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Corruption & Accountability Lecture Notes

Second Lecture

MADVS2002C04: Law and Development

Dr. Anju Helen Bara

Department of Development Studies Central University of South Bihar,Panchanpur, Gaya

Note: This study material is only for teaching purpose at CUSB

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• Lecture notes on the section includes:

Definition of Corruption and accountability; institutional measures to curb corruption; brief descriptions of AVC, CBI, CAG and Lokpal; accountability and public information, case study of fight against corruption in Uganda.

Note: Various articles and books, websites have been used to prepare these lecture notes. See the references.

Note: This study material is only for teaching purpose at CUSB

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Corruption • Corruption is defined as abuse of public office for private gain

(Smith, 2007).

• Corruption is the misuse of power for personal gain. Many people, anywhere, can be tempted to misuse power for personal gain, if permitted to do so at no cost or risk to themselves (Tummala, 2008). Thus, corruption occurs in all countries in many different forms.

• It tends to emerge and increase in any country when inequalities are grave, scarcity of resources, rules are unclear and vague, disclosure (confession) and punishment are unlikely, and upward mobility is restricted (World Bank, 1992)

Note: This study material is only for teaching purpose at CUSB 3

• Kautilya who stated thus during 300 B.C.: “Just as it is

impossible not to taste the honey or the poison that finds itself at the tip of the tongue, so it is impossible for a government servant not to eat up, at least, a bit of the king's revenue…...” (cited in Brown, 1959)

• Carl J. Friedrich who contended that corruption "is a kind of behaviour which deviates from the norm actually prevalent or believed to prevail in a given context... It is deviant behaviour associated with a particular motivation, namely that of private gain at public expense.... Such private gain may be monetary, and in the minds of the general public it usually is, but it may take other forms”. (cited in Tummala, 2008)


• Ackerman (2007) states that corruption occurs where private wealth and public power overlap, which implies the overlapping of rich elite power with bureaucratic political power. It leads to the illegal and illicit practice and readiness pay for any work or decision to be done. Thus it is abuse of money and power.

• In corrupt practices usually a private individual, organisations bribe a public official in return for a benefit. Bribes are tools of corruption, It is used to ‘buy’ things/ commitment, it increases the private wealth of those officials who accepts bribe and in return they ‘supply’ or ‘do actions’ as per the interest of those who bribed them.

• Illicit payments goes in reverse direction also, which implies from the public official to private individuals or firms to benefits for themselves or their political parties (Susan Rose Ackerman, 2006) .


• Efforts to reduce its incidence need first to identify the kind of corruption (graft, bribery, theft, conflict of interest, nepotism, bias, or favoritism), its frequency (pervasive, occasional, or intermittent), and its perpetrators (contractors, public officials, political elites, businessmen, and foreign suppliers) (World Bank 1992).

• In its study on Governance and Development, World Bank (1992) stated that there are few instances of such governments who are corrupt and yet successful. Though, it stated that, ‘corruption weakens the ability of governments to carry out their functions efficiently’.

• "Bribery, nepotism, and venality," notes World Development Report 1991, "can cripple administration and dilute equity from the provision of government services-and thus also undermine social cohesiveness" (World Bank 1991)


• The causes of corruption relate to political and economic conditions within the society and their linkages to problems in the world economy (Theobald 1990).

• Many political leaders in countries with serious poverty have amassed extraordinary fortunes.

• Foreign exchange reserves have been transferred to foreign bank accounts. Such abuse, needless to say, adversely effects economic growth and development process of a country.

• It destroys public trust.

• India is the 80 least corrupt nation out of 180 countries, according to the 2019 Corruption Perceptions Index reported by Transparency International (source:https://tradingeconomics.com/india/corruption-rank)


https://tradingeconomics.com/india/corruption-rank






Institutional Measures • In India several measures have been undertaken to curb

corruption; • The Indian Penal Code of 1860, states that a corrupt person is

one, “being or expecting to be a public servant accepts or obtains or agrees to accept or attempts to obtain from any person, for himself or for any other person, other than legal remuneration, as a motive or reward for doing or forbearing to do any official act for showing or forbearing to show, in the exercise of his official functions, favour or disfavour to any person ”.

