Good government and sustainable anti-corruption strategies: A role for independent anti-corruption agencies?

PUBLIC ADMINISTRATION AND DEVELOPMENT, VOL. 15, 151-165 (1995)

Good government and sustainable anti-corruption strategies: a role for independent anti-corruption agencies?

ALAN DOIG Liverpool John Moores University

SUMMARY Aid donors are increasingly seeking to link assistance to sustainable reform, including the provision of a responsible and responsive political and legal framework, the improvement of recipient countries’ social, health and educational prospects, and the promotion of economic development and liberalization. Much attention is given to the first of these because of the size and cost to the state and the perceived constraints it exercises on the longer-term changes to the economy and society; in general terms, good government is an essential precondition for good governance and economic development. Increasingly donors have focused on corruption, both as a core obstacle to the encouragement of good government, and on the steps taken to dealing with it as evidence of commitment and the will of recipient countries to their introduction. While the types of activity associated with corruption are readily identifiable, as are the means to attempt to deal with it, it is usually much more difficult to determine effective implementation, particularly with limited resources at a time when longer-term political and economic reforms are also being promoted. It is therefore especially important that, in relation to corruption and good government, a practicable, effective and sustainable means is available to deal with corruption from preventative, investigative and reform perspectives.

CORRUPTION, GOOD GOVERNMENT, GOOD GOVERNANCE AND ECONOMIC DEVELOPMENT THE HYPOTHETICAL FRAMEWORK?

The prevalence of corruption, fraud, and other benefits extracted from their office and through their powers by politicians and public officials, and the exacerbation of such conduct in relation to the performance of the roles of the state or its dealings with the private sector, have been documented in the literature ‘on politics, modernization and economic development (Huntington, 1968; Scott, 1972; Clapham, 1982; Clarke, 1983; Williams, 1987; Theobald, 1990). In December 1989 the Report of an Interregional Seminar on Corruption in Government (‘Report’), organized by the United Nation’s Department of Technical Cooperation for Development, noted that ‘the problem of corruption in government has come to be recognized universally as a major concern in public management’ (United Nations, 1989, p. 1).

Good government provides a responsive governmental and state administrative framework, facilitating good governance and, while good governance and economic development must be longer-term goals than good government, the former will not be achievable without attaining the latter. Good government in practice (British Council, 1993) would mean: political legitimacy for the government through democratic elec- tions and transfer of power, political opposition and representative government;

Alan Doig is Professor of Public Services Management, Liverpool Business School, Liverpool John Moores University, 98 Mount Pleasant, Liverpool, L3 5UZ, UK.

CCC 027 1-2075/95/02015 1-1 5 0 1995 by John Wiley & Sons, Ltd.

152 A. Doig

accountability through the provision of information, separation of powers, effective internal and external audit, low levels of corruption and nepotism; official competency such as having trained public servants, realistic policies and low defence expenditure; and human rights as indicated by freedom of religion and movement, impartial and accessible criminal justice systems, and the absence of arbitrary government power.

Defining corruption as ‘the abuse of public power and authority for private and other group gains’, the Report also makes it plain that, whatever the academic debates concerning the definition of corruption (Gardiner, 1993; Heidenheimer et al., 1989), its manifestations are readily identifiable:

‘as regards the various forms of corruption, it was noted that they range from acceptance of money or other rewards for awarding contracts, viola- tions of procedures to advance personal interests, including kickbacks from development programmes or multinational corporations; pay-offs for legislative support; and the diversion of public resources for private use, to overlooking illegal activities or intervening in the justice process. Forms of corruption also include nepotism, common theft, overpricing, establish- ing non-existing projects, payroll padding, tax collection and tax assess- ment frauds.’ (United Nations, 1989, p. 4)

Recognizing the ‘strategic significance that good government plays in the development process’, and that good government requires the ‘highest standards of integrity, open-ness and transparency’, the Report was also particularly concerned, not only with ‘new forms and dimensions’ of corruption, but also its pervasive effect on government performance, the use of public resources, the general morale in the public services and the legitimacy of the state and the law (United Nations, 1989, p. 1). Dealing with corruption is thus perceived as crucially important: ‘corrupt activities of public officials can destroy the potential effectiveness of all types of governmental programmes, hinder development, and victimise individuals and groups’ (United Nations, 1990, p. 4).

Such concern has been reflected more widely within the context of general societal development and the issue of good governance. Defined as the ‘use of political authority and the exercise of control over society and the management of its resources for social and economic development’, governance encompasses the ‘nature of functioning of a state’s institutional and structural arrangements, decision-making processes, policy formulation, implementation capacity, information flows, effectiveness of leadership, and the nature of the relationship between rules and the ruled’ (Ser- ageldin and Landell-Mills, 1991, p. 4). Governance, therefore, concerns not just the integrity, efficiency and economy of government but also its effectiveness in terms of the ends to which government organization and activity are directed.

