Is defence procurement generally conducted as open competition or is there a significant element of single-sourcing (that is, without competition)?
64a. Open competition
Mali score: 25/100
The majority of defence procurements are not conducted as an open competition.
Less than half (30-50%) of defence procurements are conducted as open competition. A majority of procurements are either restricted competition (i.e. 2-3 suppliers invited to compete) or single-sourced.
Most (50%+) defence procurements are conducted as an open competition, though a significant percentage of the value of contract (30% to 50%) are single-sourced.
The majority (70%+) of defence procurements are conducted as an open competition, though a significant minority of the value of contracts (10% to 30%) are single-sourced.
The vast majority (90%+) of defence procurements are conducted as an open competition, except in clearly defined and limited circumstances. There is a relatively small component (less than 10%) of single-sourcing.
There is conflicting evidence about the MDAC’s use of open tender contracts, but it appears clear that most recent major purchases have not been subject to open competition.
The website of the regulatory body ARMDS records that the MDAC issued more than 18 open tenders between May 2017 and April 2018.11 Some of these tenders relate to minor needs such as office stationery, camping equipment and fuel and tyres for military vehicles. But some are for more substantial purchases such as fuel trucks and works to construct undefined “infrastructure” at a military base in Sévaré.7
The website of the DGMP-DSP displays a list of public contracts issued between 1 January and 30 September 2016.12 The list contains details of 36 contracts awarded by the MDAC, of which:
– 20 were subject to open bidding
– 10 were subject to restricted open bidding
– 5 were concluded by direct agreement
– 1 was concluded by restricted competition.8
The most expensive defence purchase on the list was for 120 4×4 pick-up vehicles, which cost just under 3 billion CFA (USD 5,4 million).¹⁶ This tender was conducted via restricted open bidding, while there is also evidence that other larger contracts were awarded via completely open bidding.8 But there is also at least one report in the Malian media from 2017, based on sources within the defence sector, alleging that fraudulent practices are commonplace at the Directorate of Finance and Equipment (DFM).¹⁴ It alleges that defence contracts are not typically subject to open and competitive tenders: instead they are often awarded to family members or close associates of defence officials.
The fact that many defence-related purchases are exempt from the standard procurement regulations means that many large defence contracts are not subject to open competition. As Article 8 of the Code says:
“This decree does not apply to contracts for works, supplies or services when they relate to the needs of national defence or security, which require secrecy or for which the protection of essential national interests is incompatible with the publication of such contracts. The system under which these contracts operate is fixed by decree of the Council of Ministers”.¹ There is no evidence to suggest that any of the government’s recent major defence purchases have been made through open public tenders. This applies to the purchase of the:
– one C295W aeroplane from Airbus
– one new Super Puma helicopter from Airbus2
– one used Super Puma helicopter from Ireland2
– attack helicopters from Russia, which were bought after 8 million Malians reportedly signed a petition calling on the Russia government to help Mali by supplying military equipment1
– six A-29 Super Tocano combat planes from Brazilian company Embraer Defense & Security2
The purchase of the presidential jet in 2014 for 18.59 billion CFA was also not subject to an open tender given its secretive and off-budget nature.⁹ ¹¹ ¹² Neither was the maintenance contract for the presidential plane that increased repair costs by over 500% in some cases.¹² Neither were the contracts signed by former defence minister Soumeylou Boubeye Maïga for various forms of military transport that involved an overspend of 393 million CFA and were subsequently cancelled.3
There is also substantial evidence showing that the MDAC has regularly been using imprest accounts as a way of purchasing items without having to comply with procurement requirements, which are not subject to open tenders. In 2014, the IMF noted that:
