graft and corruption essay

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A full set of resources to accompany this feature can be downloaded for free here. Calling all English teachers: does this sound familiar? As structure gcse english lit essay go through extracts in the last lesson on Friday afternoon, you ask carefully crafted questions, and note with satisfaction how students shoot their hands up in a flash, like Barry Allen on the run. Later, back at home, you mark them. What went wrong?

Graft and corruption essay ethique et politique dissertation

Graft and corruption essay

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Economist I. Senior defines corruption as an action to a secretly provide b a good or a service to a third party c so that he or she can influence certain actions which d benefit the corrupt, a third party, or both e in which the corrupt agent has authority. Corruption can occur on different scales. There is corruption that occurs as small favours between a small number of people petty corruption , corruption that affects the government on a large scale grand corruption , and corruption that is so prevalent that it is part of the every day structure of society, including corruption as one of the symptoms of organized crime.

Grand corruption is Social Graft manipulation, flattery and other corrupt practices used to secure unmerited advantages or gains in social or business politics. If you lived with her you'd know she's enraged all the time. But as an expert at social graft , she's all smiles and platitudes to the outside world.

Corruption In philosophical, theological, or moral discussions, corruption is spiritual or moral impurity or deviation from an ideal. Government, or 'political', corruption occurs when an office-holder or other governmental employee acts in an official capacity for his or her own personal gain.

This article deals with the commonplace use of the term corruption to mean dishonest or fraudulent conduct by those in power. Graft and corruption was considered as the biggest problem of all. In , public perception was that corrupt government officials are greater threat to the country than the communist guerrillas. Former President Fidel V. There are 8 types of corruption frequently practiced in the Philippines namely: tax evasion, ghost projects and payrolls, evasion of public bidding in awarding of contracts, passing of Information was compiled by the author from documents, articles, newspaper clippings and other data gathered from the reports and journals of the Ombudsman and the Sandiganbayan, two of the constitutional bodies mandated by Philippine law to investigate and act on complaints filed against public officials and employees for violations of graft and corrupt practices.

More specifically, this report will cover input from an unpublished research paper prepared by scholars from the University of the Philippines, College of Public Administration, whom I will accordingly acknowledge in this work. The first portion will introduce the theoretical perspective and context of corruption in the Philippines. It clarifies the national context within which corruption operates.

It will look into the intersection of corruption and Philippine history and culture. It will likewise discuss some public perceptions of corruption. Estimates of the extent and losses of corruption in the Philippines will be briefly discussed. In a common view, corruption is misused money which causes a deficit for the country itself. A misused of power can also be a definition of corruption. Corruption in Indonesia is already going from Ir.

Soekarno era. Even though Ir. Soekarno is well known as a great leader and a great orator, he ever did a corruption which caused him to be overthrown from his era in Indonesia. Corruption which he did is proclaiming himself as a lifetime President of Indonesia. Based on World Justice There is corruption that occurs as small favours between a small number of people petty corruption , while there is the corruption that affects the government on a large scale grand corruption , and corruption that is so prevalent that it is part of the every day structure of society systemic corruption.

Examples include the exchange of small improper gifts or use of personal connections to obtain favors. This form of corruption is particularly common in developing countries and where public servants are significantly underpaid. It brings about frustration and cynicism which could undermine faith and confidence in the viability and effectiveness of the democratic system. Graft and corruption are encouraged by public apathy which results from bad and ill-managed government.

But its most important and potent medium is the individual official or employee. Let us take the Bureau of Customs as a case in point, since it is the number one collecting arm of government which account for four-fifths of the total governmental revenue generated. This entity administers control and police authority over all harbors, piers, airports, wharves, ports, bays, rivers and inland waters throughout the Philippines.

Its general duties and powers include assessment and collection of lawful revenues from imported goods and other fees, charges, dues, fines and penalties. It is charged with preventing and suppressing smuggling; supervision and control over the entrance and clearance of vessels and aircraft engaged in foreign trade; enforcement of customs and tariff laws and other rules and regulations relating to tariff and customs administration; supervision over the handling of foreign mail to collect duties on articles smuggled through mails; control import and export cargoes landed and stored in piers, airports, terminal and depot facilities like container yards and flight stations, and exercises jurisdiction over seizure and forfeiture cases in accordance with tariff and customs laws.

While the Bureau of Customs exercises extensive powers, these powers could be abused especially if these entail discretion. Newspaper reports of customs men charged of fraud, smuggling rings bared, and cargoes worth millions seized, are not uncommon. The following are typical examples of these reports: 1. The assorted contraband ranged from expensive electronic goods to highly dutiable textile materials and ready-to-Wear apparel.

The suspected ring leader tried to bribe a team of operatives during the raid. The merchandise included electronic goods, household wares, toys, and ready-to-wear clothes. Unscrupulous traders declared their food flour imports as industrial flour to do away with paying higher taxes. Smuggled food flour posed unfair competition with the imported ones which were legally paid for. There are three types of phenomena contained in the term corruption; bribery, extortion and nepotism.

They are not completely identical, but can be classified under one heading. Essentially there is a common thread running through these three types of phenomena — the subordination of public interests to private aims involving violation of the norms of duty and welfare, accompanied by secrecy, betrayal, deception and a callous disregard for any consequence suffered by the public. Another phenomenon which can be described as corruption is the appointment of relatives, friends or political associates to public offices regardless of their merits and the consequences on the public wealth.

This is called nepotism. One catalyzing agent of graft and corruption is red tape. This is a bureaucratic procedure characterized by excessive and unnecessary — delay in transacting business with government which is intentionally committed. It is a practice that slows down or hampers the delivery of much-needed basic services.

