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Public Procurement Corruption: Causes, Remedies (1)

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This is a paper he presented in Port Harcourt at a forum organised by the Bureau of Public Procurement.

According to the Organization for Economic Cooperation and Development (OECD), “procurement is the process of identifying what is needed; determining who is the best person or organization to supply this need; and ensuring what is needed is delivered to the right place, at the right time, for the best price and that all this is done in a fair and open manner”

Public procurement procedures often are complex. Transparency of the processes is limited, and manipulation is difficult to detect. Few people becoming aware of corruption complain publicly, since it is not their own, but government money, which is being wasted. Governments at federal, state, and local levels, spend significant public resources on procurement. Procurement at all levels of government in developing countries like Nigeria typically constitutes about 45 percent of the total Gross Domestic Product (OECD, 2006). These expenditures are critical to enabling governments to deliver goods and services to citizens, but they are also extremely vulnerable to corruption.

For almost a decade now there has been a significant international focus on corruption as a threat to economic and human development. Several multilateral organizations, like the UN, the World Bank, the WTO and OECD, aims at fighting the problem. So far, however, the strategies to transform the alleged practices of a state administration from corrupt to honest and clean have failed in most cases. There are several ways to explain this persistence of corruption. The time it takes to curb the problem may have been underestimated. There may also be a failure in the adjustment of anti-corruption strategies to local conditions. And finally, the incentives to implement the necessary measures may be poor among politicians benefiting from the current system.

However, in countries where corruption is a common problem it tends to disturb the market mechanisms and impede economic development. Corruption in public procurement makes the officials or the politicians in charge, purchase goods or services from the best briber, instead of choosing the best price-quality combination. The result may be construction projects several times as costly as necessary, or the acquisition of goods not actually needed. Hence, when aggregated to a macro-economic level non-optimal choices of contractors can have noticeable effects on the economy.

Also the efforts of public officials to get into position for obtaining bribes may represent a significant cost. Gifted youth often prefer jobs in the bureaucracy instead of more scientific professions, the allocation of public funds may be biased in favour of capital intensive sectors at the expense of health and education, and laws and regulations may be introduced just in order to obtain bribes. Even worse, public sector corruption has a pervasive impact on the poor since it reduces the funding available for social services and distorts public choices in favour of the wealthy and powerful, resulting in larger income differences between rich and poor.

Corruption, as an illegal activity, is difficult to define exactly as different attitudes and customs prevail, for instance when it comes to gift-giving and bureaucratic integrity. However, this paper is mostly concerned about the clear-cut cases, where no doubt about the misuse of public office exists. This is usually the case when the following conditions are all met.

1.First, the act must be intentional and in conflict with the principle of objectivity in public service performance. This implies that the rule that is broken is precise and transparent.

2.Second, the person who breaks the rule must derive some recognizable benefit for him/herself, his family, his friends, his tribe or party, or some other relevant group.

3.Third, the benefit derived must be seen as a direct return from the specific act of “corruption”.

CAUSES

The logic of incentives makes it reasonable to assume that human greed explains most of the bureaucratic corruption. However, in many developing countries, where monthly wages for ordinary officials often are less than $100, the actual need may be an equally prevalent reason. In some cases these wages represent a capitulation wage. According to Besley and McLaren (1993) capitulation wage refers to a situation where the government “capitulates” because corruption is endemic and monitoring does not function. Thus, it makes no sense to revise salaries and the government pays very low wages, aware of the bureaucrats’ ability to manage on bribes and stealing. The bureaucrats’ demand for bribes is understandable under such circumstances. Nevertheless, it is observed in many countries that officials covering their economic need by the help of bribes do not stop when they reach an acceptable standard of living.

The supply side incentives may appear less obvious because bribes often represent a significant cost to a company. Preparing for a tender is a costly and time consuming process and the company may not trust their winning chances on legal basis alone. A bribe may thus ensure that the company obtains the government contract. Corruption may also help companies obtain a de facto monopoly situation, to retain business, to obtain secret information, to counterbalance poor quality or high price, to facilitate trade or investment, or to create demand for goods that otherwise would not have been purchased. Other motives may be to reduce political risk, to receive import licenses, to reduce taxes and attain special modifications of laws or just to induce government employees to perform their duties. Despite the secrecy in these cases, it is not difficult to exemplify incentives from the media and court cases.

The major reason for bribery in public contract assignment, however, is probably because everyone believes that everyone else is involved in such kind of business. Losing a contract because a competitor bribed the officials must be very frustrating. This problem of hidden information is reflected in the way that all the companies involved pay a bribe even if they would be better off with no corruption (prisoner’s dilemma). Hence, the companies that bribe public officials seem to forget the negative externality they impose on other firms, as well as the worsening of their economic environment. For the company involved there are several common drawbacks related to bribery. One is the information about the bribery in hand of the public officials, information applicable to hit the reputation of enterprises, the multinationals in particular. A problem is also enforcement that a bribing company has no judicial guarantee of obtaining what it has paid for (unless the courts are corrupt as well). And, once a company has established a corrupt relationship it may be confronted by unexpected demands for additional payments. Ending a corrupt relationship is often difficult because of the risk of menaces, violence and other criminal activities. Apart from this, close connections to the government may imply a risk in case of political and governmental changes.

