Corruption

Sten Ström

Sida/Asdi

Embassy of Sweden, Managua

How Big Is The Problem?

USD 1 000 000 000 000(USD 1 trillion) Each year….

6 x Sweden’s Gvt debt 152 x Nicaragua’s public debt

Disposition: What is corruption? (4-6) How to fight corruption at various

levels (7-13) Corruption in procurement (14-16) Corruption in Health Sector (17-18)

interaction with patient (19-20) medical supplies (21-22) resources management (23-25)

What Is Corruption?

• Misuse of entrusted power for private gain (Transparency International)

• Institutions, corporations or individuals obtaining inappropriate gain through their position in operations, thereby causing damage or loss (Sida’s anti-corruption rule)

Examples of Corruption (1)

• Bribes (given and received) But also

• Extortion• Favouritism and nepotism• Conflict of interests

Examples of Corruption (2)

• Embezzlement• Fraud• Illegal financing of political parties• Impunity

Anti-corruption Work

Four levels:

• Individual officers

• Organisation

• Structures of the country

• Global development/initiatives

Individual Officers

• Public Administration Acts• Organisational rules• Systems for internal control • Organisational atmosphere

• (including examples, incentives, sanctions)

In The Organization• Assessment of capacity and risk of corruption

• Mitigate risks (in procurement and monitoring mechanisms: reporting, audit, information to target group)

• Extra audits (not just financial/regularity)

• Take action

Structures of Country (1)• Financial management systems

- plans (revenue forecasts, medium term)- budgets- international control- payment systems- revenue (tax, customs, etc)- accounting- audit- parliament’s scrutiny

Structures of Country (2)

• - statistical systems

- cadastre

- police, prosecutors and courts

- ombudsmen

- election processes incl. political parties

- anti-corruption commissions

- decentralisation processes

• Corruption studies and support to anti-corruption strategies

• Independent media • Watchdog organisations (TI local chapter)

Structures of Country (3)

Global Development• Ratification and implementation of UN:s anti-

corruption convention, • Regional convention (Convención Interamericana

Contra la Corrupción), • OECD regulations, etc• Support to international organisations, methods

development, lobbying(www.transparency.org)

(www.corisweb.org)

Where Corruption Occurs in The Procurement

Process

• Decision to procure• Specifications in tender documents• Access to tender documents• Qualification of tenderer• Evaluation of tenders• Award decision• Contract negotiation and design• Contract administration/implementation

Preventing Corruption In Contracting (1)

• Controls can be expensive, ineffective and/or too late

• No single solution for a complex problem

- Laws and Institutions

- Education/training

- Access to information by media, watchdog

NGOs

- Codes of Ethics

• Based on transparency- Facilitate monitoring and participation- Encourage accountability

• Integrity pacts, publish what you pay• OECD Convention- illegal bribing of foreign

officials• Increase risk of detection and “cost” if caught• Change of attitudes

Preventing Corruption In Public Contract (2)

Corruption in Health Sector - Causes and consequences

Imbalance in information High degree of discretion Low productivity without

accountability Decentralisation without

monitoring Vulnerability

Corruption in Health Sector

Health worker/patient interaction - problems

Informal payments Private practices/self-referral Training/accreditation Health care fraud Conflict of interest

Health worker/patient interaction - actions

Salaries Official user fees Accountability, improved

management Code of ethics Access to information Voice based strategies

Management of medical supplies - problems

Availability Registration of drugs Drug selection Procurement Distribution/misappropriation

Management of medical supplies - actions

Regulatory authorities/procedures List of essential medicines WHO principles Inventory control

Resources management - problems

Budget process Lack of accountability Budget leakages Multiple/large funding Promotion

Resources management - actions

Improved systems Budget transparency, participation Decentralisation Privatisation Tracking resource flows WHO ethical guidelines Information campaigns

But most importantly….

How to create a ”public ethos” (civil servants),

focussed more on public good than on personal gain ?