Fighting Corruption, Improving Transparency

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Fighting Corruption, Improving Transparency
who knows best?
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just as it is impossible not to taste the honey
or poison on the tip of your tongue, so it is
impossible for someone dealing with government
funds not to taste at least a little bit of the
king's wealth. Kautilya (nearly 2,500 years
ago)
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Action only since 1990

• Only recently have the industrialised countries
  taken action on bribes paid in developing
  countries
• December 1997- OECD convention
• against international corruption
• February 2002 - UK made the bribing of
  foreign public officials illegal.

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Corruption is a problem that all countries have
to confront. Solutions, however, can only be
home-grown. James Wolfensohn, President of the
World Bank
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Grand corruption

• undertaken by political and business leaders
• aim is to win contracts or to stay in power
• is common across the world
• in developing countries the bribes are mainly
  paid by western companies.

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Petty corruption

• involves junior officials
• public pay for services they are entitled to
  anyway
• more common where
• pay of public officials is poor
• governance and control
• processes are poor.

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TI 2003 survey shows fall in Kenyan bribes

• bribes fall from 65 to 40 of encounters
• cost of bribery falls from 50 to 15
• January 2004 police pay doubled
• BUT only 4 of incidents are reported

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Non-Governmental Organisations

• Transparency International
• International Budgetary Project
• Unicorn
• Budget Transparency and Participation

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Transparency International

• 90 national chapters
• Corruption Perception Index
• Bribe Payers Index
• Annual Corruption Report
• local surveys eg Kenya

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Other NGOs
International Budget Project Unicorn
Budget Transparency and Participation
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International Financial Institutions

• UNDP
• IMF
• World Bank
• CFAAs
• HIPC assessments
• PEFA

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UNDP Contact Programme
Website and CD Self assessment guidelines to
evaluate financial accountability and transparency
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International Monetary Fund
Code of Good Practices on Fiscal Transparency
from 1998 ROSC - Reports on the Observance of
Standards and Codes
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World Bank - 1

• Country Financial Accountability Assessment
  (CFAA)
• in-depth assessment with a 50 page report with
  annexes
• at least every five years for active borrows
• where possible undertaken with other donors and
  the government.

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World Bank - 2

• HIPC assessment
• undertaken with IMF for 24 HIPC countries this
  year
• 16 benchmarks including one on expenditure
  tracking.
• May result in donor aid being withheld.

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World Bank - 3

• Public Financial Expenditure and Accountability
  (PEFA)
• financed by World Bank, EC and DfID
• review of main assessments
• draft high level diagnostic

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Any instrument for public expenditure management
originating from another country must be
carefully analysed in the light of the local
context and rejected, adopted, or adapted as
needed. OECD 2001
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Technical advice is not enough
Is corruption the cause of poverty or a symptom
of inequality? We have to find the reasons for
poor public financial management and
accountability. The IFIs should not use their
advice to introduce political measures
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Recent research is highlighting the importance
of country specific solutions, which may not
accord with best practice models or involve
wholesale reform, but which target key local
constraints while respecting social and political
context. DfID 2003
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Conclusions

• Corruption is an international problem.
• We can all help to reduce its impactand there is
  lots of guidance to help us.
• All reform should improve
• openness
• accountability
• integrity
• participation.
• YOU KNOW BEST!

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Thank you
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Andy Wynne- Head of Public Sector Technical
Issues
ACCA 29 Lincoln's Inn Fields London WC2A 3EE
United Kingdom tel [phone] fax 44
20 7396 5730 andy.wynne_at_accaglobal.com