Adebowale, is the Managing Partner, Proactive Projective Limited.

 

Seun Adebowale

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Nigeria’s Inflation Drops to 15.06%

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Three States Record Lowest rates Published 16 Mar 2026 By  Dave Ibemere 3 min read The NBS has revealed that inflation rates dropped again in February 2026 The bureau noted that both headline and food inflation eased on a year-on-year basis Inflation was lowest in Katsina, Imo, and Ebonyi, while the highest was recorded in Kogi.
 Nigerian economy, the stock market, and broader market trends. The National Bureau of Statistics (NBS) has revealed that Nigeria’s inflation rate slowed further in February 2026. According to the bureau in its latest CPI report, the headline inflation dropped slightly to 15.06% from 15.10% in January 2026. Nigeria’s inflation eases to 15%, offering relief to households. It was 11.21 percentage points lower than the 26.27% recorded in February 2025. From breaking news to viral moments.  On a month-on-month basis, inflation stood at 2.01% in February, up from -2.88% in January, showing that prices rose at a faster pace than the previous month. Nigerian stock market records weekly gain as turnover hits N164.8billion Urban vs Rural Inflation NBS noted that urban inflation stood at 15.53% year-on-year, down from 28.49% in February 2025, while rural inflation was 13.93%, compared with 22.73% in the same period last year. Every month, urban inflation rose to 2.55% in February from 2.72% in January, while rural inflation eased to 0.71% from -3.29%. Food Inflation Food inflation dropped to 12.12% year-on-year in February, down sharply from 26.98% in February 2025. Monthly, food prices rose by 4.69%, higher than the -6.02% recorded in January. The NBS attributed the moderation to slower price increases in staples such as beans, cassava tuber, yam flour, crayfish, millet flour, cowpeas, and okazi leaf. The twelve-month average for food inflation was 19.08%, compared with 37.40% in February 2025. States breakdown for All Items The states with the highest all-items inflation rates were: Kogi (23.57%) Benue (22.85%) Anambra (22.09%) The lowest rates were recorded in: READ ALSO Naira appreciates by N27 against US dollar as external reserves cross $50bn Katsina (7.78%) Imo (11.66%) Ebonyi (11.71%) On a month-on-month basis, the highest increases were in Enugu (5.92%), Ogun (4.39%), and Anambra (4.11%), while declines were seen in Zamfara (-2.14%), Bauchi (-1.23%), and Katsina (-1.06%). Food staples contribute less to inflation as prices moderate in February. Photo: Bloomberg Source: Getty Images State Breakdown for Food Inflation Food inflation was highest in: Kogi (26.91%) Adamawa (23.12%) Benue (21.89%) The lowest food inflation rates were seen in: Katsina (5.09%) Bauchi (7.09%) Imo (7.65%) Month-on-Month Food Inflation The states with the highest month-on-month increases in food inflation were: Bayelsa (8.81%) Ebonyi (8.51%) Edo (7.72%) The states that recorded declines were: Katsina (-0.70%) Nasarawa (0.17%) Kano (1.39%) Food price changes across markets in Nigeria Earlier, The  Tide source reported that due to Ramadan, staple food prices across the country are recording sharp increases as Muslims begin the Ramadan fasting season Ramadan is not only a period of abstinence from food and drink, but also a time for ‘reflection, discipline and heightened devotion’ Several traders in Abuja, Taraba, and Kaduna states are taking advantage and have hiked price. The NBS has revealed that inflation rates dropped again in February 2026 The bureau noted that both headline and food inflation eased on a year-on-year basis Inflation was lowest in Katsina, Imo, and Ebonyi, while the highest was recorded in Kogi.
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NDCCTMA, NDDC MDS Challenge Niger Delta Indigenes On Investment In The Region 