• In 1947, The Prevention of Corruption Act came up. The Prevention of Corruption Act of 1947 was amended to make it a criminal offence to possess wealth disproportionate to the income of a public servant that cannot be satisfactorily explained


• There are many agencies in India to deal with corruption at the central government level:

• 1. The Administrative Vigilance Commission (AVC);

• 2. Central Bureau of Investigation (CBI);

• 3. Central Vigilance Commission (CVC);

• 4. Anti-corruption bureau (ACB);

• 5. Comptroller and Auditor General (CAG);

• 6. Lokpal;


• An Administrative Vigilance Commission was created within the Ministry of Home Affairs in 1955; It was established to provide direction and co-ordinate the various efforts of the ministries to deal with corruption.

• In 1964 Report of the Committee on Prevention of Corruption (known as Santhanam Committee) was published.

• It recommended for the setting up of a Central Vigilance Commission.

• Thus the government set up the Central Vigilance Commission and each ministry came to have a Vigilance Officer.


• The CBI is the principal investigative agency and it plays a major role in the investigation of corruption cases. All the cases of corruption and fraud committed by public servants of all central government departments, central public sector undertakings and central financial institutions are handled by CBI (Verma and Sharma, 2018).

• The Comptroller and Auditor General of India have been provided under Article 148 of the Constitution of India. It is also one of the institutions to prevent the corruption in government departments. It is the supreme audit institution in India, responsible for auditing government expenses and revenues.


• Lokpal: The Government of India set up a high level Administrative Reforms Commission on January 5, 1966 under the chairmanship of Morarji Desai.

• They made recommendations for the creation of Ombudsman type institutions in India. They came up with the idea of a Lokpal as an independent body to inquire into corruption in high places/ executive offices.

• The National Commission to Review the Working of the Constitution (2002) and Second Administrative Reform Commission (2007) too sought such an ombudsman.

• Ombudsman (Lokpal): Ombudsman is a Scandinavian word and it means an official or commissioner who has been assigned the duty to investigate the complaints against the government officials/ public authority and report to Parliament.

• Ombudsman is an institution through which countries have attempted to reduce or eliminate administrative inefficiencies, government corruption and human right violation by government officials (Jha, 2018).


• The first Lokpal Bill was introduced in the Lok Sabha in 1968 and after that eight more such attempts were made in the years -1971, 1977, 1985, 1989, 1996, 1998, 2001 and 2011 - before it was finally passed in December 2013 and notified on January 1, 2014.

• Thereafter, it took five more years for the appointment of the Lokpal to happen in March 2019. Critics have observed that it will be a while before the Lokpal of India actually gets going.

• The anti-corruption movement was started by Anna Hazare who fasted unto death and demanded the enactment of the long pending Jan Lokpal Bill (Anti-Corruption Law).

• The anti corruption movement by Anne Hazare is considered to be a landmarks since it forced the government to accept civil society’s demand to have the Lokpal Bill.


• As per the Lokpal Act, 2013, the anti-corruption ombudsman or Lokpal has the power to investigate any complaint of corruption against any public entity-including the Prime Minister.

• But, in order to conduct an investigation into the Prime Minister, it must be approved by two-thirds of the committee (refer: Lokpal Act, 2013).

• According to the Lokpal Act, 2013, the Lokpal is supposed to complete the inquiry in a time-bound manner.

• The act also makes it mandatory for each state to set a law for setting up Lokayukta, which is similar to Lokpal at the state level, within a year.


• Lokpal will have two different wings to carry on the investigation against the public servant. On is the inquiry wing headed by the Director of inquiry and the other one is the Prosecution wing headed by the Director of Prosecution for the purpose of prosecution of public servant in relation to any complaint by the Lokpal under this Act (refer: Lokpal Act, 2013).

• After receiving the complaint the Lokpal can initiate the inquiry either through its inquiry wing headed by the Director of inquiry wing or can engage CBI.

• The Lokpal shall also call the public official to explain his position on the complaint which has been filed against him (refer: Lokpal Act, 2013).

• If the inquiry wing finds that a prima-facie case exists then Lokpal can order prosecution wing to initiate prosecution in special courts. The website of Lokpal will display the status of all the complaints (refer: Lokpal Act, 2013)..


