Training for hu student club-eac
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The Presentation is about Corruption, where the content includes Concept,Types, Methods of Corruption Risk Assessment, How to fight corruption and Cases of the impact of corruption in the Construction ...

The Presentation is about Corruption, where the content includes Concept,Types, Methods of Corruption Risk Assessment, How to fight corruption and Cases of the impact of corruption in the Construction sector

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Training for hu student club-eac Presentation Transcript

  • 1. Corruption: Concept, Theories, Risk Assessment, Methods and Cases A Half-Day Training Prepared for Haromaya University Ethics and Anti Corruption Student Club Prepared by: Abey Doni
  • 2. Objectives of The Training  To define the concept of Corruption;  To Explain the Types of Corruption;  Train the Trainee on Risk assessment techniques and ways to prevent Corruption;  Explain different ways to combat corruption;  Show cases of corruption in the Construction Sector Globally through Examples.
  • 3. Deliverables :  At the end of the Training the trainee will be able to: ◦ Define the concept of Corruption; ◦ Explain the types of Corruption; ◦ Work on the ways to identify corruption risk areas; ◦ Know the different methods to fight corruption; ◦ See the impact of corruption in the construction Sector Globally.
  • 4. Content of The Training 1. Definition of the concept of Corruption 2. Theories and View points about corruption 3. Types of Corruption 4. Methods to identify corruption vulnerable areas 5. Methods to fight Corruption 6. Cases of Corruption in the Construction Sector 7. Conclusion– the ultimate cost
  • 5. Definition of the concept of Corruption  Joint work of Shah and Schacter(2004) defined Corruption as the exercise of official powers against public interest or the abuse of public office for private gains.  The term ‘corruption’ came from Latin word called ‘corruptio’ and it means that bribe and destroy.
  • 6. Theories and View points about corruption  We will see two major theories and view points from reputed model builders, which include; ◦ Klitgaard Model, ◦ Jeff Huther and Anwar Shah from The World Bank.
  • 7. a. Klitgaard Model  Klitgaard (1996) has developed a simple model to explain the dynamics of corruption. ◦ C(Corruption)=M (Monopoly Power)+D (Discretion) – A (Accountability)  Hence Corruption depends on the amount of Monopoly power and Discretionary power that an official exercises.
  • 8. Continued- Klitgaard  Thus, Corruption will prevail when: ◦ High Monopoly power –large in highly regulated Economies ◦ High Discretionary Power – in developing countries and transitional Economies, where; administrative rules and regulations are often poorly defined. ◦ Low Accountability-  Poorly defined Ethical Standards of public service  Weak administrative and financial systems  Ineffective Watchdog Agencies
  • 9. b. Jeff Huther and Anwar Shah  Both Believed a Self-interested individual will seek out or accept corruption if the Expected gains outweigh the cost.  Mathematically Speaking ◦ E(B)= n*E(G) – Prob (P)*P >0  Where: ◦ E – is the Expectation operator ◦ N – is the number of corrupt transactions ◦ G – is the gain from the corrupt transaction ◦ Prob (P) – is the probability of paying penalty ◦ P – the Penalty for the corrupt activity
  • 10. Continued- Huther J. & A. Shah  Hence, to reduce the corrupt behavior using the cost benefit Analysis we can use the following methods: ◦ Reducing Expected Gross Benefit ◦ Reducing the number of corrupt practice ◦ Increasing the probability of paying a penalty ◦ Increasing the penalty for corrupt behavior
  • 11. Continued- Huther J. & A. Shah The Influence of Anti-Corruption Programs on officials Cost-benefit Analysis Number of corrupt Practices Gross gains from Corruption Probability of Paying penalty Magnitude of Penalty Bureaucratic Culture Economic Reform- Improving competitive Environment Anti-Corruption Agencies Rationaliz ation of Laws Raising public service standards Parliamentary Oversight Reducing Public Employment Ombudsman Reducing Public Sector Size Financial Accountability Financial sector Liberalization Scaling down individual Public Projects Media Independence Increasing Transparency Judicial Independence Decentralization of public Services Citizen participation Rule of Law
  • 12. Types of Corruption  The Types of Corruption is based on the dynamics we intend to use. Hence, the following represent some: ◦ The Act of Corruption  Unilateral  Bilateral  Multilateral ◦ Agents Involved  High level officials  Low level Officials  Private Agents
  • 13. Types-Continued … ◦ Budgetary Functions  Expenditures  Revenues ◦ Size of the Corruption  Grand Corruption  Petty Corruption ◦ Nature of the Corruption  Political Corruption  Economic Corruption  Academic Corruption
