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The thrill of procurementEDITORIAL
28 Jan 2013 Beata Balogová Opinion
THE PROSPECT of a flutter is not the only thrill that Slovakia’s state-owned lottery company provides to the citizens of Slovakia. The history of Tipos involves a long and confusing saga, which began in January 2000 when another lottery company, Športka of the Czech Republic, sued the Slovak lottery firm over what it called unauthorised use of lottery trademarks as well as its technical know-how and which has already consumed considerable amounts of public money.
For those who are not into endless legal disputes, Tipos can provide some ‘amusement’ – for instance at the state-owned company paying €1,600 for three bathrobes, a bill that the Supreme Audit Office recently discovered in the Tipos kitchen. While the state-run company paid €530 for a single gown, according to the Sme daily, its luxury equivalent from Emporio Armani costs a mere €112.
Former Tipos boss Miloš Ronec, who ordered the tailor-made gowns with the word “Millionaire” embroidered on it, did offer Sme an explanation: “We needed something to attract publicity, so that people would trust Tipos and not stop playing. The bathrobes helped.” The audit office did not manage to discover whether the gowns did, in the end, go to lottery winners.
But what, one might ask, is €1,600 compared to the almost €5 million that the lottery company, which has a monopoly in Slovakia, plans to invest in promoting itself – at a time when the state is forcing citizens to tighten their belts? Sme broke the story about Tipos’ controversial €4.76-million tender for promotional services, announced shortly before Christmas, noting that the sum it proposes to pay for the two-year contract does not even include costs for advertising space or airtime.
These stories about state-funded promotion of gambling broke at almost exactly the same time as it was reported that the national unemployment rate had leapt to almost 14.5 percent, its highest level since May 2004. In a land where the average monthly salary hovers somewhere around €730, a state firm paying €530 for a bathrobe to promote the lottery seems a curious investment.
Earlier this month, the German magazine Der Spiegel ran a story based on a Eurostat survey reporting that Slovakia has the highest share of young people between the age of 25 and 34 living at the same household with their parents among all EU countries: 56 percent. A sociologist suggested to Sme that the trend was linked to youth unemployment and the threat of poverty.
Last year, just around the time when the education sector was shaken by strikes by teachers demanding a pay hike, the Education Ministry paid €4,752 for 36 bottles of expensive brandy to give away to foreign partners during foreign trips.
Unemployment and average wage numbers always create a good contrast to stories of waste, and the often implausible justifications and explanations that come with them.
Again, it is not so much the volume of money spent on such gifts and baubles, but rather the context in which they occur that simply weakens the public’s trust in the premise that the state works on their behalf and that the taxes they pay are used with common sense.
The story of Tipos shows how some state bodies procure services. Dozens of procurement scandals, which have been crippling public confidence in the state apparatus, have shown that officials can get incredibly creative when tailoring tenders and procurement conditions in such a way as to channel public money to the ‘right’ companies and the ‘right’ people – often ones to which they have suspiciously close ties.
Transparency International Slovensko (TIS) has said that the system of public procurement in 2012 improved in Slovakia due to the widening use of transparent methods such as public tenders or electronic auctions. Nevertheless, the transparency watchdog also sees warning signals in the planned weakening of the duty to use electronic auctions, which might again halt this positive trend, the SITA newswire reported.
TIS recommends that MPs, when they discuss changes to the public procurement law proposed by the government, do not reduce the role of electronic auctions, but instead strengthen transparency. TIS also wants to see transparency and impartiality at the official tender watchdog, the Public Procurement Office (ÚVO), increase.
Sadly, when one recalls the political tug-of-war that accompanied the search for the new boss of ÚVO, and the intense interest of politicians in having their nominee in the post, one doubts whether impartiality in this area is a readily attainable goal in Slovakia.
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