session vi_discussion on sectoral corruption

7/30/2019 Session Vi_discussion on Sectoral Corruption

1/18

Sectoral

Corruption


2/18

Corruption:

A governance problem

Sectors:

Health

Education

Environment

Public Works

Corruption

Governance


3/18

Public Perceptionsof the Most Corrupt Sectors


4/18

Global ly:Mos t Corrupt Secto rs(TI, GCR, 2005)

Most Corrupt Political parties (4)

Parliaments (3.8) Police (3.6)

Judiciary (3.5)

Tax Revenue (3.4)

Business (3.4)

Customs (3.3)

Medical Services (3.3)

Education (3.2)

Least Corrupt

Military (2.9)

NGOs (2.7)

Religious Bodies (2.6)


5/18

Most Corrupt Entities

in Africa Police (4.4)

Political Parties (4.2) Customs (4)

Parliament/Legislature (3.8) Judiciary (3.7)

TI GCB, 2005 (Average of 8 African Countries)


6/18

Some Sectors are

Especially Vulnerable

Health

Education

Public Works

Natural Resources

Electricity

Taxation

Judiciary


7/18

What makes some sectors

particularly vulnerable?

A lot of money involved

Very complex and diverse sector activities

Subject to significant government regulation

High level of Discretionary Decision Making

Information Asymmetries

Prices by end users are significantly greater

than local costs of production (particularly for

extractive industries)


8/18

How to Assess the Problem?

Financial ManagementBudget

Accounting

Transfers/Leakages

Off budget

Goods and ServicesProcurementDistribution/Transportation

Storage

Final delivery

Service Delivery Professional services

(doctors, teachers)

Facilities (schools,hospitals)

Suppliers


9/18

Analyzing Sector Vulnerabilities

Budget Process

Accounting Process

Transfers/Leakages

Off Budget Projects

Procurement

Central Receiving

Transfer/Transport

Local

Delivery/Storage

Financial Axis Goods/Services Axis

Service Providers Facilities Facilities

Clients Clients Suppliers

Service Delivery Axis


10/18

Manifestation of Corruptionin Some of the

Most Corrupt Sectors


11/18

Health

Bribes/Informal Payments for Services

Unnecessary Referrals to Private Practice

Theft/Diversion of Supplies/Equipment

Overcharging for Drugs

Funding Leakage Procurement Practices

Absenteeism


12/18

Education

Bribes (Admission/Grades)

Hiring Influenced by Politics

Ghost Schools/Teachers

Procurement Kickbacks

Funding Leakage

No Inventory of Books/Supplies

Poor-Quality Construction


13/18

Public Works

Commissions/Kickbacks

Licenses/Permits

Poor Quality Construction

Influence Peddling Contractor Collusion

Public Works vs. Public Good


14/18

Natural Resources

Influence Allocation of Prime Resources

(Water/Land/Forests/Minerals)

Permit Illegal Logging

Obtain Permits and Certifications

Buy Favorable EnvironmentalAssessments

Avoid Inspections or Enforcement ofEnvironmental Regulations

Bribes Solicited/Payments Offered to:


15/18

Private Sector

Partners in

Crime

Or

Victims?


16/18

Private Sector

Payments to Block Code Enforcement

Policies Designed to Block Firms, Investorsfrom Entering Markets

Selective Enforcement of Regulations/Taxation

Discretionary Issuance of Licenses,Permits, Customs Clearance, Border-Crossing Documents

Bribing Legislators to Pass FavorableLegislation

Illegal Contributions to Political Parties


17/18

Cross Cutting Functions

Budgeting

Procurement

Administration

Service delivery

Registration for

Services/Permits

Receipt of

Transfers/Payments


18/18

Thank you!