When there is undue delay in the processing of transactions, people resort to fixers who collude with corrupt employees and officials to expedite business transactions. This is a common phenomenon in government offices. Fixers with connections inside the different offices facilitate the issuance of marriage license or certificate of birth or of death.

After all, marriages are not made in heaven but at the city hail with the price set by the fixer. This is the price paid for the inefficiency of the bureaucracy however unethical the practice is Nepotism. Nepotism is a version of graft and corruption exemplified by favors showered on relatives by appointing them to government positions regardless of qualifications.

The practice may be viewed as an aid to responsive management if blood relatives do their share in achieving organizational goals with minimum time and effort expended. On the other hand, nepotism can be pernicious to society if the relatives in the employ of government use blood relationship as the key to open themselves to the opportunity of improving their lives at the expense of public good and general welfare.

In the Philippines, nepotism is not without historical antecedents. The barangay of early Philippine society was viewed more as a socio-economic unit composed of members with consanguinial ties and those related by affinity. Cooperation in the community was a function of personal connection than pre-determined programs and impersonal procedures.

These historical antecedents nurtured a tradition and a culture which considered public office more as a source of private gain than a public trust. The prohibition against nepotism is articulated best in the statement made by the late Ferdinand Marcos in If he offends the new society, he should be punished like the rest.

Critics maintain that it was during the Marcos era that nepotism was institutionalized. The Aquino administration also showcased nepotism. If the Marcoses and the Romualdezes had their day, the Aquinos and the Cojuangcos also have theirs.

The Ramos administration and the Estrada administration have their respective shares too. So what else is new? After all unethical behavior and practices have always been with us. In our Muslim society, this problem is of more acute proportion. But why the insatiable desire of relatives of presidents to serve in government? Why do public officials appoint relatives to sensitive positions?

Should personal loyalty and intimacy outweigh competence, seniority and the merit system? These are administrative dilemmas which have to be resolved. In the Philippines, there is a strong belief that corruption is prevalent. In a Social Weather Stations SWS survey, more than 70 percent of the respondents thought that corruption existed in government. The Philippines scored 3. Indeed, in a society with a long history of rapacity and plunder in the ranks of the state and the elite, and powerlessness among the masses, the use of public office has been identified with gaining and maintaining economic, political and social power.

Both private citizens and government employees habitually use this office to further their self-interest at the expense of the common good. This custom has prevailed in the Philippines under a long and continuing regime of rent capitalism, in contrast to production-oriented capitalism.

Here is the anatomy of some types of corruption, taken from the website ofthe Transparent Accountable Governance project. Textbook scams According to the article of Yvonne T. Chua of the Philippine Center for Investigative Journalism, up to 65 percent of textbook funds are reserved as bribe money. The range is from 20 percent to 65 percent.

Take the case of the medium-sized book publisher caught in January The total is about half the size of the contract she won. The total lost money may be bigger. In a cabinet member told journalists that commissions on public works ran up to an average 30 percent of the project cost. He cited an engineer who supervised road pavement projects in an Eastern Visayas district.

Only gravel now occupies that section, though covered by a thin covering of cement. A piece by Stella Tirol tells of the corruption that takes place in elections. A common means is the simple dole-out. One congressional candidate in Southern Luzon gave out as much as P 10, a day in the barrios. The rate then was P per voter. Election eve would require some P 4 million. The more sophisticated way is to get the barangay captain to your side. One barangay captain she interviewed admitted that he and other barangay captains were offered P 30, each.

A bidding competition would ensue among the candidates. The legal infrastructure and political commitment are supported and complemented by the existence of oversight institutions. The creation of the oversight institutions that deal with issues of ethics, accountability, graft and corruption are mandated by the Constitution. The common feature of these institutions is they enjoy a substantive degree of fiscal autonomy in the sense that they are not subject to the fiscal controls of the executive.

The budget is directly released to these institutions and the heads are authorized to realign savings from their budget. They also have quasi-judicial powers in that they can adjudicate and decide cases and enforce their own decisions, including the imposition of sanctions which may include suspension from office or even dismissal from government service. In the Philippines, the three constitutionally mandated oversight institutions are the Civil Service Commission, the Office of the Ombudsman and the Commission on Audit.

The Civil Service Commission is the central personnel agency of the government. One approach is regulatory, the other, corrective, and the last one, developmental. For instance, CSC prescribes qualification standards for each and every position in the Philippine government. Non-compliance with the QS by agencies in the processing of appointments of their staff results in the disapproval by the CSC of such appointments.

But, apart from the substantive requirements for practically all kinds of personnel actions such as the publication requirement and the promotion and selection board processes. Non-compliance with the procedural requirements constitutes ground for corrective or even punitive action. However, administrative discipline is not a function within the exclusive jurisdiction of CSC. Agency heads as well as the Office of the Ombudsman also have the authority to proceed against erring government officials and employees.

The third approach is developmental and will be discussed later in the succeeding paragraph. The Office of the Ombudsman acts as a prosecutor against those charged with the violation of RA , RA and the law against ill-gotten wealth, among others. It is mandated to investigate and prosecute the criminal liability of public officials and employees involved in graft and corruption.

The Commission on Audit is the fiscal watchdog of the government. COA is responsible for ensuring legal and proper disbursement of public funds and preventing irregular, unnecessary, or extravagant expenditures or usage of public funds. It also has quasi-judicial powers. All these oversight institutions enforce accountability ethic in government. Traditional approaches since independence, numerous mechanisms have been designed to counteract corruption in the Philippines.

Since , various Philippine presidents, from Quirino to Estrada, have created antigraft and corruption investigation units and agencies. The council was established through a memorandum of agreement among these agencies on June 11, the DOJ was admitted in At present, the Ombudsman and the PCAGC are the principal actors in government to act on complaints and cases of graft. Some of the cases are resolved by the Ombudsman while the others are elevated to the Sandiganbayan.

