Ethical procurement practices urgently needed

Julie Haggie
TINZ CEO

Julie Haggie

CEO, TINZ

Transparency International New Zealand (TINZ) recently provided two submissions on the MBIE Procurement Rules 4th Edition, and a proposed Code of Conduct for Suppliers.

Expert submission team

TINZ actively participates in submissions and advocacy because we strongly support civil society engagement in the setting of public policy. On the topic of procurement, TINZ expertise to provide highly informed advice.

The TINZ team for these procurement submissions comprised Tod Cooper (leader), Brendon Wilson, Suzanne Snively and Julie Haggie.  Tod Cooper is the National Chair of the Chartered Institute of Procurement and Supply, and a member of the Procurement Excellence Forum. 

Effectiveness of intentions  

In both submissions, TINZ recognised MBIE’s aim to strengthen ethical practice in procurement supply chains.  On the positive side, MBIE’s proposed changes reinforce the importance of open, transparent, and competitive government.

Promises of ethical behaviour are all well intended within the rule changes and the code of conduct. But evidence shows that intended behaviour must sit within a strong structure of accountability for effective accountability and oversight. 

Tod Cooper: 
Member with delegated authority for
Procurement/ Online Training/ Whistleblowing

Salient gaps

TINZ made a number of suggestions about how MBIE’s procurement documentation can be strengthened.  Overall we ask MBIE to set higher expectations.  Some salient gaps are:

  • Procurement relationships with organisations from countries with systemic issues of corruption, should be subject to additional vetting
  • All public sector procurement should have a ‘procurement plan’ developed and agreed prior to any expenditure. Such a plan needs to be relevant in terms of content and complexity commensurate with the value and risk of the procurement activity
  • The Code does not address the Treaty of Waitangi.  Since the Crown must act consistently with Treaty Principles, this requirement should also apply to any supply chain that has a base of public funding.
  • There needs to be more focus on the visibility of upstream suppliers within a supply chain activity, ensuring the government is not actively supporting terrorism, modern slavery or other forms of exploitation
  • The Rules are silent around the process and protection for whistleblowers
  • More detail is needed around consequences or a breach of conflict of interest or confidentiality. 

Mutual responsibility 

TINZ also recommends mutual responsibility for the Procurement Code involving ongoing processes and reviews between the parties. This would allow for full disclosure and remediation of lapses or changing risks. It would also enable parties to agree on the best response to each occurrence.

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