“The execution of exceptional expenditures is subject to very minimal controls considering the amounts involved. In general, funds are released without prior proofs and receipts. The payment of the advance is subject to simplified controls, focusing primarily on the identity of the payment authorization officer and the amount of the advance. Control of the compliance of the expenditure being carried out, based on supporting documentation for the payment, takes place after the actual disbursement of the funds to a supplier or service provider”.5
The IMF also states that there are numerous deficiencies in the controls carried out, “particularly with respect to the imprest accounts of the defence and security forces in Mali”.5 It adds that “some imprest accounts receive quite substantial advances that go well beyond their original purpose of ‘minor operating expenditures’. For example, the special imprest account of the Ministry of Defence carries out monthly expenditures exceeding 2.3 billion CFA”, none of which relates to open tenders.5
1. “Mali : Deux hélicoptères pour les Famas : La Russie répond à l’appel du Mali” [Mali: Two helicopters for FAMa: Russia responds to Mali’s call], MaliActu, October 4, 2017, http://maliactu.net/mali-deux-helicopteres-pour-les-famas-la-russie-repond-a-lappel-du-mali/
2. “Acquisition d’équipements pour l’armée malienne : Le PARENA dénonce ‘des micmacs et détournements’” [Procurement of equipment for the Malian army: the PARENA denounces “misappropriations and embezzlements”], Maliweb, April 26, 2018, http://mali-web.org/politique/corruption/acquisition-dequipements-pour-larmee-malienne-le-parena-denonce-des-micmacs-et-detournements
3. “Corruption : IBK ordonne la révision de tous les contrats signés par Soumeylou Boubeye Maïga”, MaliActu, August 8, 2014, http://maliactu.net/corruption-ibk-ordonne-la-revision-de-tous-les-contrats-signes-par-soumeylou-boubeye-maiga/
4. Amadou O. Wane and A. Karim Sylla, “Corruption and the presidential plane”, Bridges from Bamako, August 15, 2017, https://bridgesfrombamako.com/2017/08/15/corruption-and-the-presidential-plane/
5. Mali Technical Assistance Report – Audit of the Expenditure Chain (Washington, DC: IMF, 2014) https://www.imf.org/external/pubs/ft/scr/2014/cr14122.pdf
6. Cyrille Coulibaly, “Ministère de la Défense: Inquiétudes sur la gestion de la DFM” [Ministry of Defence: concerns over the management of the DFM], Niarela, 2017, https://niarela.net/politique/corruption/ministere-de-la-defense-inquietudes-sur-la-gestion-de-la-dfm
7. “Portail Malien des marchés publics” [Malian portal for public tenders], Direction générale des marchés publics et délégations de service public (DGMP-DSP), accessed April 29, 2018, https://dgmp.gouv.ml/
8. “Liste des Marchés Publics passés du 01 Janvier au 30 Septembre 2016” [List of Public Tenders issues from 1 January to 3° September 2016], Direction Générale des marchés Publics et des Délégations de Service public, accessed May 1, 2018, http://www.dgmp.gouv.ml/sites/default/files/liste%20des%20march%C3%A9s%20passe/Liste%20Tamboura%20au%2030%20Septembre%202016.pdf
64b. Scrutiny of single/restricted competition procedures
Mali score: 25/100
Oversight agencies have no powers to question single/sole or restricted competition procedures.
Oversight agencies have some powers to question single/sole/restricted competition procedure selected or purchase and occasionally do so.
Oversight agencies have powers to question the competition procedure selected and actively do so in a number of cases.
All single/sole source and restricted competition procedure contracts are justified to external scrutiny who have powers to question the competition procedure selected.
All single source and restricted competition procedure contracts must be justified and subject to external scrutiny (such as parliament or the external audit office), who have the power to reject the competition procedure selected.
Oversight bodies are occasionally able to audit single-source contracts, but this appears to only occur retrospectively rather than helping to prevent abuses and errors before they are signed off and public money is lost. Moreover, scrutiny of restricted competition procedures happens on an irregular and not comprehensive basis.
The BVG publishes annual reports evaluating the government’s various spending programmes. Meanwhile, it is the AMDS’s job to regulate public sector contracts and spending.