No checklist of good government or good governance indicators would be either effective or workable with the pervasive and continuous use of money and influence to manipulate them; ‘while corruption is manifest in every society, and in democratic as well as authoritarian regimes, systems corruption is a deadly sign that a society can no longer effectively manage its resources for public purposes . . . Every resource is privatized-appropriated for private gain at the expense of those members of the public who are supposed to be served by governance’ (Charlick, 1992-93, p. 177). The failure to sustain good government also has implications for the future of good governance. The World Bank argues that, ‘for example, sophisticated systems of

Good government and sustainable anti-corruption strategies 153

financial accounting and auditing may be established but the government may not absorb or use the results to good effect. A legal framework could be created, but arbitrariness or corruption in its implementation could undermine its value’. Further- more, given ‘the long-term nature of the task of developing appropriate institutions and the strengthening of budgetary decision-making and accountability, development management concerns must be integrated, where appropriate and relevant, into a long-term perspective of a country’s development strategy and prospects’ (World Bank, 1992, pp. 54-55).

Economic development is concerned with the fundamental restructuring of state activities and the promotion of macroeconomic policies that in turn would provide a favourable environment for private sector investment, initiative and growth. Pressure on governments to establish longer-term economic goals is reinforced by requirements for ‘milestone’ evidence of interim progress, with donor or lender pressure invariably focused on deregulation to allow trade liberalization and private sector investment, removing controls on inward investment and promoting capital market development, market-pricing of state-subsidised activities such as food prices, power, transport and rents, reducing state support of public sector employment or wages, reduction and reorganization of public sector enterprises, and privatization. Whatever the source or focus of external pressure for refom-and the European Union also supports the linking of aid to human rights, political pluralism and less corruption-there would appear to be a ‘remarkable consensus’ among aid donors and creditors ‘on the need for democracy, less corruption, greater respect for human rights and “good governance” or “good government” . . .’ (Riley, 1992, p. 4). A synthesized hypothesis would recog- nize good government as the precondition for good governance and sustainable economic development. The building blocks of good government would include: freedom of information and association, political accountability, objective and efficient judiciary and bureaucratic accountability. Within the general approach to good government specific attention would be paid to corruption, and the circumstances in which it flourishes:

‘in order to stimulate economic development, a stable legal environment and basic conditions of law and order must be present ... in order to monitor and promote good sound economic development, there must be a restructuring of ministrieddepartments, general management improvement, better pay, incentives and conditions of service, improved training, and higher professional standards. Along with administrative financial reforms with respect to procurement, tax and customs procedures, and auditing and expenditure control, corruption can be controlled.’ (United Nations, 1989, p. 30)

A good government framework would develop into a good governance framework as the state’s legitimacy with, and the participation of, the population became accepted as the former demonstrated: its responsiveness to the needs of the population and commitment to improving its welfare; its competence in providing law and order and delivering public service; its provision of an effective policy environment and its openhandedness in its conduct. Such a system of government would want to disengage itself from direct involvement in other areas, particularly economic production, to concentrate its efforts and abilities on societal priorities. Once the move to good

154 A. Doig

governance is underway, the centrally controlled economy dismantled and the state domination of industrial activity wound down or privatized, so, the argument runs, liberal market principles can begin to promote general economic development, which, in turn, should encourage participation in the political processes-the establishment of good governance. The long-term economic and political objectives would thus complement each other to develop ‘an educated population, with both political knowledge and the will to act, coupled with a modern industrial economy, a homogenous society, and a long-established set of democratic political values’ (Riley, 1992, p. 18). Such conditions would produce an internally generated and sustainable tax base and a sizeable economic class outside the political system whose enthusiasm for participation and reform is less for self gain than for the promotion of the state to regulate and benefit society. Society’s confidence in, and acceptance of, the legitimacy of the neutrality and responsiveness of the state would be confirmed by its efforts on behalf of the country as a whole, in turn reinforcing the state’s political stability and financial viability (Theobald, 1993).

CORRUPTION AND GOOD GOVERNMENT: CONSTRAINTS ON CHANGE

Whatever the advantages and disadvantages of such a synthesized hypothesis, or the likelihood of effective donor agreement on coordination and strategy in relation to the various goals, the underlying themes are present in some form in the expression of donor intentions and expectations, particularly in terms of the increasing awareness of aid leverage and the history of wasted funds, failed opportunities and political oppor- tunism on both sides. Moves to promote and encourage good government must, however, confront a number of issues where there is, on the one hand, no integrated donor approach and, on the other, sometimes conflict between and conflation of good government, good governance and economic development objectives. These may be further exacerbated by the existing political and economic conditions of countries to which they are directed: ‘the generation of adjustment out of crisis and donor pressure means that changes in the role and performance of government have to be managed under difficult circumstances where there are political tensions, resistance from the losers in the population, demoralisation in the public sector and niultiple changes occurring at the same time’ (Batley, 1994, p.492). Furthermore, with ‘as yet little agreement among donors on the best means to achieve policy objectives’, a lack of clarity and consensus ‘may cause resentment and uncertainty among aid recipients . . . may allow recipient governments to play donors off against one another.. . efforts to promote participation and democratisation may also impede economic reform by generating unsustainable demands from newly mobilised interest groups’ (Overseas Development Institute, 1992, p. 4). Seeking to encourage countries to undertake steps towards good government, therefore, may not be straightforward and will have to take account of the functions of the public sector, the complexities of economic development, and the roles of the existing political leaderships.

