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Conference of Central and East European Countries on Fighting Corruption

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Conference of Central and East European Countries on Fighting Corruption CONFERENCE OF CENTRAL AND EAST EUROPEAN COUNTRIES ON FIGHTING CORRUPTION International Co-operation: Its Role in Preventing and Combating Corruption and in the Creation of Regional Strategies Bucharest, March 30-31st UN Global Programme against Corruption Programme Manager: Dr. Petter Langseth International Cooperation Dr. Petter Langseth Its Role in Preventing and Combating Corruption and in the Creation of Regional Strategies SUMMARY1 According to CICP’s Global Programme against Corruption the purpose of a national anti-corruption programme is to:(i) increase the risk and cost of being corrupt and (ii) build integrity that changes the rules of the game and the behaviour of the players and (iii) eventually ensure the rule of law. Among the few success stories, Hong Kong, should have taught us that it takes time and considerable effort to curb corruption in a systemic corrupt environment. After more than 25 years Hong Kong is spending US$ 90 million (1998) per year and employed 1300 staff who conducted 2780 training sessions for the private and public sector. This is probably more than what all 50 African countries spent fighting corruption in 1999.2 Taking into account the increasing number of international instruments dealing with corruption, the workshop will be aimed at promoting co-ordinated efforts for the development of joint strategies for implementation of international instrument and best prevention practices at the international, national and municipal level. The anti-corruption strategy advocated in this paper rests on four pillars: (a) economic development; (b) democratic reform; (c) a strong civil society with access to information and a mandate to oversee the state; and (d) the presence of rule of law. On the basis of these four broad contexts, there are, according to Pino Arlacchi four basic arenas in which action can be taken against corruption within a country: First, the basic institution of good governance needs to be strengthened. At the head of this list is the judiciary, which is itself the guardian of laws and integrity. But if the judiciary is itself corrupt, the problem is compounded and the public at large without rule of law. Second, the capacity and integrity of enforcement need to be enhanced. The best law has no value if it is not enforced. The best judges and magistrates are wasted if cases are never brought to them. Good investigations are wasted effort if the police or prosecutors are corrupt. Third, a government needs to put in place a solid set of preventive tools. Codes of Conduct and strong independent oversight bodies can help ensure that the acceptable standards of behaviour are respected in both the private and public sector. Political leaders in all branches of government, legislative and judiciary can be required to have transparency in their own financial dealings through asset disclosure for themselves and their family members. Fourth, the public needs to be educated on the advantages of good governance. It must also be clear that the public itself bears a large share of responsibility for insisting on honesty and integrity in government and business. The public needs to learn: (a) not to let anybody buy their vote; (b) not to pay bribes themselves; (c) to report incidents of corruption to the authorities; and (d) to teach their children the right values; e.g. that integrity is good and corruption is bad.3 1 This paper is using parts of another paper prepared by UNICRI and CICP for the 10th Crime Congress in Vienna, April 10-17, 2000. 2 P. Langseth, Prevention: An Effective Tool to Reduce Corruption, ISPAC 1999 “Conference on Responding to the Challenge of Corruption,” Milan, 19-20 November 1999. 3 Statement of Mr. Pino Arlacchi at the Opening session of ISPAC Conference on “Responding to the Challenge of Corruption,” Milan, 19 November 1999. - 2 - TABLE OF CONTENTS SUMMARY INTODUCTION Aspects and causes of corruption Consequences of corruption Top level Corruption Corruption in public administration and the criminal justice system Corruption in the private sector RESPONSES TO CORRUPTION National measures International measures Use of statistical data to understand the dimension of corruption THE INTERNATIONAL EXPERIENCE AND ACTIVITIES UN’s Global Programme against Corruption Other UN Agencies The European Union OECD The Council of Europe The World Bank Other bodies and mechanisms RECOMMENDATIONS CONCLUSION INTRODUCTION Aspects and Causes of Corruption There is a general consensus that, although the most serious consequences to the economic and social development of a country are likely to come from the spread of corruption at the upper levels, the citizens’ perception is mostly related to their first-hand experience with public administration at the “street” level. While bribery for many years was seen as a “way of getting things done” in most developing countries and countries in transition, this “greasing of the wheel