Unreported employment is one of the breaches of law that affects competition conditions in public procurement. This was noted in a new report from the Swedish Competition Authority, which has investigated how various forms of unethical competition and breaches of law affect public procurement.
Sadly, unethical contractors tend to use unfair methods to be awarded contracts with municipalities and government agencies. The effects being that the tax payers are taken advantage of and the ethical suppliers miss out on contracts. The Swedish Competition Authority has investigated the reasons behind various such unethical tendering methods.
"It is a concern that public procurement is sometimes described as a 'problem area', indicating that there are unethical dealings. The public trust in municipalities and government agencies is damaged every time it is discovered that unethical actions have been taken in connection with the procurement of public contracts. It is very unfortunate”, says Dan Sjöblom, Director-General of the Swedish Competition Authority.
Unethical tendering, corruption and bidding cartels. There are three breaches of the law that deflect competition in public procurement, according to the Competition Authority's report. Of these, unethical tendering – which includes unreported employment – is the most common.
It can be a case of suppliers, or their subcontractors, not paying taxes and fees for their employees. The investigation indicates that the industries where unreported employment is most common is construction, cleaning, temp agencies, and transport and removal services.
In the report entitled "Unethical competition in public procurement" the results of a survey, with a large number of contractors as respondents, is presented. A number of recommendations for healthier public procurement are also presented.
Among the Competition Authority's recommendations are: measures for better follow-up of contracts in procurements, better control of suppliers and subcontractors during the contract period, making it easier to check if companies who have submitted tenders have previously breached the law. In its report, the Competition Authority also presents its view of how the regulations for barring suppliers and rejecting unusually low tenders are applied.
"It is important to actively work with prevention measures. It is necessary to stop corruption, unreported employment and other breaches of the law at an early stage. The public sector must actively combat indications where a culture of friendships and personal favours, as well as established relationships, is allowed to supersede business practice", says Dan Sjöblom.
For further information, please contact:
Jimmy Dominius, Press Officer tel. +46 (0) 8 700 15 80 or
+46 (0) 76 542 15 80
Ellen Hausel Heldahl, Head of Department, tel: +46 (0)8 700 16 66