Stop Corruption CampaignAn Advocacy of The AlterNation Reform Movement

The Philippines

7,107 islands dotting the Pacific Ocean…

The Philippines

The Philippines

Sprinkled with captivating beaches and glistening islands…

The Philippines

Moulded with panoramic landscapes…

The Philippines

Gifted with lush rainforests…

The Philippines

And abundant natural resources…

The Philippines

Some foreign tourists consider us “their paradise”…

The Philippines

Unfortunately, we remain a third-world country whose most citizens do not even

experience the wonders God has bestowed upon us…

An Impoverished Nation

• The state of poverty in our country is alarming. In 2009, an estimated 26.5 % of our population is living below the poverty line. 40% of our population earns only less than $2 per day.

Hunger Everywhere

• According to the United Nations World Food Program (UN WFP), 18% of our country’s population is undernourished. It has labeled the situation of hunger in the Philippines as “serious.”

Links to Poverty and Hunger

• The World Bank has warned, corruption is ‘the greatest obstacle to reducing poverty’.

Links to Poverty and Hunger

• Although literature points to the conclusion that corruption, by itself, does not produce poverty, corruption has direct consequences on economic and governance factors, intermediaries that in turn produce poverty. (Eldis)

The World Bank’s Report on Attacking Poverty (2001)

• The burden of petty corruption falls disproportionately on poor people …

• Corruption affects the lives of poor people through many channels.

• It biases government spending away from socially valuable goods, such as education.

The World Bank’s Report on Attacking Poverty (2001)

• Corruption diverts public resources from infrastructure investments that could benefit poor people, such as health clinics, and tends to increase public spending on capital-intensive investments that offer more opportunities for kickbacks, such as defense contracts.

The World Bank’s Report on Attacking Poverty (2001)

• Corruption lowers the quality of infrastructure, since kickbacks are more lucrative on equipment purchases.

• Corruption also undermines public service delivery.

Corruption does not only affect the Poor…

• A stocktaking of both past and current efforts to reduce poverty suggests that corruption has been a constant obstacle for countries trying to bring about the political, economic and social changes desired for their development. (Transparency International)

Corruption affects everyone…• When the Corruption Perceptions Index (CPI) for

countries is compared with their human development rankings, a strong correlation emerges between corruption and development, as measured by the Human Development Index (HDI).

• Countries with lower corruption tend to have higher HDIs, and vice versa. (Transparency International)

Human Development Index (HDI)

• The HDI, produced by the United Nations Development Programme, looks at indicators such as education and adult literacy, life expectancy and household income to come up with an indexed score to show where 177 countries fall on the development spectrum (high, medium or low).

Human Development Index (HDI)

• Human development, as defined by the United Nations Development Programme (UNDP), is a process of enlarging people's choices. For people to lead better lives, they must be able to enjoy a healthy and long-lasting existence measured by life expectancy at birth; have access to knowledge in its different expressions measured by basic enrolment ratios and literacy rate; have the material resources for a decent standard of living measured by income; and freely participate in community life and collective affairs.  (www.undp.org)

Human Development Index (HDI)

• The HDI is a summary measure of human development, computed using the average achievement in the three basic dimensions: a long and healthy life, knowledge, and a decent standard of living.

Human Development Index (HDI)

• Ideally, the HDI should be close to 1.

• It is motivated by the principle that income alone cannot faithfully reflect the basic dimensions of human development. Income is a means toward human development, not an end.

Philippine Status

• Human Development Index (HDI)• 0.654 (for 2013)• Between 1980 and 2011, the pace of human development in the

Philippines has been respectable but slow relative to the average of medium-HDI countries and countries in East Asia and the Pacific. Over the period,  China (101) and Thailand (103) overtook the Philippines. 

• In 2013 global HDR, the Philippines is ranked 114th out of 187 countries. Among its comparators in Asia, Indonesia, Vietnam, India, Cambodia and Laos are ranked below the Philippines but all are in the medium-human development range. Malaysia has entered the high-human development range and is ranked 64th.

