Contracts, Data and Investigations – Edition 2021-10-08

This week: Surprising insights from tracking public contracts, more detail on VIP fast track lanes, vaccine distribution, and kickbacks from Iraq’s electricity grid

Tracking public spending on government contracts can lead to surprising insights. 

According to the research by an Australia-based cybersecurity company, purchases of PCR tests in China's Hubei Province surged months before the first official reports of a novel coronavirus case there, Nikkei Asia’s Masaya Kato reports. Using data from a website that aggregates information on government tenders, about 67.4 million yuan (US$10.5 million) was spent on PCR tests in Hubei during 2019, nearly double the 2018 total. No one is suggesting it proves that COVID-19 was the reason for these purchases, but the finding can inform investigations into the opacity surrounding the virus’s emergence. 

In the UK, more details on the government’s set up and management of “VIP” fast lanes are emerging – despite early denials. The Guardian’s David Conn has the latest. We think the more details come out, the more it will help design open, fair and competitive processes going forward.

Without syringes, no jabs. In the US, Vanity Fair’s Katherine Eban explores how a pledge by the White House to send vaccines abroad could fall flat if syringes are not part of the package, since Pfizer’s injection requires specialized needles. 

Meanwhile, a Kenyan entrepreneur Bernard Olayo is supplying African hospitals with cheaper oxygen through a “milkman model” of small, localized plants built near hospitals, Bloomberg’s David Herbling writes. His company Hewatele now has about 10% of the Kenyan market, serving about 250 hospitals.

The COVID-19 pandemic has put budgets under strain in more ways than you could imagine. Jamaica’s bill for electronic devices for students and teachers topped $3.3 billion. Read Jamaica Gleaner’s Kimone Francis for the breakdown of how much Jamaica spent on 81,000 computers and tablets.  

In an in-depth investigation, AP’s Samya Kullab explores how corrupt deals between the political elite and electricity companies keep the lights out in Iraq. In the Electricity Ministry, through a system of under-the-table payments, the country’s power brokers allegedly siphon off state funds from companies contracted to improve the delivery of services. To secure funds for payoffs, more expensive materials are invoiced and investments don’t materialize. According to the investigation, officials who question why contract prices are inflated receive warnings, including one who objected to a power plant in northern Salahaddin province that was overvalued by $600 million. 

A ProPublica investigation by Ian MacDougall shows that McKinsey failed to disclose potential conflicts of interest emerging from its work with pharma companies, including opioid manufacturers, to the US government’s drug-regulation division as part of contracts spanning more than a decade and worth tens of millions of dollars. This is just the latest in ProPublica’s series on consultancy’s work for the government.  

Public contract monitoring by civil society can lead to very clear results. Pakistan’s government canceled a controversial tender for school desks worth Rs3 billion (US$17.5 million) after the excessive pricing was flagged by Transparency International Pakistan, Dawn’s Tahir Siddiqui reports. The government had planned to purchase school desks for over Rs29,000 (US$170), when they were available on the open market for just Rs5,000 (US$29).

Austria’s Chancellor is under investigation over claims that public funds were used in a €1.3 million (US$1.5 million) deal to ensure positive coverage in a tabloid newspaper, AFP’s Jastinder Khera reports. The deal included reporting on misleading public opinion surveys in return for purchasing advertising space. 

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A fleet of Maserati cars, bought by the Papua New Guinean government for the 2018 APEC leaders’ summit are on the market for a discount price of K400,000 (US$114,000), Leanne Jorari reports from Port Moresby for the Guardian. Bought new, the cars cost K500,000 (US$142,000) each, a whopping K20 million (US$5.7 million) in total. The government has since called it a “terrible mistake”. It seems that not even Ukraine’s transparent state asset platform Prozorro.Sale would help recover the investment: a used 2006 Maserati sold there for just US$13,000. Let’s hope Papua New Guinea has better luck. 

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For our recommendations, resources and tools, check our COVID-19 resource page. This newsletter has been put together by the Open Contracting Partnership. Comments? Suggestions? Got a story you’ve written to share? Write to Sophie and Georg at gneumann@open-contracting.org. Thanks for reading.

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