Building a Cadre of Procurement Professionals

Government purchases of goods, services, and public works constitute anywhere from 15 percent to as much as 40 percent of total public spending, and thus any government committed to fighting corruption should make procurement a priority. Corruption sneaks into public procurement in many ways in the long and often complex chain of events in the process: from identifying a need to designing the specifications for meeting the need to the award of a contract and the delivery of the final product.  While stepping up procurement audits and investigations can weed procurement out of corruption, far better is to keep it from infecting the process in the first place.

For that a government needs a cadre of well-trained public procurement professionals dedicated to ensuring their country receives the best value for every dollar it spends building roads or acquiring high tech communications equipment or simply buying pencils and papers for schools. Procurement professionals must be knowledgeable about law, finance, engineering, project management, economics, and of course corruption, and while some of that learning can be picked up through intensive on-the-job training programs, building a first-rate, technically sophisticated cadre of procurement specialists takes more than putting those with a generalist degree through a few o-j-t courses.  It requires, as Francis Fukuyama explains in discussing how the public services of Japan, Germany, and the United Kingdom’s public services were built, university courses that teach prospective public servants basic analytic skills and tools, knowledge that simply cannot be mastered in a week or even several week intensive training course.

For the United Nations Office on Drugs and Crime I have been asked to suggest what a curriculum leading to an undergraduate degree in public procurement might look like.  In “Building Sustainable Capacity in Public Procurement,” Peter Trepte of Nottingham University’s Public Procurement Research Group explains that teaching public servants what the procurement law is and how to comply with it is not enough.  To conduct fair, effective, and efficient procurements requires an interdisciplinary course of study that trains students in how to identify procurement needs, plan procurement activities, assess market conditions, manage relations with bidders and contractors, and administer contracts.

Below is my effort to follow Professor Trepte’s advice.   Comments are most welcome.

 Suggested Public Procurement Degree Curriculum/Syllabi — First Draft Units
Title: Contract Law and Economics

Description: A basic course on contract law for non-lawyers that would cover offer and acceptance, modification, impossibility, performance, breach, and damages.  It should pay special attention to topics related to procurement: bid securities, performance guarantees, sureties, warranties of performance.  All presented from an economic perspective: principal agent, monitoring, residual control, efficient breach, reputation, repeat dealing, third-party monitoring, third-party beneficiary, performance measures and contract type

3
Title: Microeconomics

Description: Introductory course on microeconomics. The course should cover as how prices are set under perfect competition and when markets are oligopolistic or monopolistic.  The effects of price controls, taxes, externalities, collusion, and related topics should also be covered.

3
Title: Industrial Organization

Description: Oligopoly and monopoly; industry structure and effect on competition; cartels; and government regulation.  Markets characterized by asymmetric information, and “lumpy purchases.”  Characteristics of industry structure that facilitate collusion.  Differences between tacit and overt collusion.

3
Title: Procurement Law and Process (1) & (2)

Description: The course should cover thee national procurement law and its background.  If as in many countries, it draws on the UNICTRAL model law, that should be reviewed as well.  Special topics would include WTO and public procurement, bid protests, UNCAC, and judicial remedies. The process by which a purchase is planned and executed should be included to provide students proper context.

6
Title: Project Management

Description:  The emphasis should be on construction and large scale ITC projects.  The role of the consulting engineer or project manager should be emphasized give the importance to anticorruption.

3
Title: Auditing & Accounting

Description: An overview of what both auditors and accountants do along with instruction on how to read income and cash-flow statements and balance sheets, national law governing auditing and accounting of public companies, and special topics in auditing such as internal controls.  The use of technical audits for construction projects and other complex contracts should be included.

2
Title: Corruption Studies (1) & (2)

Description: Rise of corruption as policy issue; international conventions; domestic laws; measurement and definitions; forms of corruption; impact, economic and noneconomic; prevention; ethics; deterrence; corruption in sectors; procurement corruption; asset recovery, prevention methods.

6
Title: Financial Issues

Description: The elements of finance as they affect government contractors.  Measures of liquidity and insolvency, construction loans, inventory financing, liens, suretyship, “clean” and “dirty” guarantees.

2
Title: Public-Private Partnerships

Description: The term public-private partnership covers a wide variety of financing arrangements that procurement staff and procurement officers should be conversant with. It should prepared students to cast a critical eye on PPP proposals given the recent problems many, particularly in the developing world, have encountered.

2

 

2 thoughts on “Building a Cadre of Procurement Professionals

  1. This a wonder work by Messick.

    There may be the need to also consider courses like: Supply Chain Management, Intoduction to use of Computer and other soft skills like negotiation, communication, inter-personal skills, etc.

  2. Pingback: Building a Cadre of Procurement Professionals | Anti Corruption Digest

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