TI Integrity Pact

1
TI Integrity Pact

• Preventing corruption
• in public procurement
• Good Practice Germany
• Airport Berlin
• City Hospital - Bremen
• Dr. K. Schubert, MPH
• Budapest 17.2.2014

2
TI Integrity Pact

• Public Procurement involves vast sums of money
• Investments by Federal, State and Municipalities
• Complexity and technical nature scare off public
  scrutiny
• Invites corruption ( authority and contractors)
• IP concept developed in 1995

3
TI Integrity Pact

• The Concept
• Contractual Agreement between Owner and
  Contractors to forego all forms of corruption
• External independent expert Monitor
• Help to governments and municipalities

4
TI Integrity Pact

• The Objective
• Make Bidders/Contractors refrain from corruption
• Help Authorities to avoid damage from corruption
• Restore public trust in government

5
TI Integrity Pact

• Structure of IP
• Pledge of Owner
• Pledge of Bidders/Contractors
• Sanctions
• Monitor (external independent expert)

6
TI Integrity Pact

• Pledge of the Owner/ Authority
• No employee will accept or demand presents or
  other advantages for performing official acts
• Equal information for all bidders
• No confidential information for some bidders
• Disclosure of all real/potential conflicts of
  interest
• Every suspicion of a criminal act will be
  investigated

7
TI Integrity Pact

• Pledge of Bidder/Contractor/Sub-Contractor
• Not to give or offer any gifts or other
  advantages
• No collusion with other bidders
• No acceptance of advantages for unprofessional
  behaviour
• Disclose any payments to agents or middlemen
• Consultants Assure real competition in selection
  of winner

8
TI Integrity Pact

• Sanctions
• Owner to apply internally
• Disciplinary, criminal, civil and labor law
  sanctions on own staff
• Bidder subject to
• Denial/Loss of Contract
• Forfeiture of bid bonds and similar securities
• Liability to pay damages
• Exclusion from future contracts

9
TI Integrity Pact

• Transparency of Process
• Broad transparency of all relevant decisions and
  process steps
• Evaluation of Bids
• Application of all selection criteria
• Protection only for real business secrets

10
TI Integrity Pact

• Five Integrity Pacts in Germany
• all accompanied by monitors
• 2005, 2009, 2010 (2x), 2011
• International Airport Berlin (BBI)
• 2005
• Financial volume about 5,1 Billion (2014)
• 1,7 Billion (2004)

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TI Integrity Pact - BBI

• Monitor
• Professor and consultant engineer
• External indipendent expert
• Full-time
• Office on the airport-area
• Continouosly involved in the process

12
TI Integrity Pact - BBI

• Monitor
• Scrutiny
• 100 (101) international contract placings - 2 Mio
  (100)
• 48 (466) national contract placings - 37 Mio
  (101 Mio )
• 35 modifications (1.800) - 68,2 Mio 200 Mio
• No corruption but mismanagement

13
Project structure Bremen

• Reconstruction of part of a clinical building
• Financial volume about 250 Mio
• Owner Gesundheit Nord gGmbH (federal gov.)
• Bremen 4 communal hospitals
• Biggest hospital in town
• Since 1850
• Reputation of the hospital
• Dirty money clinic Schwarzgeldklinik
• Previous corruption experience

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Situation in a City State

• Berlin, Hamburg, Bremen - City states
• Short ways
• Everybody knows everybody
• Indipendent of their political background
• Sleaze
• Mutuality
• Gateway for corruption
• Corruption in Public Procurement

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IP - Contact person

• Contact to the IP project
• Contact to the monitor
• Contact to the owner
• Contact to the regional group of TI
• Information mediated by the monitor
• Conferences / round table with the player
• Press releases (Bremen-Berlin)

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The Monitor I

• Independent, external Expert(s)
• Representative of Civil Society or professional
  Expert
• Selection Owner TI or public tender
• Unlimited access to all information and meetings
• If violations suspected first, discuss with
  Owner
• If no adequate correction Report to Public
  Prosecutor
• Paid by Owner

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The Monitor II (Bremen)

• Were chosen by TI
• Highly specialized lawyer
• Highly specialized engineer
• Scrutiny
• International and national contract placings
• Modifications
• No corruption but mismanagement

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Good Experience I

• Feed-back Owner company (GeNo)
• Security
• No Loss of money
• Aggreements be held
• Control of internal rules
• Experience of the Monitor
• Lawyer construction expert
• Appearance not announced
• Many useful preventive advices
• High preventive dimension

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Good Experience II

• Feed-back Construction company
• Transparent and fair competition
• No need of bribe
• No disadvantage between bidders
• Trustful cooperation
• Attractive Public Reputation
• Advantage in further competition
• Economical benefit
• Internal Control of public procurement

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• Thank you
• For
• Listening