Cases where the accused have been found guilty are sent to the Supreme Court or to the Court of Appeals. Currently, administrative cases are automatically sent to the Court of Appeals while criminal cases like the violation of the AntiGraft and Corruption Practices Act go directly to the Supreme Court. The issues of ethics and accountability pose a continuing challenge to the Philippine government. The mechanisms and infrastructure that have been put in place, as outlined in this paper, may not yet be the best or ideal in the sense that ethical and accountable behavior in the public sector is still much to be desired in the Philippines.

But, there is so much hope to hold and believe that there will be many opportunities to lead and change for the best. Public officers and employees must, at all times, be accountable to the people, serve them with utmost responsibility, integrity, loyalty, and efficiency; act with patriotism and justice, and lead modest lives.

Section 2. All other public officers and employees may be removed from office as provided by law, but not by impeachment. Section 4. The present anti-graft court known as the Sandiganbayan shall continue to function and exercise its jurisdiction as now or hereafter may be provided by law. Section 5. A separate Deputy for the military establishment may likewise be appointed.

Section The Office of the Ombudsman shall have the following powers, functions, and duties: 1 Investigate on its own, or on complaint by any person, any act or omission of any public official, employee, office or agency, when such act or omission appears to be illegal, unjust, improper, or inefficient.

No loan, guaranty, or other form of financial accommodation for any business purpose may be granted, directly or indirectly, by any government-owned or controlled bank or financial institution to the President, the Vice-President, the Members of the Cabinet, the Congress, the Supreme Court, and the Constitutional Commissions, the Ombudsman, or to any firm or entity in which they have controlling interest, during their tenure.

A public officer or employee shall, upon assumption of office and as often thereafter as may be required by law, submit a declaration under oath of his assets, liabilities, and net worth. In the case of the President, the Vice-President, the Members of the Cabinet, the Congress, the Supreme Court, the Constitutional Commissions and other constitutional offices, and officers of the armed forces with general or flag rank, the declaration shall be disclosed to the public in the manner provided by law.

Who Are Public Officers? Frauds against the public treasury and similar offenses. In his official capacity, in dealing with any person with regard to furnishing supplies, the making of contracts, or the adjustment or settlement of accounts relating to public property or funds, shall enter into an agreement with any interested party or speculator or make use of any other scheme, to defraud the Government; 2.

Being entrusted with the collection of taxes, licenses, fees and other imposts, shall be guilty of any of the following acts or omissions;. When the culprit is an officer or employee of the Bureau of Internal Revenue or Bureau of Customs, the provisions of the Administrative Code shall be applied. Prohibited transactions. Possession of prohibited interest by a public officer.

This provision is applicable to experts, arbitrators and private accountants who, in like manner, shall take part in any contract or transaction connected with the estate or property in appraisal distribution or adjudication of which they shall have acted, and to the guardians and executors with respect tom the property belonging to their wards or estate. Malversation of public funds or property; Presumption of malversation.

Failure of accountable officer to render accounts. Failure of a responsible public officer to render accounts before leaving the country. Illegal use of public funds or property. In either case, the offender shall also suffer the penalty of temporary special disqualification. If no damage or embarrassment to the public service has resulted, the penalty shall be a fine from 5 to 50 per cent of the sum misapplied. Failure to make delivery of public funds or property.

This provision shall apply to any public officer who, being ordered by competent authority to deliver any property in his custody or under his administration, shall refuse to make such delivery. The fine shall be graduated in such case by the value of the thing, provided that it shall not be less than 50 pesos.

The person giving the gift, present, share, percentage or benefit referred to in subparagraphs b and c ; or offering or giving to the public officer the employment mentioned in subparagraph d ; or urging the divulging or untimely release of the confidential information referred to in subparagraph k of this section shall, together with the offending public officer, be punished under Section nine of this Act and shall be permanently or temporarily disqualified in the discretion of the Court, from transacting business in any form with the Government.

Prohibition on private individuals. Family relation shall include the spouse or relatives by consanguinity or affinity in the third civil degree. Prohibition on certain relatives. Prohibition on Members of Congress. The provision of this section shall apply to any other public officer who recommended the initiation in Congress of the enactment or adoption of any law or resolution, and acquires or receives any such interest during his incumbency.

It shall likewise be unlawful for such member of Congress or other public officer, who, having such interest prior to the approval of such law or resolution authored or recommended by him, continues for thirty days after such approval to retain such interest. Statement of assets and liabilities. Dismissal due to unexplained wealth. Properties in the name of the spouse and unmarried children of such public official may be taken into consideration, when their acquisition through legitimate means cannot be satisfactorily shown.

Bank deposits shall be taken into consideration in the enforcement of this section, notwithstanding any provision of law to the contrary. Penalties for violations. Any complaining party at whose complaint the criminal prosecution was initiated shall, in case of conviction of the accused, be entitled to recover in the criminal action with priority over the forfeiture in favor of the Government, the amount of money or the thing he may have given to the accused, or the value of such thing.

The violation of said section proven in a proper administrative proceeding shall be sufficient cause for removal or dismissal of a public officer, even if no criminal prosecution is instituted against him. Competent court. Prescription of offenses. Termination of office. Suspension and loss of benefits. Should he be convicted by final judgment, he shall lose all retirement or gratuity benefits under any law, but if he is acquitted, he shall be entitled to reinstatement and to the salaries and benefits which he failed to receive during suspension, unless in the meantime administrative proceedings have been filed against him.

Nothing in this Act shall be interpreted to prejudice or prohibit the practice of any profession, lawful trade or occupation by any private person or by any public officer who under the law may legitimately practice his profession, trade or occupation, during his incumbency, except where the practice of such profession, trade or occupation involves conspiracy with any other person or public official to commit any of the violations penalized in this Act.

