Defence Integrity Pacts are a tool to combat corruption at the tendering and contract stage of procurement.  They bind all the bidders and the Government together in a contract to reduce the possibility of corruption occurring both during and after the tendering. The contract should include all or some of the following:

• Pledge and undertakings by bidders not to offer or accept bribes.
• Pledge and undertakings by the government, their consultants and advisers not to offer or accept bribes.
• Restrictions on government officials from obtaining work at bidding firms or their partners for a period after the bid (TI recommends a period of at least 2 years).
• Disclosure of details of agents or intermediaries.  This disclosure may only be of the name and services contract of the agent, but may also require disclosure of payments to and from the agent.
• The appointment of an independent monitor or monitoring team.  Access by the monitor to all meetings and unrestricted access to all material documents.
• Publication of some or all of the documents, evaluation criteria, bidders’ proposals and the detailed results of the evaluations.  In some cases, public hearings for discussions of the bid.
• Bidders must agree to withdraw if there is evidence of breach of the pledge. Further sanctions may involve exclusion from bidding for subsequent contracts.

In addition, the Government should encourage the involvement of Civil Society groups like Transparency International.

How do Defence Integrity Pacts help?

Integrity Pacts work on several levels to support the procurement process:

• They supplement weak laws by making contractual requirements; for example, requiring greater disclosure of information.
• They attract more bidders by leveling the playing field and providing independent technical scrutiny.
• They give more confidence to bidders through a visible effort at clean procurement and the use of an independent monitor to whom complaints can realistically be addressed.  They give greater confidence in the probity of government.
• They can reduce the costs of contracts.
• They supplement weak or slow enforcement by greatly strengthening sanctions.  Requiring a company to withdraw from the bid if they are found to engage in corrupt activities is a major deterrent.  They are applicable at the time of the tender, rather than after award, which is generally the case in current laws.
• They can be developed to provide independent assurance throughout the execution phase of the contract as well as the tender phase.
• They strengthen public confidence.  The defence procurement process often has a poor reputation, and is seen as being subject to political influence internally and externally.

Integrity Pacts have mostly been applied at the bidding stage of a contracting process.  For many contracts they also must be applied throughout the execution phase as well.  If not, there is a danger that the corruption risk is simply driven ‘downstream’ past the point of contract award.
Integrity Pacts are not a panacea. They do not address structural issues like reform of the procurement organisation, or legal issues.  They can also be rendered ineffective, for example by not having a credible Independent Monitor. They must not be reduced to an administrative procedure. There must be strong support from the top of the defence ministry, and they should be used as part of an overall national anti-corruption strategy.

The Independent Monitor

The government appoints the Independent Monitor to oversee the defence integrity pact process.  How this is done is important, as it is essential that the Monitor‘s independence is not compromised by the nature of the appointment.  Where the Independent is a body outside of government, this may done through a letter of appointment, which makes the terms of his role clear, including the formal independence of the assessor from all parties, the obligation to publish all findings, and agreement that the Monitor will be held harmless by the government for any claims against them.

The choice of the Independent Monitor is very important, and depends greatly on the national circumstances. It could be:

• An independent anti-corruption government body in the country; eg an Independent Committee against Corruption
• A highly respected person in the country, e.g. a former judge, with appropriate administrative and expert support
• A professional independent assessor
• A civil society organisation

The Independent Monitor must be an individual or organisation that knows the language and culture, understands the defence procurement process, and who will be around for some time, as the contract phase may last many years.

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