Fighting Corruption: A Pragmatic Approach to a Persistent Problem

Corruption remains one of the most significant obstacles to development and governance worldwide. To combat systemic corruption effectively, it is essential to understand who is involved, why they engage in corrupt practices, and what structural changes can mitigate these behaviors.

The primary actors involved in routine corruption are often government employees, budgetary workers, and civil servants. These include:

• Budgetary Workers, such as teachers, healthcare providers, and lower-level administrative staff. Despite their essential roles, they frequently receive insufficient pay, leading to a reliance on bribes to supplement their income.
• Civil Servants, including judges, border guards, and tax officials. These individuals manage significant financial transactions and regulatory controls, creating substantial opportunities for corruption.

For instance, teachers and healthcare workers in many countries struggle with salaries that do not cover their basic needs. Consequently, they may seek unofficial payments for services that should be free.

Raising Salaries is Never Enough

While increasing salaries might seem like a straightforward solution, it is often impractical due to budgetary constraints. Many governments simply cannot afford to raise the salaries of all state employees to a sustainable level. This is particularly true in countries with large public sectors and limited financial resources.

For example, Ukraine’s budgetary limitations make it impossible to significantly raise the wages of all its state employees. Thus, alternative solutions must be explored to address the root causes of corruption.

Privatization

Although privatization is not the most popular method in many countries, it offers a compelling solution to reducing corruption. In private companies, competitive pressures typically eliminate the need for bribes, and employees are generally paid better than their public sector counterparts.

For example, privatizing the telecommunications industry in many countries has led to improved services and reduced corruption. In India, the liberalization of the telecom sector in the 1990s led to increased competition, better services, and a significant reduction in corruption as private companies entered the market and outperformed state-owned entities.

The Powers of Civil Servants

High-level civil servants, such as judges, border guards, and tax officials, wield significant discretionary power, making them prone to corruption. Reducing their powers through structural reforms can mitigate these risks.

For example, if there are no tariffs on imported goods, there is no need to bribe customs officials. Similarly, simplifying tax codes and lowering tax rates can reduce the incentives for tax evasion and the accompanying bribes to tax officials.

Georgia’s reforms in the early 2000s are a notable success story. By simplifying business regulations and reducing the number of licenses and permits required, Georgia significantly reduced corruption. The World Bank praised these reforms, noting that Georgia went from being one of the most corrupt countries in the world to one of the least corrupt in just a few years.

Singapore is often cited as a model for reducing corruption through effective reforms. The country drastically reduced its corruption levels by simplifying tax laws and implementing strict anti-corruption measures. The Corrupt Practices Investigation Bureau (CPIB) in Singapore operates independently and has the power to investigate and prosecute corruption cases, regardless of the offender’s position.

Ukraine’s Fight Against Corruption

Ukraine has been grappling with corruption for decades, but recent years have seen significant efforts to combat it. Establishing the National Anti-Corruption Bureau of Ukraine (NABU) and the High Anti-Corruption Court (HACC) marked crucial steps towards tackling high-level corruption.

The creation of NABU and HACC has resulted in several high-profile investigations and prosecutions. One notable case involved the prosecution of a former head of the State Fiscal Service for alleged embezzlement. These institutions have helped to build public trust and demonstrate that even influential individuals are not above the law.

Additionally, Ukraine has made strides in reducing petty corruption by digitizing public services. The ProZorro electronic procurement system, which makes all public procurement processes transparent and accessible online, has been internationally recognized for reducing opportunities for corruption and saving public funds.

Successful Models

Several countries have implemented successful anti-corruption measures that provide valuable lessons.

Transparent Governance in Denmark and New Zealand has helped those countries consistently rank among the least corrupt countries due to their high levels of government transparency. Public access to government data and decision-making processes reduces opportunities for corrupt activities.

Hong Kong’s Independent Commission Against Corruption (ICAC) is a prime example of an effective anti-corruption agency. The ICAC operates independently and has been instrumental in reducing corruption through rigorous enforcement and public education campaigns.

Public Sector Reforms, as Singaporeans approach combating corruption, include stringent laws, high salaries for public officials, and a zero-tolerance policy towards corrupt practices. This comprehensive strategy has made Singapore one of the least corrupt countries in the world.

Conclusion

Addressing corruption requires a multifaceted approach that tackles both the root causes and the systemic issues enabling it. Privatization and reducing the discretionary powers of civil servants are practical steps that can significantly reduce corruption. Learning from successful international models, such as those in Denmark, Singapore, Georgia, and Ukraine, can provide valuable insights. By adopting these strategies, countries can create systems where integrity and efficiency prevail, fostering a fairer and more prosperous society.

#TeamMarta

Sources:

• World Bank. Georgia’s Fight Against Corruption in Public Services Wins Praise
• Transparency International. Corruption Perceptions Index 2021
• NABU. About NABU
• ProZorro. About ProZorro
• Transparency International. OUR WORK IN SINGAPORE
• ICAC. About ICAC
• Rose-Ackerman, S. (1999). Corruption and Government: Causes, Consequences, and Reform. Cambridge University Press.