AntiCorruption measures in both the Public and Private Sector ' Donald Rukare Program Manager EU Hum

1
Anti-Corruption measures in both
the Public and Private Sector . Donald
RukareProgram Manager EU- Human Rights Good
Governance Program - Uganda Center for Human
RightsUniversity of PretoriaGeneral Good
Governance Course14th July 2009
2
Contents

• Paper will look at
• Food for thought
• Public/ private divide
• What is corruption?
• Forms of Corruption
• Causes of corruption
• Rationale for fighting it
• Public sector initiatives
• Private sector initiatives
• Concluding Observations

3
FOOD FOR THOUGHT

• Corruption is neither a race nor color problem
  but a human problem
• Who of us in this room are corrupt?
• What would lead one to be corrupt?
• No country is immune
• Can corruption be good?
• Relationship between development, peace, human
  rights and corruption

4
USD 1.5 to 5 billion
USD 1 to 2.8 billion
USD 3 to 14 billion
USD 4 to 8 billion
USD 4.5 to 45 billion
USD 23 million to 1 billion
USD 100 million
USD 250 million or more
USD 106 to 700 million
5
Global Perception of CorruptionCorruption
Perceptions Index 2008
6
Transparency InternationalCorruption Perception
Index 2007
7
Transparency InternationalCorruption Perception
Index 2008
8

• Corruption a reality
• Anti Corruption part of the governance agenda
• Public and Private Sectors have put in place
  measures to fight it
• Policy, legal and institutional framework to
  fight corruption.
• International and regional efforts to address
  issue

9
Public- Private Sector Divide

• Public Sector
• The part of the economy concerned with
  providing basic government services. It
  comprises the sub-sectors of general government
  (mainly central, state and local government units
  together with social security funds imposed and
  controlled by those units) as well as public
  corporations, ie corporations that are subject to
  control by government units (usually defined by
  the government owning the majority of shares).

10
Public- Private Sector Divide

• Private Sector
• The private sector of a nation's economy
  consists of those entities which are not
  controlled by the state - i.e., a variety of
  entities such as private firms and companies,
  corporations, private banks, non-governmental
  organizations

11
Nexus between Public Private Sector

• In most cases the line between Public and Private
  Sector very thin
• Several Public officials have interests in the
  Private Sector
• In most African Countries Public Sector is the
  biggest spender i.e. procurements both at Central
  and local government levels

12
What is Corruption?

• World Bank abuse of public office for private
  gain
• IGG Act. abuse of office for private gain,
  embezzlement, bribery, abuse of office, nepotism,
  insider dealing and influence peddling

13
What is Corruption?

• Transparency International the misuse of
  entrusted power for private gain
• .TI further differentiates between "according to
  rule" corruption and "against the rule"
  corruption. Facilitation payments, where a bribe
  is paid to receive preferential treatment for
  something that the bribe receiver is required to
  do by law, constitute the former.
• The latter, on the other hand, is a bribe paid to
  obtain services the bribe receiver is prohibited
  from providing

14
What is Corruption?

• OECD Convention 1999 any offer, promise or
  giving of bribe to foreign public official to
  retain or get international business.
• Common practise could get tax deductions

15
Definition of Corruption

• AU convention on preventing and combating
  corruption . Art 4
• - giving/receiving gifts. money
• - influence peddling,
• - diversion of funds
• - concealment of property

16
Definition of Corruption

• UN convention against corruption, which defines
  corruption in terms of bribery, solicitation,
  inducement, offer, giving or diversion of funds.