First, developing countries’ state sectors are generally argued to be overstaffed and inefficient, weighed down by procedural and control functions, with senior levels penetrated by special interest economic groups and political influence, and employing large numbers of poorly paid and poorly trained officials with few opportunities for


legitimate promotion and financial improvement. On the other hand, a large state sector has allowed governments to absorb manpower and give it ‘a fundamental mechanism for gaining command of society. Broad groups in society had come to depend on the massive state enterprise . . . The groups which were benefitting from the state enterprise became committed to the elite which was running it. In this sense the elite was creating the basis of its own indispensability’ (Cooper, 1982, p. 23). Measures to tie politically significant parts of the population to the state by employment have also been part of many states’ mistrust of market principles and an independent commercial sector as well as a preference for direction and control of the economy.

While state sectors’ domination of GNP and the labour market is under donor pressure to reduce, rapid retrenchment of personnel and cuts in public expenditure may ‘leave public enterprises short of funds for vital maintenance, equipment and supplies . . . a balance must therefore be struck between improved efficiency and better management, on the one hand, and the requirements of proper maintenance and utilisation of existing capacity and enterprises, on the other’ (Abbott, 1993, p. 23). Thus, while it may be generally accepted that

‘governments have frequently and inappropriately overextended the public sector . . . it would be counterproductive to push private sector expansion too fast and too far. Inefficiency in public monopolies does not necessarily create a case for private monopolies. The mix of state and private sector activity varies, and should vary, with the specifics of individual countries’ economic, political and administrative structures. Indeed, many public sector enterprises were set up because the private sector offered inadequate services or no services at all. For external agencies to push national governments too far on this or other such issues, could risk the credibility of otherwise sound programmes.’ (Commonwealth Secretariat, 1989, p. 59)

Furthermore, the assumption that economic development is hindered by the size and inefficiency of the state, as well as its existing prior claims on resources and funding, should be offset by weaknesses of the private sector infrastructure, as well as the private sector’s relations with the state, and the time and means necessary to resolve both to a point where economic development is sustainable. For some countries ‘the fact that both domestic and overseas private investment, especially in the poorer developing countries, have often fallen rather than risen in response to cuts in public development expenditure’ has been compounded by ‘a squeeze on public sector development spending’. In such circumstances, the demands of economic liberalization may be counterproductive: ‘true structural adjustment requires the building up of the country’s export sectors and associated infrastructure, which in the short term may require more rather than less state intervention’ (Mosley et al., 1991, pp. 3034).

Second, the private sector may be in-no position to take advantage of economic liberalization. Even if it is, it may not welcome the volatility of the export market, particularly in agricultural or extractive commodities, as much as it may not wish to take over state enterprises with their attendant problems of reducing workforces, reskilling those that remain and replacing old equipment. It may prefer instead to focus on high-value import or franchised brandname goods or services or exploit the existing regulatory, licence and quota systems to provide short-term gains and, in the longer term, create a commercial class with little interest in good government or economic

156 A. Doig

liberalization. Such constraints and uncertainties will both discourage reinvestment and the accumulation of productive capital, as well as encourage corruption and other means of influence, to avoid or seek an accommodation with unreformed bureau- cracies and the arbitrary use of political power.

In sub-Saharan Africa, overregulated and predatory state controls have encouraged entrepreneurial activities ‘which bring quick and sizeable returns’ intended to avoid penalization and provide the means to ‘maximise the influence or the power position of the owners’ (Dia, 1993, p. 23). In Latin America, the impact of fluctuations in the world prices of staple commodities ‘discourages long-term planning and sound business practices’ while ‘changeability of laws and regulations, combined with prevalence of evasion, favour mushroom get-rich-quick firms, and handicap solid business. Absurdly high tariffs coupled with inability to prevent mass smuggling produce a situation in which practically every merchant is implicated in illegal deals while unrealistic social security laws compel most of the employers to evade them’ (Andreski, 1970, pp. 112-13). In India, where urbanization and the decline of traditional values were ‘replaced by those encouraging materialism, impersonalism, status seeking, greed for money, and an unwillingness to adhere to moral values’, businessmen have long appreciated the role of bribery in capital accumulation to secure licences, avoid taxes and manipulate company accounts (Alatas, 1990, p. 71). In Kenya, economic uncertainty has prompted employers to invest profits in land and housing rather than expansion (Cockcroft, 1990, p. 160) while, in North Yemen, similar investments by Yemeni working abroad took place because of ‘the scarcity of land for sale and the lack of opportunities for investment in the country’s rural areas . . .’ (Sultan, 1993,

