STAMPING out CORRUPTION in MALAYSIA Tunku Abdul Aziz
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113TH INTERNATIONAL TRAINING COURSE VISITING EXPERTS’ PAPERS INTERNATIONAL CASE STUDY : STAMPING OUT CORRUPTION IN MALAYSIA Tunku Abdul Aziz* I. PUTTING CORRUPTION IN A the efforts made to curb it. HISTORICAL CONTEXT When Malaya became independent in In 1957 when Malaya1 became 1957, it inherited a form of government independent, corruption was hardly an based on the Westminster model which, issue. Both British and Malayan officers with a few local adaptations, remains very maintained the highest standards of much in place. Of equal significance, it also integrity and the proud traditions of the inherited an economy based on British Malayan Civil Service and were, on the colonial mercantile interests, centred whole, incorruptible. They lived well almost exclusively on the export of rubber within their means. Ten years on, in 1967, and tin. Palm oil came a little later. the Government, sensing a gradual shift Malaya boasted the most efficient of attitude towards corrupt practices, an plantation economy in the world, so attitude that could be fairly described as efficient, in fact, that in the immediate ambivalent, felt constrained to create a post-war years, Malayan foreign exchange special bureau to combat corruption, the earnings enabled Britain to repay much of forerunner of today’s Anti-Corruption its American war debt. It was not for Agency. As you can see, the ACA has a nothing that Malaya was known as longer history than, for example, the ICAC Britain’s Dollar Arsenal. Economic of Hong Kong, arguably the most successful prosperity, by the standards of Asia, is corruption-busting organisation in the nothing new to Malaya or Malaysia, as it world today. It all goes to show that age is became later on. But it was a different kind not always everything in fighting of prosperity, an agriculture-based corruption. Political will is! economy, offering nothing like the opportunities on which corruption was able In my experience, it is impossible for us to thrive in the 1970s. to even begin to understand the impact of corruption on a country without our being As a result of the race riots in Kuala acquainted, however superficially, with Lumpur in 1969 between the Malays and that country’s social, economic and political the Chinese, the Government, recognising background. I make no apology, therefore, that economic disparity between the two for delving a little into Malaysia’s recent major races was at the heart of the tension, history, so that we may have a clearer idea decided that unless the politically of the causes of corruption in Malaysia and dominant, but economically deprived, * Vice-Chairman of the Board of Directors, Malays were brought into the mainstream Transparency International, Malaysia. of the nation’s modern economic life, 1 Malaya became Malaysia in 1963 following the prospects for lasting peace and economic merging of British North Borneo, Sarawak and prosperity would be greatly reduced. The Singapore with the Federation of Malaya. prescribed solution came in the form of Singapore was given independence by Malaysia in massive social and economic engineering, 1965. going under the somewhat grand name of 393 RESOURCE MATERIAL SERIES No. 56 the New Economic Policy or the NEP, for the closing years of the 1970s, corruption short. had become a factor of quite considerable significance in the national business A. Opportunities for Corruption equation. Unlimited The NEP was to be implemented over a Corruption and abuse of power had 30 year period. It ran into controversy from reached such unprecedented heights that day one, and was seen by Western liberals the normally staid The New Straits Times, as unwarranted discrimination against a Malaysia’s oldest English language section of the Malaysian population. Its newspaper, was moved to run an editorial motive, though, was wholly transparent; on the subject; it did not pretend to be anything other than positive discrimination, in the interest of “There was a time when a Malaysian national unity. could indulge in a little smile of condescension when stories about The Malaysian Government’s diagnosis corruption in developing countries - was spot on, and the prescribed remedy, other countries, of course-were painful and unpopular though it was, detailed. That pride was entirely produced the desired results. justified: virtually every aspect of Economically, the country took off, and with public administration was clean, it came political stability which Malaysia abuse of power was unheard of, continues to enjoy to this day. In less than departmental morale was high, 30 years, an agricultural economy was public confidence vibrant. Perhaps totally transformed, and, apart from a there was a tendency to take this state hiccup here and there, the country has not of affairs for granted. For whatever looked back. The lesson that Malaysia reason, the present conditions have recognised, and learnt quickly, was that in called forth a litany of exhortation a