Any public official and employee, whether of the national or local governments, to receive, directly or indirectly, and for private persons to give, or offer to give, any gift, present or other valuable thins on any occasion, including Christmas, when such gift, present or other valuable thing is given by reason of his official position, regardless of whether or not the same is for past favor or favors or the giver hopes or expects to receive a favor or better treatment in the future from the public official and employee concerned in the discharge of his official functions.

Included within the prohibition is the throwing of parties or entertainments in honor of the official and employee or his immediate relatives. For violation of this Decree, the penalty of imprisonment, for not less than one 1 year nor more than five 5 years and perpetual disqualification from public office shall be imposed. The official and employee concerned shall likewise be subject to administrative disciplinary action and, if found guilty, shall be meted out the penalty of suspension or removal, depending on the seriousness of the offense.

Section 1. Through misappropriation, conversion, misuse, or malversation of public funds or raids on the public treasury; 2. By the illegal or fraudulent conveyance or disposition of assets belonging to the National government or any of its subdivisions, agencies or instrumentalities or government-owned or controlled corporations and their subsidiaries; 4. By obtaining, receiving or accepting directly or indirectly any shares of stock, equity or any other form of interest or participation including the promise of future employment in any business enterprise or undertaking; 5.

By taking undue advantage of official position, authority, relationship, connection or influence to unjustly enrich himself or themselves at the expense and to the damage and prejudice of the Filipino people and the Republic of the Philippines. Definition of the Crime of Plunder; Penalties. Any person who participated with the said public officer in the commission of an offense contributing to the crime of plunder shall likewise be punished for such offense. In the imposition of penalties, the degree of participation and the attendance of mitigating and extenuating circumstances, as provided by the Revised Penal Code, shall be considered by the court.

The court shall declare any and all ill-gotten wealth and their interests and other incomes and assets including the properties and shares of stocks derived from the deposit or investment thereof forfeited in favor of the State. Competent Court. Rule of Evidence. Suspension and Loss of Benefits. Should he be convicted by final judgment, he shall lose all retirement or gratuity benefits under any law, but if he is acquitted he shall be entitled to reinstated and to the salaries and other benefits which he failed to receive during suspension, unless in the meantime, administrative proceedings have been filed against him.

Prescription of Crime. However, the right of the State to recover properties unlawfully acquired by public officers from them or from their nominees or transferees shall not be barred by prescription, laches, or estoppel. Separability of Provisions.

It erodes the moral fabric of our people, robs the poor, increases the costs of doing business, erodes tax collection efforts, and drives away investments. The World Bank estimates that at least 20 percent of government project funds ends up as kickbacks.

We can no longer fight corruption piecemeal. We need a comprehensive approach that would reduce opportunities for corruption; remove needless regulations and simplify procedures; eradicate the end to recover electoral expenses by corrupt means; increase public vigilance both to deter and to detect commissions of graft; reform budget processes; improve meritocracy in the civil service; target selected departments and agencies for cleansing; increase the efficiency and speed in catching offenders and their prosecution; stiffen sanctions against corruption partnerships with the private sector; and support judicial reform to make the courts part of the solution rather than part of the problem.

The courts should not allow themselves to be used as a refuge for scoundrels. By: Avelino P. Tendero 2. Eric Vincent C.

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Diagnostic surveys of corruption in Bosnia -Herzegovina, Ghana, Honduras, Indonesia and Latvia report that government institutions with the highest levels of corruption tend to provide lower quality services. The converse is also true: in Romania, the survey shows that state sector entities with better systems of public administration tend to have lower levels of corruption. The literature shows that corruption impacts the quality of government services and infrastructure and that through these channels it has an impact on the poor.

This is particularly the case in the health and education sectors. Enhanced education and healthcare services and population longevity are usually associated with higher economic growth. But under conditions of extensive corruption, when public services, such as health and basic education expenditures that especially benefit the poor, are given lower priority in favor of capital intensive programs that offer more opportunities for high-level rent taking, lower income groups lose services on which they depend.

As government revenues decline through leakage brought on by corruption, public funds for poverty programs and programs to stimulate growth also become more scarce. Gupta, Davoodi and Tiongson used regression analysis across a large sample of countries to assess an aggregate measure of education outcome and health status in a model that includes several corruption indices, per capita income, public spending on health care and education, and average years of education completed.

The results supported the proposition that better health care and education outcomes are positively correlated with lower corruption. In particular, corruption is consistently correlated with higher school dropout rates15 and corruption is significantly correlated with higher levels of infant mortality and lower-birth weights of babies. Mauro looked at the relationship between corruption and the composition of government spending.

He found evidence that corrupt governments may display predatory behavior in deciding how to distribute government expenditures. Specifically, his data showed corruption 12 negatively related to education and health expenditures. Extrapolating from his findings, an increase in the point corruption score, from 6 to 8, would yield an increase in education spending by one-half of one percent of GDP Mauro, Countries with higher corruption tend to have lower levels of social spending, regardless of level of development.

Corruption lowers tax revenues, increases government operating costs, increases government spending for wages and reduces spending on operations and maintenance, and often biases government toward spending on higher education and tertiary health care rather than basic education and primary health care. Impaired Governance Increases Poverty Pioneering research on the relationship among corruption, governance and poverty has been conducted at the World Bank by the team of Kaufmann, Kraay and Zoido-Lobaton.

Their studies suggest an association between good governance with control of corruption as an important component and poverty alleviation. Using a database of over indicators of governance taken from a wide variety of cross-country studies for the years , the team constructed aggregate indicators corresponding to six governance concepts. Analysis showed a strong positive causal relationship running from improved governance to better development outcomes as measured by per capita income.

