  • Below cost bidding by potential suppliers (29 per cent)
  • And just a fifth said bribery and corruption.

Rachel Bleetman, ACCA’s Public Sector Policy and Research Manager, and co-author of the report says: ‘There’s a growing need to ensure that public spending during and beyond the COVID-19 pandemic is not only made more efficient and cost-effective, but that it’s used as an opportunity to tackle some of the biggest challenges of our time - environmental catastrophe, rising social inequalities, ending corruption and meeting the needs for life-saving procurement.’

Alex Metcalfe, ACCA’s Head of Public Sector and report co-author adds: ‘Corruption costs the public sector significant sums of money every year and can create feelings of mistrust towards governments. So the role for finance professionals in helping to make, monitor and evaluate these changes is significant and, as this report demonstrates, the global finance profession is needed now more than ever to help transform how the public sector responds to the crisis.’

Other findings for European respondents reveal they want the following policy objectives to be considered in the evaluation of bids for public procurement include:

  • Transparency to the public (69 per cent)
  • Fair dealing with all bidders and suppliers (66 per cent)
  • Improving environmental sustainability (54 per cent)
  • Promoting ethical practices (53 per cent)
  • Respondents also said that to support the post COVID-19 recovery, governments should implement procurement strategies that increase engagement with SMEs in the procurement process (58 per cent) , alongside taking a more innovative approaches to public service delivery (55 per cent); increasing transparency in the bid selection process (46 per cent) and offering better digital solutions to cover the whole procurement cycle (44 per cent).

Rachel Bleetman concludes: ‘There’s room for optimism here as the reforms we recommend around eliminating bribery and corruption, competition and the buyer–supplier relationship, modernisation and COVID-19 and the public procurement ‘need for speed’ will all make for stronger public procurement, which is an essential part of public sector spending that, until now, has received relatively little attention. Now’s the time for change, as history has long taught us that, out of crises, new opportunities can emerge.’

- ends -

For media enquiries, contact: Cecile Bonino-Liti, head of EU Affairs

E: cecile.bonino-liti@accaglobal.com; M: +32 (0) 493 29 17 66 @ACCAViews

·       The report can be downloaded here https://www.accaglobal.com/gb/en/professional-insights/pro-accountants-the-future/New_models_public_procurement.html

·       The report was launched at ACCA’s annual Virtual Public Sector Conference on the 4 December 2020 https://www.accaglobal.com/ca/en/member/discover/events/uk/2020/12/Virtual-ACCA-Public-Sector-Conference-2020.html

Notes to editors

About ACCA: ACCA is the Association of Chartered Certified Accountants. We’re a thriving global community of 227,000 members and 544,000 future members based in 176 countries and regions that upholds the highest professional and ethical values.

We believe that accountancy is a cornerstone profession of society that supports both public and private sectors. That’s why we’re committed to the development of a strong global accountancy profession and the many benefits that this brings to society and individuals.

Since 1904 being a force for public good has been embedded in our purpose. And because we’re a not-for-profit organisation, we build a sustainable global profession by re-investing our surplus to deliver member value and develop the profession for the next generation.

Through our world leading ACCA Qualification, we offer everyone everywhere the opportunity to experience a rewarding career in accountancy, finance and management. And using our respected research, we lead the profession by answering today’s questions and preparing us for tomorrow. Find out more about us at accaglobal.com

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