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The Nigeria Delta Chamber of Commerce, Trade, Mines and Agriculture  (NDCCTMA), and the Niger Delta Development Commission ( NDDC ) have challenged Niger Delta entrepreneurs to close the gap in Gross Domestic Products (GDP) differences between the region and that of the South Western part of the country by coming home to invest.
The bodies made the call at a Business Round Table organized by NDDCTMA, in Port Harcourt.
Chairman of NDDCTMA, Ambassador Idaere Gogo Ogan, said to close the gap between the south west region which he said has a GDP seize of about #59 trillion and that of the Niger Delta which is about #34 trillion was to massively invest in the region.
He said no other persons can  do this except sons and daughters from the region.
“For me I believe in statistics,I believe in data and everyday I looked at the data concerning development in Nigeria and from the GDP point of view, the South West has #59 trillion, that is the seize of the south west region economy, the second region following them is the Niger Delta region with GDP seize of #34 trillion,so there is a yearning gap of #25 trillion that separates the south west and the Niger Delta region, that is why we are here.”
Ogan said the region has the capacity to close the gap and even surpassed it but regretted that indigenes of the region have chosen to ignore it in terms of investment.
“We need to close that gap .If we close that gap and even surpassed it,all the negative problems of militancy and unemployment will automatically erase”, he stated.
Ogan noted that the event was organized to remind the people that past efforts of militancy and agitations have not led the region to any where saying “that is why we are gathered here in this room”.
Also speaking, the Managing Director/Chief Executive Officer, NDDC, Dr Samuel Ogbuku urged indigenes of the region not to use the problem of insecurity as an excuse to continue to deny the region of investment  as every part of the country have in one time or the other experienced crisis.
Ogbuku said most indigenes have displayed high level of unpatriotism towards the region by taking investments that would have benefited the people to either Lagos or Abuja.
“With little threat we have left the city, we have gone to Lagos,we have moved  our families to Abuja and Lagos. If you go round GRA all the property, you will see,”to let to let”most of them are now empty “he said.
The NDDC MD said despite the fact that people from the region are doing well in the oil and gas, banking and other sectors, its impact are not being felt at home because they are stationed outside the region.
By; John Bibor
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Cash Handouts Unproductive For Sustainable Agricultural Development – Engineer Kii

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Rivers State by its natural disposition is gifted with strategic economic advantage, particularly in  agricultural potentials and fortunes. This informs successive governments’ interest in  developing the agricultural sector, such as the School to Land Program, the Shongai Project, among several others.
The objective is to engender and leverage the sector  beyond mere subsistence practices into a full thriving economy, with the engagement and involvement of the youthful and productive population.
The Farm to Future Agro Based Training for Rivers youths by the present administration is notably one of the most pragmatic efforts of the Rivers State Government to engage the prospective creative capital of both the natural and human resources in the agricultural sector for sustainable development.
The concept, premised on the imperative of maximizing the huge agrarian prowess of the state, targets creation of sustainable livelihood for the teeming youth of the state. The project is also intended to achieve the chore needs of food sufficiency and job creation in the state.
This implies a significant deviation from the acculturised norm of expectations of financial benefits as the outcome of government programs and policies.
The tenets of the program are expressly difined in concept and practice as shown in the phases of its execution.
However, some beneficiaries of the project recently staged a protest, allegdging unpaid largesse, diversion of funds and perceived slighting by the Rivers State Ministry of agriculture. The said protest has stirred up concerns among stakeholders about how people view  government policies.
Many see the protest  as an attempt to create tension around the program and sabotage its original objectives.
Stakeholders and commentators are of the view that the Rivers State is in dire need of development in every critical sector, as such the  Ministry of Agriculture and its partners should be given the benefit of the doubt to implement the project to its logical conclusion without being hauled with accusations.
The former Commissioner for Agriculture, Engineer Victor Kii who was at the fore of driving the program has in a press statement debunked the allegations and sued for calm, restraint and understanding. Engineer Kii assured the participants that the empowerment phase will be implemented as soon as administrative normalcy is restored.
He commended the participants for their commitment and discipline during the training and urged them to uphold the norms of the program rather than misrepresenting its intentions.
Some pundits who commented on the recent development decried the fact that many people  still hold on to the notion that  incentives billed to create sustainable impact through skills based programs, should be given out as  largess, without adroit supervision of its utility function. This practice  has however created a culture of economic doldrum, dependency and servitude in the past.
Thus the idea of seen the Rivers Farm to Future project  as a mere quixotic experiment for cash benefits  without achieving set goals is counter productive. Such opportunistic thinking have stunted government efforts  over the years in achieving long term objectives of development.
As disclosed by the former commissioner for Agriculture in his detailed explanation, the Farm to Future project was strategically designed to address this culpable deficit in institutional planning and consolidation of results.
The former commissioner gave an  explicit description of the nexus of operation of the program.
As revealed by him;  ” The program is a strategic intervention to equip young people in Rivers with practical skills and to nurture a new generation of agricultural entrepreneurs. 500 beneficiaries received intensive agri business training in the first phase.”
 He pointed out that the program was conceived and designed in line with global best practices which de emphasizes indiscriminate cash handouts for beneficiaries. Rather it promotes practical engagements in agricultural activities and business initiatives.
At the end of the training in February, beneficiaries were encouraged either individually or in cooperative clusters to identify value chain for establishment of viable businesses.
They were also asked to produce structured business proposals for perusal and review by the ministry of agriculture and appointed consultants, after which successful proposals would be forwarded to the Bank of Agriculture with Rivers State Government providing guarantees.
The strategies for implementation include field inspections and evaluation for beneficiaries who had already commenced practical activities in identified locations.
The approach was to discourage the commonplace ideology of diverting funds meant for specific projects for unrelated purposes, thereby undermining the conscious exploration of creative potentials into long term benefits.
The process was however temporary interrupted by the dissolution of the Rivers State Executive Council and the ongoing renovation of the Rivers State Secretariat complex but the profound optimism and positive expectations that are the hallmark of the project remains sacrosanct.
Engineer Kii assures.
By: Beemene Taneh
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