Due to non-transparent public procurement, some IT companies in BiH are doing better than Microsoft

SARAJEVO, (Patria) - Ivana Korajlić from Transparency International , during the presentation of the "Monitoring of the implementation of the strategy for the fight against corruption in Bosnia and Herzegovina for the period 2015 - 2019", said that there is statistical progress in Bosnia and Herzegovina compared to previous strategies for the fight against corruption, but the essential laws related to the improvement of anti-corruption in the country are missing.

Centres for Civic Initiatives have been warning for several years that the most corruption in Bosnia and Herzegovina is in public procurement.

"When asked where it is most present, research, both domestic and foreign, as well as the daily perception of citizens, actually indicate that corruption is most present where there is the most power, i.e., where there is the most money."

According to CCI data, out of one billion euros, close to two-thirds relate to the value of tenders selected through public bidding procedures, while almost one-third, according to unofficial estimates, relates to direct agreement procedures and the like, which do not have the same level of transparency, reported Al Jazeera in March 2016.

A huge amount of money from public companies is extracted, among other things, through the suspicious procurement of various software for these companies. Software is often paid several times more than its real value, while public money is further drained through the maintenance of this software, which is an area particularly susceptible to manipulation.

In the database of the Center for Investigative Journalism , among the 50 companies that received the most money in public procurement of goods, services, and works from 2011 to 2015, there are at least five companies from the IT sector, such as the company Lanaco from Banja Luka , which received 81 contracts in state institutions or companies from 2011 to 2015, with a total value of nearly 40 million KM.

There is also the Zagreb-based company b4b , which received more than 16 million KM for 24 contracts in four years. The money was mostly received from Elektroprivreda BiH and Elektroprivreda HZ HB, for the procurement and maintenance of software known as SAP.

The database of the Center for Investigative Journalism also includes the private IT company BS Telecom, which received 24 contracts in six public companies from 2011 to 2015, with a total value of 32 million KM. This company received most of its contracts from BH Telecom and Elektroprivreda BiH.

Slobodna Bosna writes that BS Telecom is a private IT company founded as a Sarajevo subsidiary of the Prague-based company Strom, whose owners are close friends of the former leader of the SDP Zlatko Lagumdžija, which may explain the sharp increase in the revenue of this company, which has about 40 employees.

According to the business reports of this company, shown to Patria, BS Telecom reported revenue of 8.9 million KM from 2008 to 2011. From 2012 to 2014, the reported revenue of this company experienced a sharp increase and amounted to 62 million KM, all thanks to contracts with public companies. For the same period, expenses for salaries in this company fell from about 800,000 KM to about 570,000 KM.

The return on equity in BS Telecom is 514 percent, according to the business reports of this company. For comparison, according to data available on the Microsoft website, this global company reported a return on equity that did not exceed 32 percent.

The problem of public procurement in BiH was also recently highlighted by the Open Society Fund BiH. Monitoring teams, consisting of the Open Society Fund BiH, Eda Banja Luka Development Agency, Transparency International BiH, Center for Investigative Journalism BiH, and NGO "Tender" Banja Luka , monitored 173 contracting authorities and 1,566 ongoing public procurement procedures from April to September this year. The monitoring process covered all levels of government in BiH. The results of monitoring the transparency of contracting authorities showed that in April this year, 43 percent of contracting authorities did not have the legally required public procurement plan on their website, and other omissions were noted.