On the other hand, governmental policies that actively seek to promote economic development or a new economic class may themselves generate new problems. In Malaysia the New Economic Policy, designed to promote the role of indigenous Malays in the economy, was used by many for immediate personal gain, and under- lined ‘the limits to which private regarding behaviour can be tapped for the overall good of the system’ as well as the political gamble between the creation of public ‘goodwill’ and loyalty and increased general propensity to rule breaking (Tharan, 1979, p. 62; Sivalingam, 1983, p. 429). In North Yemen, the government’s measures to deal with its economic problems increased the opportunities for corruption, as officials and businessmen operated their own market mechanisms to circumvent import restric- tions, price controls and the sale of food and other commodities by state companies to offset private sector exploitation (Sultan, 1993, p. 388). In Venezuela, ‘government efforts to stimulate exports through tax incentives-rational in principle-foundered as a result of fraud’ when 20 companies were discovered to have claimed back millions of dollars in tax credits on non-existent exports (Little, 1992, p. 55). More recently in China, the government’s ‘immediate concern over the stagnant economy and therefore the necessity of revitalizing society’ as it ‘relaxed its control over resource allocation, given great autonomy to local authorities to direct investment and decentralised its managerial power over enterprise’ in the economic sector, led not only to the revival of old patron-client networks but also new patterns of corruption (Gong, 1993, pp. 317, 3234).

Finally, political leaderships may be ambivalent toward reform and its sustainability. Anti-corruption rhetoric sentiments have been a routine feature of politics, invariably less as a means to longer-term reform than as a means to diffuse opposition

pp. 381-2).


to the incoming regime, placate external agencies and secure tenure on office (Gillespie and Okruhlik, 1991). The rhetoric in countries like Nigeria underlines their cosmetic nature: ‘the preoccupation with panic measures and the creation of ad hoe panels and tribunals to replace non-functioning legal institutions for ensuring public accountability have not been particularly helpful’ (Oluwu, 1987, p. 230) while ‘political actors often talk of accountability and integrity but this by itself does not translate into a genuine commitment to detect and penalise unethical behaviour. Even when anti- corruption agencies are created, they are usually denied the resources needed to achieve their stated purpose.. . in many cases the codes of ethics they are asked to enforce have no broad-based popular understanding or support’ (Oluwu, 1992-93, p. 23 1). Mexican governments increasingly used anti-corruption rhetoric during the 1980s to deflect attention from its economic difficulties; ‘indeed, many of the outcries and mobilis- ations against corruption of the 1980s were staged or triggered by the government in a well-orchestrated effort to use corruption symbolically to divert attention away from the economic difficulties and rejuvenate popular faith in the government’ (Morris, 1991, p. 122). In Sierra Leone, new governments proposed commissions of inquiry, anti-corruption squads and tough legislation, but the legislation lacked any specific means to enforce it while the ‘plans to establish an ongoing independent commission against corruption, to revise salaries, to provide incentives to public workers and to reorganise the civil service . . . remain to be accomplished’ (Kpundeh, 1992-93, p. 242). Repetitive rhetoric unmatched by sustainable reform will lead to indifference or cynicism within and outside the political system over the value and sustainability of reform: ‘in too many cases, the problem is a non-problem in that far from attempting to improve the situation, governments, or at least major parts of them, are the problem. Anti-corruption campaigns then degenerate into political rhetoric designed more to appease foreign donors and international financial institutions than to address the major issues’ (Williams, 1987, p. 125).

Where there is political reform-particularly in the short-term proliferation of the trappings of participation and decentralization to satisfy donor pressure-there is a danger that the widening of involvement, particularly among politicians and political activists, will lead to increased competition for patronage and party funding and thus extend and replicate the existing political environment: ‘certain characteristics that are often thought of as increasing representativeness, such as multi-party systems that reflect a wide spectrum of interests and open list proportional representation, may paradoxically cause elected officials to be less responsive to the public interest’ (Geddes, 1991, p. 389). Conversely, and equally likely, is an awareness among political leaderships and their client groups (and, on occasion, donors) that any expansion of political participation is to be resisted because of the implications for the stability of the state and the potential for social or political turbulence: ‘the masses, once aroused, are unwilling to limit their demands to the reforms prescribed by the government. They will tend to broaden out their programme to include demands for far-reaching changes to domestic policies, such as greater political freedom, radical measures to reduce inequalities in income distribution and effective agrarian reform. In many Latin American countries. . . the ruling elites seem well aware of the dangers they would face in the wake of wide-spread popular mobilisation. Indeed, almost all factions of Latin America’s bourgeoisie appear to prefer to see their countries slip back into underdevelopment and dependency rather than run the risk of being forced into radical social and economic reforms’ (Brandford and Kucinski, 1988, p. 134).

158 A. Doig

THE FOCUS OF GOOD GOVERNMENT: DEALING WITH CORRUPTION

Given the sensitivity of political conditionality, the rhetoric calling for the implementation of good government practices at the political or participatory level (and to a lesser extent at the legal and judicial levels) has tended to shift from an essential to a necessary to a preferable requirement, where its fulfilment may in any case only be realized in a very general or superficial form. Much less defensible by recipient countries and much more realizable as a basic building block of good government has been the focus on the public sector and administrative delivery:

‘the public sector in many developing countries has been characterised by uneven revenue collection, poor expenditure control and management, a bloated and underpaid civil service, a large parastatal sector that provides poor return on the scarce public funds invested in it and weaknesses in the capacity of core economic agencies to design and implement policies that would address these problems. Not only does this state of affairs contribute to large fiscal deficits requiring adjustment measures, but it also progres- sively erodes the capacity of the state to provide economic and social services.’ (World Bank, 1992, p. 12)

Donors routinely require the rationalization, realignment and reduction of public sector organizations, staffing levels and activities to make the public sector more responsive, effective and economical through the following: markets rather than governments allocating resources; involvement of end-users in implementing allocation of resources; fewer but better-paid public officials; reasonable and clear rules on conduct; more punishments for transgressions; better investment and budget program- ming; better personnel management; cost-containment measures; moves toward privatization and rationalization; decentralization; clarifying public enterprise- government relations; transparency of decision making; contract competition; re- moval of unnecessary controls and regulations; rationalization of employment levels in state enterprises; and transfer of resources toward health and primary education (World Bank, 1992; Dia, 1993).

