by Professor Albert Sanchez-Graells, University of Bristol Law School.
Approximately a third of public sector spending goes to procure third-party goods, services, and works. Procurement rules and policies seek to ensure that contract awards are free from corruption, conflicts of interest or anticompetitive practices, and that these vast sums of public funds generate value for money and support social, environmental, and innovative practices. There is always room for improvement, though. The adoption of digital technologies is seen as a strategic catalyst for procurement reform, to increase the effectiveness of procurement regulation. Digitalisation could reduce the administrative burden through automation, generate data insights to inform policies and boost efficiency in public spending, and serve as a living lab for GovTech experimentation.
However, the transformative potential presumed in digital technologies generates hype and excessive expectations on the true size and nature of the achievable improvements. It also tends to overshadow the required groundwork and preparatory investment. New digital governance risks and requirements are not always recognised or understood. The growing public sector digital capability gap raises further obstacles. Heightened expectations and a minimisation of the challenges can get on the way of successful reform. In ongoing research funded by the British Academy, I apply an innovative technology-centred methodology to assess the governance opportunities and challenges for procurement digitalisation. This blog post provides a summary of the main findings so far. I will also be discussing them with a stellar panel on 15 December 2022 (details and registration). (more…)
By Professor Albert Sanchez-Graells, Professor of Economic Law and Co-Director of the Centre for Global Law and Innovation (University of Bristol Law School)
Preventing, detecting, and sanctioning corruption in public procurement is one of the main goals of all systems of regulation applicable to the expenditure of public funds via contract (see eg Williams-Elegbe, 2012). Despite constant and regularly renewed efforts to fight procurement corruption at an international (such as the UN Convention against Corruption, or the 2016 OECD’s Preventing Corruption in Public Procurement report) and domestic level (see eg the UK’s 2020 ‘Local government procurement: fraud and corruption risk review’), corruption remains a pervasive problem in any given jurisdiction. Of course, there are different forms and degrees of corruption infiltration in different procurement systems but – if any evidence was needed that no system is corruption-free – pandemic-related procurement served as a clear reminder that this is the case (see eg Transparency International, 2021; as well as Good Law Project v Cabinet Office  EWHC 1569 (TCC)). It should then not be surprising that the possibility that artificial intelligence (AI) could ‘change the rules of the game’ (eg Santiso, 2019) and bring procurement corruption to an end is receiving significant attention. In a recent paper*, I critically assess the contribution that AI can make to anti-corruption efforts in the public procurement context and find that, while it could make a positive incremental contribution, it will not transform this area of regulation and, in any case, AI’s potential is significantly constrained by existing data architectures and due process requirements. (more…)