Analysis of updated indicators for did not change these conclusions. The authors attribute this second finding to state capture. In short, the authors suggest that corruption in the form of state capture may interfere with the expected relationship between economic growth higher per capita incomes and better governance.

The authors note that an empirical in-depth examination of the phenomenon of state capture in the Latin American and The Caribbean LAC region is part of the upcoming research agenda. The deterioration in governance discussed in this study was accompanied by an increase in both corruption and poverty. Thus, as seen earlier, increases in corruption tend to deteriorate governance practices, but the reverse holds true as well — reduction in governance capacity increases the opportunities for corruption.

Reduced Public Trust in Government Increases Vulnerability of the Poor Corruption that reduces governance capacity also may inflict critical collateral damage: reduced public trust in government institutions.

As trust — an important element of social capital — 13 eclines, research has shown that vulnerability of the poor increases as their economic productivity is affected. The concept of social capital refers to social structures that enable people to work collectively for the good of the group. Empirical studies point to an association between low social capital and poverty, although the relationship is difficult to test and difficult to disentangle empirically from affluence and democracy.

One of the effects of widespread corruption in government services is that it appears to contribute to disaffection and distrust, and this appears to impact particularly heavily on the poor. Lack of trust has economic consequences: when people perceive that the social system is untrustworthy and inequitable, this can affect incentives to engage in productive activities.

They added the WVS trust measure to investment and growth regressions and found that trust correlated highly with economic growth. Each 12 percentage point rise in trust was associated with an increase in annual income growth of about 1 percentage point. They also found that the impact of trust on growth is significantly higher for poorer countries, suggesting that interpersonal trust is more essential where legal systems and financial markets are less well developed.

In a later study, Zak and Knack found that trust is higher in nations with stronger formal institutions for enforcing contracts nd reducing corruption, and in nations with less polarized populations as measured by income or land inequality, ethnic heterogeneity, and a subjective measure of the intensity of economic discrimination. They also showed that formal institutions and polarization appear to influence growth rates in part through their impacts on trust.

For example, income inequality, land inequality, discrimination and corruption are associated with significantly lower growth rates, but the association of these variables with growth dramatically weakens when trust is controlled for. Knack also looked at the effect of social capital on income inequality.

His study regressed various indicators of social capital and trust against income data by quintile and found that higher scores on property rights measures were associated with declines in income inequality. Using the WVS trust indicator, he also found that inequality declined in higher trust societies. Each 8 or 9 point increase in the percent trusting was associated with a one- point decline in Gini.

This partial correlation was only marginally significant, however. Table 1 summarizes the major findings of this report. Table 1. Corruption is associated with low economic growth Corruption reduces domestic investment and foreign direct investment Corruption increases government expenditures Corruption reduces public sector productivity Corruption distorts the composition of government expenditure, away from services directly beneficial to the poor and the growth process, e.

High state capture makes it difficult to reduce inequality, even with growth Extensive, organized, well institutionalized and decisive political competition is associated with lower corruption Trust is a component of social capital. Higher social capital is associated with lower poverty. Corruption undermines trust in government and other institutions and thereby undermines social capital. If carefully crafted, anti-corruption programs might yield important poverty reduction results.

There are many unanswered questions in the research, particularly regarding the manner in which these factors manifest themselves in different countries. More attention needs to be given to linking theory to empirical endeavors and to generating practical policy insights based on this 15 research.

Finally, much can be learned from the experience of countries and donor organizations that initiate anti-corruption and anti-poverty programs. Compiling and analyzing such experience would provide valuable insights for future planning. Cartier-Bresson, Jean. Easterly, William. Feldman, Tine Rossing and Susan Assaf. Goudie, Andrew and David Stasavage. Gray, Cheryl W. Guttman, Michel. Heidenheimer, Arnold J. Political Corruption: Concepts and Contexts. Johnston, Michael. Johnston, Michael and Sahr Kpundeh.

Karstedt, Susan. Kaufmann, Daniel. Kaufmann, Daniel and Aart Kraay. Christiaan Grootaert and Thierry van Bastelaer, eds. Knack, Stephen. Knack, Stephen and Philip Keefer. A Cross-Country Investigation. Krueger, Anne O. Lambsdorff, Johann Graf. Handbook on Using Corruption Assessments. Management Systems International b. Handbook on Using Existing Corruption Indices. Mauro, Paolo. March Mauro, Paulo.

Murphy, Kevin M. Institutions, Institutional Change and Economic Performance. Cambridge University Press. Quibria, M. Rose-Ackerman, Susan. Corruption: A Study in Political Economy. NY: Academic Press. Corruption and Government: Causes, Consequences and Reform. Salinger, Lynn, and Dirck Stryker.

Spector, Bertram I. Tanzi, Vito. Tanzi,Vito and Hamid Davoodi. Human Development Report New York: Oxford Univ. Wolf, Thomas and Emine Gurgen. IMF Working Paper. World Bank. Washington D. Oxford University Press. World Bank and Oxford University Press. Corruption in Bangladesh Surveys: An Overview. Draft, April 18, Bosnia and Herzegovina: Diagnostic Surveys of Corruption. Corruption in Small and Medium-Sized Enterprises. Regional Networking Project, Freedom House. May Executive Summary, Second Draft, undated.

August Commissioned by the World Bank. Draft, January 9, Report: Corruption in Latvia: Survey Evidence. Diagnostic Surveys of Corruption in Romania. Corruption in Slovakia: Results o f Diagnostic Surveys. See Annex 1, Bibliographic Table. UNDP Knack suggests that second generation governance indicators should have greater specificity in measuring performance, increased transparency and replicability in their construction, and give greater attention to measuring governmental processes or institutions.