17
Definition of Corruption

• SADC Protocol Against Corruption (2001)
• - Article 3.Active/Passive corruption
  committed by a public/private sector official

18
Forms of Corruption

• Bribery
• Solicitation/inducement
• Embezzlement
• Influence peddling ( corporate events)
• Insider trading
• Nepotism/tribalism
• Abuse of office

19
Forms of Corruption

• Air Supply
• Collusion

20
Causes of Corruption

• Human condition- greed
• Terms and conditions of service
• Lack of monitoring and weak sanctions
• Society adores the corrupt
• Corruption pays weak sanction base
• Corruption become a culture or way of life
• Stolen loot seen as State/Company resources
• No of social welfare system

21
Why Fight Corruption?

• Erodes public confidence in GOU (both nationally
  and abroad)
• Distorts allocation of resources and undermines
  competition
• Constraints investment, growth and development
• Exacts high price on poor denies them social
  services.
• Most government budgets internally/ externally
  funded- Aid is tax payers money meant for
  service delivery

22
Public Sector Interventions

• Policy
• A. Poverty Reduction Strategy Papers ( PRSP)
• B. National Anti Corruption Strategy
• C. Institutional Anti Corruption Strategy
• D. NEPAD/APRM ( voluntary)

23
Public Sector Interventions

• Legislation
• 1. Penal Code
• 2. Prevention of Corruption Act
• 3. Leadership Code Act- Asset Declaration
• ( Public or Restricted access)
• 4. Access to Information Act
• 5.Whistle Blower Act
• 6. Qui Tam Act

24
Public Sector Interventions

• Regional
• SADC Protocol (acts of corruption, extradition,
  cooperation, confiscation seizure)
• AU Convention Against Corruption
• provides for access to information, funding
  of political parties, the involvement of the
  private sector, civil society and the media in
  the fight against corruption.

25
AU Convention on preventing and combating
corruption

• 46 signatures
• 21 ratifications
• 27 have not
• ratified

26
Public Sector Interventions/Regional

• OECD interventions treaty
• OECD adopted its convention in response to the
  growing phenomena of bribery of public officials
  mainly in developing countries like Uganda by
  multi national companies (MNC) chief executive
  officers from the developed countries.
• Before 1999, common practice for MNCs to offer
  bribes to public officials in dev-countries in
  order to obtain or retain international business
  deals / write it off as tax deductions

27
Public Sector Interventions/Regional

• However with the entry into force of the OECD
  Convention on 15 February 1999, it was no longer
  business as usual. Most of the development
  partner countries have signed and ratified this
  convention and are committed putting an end to
  bribery of public officials in developing
  countries.

28
Regional Initiatives

• Asia Pacific region- Anti-Corruption Action
  Plan- national and regional interventions (
  develop transparent systsm for public services,
  ethical codes, accuntabilty transparency,anti
  bibery measures, coroporate responsbility)

29
Public Sector Interventions /Regional Intervention

• OAS - Inter American Convention Against
  Corruption, which has similar provisions to the
  UN and AU conventions.
• It deals with preventive measures, transnational
  Bribery, illicit enrichment, progress
  development, extradition, assistance and
  cooperation and bank secrecy.

30
Public Sector Interventions/International

• International
• UN Convention Against Corruption
• Treaty basis for cooperation to fight corruption
• To date 140 signatories, 117 have ratified it
• Bostwana,Comoros, Cote dIvoire, Ethiopia,
  Guinea, Sudan, Swaziland, Tunisia not ratified.

31

• six main themes prevention, criminalisation,
  enforcement, international legal co-operation,
  asset recovery, technical assistance and
  monitoring

32
International Initiatives

• Criminalization requires governments to
  criminalize the bribing of their own and foreign
  public officials and other corruption-related
  crimes such as embezzlement and money laundering.
  
• Prevention requires governments to take a number
  of measures to prevent corruption, including
  those that promote integrity among their public
  officials and increase the participation of civil
  society in the fight against corruption.

33
International Initiatives

• International cooperation, including with respect
  to asset recovery provides a practical channel
  for governments to work together to extradite
  persons and exchange evidence regarding
  corruption offenses, and recover assets illicitly
  acquired by corrupt public officials.
• Cooperation in implementation creates a vehicle
  for governments to monitor implementation of the
  convention and to share expertise and provide
  technical assistance relating to their
  anticorruption efforts.

34
International Initiatives

• WTO- Principles on Public Procurement that are
  supposed to be operationalised by member states.
• The principles cover the areas of
• non-discrimination among foreign and domestic
  products and suppliers,
• Transparency, fair tendering and selection
  procedures.