However, defence finances have generally not been subject to comprehensive audits or publicly detailed in recent years. In 2016, the ARMDS found that it was wholly unable to audit the Ministry of Defence’s finances for 2014 because of the lack of documents provided by the ministry.1
In April 2018, opposition party Parena claimed to have gained access to an unpublished BVG audit of defence purchases, which identifies numerous cases of overspending and dubious activity in military procurement.5 Parena maintains that the report shows that the government bought one of the Super Pumas from Ireland, paying 3.5 billion CFA for the used helicopter in cash. The audit also reportedly shows that the second Super Puma, bought directly from Airbus, cost 3.9 billion CFA, although the terms and conditions of the contract are opaque, according to the auditors.5 These claims were also reported by a journalist, who had also seen the unpublished audit, in Le Républican newspaper.7 The fact that this audit remains unpublished indicates that the BVG and the ARMDS are likely more active than their number of publications would suggest. Indeed, the BVG’s last published report came in 2015 and makes no mention of defence spending or incomes.2 As the World Bank points out, the BVG has not specifically reviewed Ministry of Defence accounts, and only an aggregate administrative account is transmitted to the auditor when the annual budget is examined.3,4
When the IMF, the World Bank and the EU suspended their aid programmes to Mali following reports of the off-budget purchase of a new presidential jet in 2014, it was the BVG that audited the account (see Q16C). The BVG’s report showed strong signs of its independence and ability to question the rationale of single-source defence purchases (see Q29C).
The BVG found that the MDAC had failed to respect the 2014 Finance Law requiring it to register these contracts and submit them as part of the annual budget. Moreover, many of the contracts were found to be heavily overpriced, strongly suggesting that these acquisitions involved substantial illicit activity..6
– Lorries that can transport up to 5 tonnes of goods that normally cost 28.5 million CFA were priced at 78 million CFA in the contract.
– Lorries that can transport up to 10 tonnes that normally cost 34 million CFA were priced at 115 million CFA.
– Petrol-tankers that can carry up to 6 cubic metres of fuel, normally costing 29 million CFA were billed at 120 million CFA.
– And petrol-tankers that can carry up to 18 cubic metres of fuel, normally worth 38.5 million CFA were billed at 210 million CFA.6
As of April 2018, it has yet to be determined what happened to the money overspent on these contracts, which would have amounted to 393 million CFA had the government not subsequently cancelled them. But the Defence Minister responsible for signing these contracts has since returned to government as Prime Minister.
1. A.B. Niang, “Mali : Audit des marchés publics de l’année 2014 : – 41% seulement de conformité aux procédures – Opacité totale pour le Ministère de la Défense et des anciens combattants” [Mali: Audit of the public contracts from 2014: – only 41% are compliant with procedures – Total opacity for the Ministry of Defence and Veterans], MaliWeb, July 1, 2017, https://www.maliweb.net/economie/audit-marches-publics-de-lannee-2014-41-de-conformite-aux-procedures-opacite-totale-ministere-de-defense-anciens-combattants-2358322.html
2. Official website of the Bureau du Vérificateur Général Mali, http://www.bvg-mali.org/index.php
3. Malian Security Forces: Financial Management Assessment Report (Washington, DC: World Bank, 2012)
4. Bernard Harborne, William Dorotinsky, and Paul M. Bisca, eds., Securing Development: Public Finance and the Security Sector (Washington, DC: World Bank, 2017)
5. “Achat d’équipements pour l’armée malienne ‘micmacs et détournements’ : un hélicoptère Super Puma payé en espèces, le mystères des avions brésiliens !” [Purchase of equipment for the Malian army, misappropriations and embezzlements: a Super Puma helicopter bought in cash, the mystery of the Brazilian planes!], Conférence de presse du PARENA, Maison de la Presse, Bamako, April 25, 2018.
