Government Passes Bogus Procurement Amendment
With shouts for change on how state contracts are dished out to suppliers with hidden owners, the government took it on itself to change the Public Procurement Act, but the amendment, given green by 84 MPs, changes nothing of the big picture, with anonymity still protected.
The amendment to the Public Procurement Act aimed at preventing so-called POBox companies from winning state tenders is hardly worth the effort according to independent watchdog Fair Play Alliance (FPA) and opposition MPs, as it only requires companies to demonstrate their ownership structure, up to a certain point with various exceptions.
Certain opposition MPs are calling the amendment a mere marketing stunt, as they were calling for these POBox companies to show the final ultimate owner who would benefit from the state orders. The standalone Smer-SD party government led by Prime Minister Robert Fico ignored various proposals of MPs regarding the amendment, opting instead to push it through a fast-track legislative procedure.
Due to the mere cosmetic nature of the change, the FPA watchdog is calling on the government to deal with the issue in a real manner and so put a stop to the siphoning off of public money in overpriced tenders due to crony ties. They are also demanding that the true identities of those behind successful tenders be revealed.
Zuzana Wienk from the FPA underlined how the legislative amendment was just for show and how it concerned only a small fraction of cases, with it basically effecting no change to the current situation where the true owners are hidden behind several layers of companies.
The raised voices for legislative change come after speaker of the house Pavol Paska stood down over accusations that he has had ties with companies profiting from the health service for years, most notably the company Medical Group SK, which recently mediated the sale of a CT machine for a hospital at three times the market price, for instance.
The calls for real change will most likely fall on deaf ears, however, as the ‘established system’ in Slovakia has been to set up one company, owned by another company, and by another etc, shifting ownership abroad, before ending up in a tax haven with ownership anonymity. Trails of such cashflows point to many of the political elite in the country, so the chances of change anytime soon are limited.