Assessingchallenges of Corruption

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Assessingchallenges of Corruption AssessingChallenges of Public Sector Leaders in Combating Corruption: A Case Study of Ethiopian Revenues and Customs Authority in Selected Branch Offices in Addis Ababa. By: TagelTesfaye A Thesis Submitted to College Of Business And Economics In Partial Fulfillment Of The Requirement For The Degree Of Masters Of Art In Public Management And Policy (MPMP) In The Department Of Public Administration And Development Management June 2017 Addis Ababa, Ethiopia i ADDIS ABABA UNIVERSITY COLLEGE OF BUSINESS AND ECONOMICS DEPARTMENT OF PUBLIC ADMINSTRATION AND DEVELOPMENT MANAGEMENT Assessing Challenges of Public Sector Leaders in Combating Corruption: A Case Study of Ethiopian Revenues and Customs Authority in selected branch offices in Addis Ababa:- Approved by Board of ExaminersSignature 1.________________________________________________ (Advisor) 2.__________________________ ______________________ (Chair person,Graduate Committee) 3._____________________________ ______________________ (Internal Examiner) 4. ____________________________ ______________________ (External Examiner) ii ACKNOWLEDGEMENT To an effort made to explore the challenges of leaders in combating corruption, many people have shared their time and effort. Chief among these were my advisor Dr. FilimonHadaro in particular; his great professional and academic directions, opinions, suggestions, discussions in the trial of the subject has given me valuable enthusing knowledge; great thanks are due to him. And all lectures of the department for their valuable corrections & suggestions, I am greatly indebted to them. This paper could have not appeared in this form had it not been supported for your valuable consultations & corrections. Deep gratitude goes to AtoMengistuGizaw, from Ethiopian Revenue & Customs Authority, Investment Directorate, and Deputy Director for facilitating conditions to his staff members in distributing and collecting questionnaires and rearranging the interview schedule. AtoMezmurYared, Federal Attorney General, Corruption Crimes Prosecution Directorate, Director, I must thank him for every arrangement he did to me. And I am also grateful to those his colleagues whose interview and valuable ideas put the basis for my findings and very amendable atmosphere throughout my study. Finally, my wife W/roTigistErgetie for her encouragement and support to start this graduate Degree program and finalize it in a good condition; for her moral support, patience and facilitation of a quiet, great thanks need goes to her. i ABSTRACT Corruption is a challenge to development. Scholars define corruption as abuse of public office for private benefit. Using this working definition, this study explores the main causes, the aggravating factors, work areas vulnerable to corruption and the means to combat corruption.Ethiopian Revenue and Customs Authority was taken as case study institution. Interviews were conducted with leaders and experts in the institution. From 2,905 population size in the selected four branches,one hundred fifty seven survey questionnaireswere administered to the staff of Ethiopian Revenue and Customs Authority by stratified sampling. The findings from this study confirm that corruption is increasing in extent and type (pity and grand corruptions). The perception of employee of the institution and the tax payers confirm the prevalence of corruption. Corruption has becomes a day to day tradition and considered as “normal”transaction, in terms of perception, including in ERCA office. From the findings of both primaryand secondary sources, there need to be enhancedholistic anti-corruption efforts and reforms, commitment of leaders and experts, building of strong institutions and corruption prevention and enforcement mechanisms at all levels. Creating an educating society starts from modeling students in ethics, inclusive development and coordinated approach in the staffs, leaders of the organization and the country at general. Key Words: Challenges, consequences, corruption, perception, commitment, ethics, national integrity system, Ethiopian Revenue & Customs Authority, Federal Attorney General ii ACRONYMS ADB African Development Bank AIMDG African Institute of Management, Development and Governance AU African Union BPR Business Processing Reengineering CPI Corruption Perception Index CSRP Civil Service Reform Program DIFD Department for International Development EDI Economic Development Institute of the World Bank EPRDF Ethiopian People’s Revolutionary Democratic Front ERCA Ethiopian Revenue and Customs Authority ETB Ethiopian Birr FAG Federal Auditor General FEACC Federal Ethics and Anti-Corruption Commission GDP Gross Domestic Product HPR House of Peoples Representatives HRDD Human Resource Development Directorate HTTP Hypertext Transfer Protocol MPMP Masters in Public Management and Policy (MPMP) NGO Non-governmental Organizations OECD Organization, Economy of Countries Development PSCAP Public Sector Capacity Building Program TI Transparency International UN United Nations UNDP United Nations Development Program UNDAF United Nations Development Assistance Framework UNPAN United Nations Poverty Action Network. VAT Value Added Tax WB Word Bank WWW World Wide Web iii TABLE OF CONTENTS Acknowledgment…………………………………………………………………………………..i Abstract……………………………………………………………………………………………ii Acronyms………………………………………………………………………………………....iii List of Tables .............................................................................................. Error! Bookmark not defined. List of Graphs .............................................................................................................................................. ix List of Figures .............................................................................................................................................. ix List of Appendices ....................................................................................................................................... ix CHAPTER ONE 1. INTRODUCTION .................................................................................................................................... 1 1.1 Background of the Study .................................................................................................................... 1 1.2 Statement of the Problem .................................................................................................................... 3 1.3. Research Questions ............................................................................................................................ 6 1.4. Objectives of the Study ...................................................................................................................... 7 1.4.1. General Objective ....................................................................................................................... 7 1.4.2. Specific Objectives ..................................................................................................................... 7 1.5 Scope of the Study .............................................................................................................................. 8 1.6. Significance of the Study ................................................................................................................... 8 1.7 Organization of the Research Report .................................................................................................. 9 1.8 Limitation of the Study ..................................................................................................................... 10 CHAPTER TWO 2. LITERATURE REVIEW ....................................................................................................................... 11 2.1 Introduction ....................................................................................................................................... 11 2.2 Defining Basic Terms ....................................................................................................................... 11 2.2.1 Corruption .................................................................................................................................. 11 2.2.2 Corruption in Public Administration .......................................................................................... 12 iv 2.2.3 Public Leadership ....................................................................................................................... 13 2.2.4 Preventing Corruption in Public Sector Administration ............................................................ 14 2.2.4.1 Prevention .......................................................................................................................... 14 2.2.5 Public Sector .............................................................................................................................. 14 2.2.6 Challenges .................................................................................................................................. 15 2.2.7 Prospects .................................................................................................................................... 15 2.3 The Leadership Challenges in Combating Corruption ..................................................................... 15 2.3.1 Theoretical Literature Review ................................................................................................... 16 2.3.1.1 Public Leaders and Employees Attitude in
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