multi-racial and multi-cultural society, from the various rulers, the Prime extreme economic disparities along racial Minister, his deputy, and a number lines, if neglected, could and would quickly of ministers and departmental create political and social instability, to the heads.” detriment of the democratic values we profess to uphold and cherish. Malaysia had taken the first eager step on the slippery slope of national While the NEP has generally been degradation. successful in meeting nearly all of its main social and economic objectives, the creation II. GOVERNMENT ANTI- of dozens of public enterprises to CORRUPTION MEASURES implement hundreds of socio-economic A. The Early Years measures (enjoying wide discretionary As mentioned earlier, the Anti- powers) produced some not totally Corruption Agency was set up in 1967. Its unexpected results. As with most main function was to combat corruption, government-inspired initiatives anywhere previously handled by the police. It was in the world, more often than not operating thought that with the growing without the benefit of effective central sophistication of the economy, specialists coordination, they soon create enormous were required to deal with white-collar problems of their own; the most pervasive crimes, including corruption. In the initial was corruption, both grand and petty. In 394 113TH INTERNATIONAL TRAINING COURSE VISITING EXPERTS’ PAPERS years, the ACA, with full government vital information.” backing, notched several notable successes, including the prosecution and conviction of I have quoted Harun Hashim at some several political leaders and senior civil length because there are important lessons servants. to be learnt from his pioneering work. The most important lesson is that combating Harun Hashim, the first Director of the corruption requires public support and ACA, and arguably the most effective in a cultivating public confidence in the system long line of dedicated officers, recalled is crucially important. This involves, recently that his first duty was to know the among other things, guaranteeing an extent of corruption in the country - what, informer that their anonymity will not be where and who. Let him tell us what he compromised, and they will not be did in his own words; victimised. Every scrap of information is important, nothing should be consigned to “Initially, pleas for information on the waste paper basket without checking corruption from the public, with the out and verifying the information given. As assurance that their identities would the saying goes, “nothing succeeds like be kept a secret, did not meet with success”, and nothing is more encouraging much response. The people were to the public than a few successful afraid of being victimised by the very prosecutions. The ACA, under Harun people they had bribed. Bribery is a Hashim, was perceived to be free to act. secret transaction between two The fact that he also had the power of a individuals and if the secret is not deputy public prosecutor was not lost on kept, it must have been revealed by the corrupt. the giver. Victimisation is a natural consequence. But I had to know. So I B. Methods of Stamping Out established P.O Box 6000. The public Corruption in Malaysia were invited to write to me on In the 1970s, when the NEP was anything they knew about corruption installed, the Government intervened in government, or by any of its actively in economic activities, setting up servants, without having to disclose large numbers of agencies to regulate and their identity if they did not want to. control every aspect of commercial and Postage was free. The response was industrial life. Licensing, in particular, was tremendous. Sometimes I received the key instrument used to enforce the new about 200 letters in a single day from requirements of the NEP. It is said that all over the country. I read them all. the British invented the red tape and the I was then able to implement a plan Indians subsequently improved it by tying of action of instituting measures to it up in knots. The Malays, ever prevent corruption (the primary resourceful, turned it into a profitable objective of the Agency) and where personal revenue service. there was sufficient evidence, to sanction criminal prosecutions. The Without naming names, the public would not have kept writing to departments of government that exploited the Agency if they did not see any the opportunities presented to them by the result. Indeed the Agency could not need to obtain various approvals before a have functioned without the manufacturing license was granted, were assistance rendered by the thousands those with powers to grant or withhold of anonymous letter writers who gave specific approvals. The approval process 395 RESOURCE MATERIAL SERIES No. 56 was complicated and extremely time public servants (a recent Hong Kong based consuming. Several departments were survey put Malaysia just behind Hong involved and many businessmen were Kong and Singapore in a public service forced by circumstances to oil the wheels efficiency poll.