By Rebecca Haipinge
The focus of this article is conflicts of interest arising in public procurement decision-making processes. According to the World Bank, Procurement Guidance on Conflict of Interest, 2020, conflict of interest affects, or can be perceived to affect, a person’s independence, objectivity, or impartiality.
In terms of the Public Procurement Act, 15 of 2015 (as amended), Section 26 (8), 66 (1) (c) and (2) (a) and (b), 76 (1) (b) staff members are to avoid any conflict of interest in carrying out their functions, must recuse themselves and may not participate in the deliberations or take part in the decision-making process in relation to that procurement matter nor participate in the bidding process as a bidder or supplier.
It is the obligation of the staff members to disclosure/declare any conflicts of interest, withdraw from the procurement process, unless such conflict of interest is managed and decided that the conflict is trivial to affect the impartiality of the staff member.
Conflict of interest exist and/or can arise due to a relationship or an activity. A relationship due to a staff members’ business interests, family, religious communities, close personal friendships, or political affiliations. An activity due to a staff member involved in a professional or legal obligation to a bidding company, e.g., owes money to the company.
The World Bank, Procurement Guidance on Conflict of Interest, 2020, indicates three (3) types/categories of conflict of interest, where a person’s independence, objectivity or impartiality are compromised, could be compromised, or may be seen by some as being compromised.
These are described as:
- Actual: where a real conflict exists, for example: a staff member’s father owns a company that has submitted a bid.
- Potential: where a conflict is about to happen, or could happen, for example: a staff member is in the process of acquiring shares/ownership of a firm that has submitted a bid.
- Perceived: where others might reasonably perceive that a person is compromised and unable to be independent, impartial or objective (the appearance or perception by others is damaging, for example, where a close personal friendship exists between a staff member and the director(s) of a firm that has submitted a bid and are often seen socializing together.
It is, therefore, important for organizations to manage conflicts of interest, as a mitigation measure against corruption as well as to indemnify staff members against any result of conflicts of interest acts committed in good faith, attributed to the conduct of a staff member.
The World Bank prescribes the below steps to managing conflicts of interest:
STEP 1: Declaration
STEP 2: Identify conflict of interest
STEP 3: Managing conflict of interest
- Remove the staff member from the process.
- Impose a restriction on the staff member
- Engage an independent adjudicator
- Staff member relinquishes the business interest that causes the conflict of interest
- Staff member resigns from the position that causes the conflict of interest.
Rebecca Haipinge has overall, twenty-two (22) years of work experience, a combination of Public Service Sector, International Development Organizations and State-Owned Enterprises of which fourteen (14) years entails the administration of public procurement. Currently she is serving as Procurement Manager (PMU Head) at Namibia Institute of Pathology Limited (NIP).