Tests for directionality showed that it appears to be corruption that increases poverty. For a summary discussion of these points, see Mauro For further discussion of the theoretical reasoning, see Heidenheimer and Johnston , specifically Chapter 19, Corruption and Development: A Review of the Issues, pp. Cross country empirical studies confirm the negative impact of corruption on economic growth.

See also Heidenheimer and Johnston Introduction to Part VI, Corruption and Economic Growth 7 For clarity, abbreviated references to the diagnostic studies are by country name rather than by name of author. References to the diagnostic studies are grouped at the end of the bibliography.

The transition economies have been particularly vulnerable to state capture because of the socialist legacy of fused economic and political power. Lambsdorff questions whether inequality may also contribute to corruption. We have not found direct empirical support for reverse causality, though there is some indirect support in Kaufmann and Kraay, , discussed below.

The question of the direction of causality is debated in several of the sources reviewed for this report. There is some empirical evidence of causality running from corruption to poverty. Dollar and Kraay, ; Gupta, Although intuitively it would seem that there might also be reverse causality i. There is some evidence, however, of reverse causality running from per capita incomes to governance. See Kaufmann and Kraay , discussed below.

Quibria suggests that a factor in this growth was the containment of corruption to the centralized type which he considers less costly to growth than more generalized or chaotic corruption. Gupta, Davoodi and Tiongson at Although the relationship held for most of the aggregate indicators, the test of the relationship between the aggregate indicator for corruption and increase in per capita income did not hold up. Specification tests reported the p-value associated with the null hypothesis that the instruments affect income only through their effects on governance.

For five out of the six aggregate indicators, the null hypothesis was not rejected, which was evidence in favor of the 20 identifying assumptions. Corruption was the aggregate indicator for which the null hypothesis was rejected. This suggested that the aggregate indicator was not an adequate independent measure of corruption.

Rather, in this set of countries, we have found it difficult to find exogenous variations in the causes of graft which make it possible to identify the effects of graft on per capita incomes. Section 1 of Article XI states that:. Public office is a public trust.

Public officers and employees must at all times be accountable to the people, serve them with utmost responsibility, integrity, loyalty, and efficiency, act with patriotism and justice, and lead modest lives. This provision requires every public official and employee to exhibit and live certain values while in government service.

In , the Philippine legislature passed Republic Act No. These norms or standards are:. Commitment to public interest Professionalism Justness and sincerity. Political neutrality Responsiveness to the public Nationalism and patriotism Commitment to democracy Simple living.

The Code, likewise, introduced some reforms in the administrative systems like giving heads of agencies the responsibility of ensuring there is a value development program for their employees; continuing studies on work systems and procedures with the end in view of improving the delivery if public services; and, mandating the designation of a resident Ombudsman in every department, office and agency.

Incentives and rewards system has also been put in place. Another comprehensive law passed to address and curb the commission of malfeasance in government is Republic Act No. In Section 1 of this law, it states that:. It is the policy of the Philippine Government, in line with the principle that a public office is a public trust, to repress certain acts of public officer and private persons alike which constitute graft and corrupt practices which may lead thereto.

This law specifies eleven 11 instances of corrupt practices in addition to acts or omissions already penalized by existing laws: Sec. Corrupt practices of public officers. This provision shall apply to officers and employees of offices or government corporations charged with the grant of licenses or permits or other concessions.

Interest for personal gain shall be presumed against those public officers responsible for the approval of manifestly unlawful, inequitable, or irregular transaction or acts by the board, panel or group to which they belong. The Constitution of provides six grounds as basis for initiating impeachment proceedings against high ranking government officials, among which are graft and corruption.

The President, the Vice-President, the Members of the Supreme Court, the Members of the Constitutional Commissions, and the Ombudsman may be removed from office on impeachment for, and conviction of, culpable violation of the Constitution, treason, bribery, graft and corruption, other high crimes, or betrayal of public trust.

Article XI Sec. Constitution These are unethical conduct ubiquitously present in all systems of government. The problem is not so much the present but rather the extent of its use and the negative effects upon the bureaucracy. The inference is that where there is dishonesty, there is the corresponding decrease of efficiency and productivity.

Applied to public management, there will therefore be inefficient and poor delivery of service, and if the segment of the bureaucracy infested is a revenue collecting entity, like the Bureau of Customs and the Bureau of Internal Revenue, this could only mean a much depreciated revenue collection.

The identity or similarity of their consequences, notwithstanding, In the Bureau of Internal Revenue, graft takes the form of falsification and manipulation of financial documents and other records and delay in forwarding remittance collections. Contract graft in public works construction may take the form of sealed bids which are but a formality because there already is a pre-arranged winner of the bid.

The use of substandard construction materials is also another form of graft. Colonial roots The use of public office for private ends by government officials and private businessmen has been evident since the Spanish colonial period. The evidence of embezzlement of funds was destroyed and the cabezas de barangay were obliged to sign blank financial statements. Corrupt governors hid monies from the administration in Manila.

They also found ways to discourage the natives from working so they would be thus liable to fines. Taxes and fees were arbitrarily set and excessively high, and illegal fines were often collected. Governors could embezzle the salaries of public officials and often demanded gifts from their hosts when they made official visits. Gifts were also necessary so that false documents would not be issued. The reasons for corruption were many: the governors had executive, legislative and judicial powers.

No checks and balances were built into the system, and when they were, they were unenforceable. Many Filipinos today believe that corruption was negligible during the American colonial era. The US colonial authority similarly tried to restrain rent-seeking by an emerging national elite.