  • 14. Methods to identify corruption vulnerable areas  is a (diagnostic) tool which seeks to identify weaknesses within a system which may present opportunities for corruption to occur.  As a general rule most corruption risk assessments take an institutional approach  the conceptualization of risk varies from tool to tool, for example:
  • 15. Methods-Continued…  Corruption risk is equated with the set of institutional vulnerabilities within a system or process which might favor or facilitate corrupt practices  Measures of institutional vulnerability are combined with data on perceptions and/or experience of corruption as a proxy for corruption risk  Risk is expressed as a factor of the likelihood of corruption multiplied by the impact of corruption  Corruption risk is understood as a factor of the level of transparency and level of fairness in a process
  • 16. Methods-Continued…  Basic Risk Matrix ◦ The Likelihood of Corruption Occurrence ◦ The Impact of Corruption Medium Risk High Risk High Risk Low Risk Medium Risk High Risk Low Risk Low Risk Medium Risk Low Impact of Corruption High High Likelihood of Corruption Low
  • 17. Methods to fight Corruption  There are different ways to combat Corruption that are used by different countries.  Here for our training purpose we will consider three ways including: ◦ Penal-Administrative Approach ◦ National Integrity System ◦ The Hong Kong Model
  • 18. a. Penal-Administrative Approach  Strengthen National law and administrative Structure in order for unveiling leakages from the system.  Betterment of institutional tools  Firm punishment of those cases by strict laws and regulations
  • 19. b. National Integrity System  Suggested by Ibrahim Seushi (President of Transparency International-Tanzania 1998)  Refers to Eight Pillar Model including: ◦ Political Will; ◦ Administrative reforms ◦ Watch Dogs-Like Anti-Corruption ◦ Parliaments ◦ Public Awareness/Involvement ◦ The Judiciary ◦ The Media ◦ The Private Sector
  • 20. c. The Hong Kong Model  The Model integrates three basic pillars ◦ Education ◦ Prevention ◦ Deterrence/law Enforcement  The Ethiopian Ethics and Anti- Corruption Commission has adopted the Hong Kong Model and its Objectives include
  • 21. Continued …Basic Objectives of the FEACC  In cooperation with relevant bodies, to strive to create awareness in Ethiopian society that corruption will not be tolerated by promoting Ethics and Anti- Corruption Education;  In cooperation with relevant bodies, to prevent corruption offences and other improprieties, and;  To Expose, Investigate and prosecute corruption offences and other improprieties.
  • 22. Cases of Corruption in the Construction Sector  Corruption in the construction sector is one of the most difficult problems due to ◦ Its High Spending nature ◦ Ease with which many corrupt practices can be hidden ◦ Any lack of Capacity, Transparency or accountability tends to accentuate the risk by  Increasing the opportunities for corrupt practices and
  • 23. Bangladesh
  • 24. Bangladesh-Continued …  ‘Rana Plaza’ :- An eight-storey building collapsed in Savar, on the outskirts of Dhaka.  a complex that included a shopping centre and six garment factories.  At least 250 people were killed  The building violated applicable building codes.  According to reports its foundation was unstable; part of the complex had been built on a pond filled with sand. (Bangladesh’s home minister, Muhiuddin Khan Alamgir, )
  • 25. Bangladesh-Continued …
  • 26. Tanzania  In 2006, a three-storey building collapsed in the outskirts of Dare Salaam, injuring several people.  Two years later, a 10-storey building collapsed in the city centre, injuring scores of people. Yet another team was formed to investigate the mayhem, but the findings never came out.
  • 27. Tanzania-Continued …
  • 28. Tanzania-Continued …  Again on March 28, 2013. a 14- storey building was collapsed, in Dare Salaam  The building was being constructed under a joint scheme between a private investor and the public agency, the National Housing Corporation.  President Kikwete, for example, has said corruption is so endemic that public tenders are not won by the most competent firms but by the most corrupt.  killing more than 36 people and crushing several cars.
  • 29. Conclusion – the ultimate cost  All in all Corruption : ◦ Claims the Life of peoples ◦ The Cost of replacement and repairing ◦ The Opportunity cost of damage-Time value ◦ Breeds Artificial Inefficiency ◦ Competition and Ability will be replaced with Financial Muscle ◦ Rule of Law disappears and so On.  Thus Fight Corruption and let Fight Others
  • 30. Miscellaneous Pictures- Procurement
  • 31. Pictures-Procurement- Continued…
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  • 35. Pictures-Procurement- Continued…
  • 36. Thank You