How Corruption is Measured…

• Corruption is inherently a secretive transaction and, thus, difficult to observe and measure. (World Bank)

• A number of international organizations and corporations, however, made use of surveys to find out how corrupt a certain country is perceived to be.

Corruptions Perception Index (CPI)

• The  Corruption Perceptions Index ranks countries based on how corrupt a country’s public sector is perceived to be.

• It is a composite index, drawing on corruption-related data from expert and business surveys carried out by a variety of independent and reputable institutions.

Corruption Perceptions Index (CPI)

• The Index scores 177 countries and territories on a scale from 0 (highly corrupt) to 100 (very clean). 

• The Corruption Perceptions Index for 2013 serves as a reminder that the abuse of power, secret dealings and bribery continue to ravage societies around the world. 

Philippine Status

• Corruption Perceptions Index

Philippine Status

• Corruption Perceptions Index

Effects of Corruption

• Poverty• Lower HDIs• Unequal Development • Poorer Economic Performance

• Reduced domestic investment• Reduced foreign direct investment

• Overblown government expenditures

Effects of Corruption

• Reduction of the quality of roads and other infrastructures

• Increase in incidence of power outages, telecommunication faults, and water losses

• Tends to skew public expenditure away from health and education

• Environment adversely affected

Unequal Development• Defense contracts are often budgeted at the

expense of rural health clinics specializing in preventive care (Gray and Kaufmann, 1998).

• To the extent that rural residents tend to have lower incomes than their urban counterparts, this corruption-induced policy bias may worsen the income distribution, and at the same time, divert the needed resources away from the countryside. (Shang-Jin Wei)

Poorer Economic Performance

• Among East Asian host countries, foreign investors prefer to go to less corrupt countries. (Shang-Jin Wei)

• Corruption discourages foreign and domestic investment: rent -taking increases costs and creates uncertainty, reducing incentives to both foreign and domestic investors. (Eldis)

Poorer Economic Performance

• Corruption taxes entrepreneurship: entrepreneurs and innovators require licenses and permits and paying bribes for these goods cuts into profit margins. (Eldis)

• Bribery may come in the form of extortions, lagay and tong…

• Investor Confidence (P-Noy Example)

Index of Economic Freedom

• Economic Freedom: It is the fundamental right of every human to control his or her own labor and property.

• In an economically free society, individuals are free to work, produce, consume, and invest in any way they please.

• Economic freedom brings greater prosperity.  It is measured through the Index of Economic Freedom.

Index of Economic Freedom• The Index of Economic Freedom is based on 10 quantitative and

qualitative factors, grouped into four broad categories, or pillars, of economic freedom:

• Rule of Law (property rights, freedom from corruption);• Limited Government (fiscal freedom, government spending);• Regulatory Efficiency (business freedom, labor freedom,

monetary freedom); and• Open Markets (trade freedom, investment freedom, financial

freedom).

• Each of the ten economic freedoms within these categories is graded on a scale of 0 to 100. 

Freedom from Corruption in the Philippines

Index of Economic Freedom in the Philippines

Poorer Economic Performance

If Philippines could reduce its corruption level to the Singapore level, other things being equal, it would have been able to

raise its investment/GDP ratio by 6.6 percentage points. (Shang-Jin Wei)

Overblown Government Expenditures

• Construction projects overpriced

• Presence of Ghost Employees

• Fake NGOs & Misuse of PDAF

• Overpricing of medicine supplies

Overblown Government Expenditures

About 30 % of the national budget is reportedly lost to graft and corruption

every year. (Philippine Center on Transnational Crime)

Reduction of Quality of Roads and Other Infrastructures

• Rigged bidding --- ‘staged bidding’;  a secret deal was made between the dealer and the Bids and Awards official prior to the bidding to ensure that the favored bidder gets the deal.