And although it was penetrated and manipulated by these elites, the colonial bureaucracy managed to maintain its influence until the s. Although American colonial rule tried its best at eradicating corruption, there were incidents that already indicated its prevalence. Paul D. Hutchcroft , for example, cites the solvency problems faced by the Philippine National Bank less than five years after its establishment in Loans were given out without consultation and went to well connected agricultural families, directors or interests controlled by directors.

In , an accounting firm reported that the PNB had squandered the entire capital stock contributed by the government as well as half of all government deposits in the bank. American colonial rule also helped develop another building block for the national spread of corruption. It maintained and expanded a big and interventionist government within a democratic framework. At the start, the colonial administrators promoted an economy led by private enterprise, and big business in particular, following the trend in the United States at the time.

However, beginning in , the government took an active role in the promotion of economic growth. Then, in , the colonial administrators increasingly interfered in business. With this legacy came expanded opportunities for corruption. These included granting individuals and organizations of special favors, policy changes, licenses, business contracts, and even employment which in a patron client system redound to personal gain. Such practices effectively destroyed the development of a merit system in the Philippines.

After political independence in , writers like nationalist Renato Constantino bewailed the pervasiveness of corruption in Philippine society. During election time the principal issue is always graft and corruption. No wonder public concern is almost exclusively centered on malfeasance in government.

But with every change of administration, the problem only becomes aggravated. The panaceas and the grandiose promises fizzle out. The accusers become the accused; the halo of righteousness changes heads. The list of dishonor is different but corruption remains the same. Graft and corruption persist, like a cancer gnawing at our entrails, showing no signs of abatement and consigning us to a state of helplessness and hopelessness.

This was not surprising considering the concentration of state powers in the President at the time. Unlike in previous administrations that more or less observed the independence of the executive, legislative, and judicial branches of government, Marcos effectively controlled these three branches. Eventually, crony capitalism reached its zenith with the centralization of political power and the realignment of concentrated economic power from the old elites to favored Marcos associates.

Although the Marcos government has been considered as the most corrupt of all, succeeding political administrations had their own share and have not effectively controlled the problem. In fact, with the return to democracy after the EDSA Revolution, the perception is that the floodgates of corruption have been opened for more people at various levels of government and society. The vacuum left by the Marcos regime has been filled and even widened; opportunities have simply become available to a broader population.

The characteristics of corruption are as follows: a Corruption always involves more than one person. This is need not be the case with stealing, for instance, or embezzlement. The lone operator is corruption is virtually nonexistent, and such cases usually fall under fraud. One instance is making a false declaration of traveling expenditure or hotel bills.

But even here there is often a silent understanding between officials who practice such frauds to let the situation prevail. But nevertheless, even here the corrupt motive is kept secret. The obligation or benefit need not always be pecuniary. They avoid any open clash with the law. Page 7 of 31 pages. He acts in a dual contradictory function. The same may be said of the party offering the bribe. Applying and receiving of license is a function of his lawful business interest, but resorting to bribery is not.

It is based on the deliberate intent of subordinating common interest to specific interest. The above list of characteristics of corruption could be extended. For an act to be classified as corrupt it has to contain all the above characteristics. The only possible exception is where corruption is difficult to distinguish from criminal extortion, where the party who bribes was compelled to do so, grudgingly and resentfully, and where the bribery was not considered as a necessary outlay for future gain.

In such cases the victims kept no secrecy. Opportunities for corruption abound in the absence or lack of order, transparency and accountability. Ledivina V. The inability of the organization to provide adequate services to cope with the volume of demand breeds black market operations for government subsidized services. Poor public relations could result to public ignorance of what the organization does.

This whets employee appetite for corruption. Poor working conditions and office facilities, weak organizational leadership and bureaucratic politization are other contributory factors. The negative role model played by superiors creates an atmosphere of incompetence and defiance rather than efficiency and discipline.

The Filipino is further beset by extreme familism and personalism which generate inefficient delivery of services. The expected behavior of the Filipino is arrayed against cultural norms most of which are anchored on personalism. Behavior that is legally unacceptable may be ideal and acceptable depending upon the political culture of a society. The bureaucrat is expected to deal equally with everyone, whether relatives or strangers. They are not supposed to receive gifts in any form.

However, this expected behavior often clashes with the personal way Filipinos get on terms with one another. The practice of taking care of their kin is a deeply ingrained trait which could result in partiality and preferment in his official dealings. He gives priority to the transactions of his family however down the file these may be.

Such personalism is not limited only to blood relations but extends to all those sanctified by ritualistic ties like the compadre system, including neighbors, friends and other persons with whom, one interacts.

All these practices explain the persistence of the social evils in our society. Social tolerance of these negativistic practices is complemented by passage of legislation without sufficient study of implications; the difficulty of proving graft and corruption cases; lack of political will to wage a determined anti-corruption campaign; poor educational orientation of the citizenry and clannishness and parochialism which destroys the merit system.

There are three critical focal points of corruption in the bureaucracy. Two variants of corruption have been identified as negative bureaucratic behavior in the Philippines:. In the Bureau of Customs, corruption takes the form of: 1. There is undervaluation when an importer depreciates his imported goods very much below the actual cost.

For instance, a sardine importer brings in a million cans. He pays P2. If the importer is dishonest, he undervalues the importation to P1. With millions of cans of sardines, and with the number of importers doing this, government is defrauded by the millions of pesos.

Customs appraisers check the value of the imported goods against the official customs published values. When they are bribed, they will not bother to check, and if they check they deflate the value. Misdeclaration and misclassification are falsification of quantity and quality of imported goods.

There is misdeclaration when the importer declares a lesser volume or quantity or declares the items different from what is contained in the van. The inspector does not bother to check and just clears the cargo. In the case of misclassification, the importer declares the importation as belonging to another classification. For example, he declares it as industrial flour but in reality it is food flour which is taxed less.

