Public contracts are a trillion-dollar global marketplace run on public money to deliver goods, works and services to citizens. Yet, information on what happens with that money is scarce and disconnected, and access to it is restricted.
Transparency and openness around this spending can help improve the competitiveness, integrity and efficiency of the contracting process.
Concern about confidentiality of information in the contracts obscures vital details from the public, challenges better decision-making and monitoring of the procurement process and public spending.
We've talked to over 70 experts from more than 20 countries and found surprisingly little evidence that supports keeping contracting information secret.
This handy guide and report will help you with arguments and evidence to help reveal all the details on government dealings. And argument against a lazy default where contracting information is routinely classified as confidential.
The facts about the 10 most common myths that keep information confidential in public contracting
You don’t need an explicit reference to procurement information in FOI acts to proactively disclose it; you don’t even need an FOI act.
• Disclosure of contracting information can be based on other legislation than FOI
• Most FOI acts require public authorities to proactively disclose information, which may include contracting information
• Contracting authorities may decide to disclose contracting information even if legislation (FOI or other) lacks detailed requirements for proactive disclosure
• Legislation pertaining to public information disclosure often also applies to private companies contracted by the government
Proactive disclosure of contracting information is not possible without a Freedom of Information (FOI) act
Confidentiality clauses do not prohibit the disclosure of contracting documents.
• Confidentiality clauses can only protect information that is legitimately sensitive
• It’s unlikely that all elements of a contracting document are legitimately sensitive
• Governments must disclose contracting information if required by legislation such as FOI or stock market disclosure requirements, even if the contract contains a confidentiality clause aimed at ‘protecting’ the information
• Confidentiality clauses can be overridden where parties agree to disclosure
Confidentiality clauses prohibit the disclosure of contracting documents
Contracting documents containing commercially sensitive information can be disclosed.
• If information is legitimately sensitive, a clear case should be made as to how and why disclosure would cause harm; any redactions should be minimal
• Most commercially sensitive information is not legitimately sensitive forever
• Commercial information cannot be legitimately sensitive if it’s already known to competitors
• In some jurisdictions, even commercially sensitive information may be disclosed based on a public interest test
• The ‘commercially sensitive information’ argument is over-used. Some countries publish their contracts by default without apparent harm
There is commercially sensitive information in contracting documents, so they can’t be disclosed
Defense contracting documents can be published without compromising national security.
• The national security argument is often applied to information that cannot legitimately be expected to undermine national security
• Only information that, if disclosed, would be likely to harm national security may be exempt from publication
• Non-sensitive parts of the contracting documents should be disclosed; redactions should be minimal and explained
• Classified defense contracting information cannot be withheld forever
• In some jurisdictions, even potentially harmful national security information may be disclosed based on a public interest test
There is national security information in contracting documents, so they can’t be disclosed
Contracting documents that contain personal data can be disclosed.
• Disclosing some personal data is important for transparency in the procurement process and to prevent fraud
• Certain personal data can be disclosed without endangering people’s privacy and safety
• Anonymizing or aggregating certain personal data to make it non-identifiable can minimize harm
• Non-sensitive information can be disclosed unredacted; redactions should be minimal
• Privacy should operate in an inverse relationship to power
• It should be clear what personal data is collected, and how it is used, shared and secured
There is personal data in contracting documents, so they can’t be disclosed
Disclosing contracting information does not encourage nor sustain collusion.
• Companies know who their competitors are; they do not depend on publicly disclosed contracting information for that knowledge
• The winning bidder’s name, which is usually disclosed anyway, is enough for cartel members to begin to check whether a cartel agreement was honored
• Disclosed contracting information has been used to detect collusion and to bust cartels
• Research shows that disclosing contracting information decreases cartel duration
• A supplier’s best strategy to win a contract is to tender at their best price, regardless of the estimated contract value
Disclosing contracting information encourages and sustains collusion
Disclosing contracting information does not decrease competition.
• Default publication of contracting information and contracts in some countries, or its widespread availability via FOIs in others, has not deterred companies from bidding for government contracts
• Evidence shows disclosing contracting information leads to an increase in the average number of bidders per tender and/or a reduction in single bid contracts
• Publishing contracting information leads to a decrease in bid prices, not an increase
Disclosing contracting information decreases competition
Reactive disclosure is more expensive than systematic, proactive disclosure.
• With the right infrastructure, managing records and disclosing information can be an automated, low-cost process
• Disclosing contracting information leads to substantial public savings and other benefits
• Government spending on resources to engage with the public is an investment, not a pure cost
• Bidders can factor the costs of redacting and uploading information into their bids
Disclosing contracting information does not lead to more appeals.
• The frequency of appeals does not depend on the disclosure level of contracting information
• E-procurement systems can make appealing and resolving award decisions easier and faster
Disclosing contracting information costs too much money and leads to costly appeals and renegotiations
Disclosing contracting information can expose and reduce corruption.
• There is strong empirical and academic evidence that the chances of exposing and lowering corruption are highest when contracting information on all stages of the procurement process is disclosed
Disclosing contracting information does not expose or lower corruption
There is abundant evidence of public engagement with contracting information; it increases as data improves.
• Plenty of stakeholders, including the public, media, civil society, companies and other parts of government already regularly access contracting information
• Education on government projects and easily accessible data increase stakeholder involvement and data use in public contracting as well as contribute to public trust
Government can easily mitigate the risk of misunderstandings by explaining information and its context better; potential criticism is no reason to keep information confidential.
• Contracting information should not be kept confidential simply because it could be misunderstood or lead to embarrassment and criticism
• To reduce misunderstandings and add context, governments should explain the information, and educate civil society, the media and citizens
No one actually reads contracting information; if they do, they either misunderstand it or use it to embarrass officials