Accountability and Public Information • Accountability itself can mean any number of things that officials

must explain i.e ‘account for’-their actions (which makes accountability almost synonymous with transparency); that officials must ‘take responsibility’ for their actions’; that elected officials will be made accountable by voters through elections (Jenkins and Goetz, 2010).

• Information and its dissemination to the public has been understood as an important means of curbing corruption;

• A newspaper campaign in Uganda aimed at reducing capture of public funds by providing schools and parents with information to monitor local officials handling of a large education grant program;

• The study done by Reinnika and Svensson (2004) revealed that in Uganda during 1990s, the average school received only 20 percent of central government spending and most schools received nothing and the grants were captured by local government officials;

• The government initiated a newspaper campaign to curb this corruption;


• Traditionally, anticorruption programs follows the top down approach which means that government officials and agencies are assigned the duty to tackle corruption issues and to control such corrupt practices.

• In top down approach government targets corruption in public service delivery primarily through capacity building of the legal and financial institutions - judiciary, police, and financial auditors, which implies by enforcing accountability and transparency in the public sector.

• In many poor and developing countries the legal and financial institutions are weak and also the most corrupt institutions.

• Hence the Ugandan government decided to take the bottom-up route of citizen enforcement and began to publish data on monthly transfers of capitation grants to districts in the national newspapers and their local language editions (Reinikka and Svensson, 2005).


• The study by Reinikka and Svensson (2005) found that: • 1. Schools that are more extensively exposed to the newspaper

campaign, i.e., more informed schools, experience a significantly larger reduction in local capture of funds since the campaign started;

• 2. There is a strong relationship between distance to the nearest newspaper outlet and increase in school enrollment since the newspaper campaign started;

• 3. Being located near a newspaper outlet had no impact on school enrollment prior to the campaign, but a large effect once the campaign had started.

• 4. Enrollment increased significantly faster in districts with higher newspaper penetration and thus in districts more extensively exposed to public information about the grant program and thereby less subject to capture.


• In NREGA programme in India, provisions of Right to Information (RTI) has been used, which ensures that all information requests related to the NREGA be made available to the applicant within 7 days;

• An integrated Monitoring and Implementation System has been developed to facilitate ease and access to information;

• Social Audits or the process of cross-verification of government records with realities on the ground completes the feedback loop in the accountability chain;

• It creates a platform for the poorest and most disempowered to participate in governance;

• Apart from unearthing corruption , social audits also give a chance to the senior officials to interact with front line implementers and wage seekers;

• Social audits are most effective when they are conducted regularly, have feedback mechanism and they are undertaken in partnership with the state to ensure immediate grievance redressal (Jenkins and Goetz, 2010)


References

• Aiyar, Y, 2009, Transparency and Accountability in NREGA: A Case Study of Andhra Pradesh, Working Paper No 1 • Ackerman, Susan R, 2006, International Handbook on the Economics of Corruption, Edward Elgar, Cheltenham UK. • Brown, M, 1959, The White Umbrella, California University Press, Berkeley. • Engelbert, A et al, 2016, Effective corruption control: Supplier remedies in public procurement in Kenya, Uganda

and Tanzania, Logos Verlag • Jenkins, R and A. M. Goetz, 2010, Accounts and Accountability: Theoretical implication of the right to information

movement in India, Third world Quaterly, Vol 20, Issue 3, pg.603-622. • Jha, R, R, 2018, Ombudsman in India in in Indian Political System by Himanshu Roy and M P Singh, Peason

Education India • Reinikka, R and J. Svensson, 2005, Fighting Corruption to improve schooling: Evidence from a newspaper campaign

in Uganda, Journal of the European Economic Association, Vol 3, No 2-3. • Smith, D. J, 2007, A Culture of Corruption, Princeton University Press, Princeton • Tummala, K. T, 2008, Corruption in India: Control measures and consequences, Asian Journal of Political Science,

10:2, 43-69. • Verma, A and R. Sharma, 2018, Combating Corruption in India, Cambridge University Press, Cambridge. • World Bank, 1991, World Development Report • World Bank, 1992, World Development Report • https://www.epw.in/journal/2019/18/commentary/undermining-lokpal.html • https://www.transparency.org/cpi2019


https://www.epw.in/journal/2019/18/commentary/undermining-lokpal.html
















https://www.transparency.org/cpi2019








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