 Jewish ethos sees economic activity as part and parcel of a moral way of life bringing us closer to G-d. Government as a prime source of economic activity has an obligation to create a climate where honesty and integrity in our financial affairs is the norm. This demands constant vigilance to ensure not only that deceptive practice i.e. misleading advertising are banned but the temptation for wrongdoing be minimized. Even creating a perception of misconduct is a violation of Halacha ( Ma'arit ayin) . This is especially so with public figures who have easy access to money and power (or its distribution) and are often fodder for gossip and slander. Thus our Sages rule that the kohanim servicing the Temple were not allow to have pockets lest they be accused - falsely or perhaps not- of personally pocketing money. In fact seven keys and seven people were needed to open the vaults of cash in the temple. Our internal controls must be the strongest when dealing with religious and charitable institutions.
Jewish law insisted that public funds were to be collected only in groups of two and distributed in groups of three. To allow otherwise invites accusations of, or perhaps even actual corruption. It thus appears that one should not give charity in cash to a lone individual. If there is no 'witness' one should then write a check. In fact the Torah itself spends many a verse detailing Moshe's accounting of monies raised to build the tabernacle an accounting necessitated by grumblings that Moshe was benefiting personally from the public till. Even (especially?) a Moshe Rabbeinu must not allow even the slightest pretext for charges of wrongdoings.
It is these concepts which call for all public institutions to conduct their activities in a transparent manner. Paper trails must be kept and no expenditures should be approved without proper mechanisms being followed. Contracts must be awarded on the basis of merit not nepotism or convenience. At the same time there is no reason to insist that all governmental contracts be awarded only to those firms who have no connections with government. As long as the decision making process is conducted in an independent, open and honest fashion all members of society should be allowed to compete equally including i.e. former partners or relatives of cabinet ministers.
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