E-Procurement: A Tool to Mitigate Public Procurement Fraud in Malaysia?

The major aim of this paper is to explore and analyse the views of Malaysian public officials on how e-Procurement helps mitigate procurement fraud. Inevitably, government activities have an intertwined relationship with the private sector manifested in the implementation of activities such as acquisition of works, supplies and services. While it is fully legitimate for private enterprises to bid for public works, in many cases there is inappropriate granting of public money to non-qualifying private business in a fraudulent manner. Concerns about public procurement fraud in Malaysia have been of practical significance for massive public spending and great deficiencies among various government departments. The visibilities of fraud losses in the public sector have undermined the delivery of public services. Decrease of fraud can improve the country's growth in terms of infrastructure, by providing facilities to improve healthcare and education, to combat poverty, and to fund security and defence. The prevalence of public procurement fraud has eroded public confidence of political and economic institutions. The implementation of E-Government has transformed the public service into a dynamic and diverse environment for government activities. Electronic Procurement (e-Procurement) can be used as a tool to mitigate fraudulent activities in public organisations. In other words, e-Procurement is one way of mitigating public procurement fraud in Malaysia by ensuring accountability, transparency and the achievement of best value for money contracts. In this study, the oral history technique via in-depth interviews and documentary analysis using a political economy approach are employed. We examine how e-Procurement is infused with power relations of dynamic institutions, various vested interests and public-private interactions. This study shows how e-Procurement helps to alleviate fraudulent activities in the Malaysian public procurement and it has a number of practical implementations and contributions. The experience and views on e-Procurement by Malaysian public officials can facilitate policy makers, enforcement agencies and researchers in understanding how to mitigate public procurement fraud using an automated and online environment. However, this study also concludes that e-Procurement is just a 'tool' to moderate public procurement fraud, not the solution to this problem.