6. “Corruption : IBK ordonne la révision de tous les contrats signés par Soumeylou Boubeye Maïga” [Corruption: IBK orders the revision of all contracts signed by Soumeylou Boubeye Maïga], MaliActu, August 8, 2014, http://maliactu.net/corruption-ibk-ordonne-la-revision-de-tous-les-contrats-signes-par-soumeylou-boubeye-maiga/
7. A. Karim Sylla, “Comment la fraude est devenue monnaie courante dans le système IBK” [How fraud become common currency in IBK’s system], Le Républicain, April 26, 2018, http://ibk2018.net/materiel/Malversation_MDAC_2018.pdf
Compare scores by country
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|Country||64a. Open competition||64b. Scrutiny of single/restricted competition procedures|
|Albania||50 / 100||25 / 100|
|Algeria||0 / 100||0 / 100|
|Angola||0 / 100||25 / 100|
|Argentina||0 / 100||75 / 100|
|Armenia||75 / 100||50 / 100|
|Australia||NEI||25 / 100|
|Azerbaijan||0 / 100||0 / 100|
|Bahrain||0 / 100||0 / 100|
|Bangladesh||NEI||0 / 100|
|Belgium||75 / 100||75 / 100|
|Bosnia and Herzegovina||75 / 100||75 / 100|
|Botswana||75 / 100||25 / 100|
|Brazil||25 / 100||25 / 100|
|Burkina Faso||0 / 100||25 / 100|
|Cameroon||0 / 100||0 / 100|
|Canada||75 / 100||50 / 100|
|Chile||NEI||25 / 100|
|China||50 / 100||0 / 100|
|Colombia||25 / 100||25 / 100|
|Cote d'Ivoire||0 / 100||0 / 100|
|Denmark||100 / 100||0 / 100|
|Egypt||0 / 100||0 / 100|
|Estonia||75 / 100||50 / 100|
|Finland||NEI||50 / 100|
|France||50 / 100||50 / 100|
|Germany||50 / 100||50 / 100|
|Ghana||0 / 100||0 / 100|
|Greece||75 / 100||25 / 100|
|Hungary||NEI||25 / 100|
|India||NEI||50 / 100|
|Indonesia||NEI||25 / 100|
|Iran||0 / 100||0 / 100|
|Iraq||0 / 100||0 / 100|
|Israel||50 / 100||100 / 100|
|Italy||0 / 100||100 / 100|
|Japan||25 / 100||75 / 100|
|Jordan||0 / 100||0 / 100|
|Kenya||25 / 100||50 / 100|
|Kosovo||75 / 100||25 / 100|
|Kuwait||0 / 100||25 / 100|
|Latvia||100 / 100||50 / 100|
|Lebanon||NEI||25 / 100|
|Lithuania||25 / 100||25 / 100|
|Malaysia||NEI||0 / 100|
|Mali||25 / 100||25 / 100|
|Mexico||25 / 100||0 / 100|
|Montenegro||25 / 100||25 / 100|
|Morocco||0 / 100||0 / 100|
|Myanmar||NEI||0 / 100|
|Netherlands||NEI||75 / 100|
|New Zealand||NEI||75 / 100|
|Niger||25 / 100||0 / 100|
|Nigeria||NEI||0 / 100|
|North Macedonia||100 / 100||75 / 100|
|Norway||NEI||25 / 100|
|Oman||0 / 100||0 / 100|
|Palestine||75 / 100||25 / 100|
|Philippines||25 / 100||50 / 100|
|Poland||25 / 100||25 / 100|
|Portugal||NEI||100 / 100|
|Qatar||0 / 100||0 / 100|
|Russia||0 / 100||0 / 100|
|Saudi Arabia||0 / 100||0 / 100|
|Serbia||25 / 100||0 / 100|
|Singapore||50 / 100||75 / 100|
|South Africa||NEI||100 / 100|
|South Korea||0 / 100||25 / 100|
|Spain||25 / 100||25 / 100|
|Sudan||NEI||0 / 100|
|Sweden||50 / 100||25 / 100|
|Switzerland||50 / 100||50 / 100|
|Taiwan||25 / 100||25 / 100|
|Thailand||0 / 100||0 / 100|
|Tunisia||0 / 100||25 / 100|
|Turkey||25 / 100||0 / 100|
|Uganda||NEI||50 / 100|
|Ukraine||50 / 100||25 / 100|
|United Arab Emirates||0 / 100||0 / 100|
|United Kingdom||50 / 100||50 / 100|
|United States||50 / 100||50 / 100|
|Venezuela||NEI||0 / 100|
|Zimbabwe||NEI||0 / 100|