PRESS CONFERENCE BY CHIEF OF UNITED NATIONS PROCUREMENT SERVICE

At a Headquarters press conference today, Paul Buardes, Chief of the United Nations Procurement Service, highlighted the Service’s zero-tolerance policy on corruption, while outlining its role and responsibility within the Organization.

His office’s function was “unique”, in that it linked the United Nations to the commercial world, Mr. Buardes said.  Though the procurement process involved many stakeholders, its ownership lay in the hands of the procurement staff, who numbered 80.  When all missions and other offices were added to that number, however, it totalled 400.  Moreover, the procurement community -- governed both by financial regulation rules and by the Procurement Manual -- was responsible for the acquisition of approximately $2 billion annually.

The vendor registration process, first launched in 1996, he explained, was a prerequisite to doing business with the United Nations.  The Service had, later, in February 2004, launched a new, centralized registration process -- the United Nations Global Marketplace (UNGM).  “This UNGM should be a unique business portal for UN procurement,” he noted.  “So the purpose of the registration is to ensure that the vendors have the financial, technical capacity and expertise to execute the UN contract, while, at the same time, mitigating the risk for the Organization, and of course, adhering to the ethical values.”

In order to send a strong signal to vendors related to corruption, a number of new, contractual provisions had been added last year, he said.  While there were currently 5,900 vendors in the United Nations vendor database, Mr. Buardes urged more to register, as it was important to have a large base of vendors to ensure international competition.

Turning to the Vendor Review Committee -- an internal committee established by the Chief of the United Nations Procurement Service -- he said that it consisted of all Service section chiefs.  Field, logistics, support service and Headquarters were all represented.  The Committee’s objective was threefold: to review complaints from potential vendors denied access to the registration process, to address issues related to poor performance by vendors and to assess any information on alleged unethical or fraudulent behaviour by vendors.

Regarding the suspension or removal of a vendor from the United Nations database, neither the Vendor Review Committee nor the Procurement Service had dedicated resources or the authority to conduct investigations related to vendor fraud.  “It is not a [Procurement Service] core function, but we are working closely with the Procurement Task Force, part of the Office of Internal Oversight Service, to make sure that we exchange information on a confidential basis,” he said.

For its operations, the Vendor Review Committee relied on “triggers”, such as customer complaints about poor vendor performance or the non-responsiveness of a vendor during the negotiation process.  Other “triggers” included a Procurement Task Force report, addressing a potentially inappropriate relationship between a vendor and United Nations official, or press reports, which required validation by the Procurement Task Force.

On the subject of vendor suspension or removal, Mr. Buardes said that the criteria were the same for both, but with “a different degree of criticality of importance”.  When a vendor was suspended or removed, that vendor was blocked and flagged.  In certain instances, the Service could continue to do business under the current contractual agreement -- if any -- but the vendor would not be consulted for any future solicitation.  In other instances, the current contractual arrangement might be terminated immediately.  “It is a very strong signal to the vendor that this Organization is implementing a zero-tolerance policy,” he continued.

Turning to the United Nations procurement reform programme, Mr. Buardes touched on three important items: the strengthening of internal control measures; the optimization of the acquisition and procurement management; and the strategic management of United Nations procurement.

The senior vendor review committee, he said, needed to be composed of senior members from various departments, including the Ethics Office.  It would also be directly and permanently advised by the Department of Legal Affairs, the Procurement Task Force and the Office of Internal Oversight Services.  That committee would be better placed outside of the procurement function, so it could prevent the possibility of a perceived conflict of interest.  “We need to rebuild confidence and trust in procurement function and procurement activities, for the staff first, the Member States and the vendors.”

Responding to a question on the status of United Nations official Andrew Toh and his suspension, Mr. Buardes said he was unable to give such an update.  The Under-Secretary-General for Management, Alicia Bárcena, had already provided that, and he was neither part of the investigation, nor the process.

Referring to the Volga Dnepr case, in which the United Nations had decided to suspend registered vendors Corimec Italiana S.p.A and Volga Dnepr Airlines, as well as its subsidiary, Volga-Dnepr (Ireland) Ltd., in light of alleged inappropriate relationships between those vendors and a former United Nations official, Mr. Buardes said: “We are not doing business with them any more and, of course …this has an operational impact and even a financial impact …We try to minimize this effect by working closely with [the Department of Peacekeeping Operations] …but it is a strong signal, when we have the evidence provided by [the Procurement Task Force], that -- that’s it, we don’t do business, whatever the cost of this decision.”

In response to a question about the Secretary-General’s proposal to restructure the Department of Peacekeeping Operations and its possible effect on procurement, Mr. Buardes replied that, regarding the procurement function, the process was still ongoing.  In addition, it was important to support the customers.  The Department of Peacekeeping Operations was a major customer -- with 80 per cent of the Division’s business.  Clients also included information technology services, Facility Management Services and the Capital Master Plan. 

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For information media • not an official record