Taking a glimpse at corruption
In a recent survey of 150 high level officials from 60 third world countries by Gray and Kaufmann, the respondents ranked public sector corruption as the most severe obstacle confronting their development process.
Corruption is viewed as the use of public office for private gain, or in other words, use of official position by an office bearer for his own personal benefit. Intentional ill behaviour such as bribery, extortion, fraud, cheating, falsification, forgery embezzlement, nepotism, appropriation of public assets and property for private use, and undue influence on justice and framework of governance are considered as acts of corruption in different legal statutes.
When a corrupt act is already done and during committing an offence of corruption it is not detected and through this corrupt act, one is gained wealth which is disproportionate to his known source of income, then she/he will be prosecuted. Indirect method of detection of offences relating to ownership of property obtained not consistent with his legal sources of income or the property is not consistent with the known source of income is applicable to all public and private Bangladeshi citizens at large.
Subsidies, social safety nets and rationed prices etc are gray areas for corruption in many countries. Corruptions take place in obtaining licenses and permits to engage in lucrative economic activities such as importing certain goods in high demand and in short supply.
Moreover, bribe as a tool of corruption is given to acquire in-kind benefits such as access to privileged schools, hospitals etc. Bribes are used to reduce the amount of taxes, fees, dues, custom duties, and electricity and other public utility charges collected from business firms and private individuals. Bribes are offered to speed up the granting of permission, licenses and permits to carry out activities that are perfectly legal. This is the so-called "grease money" to turn the wheels of corrupt public post more smoothly, speedily and hopefully in the most wanted direction.
Bribes are used to provide incentives to regulatory authorities to refrain from taking action, and to look the other way, when private parties engage in activities that are in violation of existing laws, rules and regulations such as those relating to controlling pollution, preventing health hazards, or promoting public safety as in the case of building codes and traffic regulations.
The concept of rent seeking behaviour occupies a central place in the literature of the subject of corruption. Economic rent arise when a person has something unique or special and no competitors in his possession. A person who owns such a special asset without any competitors can charge a more than normal price for its use and earn economic rent or monopoly profit. This kind of rent seeking behaviour is dominant in many public offices such as passport office, gas office, land office, police stations, revenue office and so on where no alternative is available other than to visit those offices for a particular service.
If official rules are not transparent and are not made known in advance to all concerned and application of those are not impartial and be subject to frequent and arbitrary changes then opportunities are open for officials seeking grease money.
Discretionary powers represent another key in committing corruption. It takes place because it is not possible to devise rules and regulations that are watertight and foolproof and will take care of all issues in one platform. Each event is unique in public office under one regulation. Thus public official has the authority to interpret rules maintaining objectives for ends of justice. Hence, some flexibility and discretionary powers are given to administrators/judges in interpreting and implementing rules in accordance of its objectivity. But this interpretation of rule creates huge scope for corruption for an officer who is not guided by code of integrity.
The situation is most helpless when there are a large number of laws, rules, regulations, and administrative orders to guide business, commerce, tax, vat, custom duty and thereby creates huge opportunities for generating rent.
Underground economic activities exist in all countries. Drug trade or the smuggling business and human trafficking give rise to these types of activities and contribute directly to the rise of the underground economy. In the process of setting up the business things like procurement or leases for land and buildings, permission to engage in activities such as production, transport, storage, marketing, distribution, import and export; obtaining connections for water, gas, electricity and so on, bribe is obvious in many instances. It is propelled sometimes through an agent or sometimes directly by the officials.
Getting permissions are so difficult and complex for the industry, business, trade and commerce that they feel good to engage middle man than to engage themselves for getting those permission, license or service. For a poorer economy, talented local business people, entrepreneurs and industrialists signify a scarce and valuable resource. Their talents are wasted in rent seeking activities. They are supposed to engage productive work but many surveys have revealed that business people have to spend a lot of management time in discussions, negotiations and waiting for appointments with corrupt public officials.
In any society, there are laws and regulations to serve social objectives and to protect the public interest, such as building codes, environmental controls, traffic laws and prudential banking regulations. Violating these laws for economic gain through corrupt means causing serious social harm.
Violating building codes through the involvement of corrupt officials and building contractors has resulted in collapse of apartment buildings, department stores and hotels. Failure to observe proper fire prevention and safety regulations has caused supermarkets, garment factory, hotels to go up in flames. Overloaded ferries and passenger ships have sunk in seas and rivers. Paying bribes to operate un-roadworthy and poorly maintained vehicles have led to accidents on the highways very often thus causing huge loss of lives.
Use of substandard materials and disregard for proper design and engineering specifications, due to corruption, have caused bridges to collapse and dams to burst, resulting in heavy loss of life and property. Incomprehensible trading practices in share markets and financial scams in Banks and financial institutions and poorly supervised financial systems have created serious economic consequences in many economies.
Magnitude of the causes of corruption that discussed here itself reveals what reform measures are needed. The rich and the powerful, the main gainers of a corrupt system, always want to keep existing systems on the run. If anyone wants to oppose defective process and thus demands reform agenda, she/he is highly censured in anywhere in the world. Possible task for policymakers could be to improve the governance at all level for the interest of the majority people that could reduce the discretionary power of officials, make harder the preferential gains from corruption, and decrease both the means and dispersion of corruption.
The writer is a former Senior Secretary