Few, if any, of such reforms, however, would be effective without complementary preventative and investigative measures against corruption as part of the process, among which the Report included: public service training; staff rotation, particularly in the customs, revenue and contract-awarding agencies; suitable salary levels; codes of ethics and related disciplinary procedures; ‘watchdog’ units within departments but reporting to senior ministers; effective organization of decision-making and work distribution procedures; effective administrative procedures; task forces, including the use of lawyers, accountants and engineers, to carry out investigations; the use of publicity and educational programmes; and the establishment of anti-corruption agencies with extensive investigative powers, a high public profile, honest staff and governmental support. The 8th UN Congress also argued for: defining the type of offences that should be made illegal-including theft, abuse of office without personal gain, conflict of interest, and non-disclosure of financial interests; encouraging the reporting of corruption-including the means to receive and assess allegations of corruption as well as offer rewards to, and protect, informants; developing staff


training and motivation-including the development of the role of departmental ethics officers; the development of an investigative strategy-including priorities on seriousness of cases to be investigated, intelligence gathering, and the independence of the investigating agency; and sanctions against wrongdoers-including the confis- cation of assets.

These proposals, however, raise two crucial issues; investigation and prosecution can only be arbitrary and individualized in organizations where corruption may be pervasive, and ‘however desirable punishment may be, it is merely a means of satisfying a social demand for retribution. It is not a deterrent and never has been’ (Hope, 1987, p. 143). On the other hand, reliance on prevention, particularly through codes and other means of inculcating standards of conduct, may be ineffectual without complementary means to police them in operation and change the behaviour that the code, by its introduction, deems unacceptable (Findlay and Stewart, 1992). Increasingly governments with varying degrees of commitment to good government are considering a suitable and cost-effective means to pursue the two functions-prevention and investigation-that could also encompass wide cross sector responsibilities as well as providing an effective means to enforce reforms or sanctions, and also liaising with key departments to complement each other’s efforts.

A MODEL FOR ALL REASONS? THE ROLE OF AN INDEPENDENT ANTI-CORRUPTION AGENCY

In such circumstances, Hong Kong’s Independent Commission Against Corruption (ICAC) has been the focus of much attention, from countries as diverse as Australia and Botswana, not only because of its operational success, its relative freedom from internal corruption and outside interference, and its ability to attract widespread public support, but also because of its apparent capacity to fit into a heterogeneous society with several strong cultural imperatives as well as being able to work across both public and private sectors. Although organizationally weighted toward operational investigations, ICAC also comprises preventative and educational departments as well as having intelligence, complaints and advice capabilities. While ICAC was established at a time when the government wanted to retain the confidence of foreign investors, the main reason for its creation was political-‘to persuade citizens that an agency independent of the police and the civil service was more likely to be effective than the existing system’ (Clark, 1986, p. 61). ICAC also from the outset saw its role extending beyond the investigation of specific cases, to identifying major structural factors that gave rise to corrupt behaviour by evaluating how work should be done (formal procedures), how it is actually done (informal practices) and how it is tasked and controlled (management) (Allan, 1992). These factors include: policy weaknesses; inadequate departmental instructions, unnecessary procedures, inadequate super- vision, excessive discretion, unnecessary administrative delays, unenforced laws and regulations, public ignorance of an official’s powers, and misuse or abuse of position.

ICAC provides a report-back and assistance service on organizational and procedural reforms, an activity that has been further enhanced by its ability ‘in persuading private sector managers to examine their own systems of internal accountability and has encouraged the modernisation of business practices’ (Clark, 1986, p. 62). It has the power to freeze and request the forfeiture of unexplained assets and wealth, and the

160 A. Doig

requirement that administrative departments consult it as appropriate on policies and legislation to assess potential vulnerability and risk. Its policy and investigative strategies are subject to external review while, internally, it has its own complaints, investigative and monitoring unit to provide a degree of quality control.

