Gabriel Sípos, Samuel Spác and Martin Kollárik of Transparency International Slovakia have just published an important and useful evaluation of that country’s contract publication regime. The evaluation suggests proactive contract publication can be a popular, cheap, and effective tool for improving competition in government procurement.
Since 2011, Slovakia has proactively published the full text of most contracts online. Between 2011 and 2014, central authorities published more than 780,000 contracts and municipalities published over a million more. It is an experience highlighted in the CGD Working Group report on publishing contracts — and Gabriel was a member of the Group. But the new Transparency International report brings a great deal of new information and detail on the costs and benefits of contract publication in Slovakia as well as ways to increase its impact.
The costs of publication were low: the central contracts registry was created for 20,000 euros, and even at the municipality level, the administrative burden of uploading contracts is apparently limited. Some surveyed officials suggested that a proactive and automated system was less time-consuming than responding to ad hoc Freedom of Information requests for contracts under the old system.
The contract transparency initiative was also widely supported and widely used: it was backed by a number of business associations including the US Chamber of Commerce in Slovakia. More than one in ten of Slovak adults — 480,000 people — say they have checked at least one public contract or receipt online since 2011, and the main contract registries get around 46,000 visits a month from citizens. And mainstream media discussion of procurement have climbed from 1,398 mentions between 2007-2010 to 1,765 between 2011-2014.
Gabriel and his colleagues also suggest there has been a real impact on the quality of procurement from the transparency initiative: In 2010 over one-half of all government tenders received a single bid; this fell to one-third by 2014, and the average number of bidders on tenders rose from 1.6 to 3.7 firms over the same period. Restricted contest and direct purchase tenders have become considerably less common, dropping from 21 percent of all tenders in 2010 to less than 4 percent in 2014.
And the report provides some examples where waste, fraud, and abuse has come to light with the help of contract publication such as CT scanners brought at double the normal price from a shell company connected to a high-ranking politician and contracts for expensive seafood, cognac, and luxury cars cancelled after they were published and picked up by the media.
It isn’t all positive: exceptions to publication have mushroomed to include many state-owned enterprise contracts, land expropriation, and coin minting among others. Of almost 1,100 state-owned enterprise and municipality contracts surveyed by TI, almost one-fifth were not published in their entirety — often with missing appendices. One-third of surveyed contracts were not published in a machine readable format, and some contracts disappear or are changed without notice.
The TI team has recommendations for making the system work better: a single site housing all contracts in machine-readable form with better metadata including unit prices and links to related procurement information; publication as a condition of contract validity; and an oversight regime. Despite these challenges, Slovakia stands as a model for other countries that have less complete proactive government contract publication systems (like the United Kingdom) or none at all (like the United States).