35
International Initiatives

• The principles provide for the special and
  differential treatment for developing countries
  in order to take account the development,
  financial and trade needs of developing counties

36
International Initiatives

• Asia Pacific Economic Cooperation (APEC)
  -non-binding principles on government procurement
  for the region.
• The principles are based on,
• transparency
• value for money
• open and effective competition,
• fair dealing and
• confidentiality and accuracy of information

37
International Initiatives

• The end game of all these procurement guidelines
  is the acknowledgment that competitive
  procurement limits the authority of government
  officials thereby guarding against corruption.
• Competitive procurement removes personal
  discretion

38
International Initiatives

• The selection of governments supplies and
  contractors by prescribing an open bidding
  process and laying out clear procedures and
  criteria for selection as enunciated in the
  principles above.
• Global and regional initiatives require countries
  (where relevant) to take measures at the national
  level to give effect to the various undertaking
  made at that level.

39
International Initiatives

• This involves state reporting and taking
  appropriate legislative, policy and institutional
  reform.
• Uganda for example has recently adopted a new
  procurement law that incorporates a number of
  these principles.

40
Public Sector Interventions

• Institutional Framework
• Courts of Law
• Police, CID
• Anti Corruption Agencies
• Ministry of Ethics/Anti Corruption
• Procurement Regulator
• Public Accounts Committee
• District Accounts Committee

41
Public Sector Interventions

• Auditor Generals Office
• Commission of Inquiries ( Quasi Judicial)
• Development Partners ( World Bank and Bilateral

42
Public Sector Interventions

• Leadership and Political will at all levels
  starting at the very top
• Zero Tolerance against corruption

43
Private Sector

• Corporate Governance Principles
• Transparency, Accountability
• Most Companies have codes of conduct
• Internal mechanisms auditors
• Client Charters
• Board of Directors/ Share holders
• King Report (2002) on Corporate governance

44
Private Sector

• International Chamber of Commerce (ICC),
  Commission on Anti-Corruption, Transparency
  International, the United Nations Global Compact
  10th Principle and the World Economic Forum
  Partnering Against Corruption Intitative agreed
  to coordinate their efforts.

45
Private Sector

• The Group committed to fighting corruption
• The fight against corruption is one of the
  biggest challenges of our time for business. If
  this fight is to succeed, all anti-corruption
  efforts need to be embraced and coordinated

46
Private Sector

• International Chamber of Commerce Rules of
  Conduct to Combat Extortion and Bribery
• Transparency International Bussiness Principles
  for Countering Bribery
• World Econmic Forum Parterning Against Corruption
  ( PACI) Principles for Countering Bribery
• http//www.iccwbo.org/iccfccd/index.html

47
Private Sector

• Civil Society Demand side
• Media investigative role

48
Challenges

• Lack of Political Will
• Selective application of rules
• Weak Sanctions
• Weak and poorly resourced agencies
• Weak CSO/Public Participation
• Notion of State weak- low tax base
• New forms of Corruption e-based
• Collusion both parties happy
• Private sector largely self regulatory

49
(No Transcript)
50
What is needed?

• Political Will/ Corporate leadership
• CSO/Public involvement in fight
• Media should step investigative role
• Strengthen oversight agencies and ensure their
  autonomy
• Voluntary codes of conduct in private realm and
  peer review
• Public/Private partnership

51
(No Transcript)
52
Concluding Remarks

• Corruption is a vice that needs to be firmly and
  resolutely fought by all across the
  public/private divide.

53
Conclusion

• It is widely accepted that development will occur
  in countries with relatively good institutions
  and polices, where accountability and
  transparency is adhered to in both the private
  and public sector.

54
Useful Websites

• Transparency International http//www.transparency
  .org/
• OECD http//www.oecd.org
• World Bank Http//worldbank.org
• Asia Pacific http//www1.oecd.org/daf/ASIAcom/Acti
  onPlan.htmactionplan

55
THANK YOU