• Unfinished infrastructure projects

Reduction of Quality of Roads and Infrastructures

• NAIA Terminal 1: Worst Airport in the World

• The rankings were based on the following factors:• Comfort: Metallic seating and armrests, crowded terminals and

limited seats, delays or layovers.• Conveniences: Bad signage in terminals, difficult transfers, lack

of 24-hour food, and nothing to do in transit.• Cleanliness: dirty floors, bathrooms and food courts.• Customer Service: unfriendly staff, airport scams, anti-airport

sleeper policies, immigration officers who prefer to play Angry Birds than process travellers

Increase in incidence of power outages, telecommunication

faults, and water losses

• Power Outages in Albay, Camarines Sur and other provinces due to inability to pay debts

• MERALCO rate hikes due to alleged collusion among energy providers

Public Health and Education Severely Affected

• Up to 70% of local health funds lost to corruption.

• Local officials focus more on roads, not on health

• Rampant practice of overpricing of medicine supplies. PCIJ: “Drugs can be overpriced by as much as 700 percent, COA records show.”

Public Health and Education Severely Affected

• Rigged biddings

• Short and ghost deliveries

• Purchase of substandard drugs

Environment Adversely Affected• “There are huge rents to be earned from

activities such as logging in tropical rain forests, where permits can be obtained corruptly or where inspectors can be bribed. 

• “The environmental costs of corruption may take

the form of ground water and air pollution, soil erosion, or climate change, and can be global and intergenerational in their reach.” (World Bank)

• Students of the Philippines have often observed that the country is an example of a weak state but is not a failed state.

• Filipinos and foreigners agree that many of the problems of the Philippines could be solved with better governance.

Government Anti-Corruption Bodies

• The Office of the Ombudsman

• Commission on Audit (COA)

• The Sandiganbayan

• Department of Justice (DOJ)

Government Anti-Corruption Bodies

• The National Bureau of Investigation (NBI) and the Philippine National Police (PNP)

• The Presidential Commission on Good Government (PCGG)

• The Presidential Commission against Graft and Corruption

• The Office of the Ombudsman investigates and acts on complaints filed against public officials and employees, and serves as the “people’s watchdog” of the government. The Ombudsman and his deputies are the “protectors of the people.”

• The current Ombudsman is Conchita Carpio-Morales

Commission on Audit (COA)• The Commission on Audit (COA) is the Philippines'

Supreme Audit Institution. The Philippine Constitution declares its independence as a constitutional office, grants it powers to audit all accounts pertaining to all government revenues and expenditures/uses of government resources and to prescribe accounting and  auditing rules, gives it exclusive authority to define the scope and techniques for its audits, and prohibits the legislation of any law which would limit its audit coverage.

• The Current Chair of COA is Grace Pulido-Tan.

The Sandiganbayan

• The Sandiganbayan is the anti-graft court of the Philippines. It has jurisdiction over civil and criminal cases involving graft and corrupt practices and such other offenses committed by public officers and employees. It is in charge of maintaining morality, integrity and efficiency in the public service.

The Department of Justice (DOJ)

• The DOJ conducts preliminary investigations on complaints of a criminal nature against public officials that are filed with the Department, subject to the approval of the Ombudsman if the offense investigated was committed by the public official in relation to his office.

• The DOJ is currently headed by DOJ Secretary Leila De Lima.

The NBI and the PNP• These law enforcement agencies conduct fact-

finding investigations on graft cases. They conduct entrapment operations which, if successful, results in the arrest and filing of criminal complaint against the perpetrators in the courts. It may issue subpoena and serve warrants of arrest issued by the courts. The NBI agent or policeman who conducted the investigation also acts as witness for the prosecution during journal preliminary investigation and the prosecution of the case by the Ombudsman.

The Presidential Commission on Good Government (PCGG)

• This was created primarily to go after ill-gotten wealth. It is also tasked to adopt safeguards to ensure that corruption shall not be repeated and institute measures to prevent the occurrence of corruption.

The Presidential Commission against Graft and Corruption

• This was created under Executive Order No. 151 by then President Ramos to investigate graft and corruption cases in the executive department.

What Can a High School Student Do? (Starting Points)

• Love God. Love one another.• Unity and Cooperation• Honesty and Integrity• Obedience to the Rule of Law• Industry and Diligence• Awareness of Current Events

ALL FOR THE GLORY OF OUR NATION, THE

PHILIPPINES!

FIN

This presentation was prepared by Raymond “Ojo” Andes for the AlterNation Reform Movement.

Mabuhay!