Outright smuggling occurs when the cargo is unloaded not in the designated place or port of entry. The culprits here are the coastguard and the military at the checkpoints who are paid off to let the cargo pass. Abuse of bonded warehouse permits occurs when an importer brings in raw materials to be made into finished products. He does not pay taxes for the raw materials because he holds a permit to import. But in reality, he sells these raw materials to manufacturers at a price slightly lower than when the factories import by themselves.

If the causes of graft and corruption are individual, organizational and societal, said three sectors are also affected. To the individual there is loss of self-respect and ultimate dehumanization; to the organization it could result in subversion of authority structure and disillusionment within the bureaucracy. To society, it could mean increased administrative cost and revenue loss to government.

There will be corresponding deterioration of public service and loss of confidence in government. The intent of policy and the procedures for their implementation become useless since target beneficiaries are substituted for. Unauthorized control mechanisms take precedence over legal rules and regulations. Authoritative allocation of values envisioned by legislation gives way to shady deals and the demands of personal expediency. It brings about frustration and cynicism which could undermine faith and confidence in the viability and effectiveness of the democratic system.

Graft and corruption are encouraged by public apathy which results from bad and ill-managed government. But its most important and potent medium is the individual official or employee. Let us take the Bureau of Customs as a case in point, since it is the number one collecting arm of government which account for four-fifths of the total governmental revenue generated. This entity administers control and police authority over all harbors, piers, airports, wharves, ports, bays, rivers and inland waters throughout the Philippines.

Its general duties and powers include assessment and collection of lawful revenues from imported goods and other fees, charges, dues, fines and penalties. It is charged with preventing and suppressing smuggling; supervision and control over the entrance and clearance of vessels and aircraft engaged in foreign trade; enforcement of customs and tariff laws and other rules and regulations relating to tariff and customs administration; supervision over the handling of foreign mail to collect duties on articles smuggled through mails; control import and export cargoes landed and stored in piers, airports, terminal and depot facilities like container yards and flight stations, and exercises jurisdiction over seizure and forfeiture cases in accordance with tariff and customs laws.

While the Bureau of Customs exercises extensive powers, these powers could be abused especially if these entail discretion. Newspaper reports of customs men charged of fraud, smuggling rings bared, and cargoes worth millions seized, are not uncommon.

The following are typical examples of these reports: 1. The assorted contraband ranged from expensive electronic goods to highly dutiable textile materials and ready-to-Wear apparel. The suspected ring leader tried to bribe a team of operatives during the raid.

The merchandise included electronic goods, household wares, toys, and ready-to-wear clothes. Unscrupulous traders declared their food flour imports as industrial flour to do away with paying higher taxes. Smuggled food flour posed unfair competition with the imported ones which were legally paid for. There are three types of phenomena contained in the term corruption; bribery, extortion and nepotism.

They are not completely identical, but can be classified under one heading. Essentially there is a common thread running through these three types of phenomena — the subordination of public interests to private aims involving violation of the norms of duty and welfare, accompanied by secrecy, betrayal, deception and a callous disregard for any consequence suffered by the public.

Another phenomenon which can be described as corruption is the appointment of relatives, friends or political associates to public offices regardless of their merits and the consequences on the public wealth. This is called nepotism.

One catalyzing agent of graft and corruption is red tape. This is a bureaucratic procedure characterized by excessive and unnecessary — delay in transacting business with government which is intentionally committed. It is a practice that slows down or hampers the delivery of much-needed basic services. When there is undue delay in the processing of transactions, people resort to fixers who collude with corrupt employees and officials to expedite business transactions.

This is a common phenomenon in government offices. Fixers with connections inside the different offices facilitate the issuance of marriage license or certificate of birth or of death. After all, marriages are not made in heaven but at the city hail with the price set by the fixer. This is the price paid for the inefficiency of the bureaucracy however unethical the practice is Nepotism. Nepotism is a version of graft and corruption exemplified by favors showered on relatives by appointing them to government positions regardless of qualifications.

The practice may be viewed as an aid to responsive management if blood relatives do their share in achieving organizational goals with minimum time and effort expended. On the other hand, nepotism can be pernicious to society if the relatives in the employ of government use blood relationship as the key to open themselves to the opportunity of improving their lives at the expense of public good and general welfare.

In the Philippines, nepotism is not without historical antecedents. The barangay of early Philippine society was viewed more as a socio-economic unit composed of members with consanguinial ties and those related by affinity. Cooperation in the community was a function of personal connection than pre-determined programs and impersonal procedures. These historical antecedents nurtured a tradition and a culture which considered public office more as a source of private gain than a public trust.

The prohibition against nepotism is articulated best in the statement made by the late Ferdinand Marcos in If he offends the new society, he should be punished like the rest. Critics maintain that it was during the Marcos era that nepotism was institutionalized. The Aquino administration also showcased nepotism. If the Marcoses and the Romualdezes had their day, the Aquinos and the Cojuangcos also have theirs. The Ramos administration and the Estrada administration have their respective shares too.

So what else is new? After all unethical behavior and practices have always been with us. In our Muslim society, this problem is of more acute proportion. But why the insatiable desire of relatives of presidents to serve in government?

Why do public officials appoint relatives to sensitive positions? Should personal loyalty and intimacy outweigh competence, seniority and the merit system? These are administrative dilemmas which have to be resolved. In the Philippines, there is a strong belief that corruption is prevalent.

In a Social Weather Stations SWS survey, more than 70 percent of the respondents thought that corruption existed in government. The Philippines scored 3. Indeed, in a society with a long history of rapacity and plunder in the ranks of the state and the elite, and powerlessness among the masses, the use of public office has been identified with gaining and maintaining economic, political and social power.

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