syndrome has been change to the “sanding of the wheel.” This change in perception is partly due to: (a) At the international level; the recent economic crisis in Asia, according to many experts was partly triggered by inadequate corporate governance practices (e.g. inadequate accountability and transparency) and (b) National level; data from surveys in Uganda (1998), Tanzania (1997) and Ukraine (1999) proves that citizen bribing are less likely to be satisfied with the service than the once who did not bribe. In Tanzania we found that survey participants who did not pay a bribe were 2.9 times as likely to find a higher level of service provided. On the other hand, those who paid bribes were 1.7 times more likely to receive poor service than good service. In fact only 13% of the people surveyed paid the bribe and received a good service.4 Types of corruption have been classified in many ways in the literature. For example, distinctions can be made between “petty” or survival and “grand” corruption, or between “episodic ” and “systemic ” corruption.5 Another distinction has been made between “simple” and “complex” corruption as it is observed in European countries.6 This paper will refer to three levels (“street,” business and “top” political and financial) as taken from the Global Programme against Corruption. When discussing the issue of corruption, a distinction must be made between the supply and the demand side of the activity. Corruption involving the supply side focuses on the payment of bribes in return for specific services, preferential treatment or contracts. Corrupt practices occurring on the demand side include solicitation of bribes and/or extortion. The latter is typical of corruption involving political and financial powers. Countries that are in a developing phase are susceptible to corruption. This is basically the result of a change in the needs of the civil society as it transitions towards a consumer society in combination with imperfectly organised and enforced public and judicial administrations. Therefore, previously existing corruption at the street level provides a hotbed for corruption at higher levels. Greed, social injustice, peer pressure and a lust for social status and power may all be contributing factors. Since corruption is—in a narrow sense—a victimless crime, low risks of discovery and punishment do little to deter the prevalence of these factors.7 Additionally, certain country-specific factors, such as population size and natural resources, also appear to be positively linked with the prevalence of bribery and corruption.8 4 “Are Bribe Payments in Tanzania ‘Grease’ or ‘Grit’?” Petter Langseth and Bryane Michael, in Crime, Law and Social Change 29; 197-208,98 5 P. Langseth, proceedings of the International “Conference on Responding to the Challenges of Corruption,” Milan, 19- 20November, 1999 (Milan Conference). 6 Simple corruption, or the base of the pyramid, mostly refers to bribery of public administrators and generally involves transactions between two individuals. Complex corruption, the top of the pyramid, generally corresponds to political corruption and involves several actors from both the supply and the demand sides. See E. Savona, L. Mezzanotte, La corruzione in Europa, Roma 1998. 7 “ Corruption Prevention - A Hong Kong Perspective,” in Proceedings of the Milan Conference, p. 2. 8 C.W. Gray, D. Kaufmann, “Corruption and Development,” in: The World Bank PREMnotes 4/1999, p. 2. International Cooperation Dr. Petter Langseth Its Role in Preventing and Combating Corruption and in the Creation of Regional Strategies Countries that are radically reforming their economic and political system, like Central and Eastern Europe during the 1990s, are confronted with corruption in the business sector and at the high political and financial levels. Their exposure stems mainly from the strong impact of reforms on their national economy, through the large-scale privatisation of former state-owned properties, such as enterprises, buildings and other holdings which are an important part of the national economic value.9 The new opportunities arising from the distribution of such property increases the appeal of obtaining illegal advantages. The actors in this context are not only national or international business members, but also, in the case of high-level corruption, the national decision-makers within political and administrative offices.10 Consequences of Corruption The consequences of corruption are generally disastrous both for the economy as a whole and for the citizens. The “pain” caused by corruption at the village level has best been described by more than 3500 villagers participating in 348 focus groups facilitated by CIETinternational in Uganda in 1998.11 At the Hospital: A man had taken his pregnant wife to hospital to deliver their baby. He did not have the money demanded by the hospital. While he searched for money, the hospital workers let his pregnant wife die. —Soroti, Site 1, Men’s group At the Police Station: If a woman is arrested, the policemen rape her —Mukono, Site 4, Women’s group My husband was beaten by a thief.
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