The emergence of ICAC as a model under consideration in a number of states does, however, raise questions about its transferability as an independent agency. ICAC is a particular product of a particular environment. It is very well resourced, its higher echelons have been staffed with seconded and expatriate officers and it has a very intensive selection and training programme. It operates within a relatively well- regulated administrative culture alongside a large and, again, well-resourced police force under a supportive political and legal framework. It has deliberately developed a highly successful public relations profile, exploiting both mass communications and a media-using population at a time of economic growth:

‘one of the special features of the Hong Kong experience has been that the government introduced new legal standards at a time of, and under conditions of, rapid modernisation.. . some of these changes might never have occurred were it not for the government’s overall policy of promoting Hong Kong as an international business centre. In any event the authorities were singularly fortunate that opposition to the new laws were muted and that the shift to universalistic legal standards occurred when the society and the economy were moving in the same direction. This is not a case of a government presiding over a disintegrating economic and social system, or a society verging on collapse. The administrative machine was strong and efficient and able to secure idealistic and talented personnel. Hong Kong also enjoyed an advanced level of economic development that cumu- latively permitted successful implementation of the policy.’ (Clark, 1987, pp. 250-51)

For many developing countries, an ICAC may appear to offer not just another layer of expensive control but one whose efforts may be negated by corrupt or political influence unless it is established within the necessary climate of political and judicial support. Nevertheless, some countries have already introduced independent agencies, albeit for limited purposes or as a result of specific circumstances. In Zambia a special investigation agency has dealt with malpractice under exchange control and banking legislation while Zimbabwe established an investigation unit within the Ministry of Finance to deal with exchange control, banking, and import/export and trading offences. In Mexico, continuing public concern about corruption, after the government used the issue as a means of deflecting criticism from itself, (Morris, 1991, pp. 122-23), led to the government setting up a department that does the following: receives allegations about corrupt officials; adjudicates on allegations of corruption involving contracts; monitors the possibility of corruption in the National Solidarity Programme (designed to develop infrastructure, services and agriculture at community level) through locally elected ‘Control and Vigilance Officers’ on locally elected Soli- darity Committees; and promotes improvements in public service with a complaints procedure and free telephone service (Vazguez Nava, 1992).

While the ICAC model may Be too expensive and too politically threatening to many countries, and other examples of independent agencies too limited or too constrained


by departmental control, an anti-corruption agency, whose agenda and focus are determined from the outset after internal and external consultation, may offer the opportunity, with donor support, to provide an immediate building block for good government where other administrative reforms may be more problematical. The comprehensive approach to public sector reform that takes in the redrafting and updating legislation and the judicial infrastructure, as well as the training, organization and accountability of a reduced number of public sector departments, is also costly, time consuming and prone to substantial slippage. On the other hand, the enclave approach of transferring activities into semi-autonomous, externally led and funded agencies is, unless long-term future government support is certain, a short-term solution that may well raise resentment among other departments, political interference and the possibility of the loss of experienced personnel to other organizations (Demongeot, 1994; Dia, 1993).

An anti-corruption agency offers the opportunity to take lead ownership of, and responsibility for, the activities and offences identified by the Report and the 8th UN Congress and, in seeking to resolve the structural factors that give rise to them across the public sector, offers a route to institutional strengthening and capacity building, subject to certain requirements on location and staffing, agenda and support.

Such an agency should be located centrally within the public sector, preferably close to the Treasury or the Director of Public Prosecutions, have clear guidelines on selection and tenure of senior personnel, as well as on operational responsibilities and reporting procedures, and with a dedicated budget. It would be usefully part of a limited ‘establishment and maintenance of “cross-executive corps” of senior policy and programme managers’, promoted on merit from within the civil service (Demon- geot, 1994, p. 48 I), which would help create ‘islands of competence within the bureauc- racy and concentrates advocates of further reform strategically inside government. Though they lose many battles, they rarely disappear from the scene completely’ (Geddes, 1991, p. 387). The agency should be linked into the process with either a posting to the agency as part of career progression of such personnel, or secondment from key government departments as a means of developing expertise inward and later transmitting expertise and the development of networks outward. Experienced personnel should be drawn from key departments such as the Treasury, the Central Bank, the Central Audit Office and the Foreign Office. Agency training should be underpinned both by cascade training from outside consultants and by the provision of senior management training on a regular regional or overseas-based arrangement, preferably with professional organizations to maintain both morale and professionalism. Ad- ditionally the agency should be provided with basic training and equipment in docu- mentation, record keeping, inquiry management and case control to guard against turnover in staff and to encourage the development of an intelligence and analysis resource. It should also agree regular formal relations with other agencies, such as the police and prosecuting authorities, to be able to draw on competent staff on a needs basis and to reinforce its networking and information-gathering activities.

The choice and rotation of staff in this manner should have a strong influence on the agency’s balance of activities, both in terms of having a flexible approach to staffing levels, and avoiding a tendency toward becoming overly committed to policing and investigative functions. Not only does this make the agency heavily dependent on the integrity of the judicial system for its results and the tolerance of the political leadership for its continued independence, but it can focus its resources and manpower

162 A. Doig

in the costly pursuit of cases. With the inevitability of fraud and corruption, such a focus on investigation, while an essential capability of the agency in being able to demonstrate a competent and robust deterrence and potential prosecution capability, is of less long-term value than structural reform-focusing on procedures, control systems, accountability and the exercise of discretionary authority.

