Defence Procurement

[Author of box 2.4 is Maciej Wnuk, Poland. Elisabeth Wrigth, US is the author of box 7.6]

Defence procurement is an integral part of two fairly distinct processes:

1. The process of acquiring new defence capabilities, e.g. through introduction of more advanced weapon systems; or
2. The process of maintaining existing capabilities through provision of spare parts, fuel, logistics services, etc.

In lacking integrity of organisations, procedures and individuals involved, both of these processes are prone to corruption. This chapter focuses mostly on the first process for a number of reasons:

• It usually involves larger amounts of money;
• Linking defence needs to actual procurement is far from trivial;
• It often involves advanced technologies and, respectively, there are a handful of potential providers;
• Procurement options are even more limited when security of supply or other national security considerations come into play;
• The statistics on costs is limited, hard to attain or non-existent.

As a result of these and other reasons, defence acquisition involves higher corruption risks. For example, consistently more than half of the cases covered by the Defence Anti-Corruption Digest relate to international acquisition of new weapon systems and equipment. Notwithstanding the focus of acquisition, most of the findings and the recommendations in this chapter are applicable also to procurement within the process of maintaining existing capabilities.

Studies on procurement-related corruption often focus on contractual issues, i.e. this phase of the acquisition process when public officials prepare, sign and manage contracts with suppliers of defence equipment and services. However, in order to reveal the mechanisms of corruption, one needs to examine the acquisition process comprehensively and to develop corruption reduction measures respectively.

Integrity of the Acquisition Process

Defence acquisition is the process of adding new or enhancing existing defence capabilities, in particular when that involves insertion of new technologies. Box 7.1 provides a definition of the scope of the term and delineates three major areas of acquisition activities.

Key for reducing the potential for procurement-related corruption is the integrity of the decision-making process. Decision making has to be regulated in a way that assures procurement decisions and actual procurements clearly relate to defence policy objectives and account for fiscal and other resource constraints. Regulations have to provide for a clear causal link from defence objectives to procurement.

... For the full text of this chapter see the accompanying file below.