A more effective approach would, depending on country-specific issues, be to balance features of an ICAC with those of Inspector-Generals (IG) in the USA in state and federal governments. As internal rather than external agencies, and without the political or legal framework of an ICAC, IGs seek to bridge preventative-investigative capabilities within the departments whose activities they monitor. Their establishment was intended to combine and coordinate investigation, audit and sanctioning powers that do not replace established lines of operational authority, but allow for independent intervention and evaluation in a number of areas, including: audit; the promotion of economy, efficiency and effectiveness in reaching departmental goals; the enforce- ment of rules and laws; and the prevention of fraud and waste. They are usually required to report their findings formally to their department but also to external agencies at the same time. IGs have also tended toward the more interesting and quantifiable investigative work but their remit has included an evaluation and preventative function that could be much more effective in the long-term: ‘instead of participating in programme reviews on a post-hoc basis, after the damage already has been done, capacity building would require a more active role for the IGs at the beginning of the legislative and regulatory process’ with the emphasis on the antici- pation and the prevention of the circumstances that gave rise to corruption and fraud (Light, 1993, p. 194).

If, from the outset, an anti-corruption agency drew on both the ICAC and IG perspectives, and established the primacy of an evaluations and inspections agenda as a move towards capacity building, then it could establish structured and pro-active programmes based on organized intelligence gathering and analysis. This would be achieved through an understanding of public sector organizations to assess potential risks and to highlight areas for in-depth inquiries by focusing on: selective investigations of signs of possible serious waste, extravagance, inefficiency, ineffectiveness or weaknesses in control; broad-based procedural and control investigations of a whole body, or of important activities, projects or programmes; and reviews of standard managerial operations (‘good housekeeping’ and ‘good practice’ examinations). Built into an annual information and inquiry programme, the agency will have the knowledge of activity as well as an inter-organizational perspective to make assessments and recommendations on vulnerability, risk and reform, and the basis for return monitoring, in a wide range of areas such as: the management of assets, improved information bases, better fraud awareness (particularly when dealing with the private sector), effective project management (including donor projects), better means for monitoring and controlling routine expenditure and the promotion of good housekeeping and good practice management and delivery. The intelligence and expertise built up by the agency would provide a framework for investigations that would be led, organized and controlled by the agency; both would provide achievement milestones to secure continued donor support.


CONCLUSION

Anti-corruption agencies will require both donor operation and coordination over a number of years to provide effective support, not only to establish the agency, but also its operations. Such support is necessary because corruption should not necessarily be ‘associated with political modernisation. Neither is corruption doomed to destruction as a political system matures. Corruption alters its character in response to changing socio-economic cultural and political factors. As these factors affect corruption, so does corruption affect them. Significantly, because corruption is in equilibrium, the concept of entropy is not applicable. Simply put, corruption may be controlled through alterations of its character but, most importantly, not destroyed’ (Werner, 1983, p. 638). Thus, while it may be difficult to perceive ‘that public administration can even aspire to, let alone sustain, acceptable levels of honesty and efficiency against a background of punishing indebtedness, galloping inflation, chronic unemployment, dismal standards of living and the serious civic strains that such conditions inevitably produce . . . to assert that corruption is simply a consequence of underdevelopment runs the risk of embracing a rude evolutionism which envisages a proportionate decline in the volume of abuse with each percentage improvement in GDP’ (Theobald, 1990, p. 164).

Given the issues relating to political and economic change, corruption is unlikely to disappear or diminish. The establishment of properly focused independent anti- corruption agencies may provide an effective means of promoting probity in government and protection of state income and expenditure, building up a public service ethic and encouraging better administrative procedures, offering a means of public redress and promoting good practice across the public sector, and thus beginning to make the machinery of government work more productively and efficiently with a concomitant benefit of improving the reputation and performance of the public sector. Such goals will only be achieved on an incremental and gradual basis but the use of an anti- corruption agency may offer a catalyst and a building block with a number of complementary roles that, in the immediate future, may offer donors a sustainable anti-corruption strategy to help progress toward good government.

REFERENCES

Abbott, G. C. (1993). Debt relief and Sustainable Development in Sub-Saharan Africa, Edward

Alatas, S. H. (1990). Corruption: Its Nature, Causes and Functions, Avebury, Aldershot. Allan, P. (1 992). ‘Empirical knowledge on strategies for corruption control’, 5th International

Andreski, S. (1970). Parasitism and Subversion: The Case of Latin America, Weidenfeld and

Batley, R. (1994). ‘The consolidation of adjustment: implications for public administration’,

Brandford, S. and Kucinski, B. (1988). The Debt Squads, Zed Books, London. British Council (1993). Development Priorities: Good Government, British Council, London. Charlick, R. B. (1 992-93). ‘Corruption in political transition: a governance perspective’, Corrup-

Clapham, C. (1982). Private Patronage and Public Power: Political clientism in the Modern State,

Clark, D. (1986). ‘Corruption in Hong Kong-the ICAC story’, Corruption and Reform, l(1).

Elgar, Aldershot.

Anti- Corrup t ion Conference, Amsterdam.

Nicolson, London.

Public Administration and Development, 14(5), 489-505.

tion and Reform, 7(3), 177-187.

Frances Pinter, London.

164 A. Doig

Clark, D. (1987). ‘A community relations approach to corruption: the case of Hong Kong’,

Clarke, M. (ed) (1 983). Corruption Causes, Consequences and Control, Frances Pinter, London. Cockcroft, L. (1990). Africa’s Way, I B Taurus, London. Commonwealth Secretariat (1989). ‘Reinforcing International Support for African Recovery

and Development’, The IMF, the World Bank and the African Debt, Zed Books, London. Cooper, M. N. (1982). The Transformation of Egypt, Croom Helm, London. Demongeot, P. (1994). ‘Market-oriented approaches to capacity building in Africa’, Public

Dia, M. (1993). A Governance Approach to Civil Service Reform in Sub-Saharan Africa, World

Findlay, M. and Stewart, A. (1992). ‘Implementing corruption prevention strategies through

Gardiner, J. (1993). ‘Defining corruption’ in Punch, M., Kolthoff, E., van der Vijer, K., and van

Geddes, B. (1991). ‘A game-theoretical model of reform in Latin American democracies’,

Gillespie, K. and Okruhlik, G. (1991). ‘The political dimensions of corruption cleanups: a

Gong, T. (1993). ‘Corruption and reform in China: an analysis of unintended consequences’,

Heidenheimer, A. J., Johnston, M., and LeVine, V. T. (1989). Political Corruption: A Handbook,

Hope, K. R. (1987). ‘Administrative corruption and administrative reform in developing

Huntington, S. (1968). Political Order in Changing Societies, Yale University Press, New Haven. Kpundeh, S. J. (1992-93). ‘Prospects in contemporary Sierra Leone’, Corruption and Reform,

Light, P. C. (1993). Monitoring Government, The Brookings Institution, Washington, DC. See also McKinney, J. B. and Johnston, M. ( I 986). Fraud, Waste and Abuse in Government, ISHI Publications, Philadelphia.

Little, W. (1992). ‘Political corruption in Latin America’, Corruption and Reform, 7(1), 41-66. Morris, S. D. (1991). Corruption and Politics in Contemporary Mexico, University of Alabama

Mosley, P., Harrigan, J., and Toye, J. (1991). Aidand Power: The World Bank and Policy-Based

Oluwu, D. (1987). ‘Bureaucratic delay and the prospects for regeneration in Nigeria’, Corruption

Oluwu, D. (1992-93). ‘Roots and remedies of governmental corruption in Africa’, Corruption

Overseas Development Institute. (1992). Brie$ng Paper: Aid and Political Reform, Overseas

Riley, S. (1 992). ‘Political adjustment? Democratic politics and political choice in Africa’, Centre

Scott, J. C. (1972). Comparative Political Corruption, Prentice-Hall, Englewood Cliffs, NJ. Serageldin, I. and Landell-Mills, P. (1991). ‘Governance and the external factor’, Proceedings of

the World Bank Annual Conference on Development Economics, World Bank, Washington. DC.

Sivalingam, G. (1 983). ‘Bureaucratic corruption in Malaysia’, Phillipine Journal of Public Administration, 27(4), 41 8435.

Sultan, N. A. (1993). ‘Bureaucratic corruption as a consequence of the Gulf migration: the case of North Yemen’, Crime, Law and Social Change, 19(4), 379-393.

That-an, S. (1979). ‘Systems corruption and the new economic policy’, Phillipine Journal of Public Administration, 23(1), 39-60,

Theobald, R. (1 990). Corruption, Development and Underdevelopment, Macmillan, London. Theobald, R. (1993). ‘Corruption in a changing world: comparisons, theories and controlling

strategies’, The 3rd International Conference on Ethics in the Public Service, Jerusalem.

Corruption and Reform, 2(3), 235-257.

Administration and Development, 14(5), 479437.

Bank Technical Paper Number 225, World Bank, Washington, DC.

codes of conduct’, Corruption and Reform, 7(1), 67-85.

Vliet, B. Coping With Corruption in a Borderless World, Deventer, Netherlands.

American Political Science Review, 85(2), 37 1-392.

framework for analysis’, Comparative Politics, 24(1), 77-95.

Crime, Law and Social Change, 19(4), 31 1-327.

Transaction Books, New Jersey.

countries’, Corruption and Reform, 2(2), 127-1 47.

7(3), 237-247.

Press, Tuscaloosa.

Lending, Volume 1, Routledge, London.

and Reform, 2(3), 215-233.

and Reform, 7(3) 23 1.

Development Institute, London.

for African Studies seminar, University of Liverpool.


United Nations Department of Technical Cooperation for Development and Centre for Social Development and Humanitarian Affairs (1989). Corruption in Government, report of an interregional seminar.

United Nations (1990). Crime Prevention and Criminal Justice in the Context of Development: Realities and Perspectives of International Cooperation: Practical Measures Against Corrup- tion, 8th United Nations Congress on the Prevention of Crime and the Treatment of Offenders, Cuba.

Vazquez Nava, M. E. (1992). ‘Controlling corruption as a social responsibility’, 5th ICAC Conference, Amsterdam.

Williams, R. (1987). Political Corruption in Africa, Gower, Aldershot. World Bank (1992). Governance and Development, World Bank, Washington, DC.

Documents

Good government and sustainable anti-corruption strategies: A role for independent anti-corruption agencies?