Thursday, 28 October 2010

Corruption Part 1: Scale and Causes

Corruption is something that Nigerians regularly experience, complain about and ultimately partake in. It exists in both private and public spheres of life, for the sake of this discourse however, analysis will be limited to the public sector. This is not because the problem of private corruption is not important but rather because while not excusable, it is understandable in an under-regulated or under-policed business environment for people acting in their private interest to act in a way so as to advance their own interest. For the sake of this analysis corruption shall be looked at as the abuse of public position or power for private gain. In aid of simplicity corruption in Nigeria should be seen as having three principle forms: Bribery, patronage and embezzlement.Also important is to distinguish between high and low level corruption where the level reflects the level of public officials involved. While the division is quite arbitrary and the two levels are undoubtedly connected, it is useful in highlighting different aspects, causes and consequences of corruption.
In the Nigerian context it may be important to distinguish between bribery and the ‘tradition’ of gift giving, but this is a very contentious issue. It will be generally accepted and indeed expected that a public official should receive numerous holiday hampers from all manners of businesses but then there may not be general acceptance if a public official were to receive a more substantial gift, say a car, from a business person or even from another public official. The point here is that the distinction is very subjective as such it is not worth arguing as to where the cut off lies, but rather we should distinguish between them on the level of secrecy and the idea of reciprocity. As a rule of thumb a gift is something that is given openly where both giver and receiver are willing to make the nature of the gift public and that the gift is not giving as payment or in anticipation of a favour. That said, because something falls short of either aspect of the test doesn’t automatically make it a bribe but it should at least raise suspicions.
Political patronage refers to the use of state resources to reward individuals for political support. In the context of Nigeria, patronage takes the forms of political clientelism, pork-barrelling, nepotism and cronyism. Different levels of patronage are seen as acceptable in different polities, in order to decide on the what the acceptable level is for Nigeria the discussion needs to be had and the rules of the game need to be agreed on accessible to all. In general however, it should be agreed that merit is the best basis for selection (the most qualified and/or experienced should get the job) and state resources should be allocated according to need.
Public embezzlement can be broadly defined as the misappropriation of government resources for private use by public officials. For the purposes of Nigeria, this definition may be considered by many too broad as it would include for example the use of government vehicles for private purposes like taking children to school, or the use of sirens to avoid traffic when on none-government business. While some may consider this sort of behaviour to be deplorable, for the sake of this analysis the definition of embezzlement should be limited to the misappropriation of public funds, i.e. money.
Before going any further it is important to note that the problem of corruption is vast in scale and in scope as is the literature and existing discourse on the subject. With that in mind this is neither meant to be an exhaustive nor prescriptive discussion. It is the job of the politicians to come up with solutions.
Scale of Corruption in Nigeria
Corruption is a difficult thing to measure partly because of the difficulties of defining what constitutes corruption but largely because of the secretive nature of corrupt acts. The most widely used measurement of corruption is the Corruption Perception Index (CPI) as compiled by the NGO, Transparency International. The organization defines corruption as the abuse of entrusted power for private gain and its CPI seeks to measure the degree to which corruption is perceived amongst public officials and politicians on a scale of 0-10, with 0 being perceived absolute corruption and 10 being no perceived corruption at all. Nigeria scored 2.4 in 2010, which makes her the 130th least corrupt country in the world. To put into perspective, that is the same level of perceived corruption as Libya, less corrupt than Somalia (1.1) and Zimbabwe (2.2), but more corrupt than Benin (2.8), Jamaica (3.3) Ghana (4.1) and miles behind the least corrupt country New Zealand (9.4). The problem with this measure is how it measures perceived corruption; it is largely reliant on surveys carried out by and for international experts i.e. not the Nigerian public. It may be useful as a measure of how the world sees Nigeria, but it neither tells us how Nigerians see corruption in their country nor the true level of actualcorruption.
The true scale of corruption is available for Nigerians to see in their day to day lives. Low level corruption is evident in the public’s interaction with the police and other arms of the civil service. A bribe is required in order to avoid harassment or to gain the basic services that the institutions were set up to provide. Tales (if not the full details) of high level corruption fill the news media, at the time of writing the country’s anti-corruption agency has just released a list of over 100 persons suspected of corrupt practices, with the value of their corruption put in excess of 1.2 Trillion Naira. While it must be noted that these cases are in different stages of the legal process and many of these cases are by private individuals or firms. It helps to expose the scale of corruption in Nigeria. Corruption in Nigeria exists in the three aforementioned forms as there is plenty of anecdotal evidence of bribery, embezzlement and patronage. Though the extent of these things is hard to measure, they clearly exist at both high and low levels of public life.
Causes of Corruption in Nigeria
To begin with, there is a view expressed in the literature as the ‘Moral superiority’ view which asserts that the some societies (non-western) are for reasons of culture, religion, ethnic diversity amongst others more prone to corruption. In essence the argument is that some societies are just intrinsically corrupt of which Nigeria is often a cited example. This view must be rejected out of hand, as it has historically been an excuse for western companies to partake in corrupt practices and for Nigerian individuals to be complicit. If there is a cultural cause of corruption then it must be found and addressed in its own right without belittling the people and culture of Nigeria. What is clear is that the deep rooted nature of public corruption in Nigeria has a multitude of causes; these causes can be loosely grouped into historical, social, economic and political categories.
The post-colonial legacy further entrenched corruption, and the role of foreign investors cannot be underestimated, the lack of regulation relative to their parent countries and the myth of greater cultural acceptance of bribes mean that foreign firms come into Nigeria willing to throw bribes at eager public officials. Government interference in the private sector has been linked to increased levels of corruption, there is anecdotal evidence for this in Nigeria as can be seen with the petroleum, power and telecommunication sectors when they were still wholly state owned enterprises.
There is evidence to show that countries that were colonies in the last 100 years are more likely to have high levels of corruption. This argument certainly fits in with the historical narrative of Nigeria: during the period of colonization in Nigeria, there was little or no effort made by the metropolitan power to build authentic instruments of state. There was heavy reliance on the coercive power of money, often money taxed from the general population, to influence and control the local elite. The elite in turn used these resources to consolidate their position. The failure of state and nation building in the colonial era sowed the seeds of corruptions in all its forms: it created a situation in which the elite in public office saw embezzlement as their right or even their obligation, in which the access to these lucrative public offices became deeply political and in which bribery was the only means of access to state power and authority for those outside of public service.
There are also a host of social factors that cause or at least aid corruption in Nigeria. There is a body of evidence that links the acceptance of bribes with low levels of education. People have sought to build on the work of Lawrence Kohlberg stages of moral development; to show how lower levels of education hinder the development of perceptions of morality which in turns makes people more likely to accept and partake in corrupt practices. With more than 3 in 10 Nigerians over the age of 15 being illiterate and with the average Nigerian only expecting 9 years of education, the argument certainly seem to fit the facts of Nigeria.
There is also the role that ethnicity has to play, particularly in terms of patronage. Many fall back ethnic affinities when trying to consolidate one’s position, giving resources or jobs disproportionately to those of their ethnic group and the problem is exasperated by the sheer ethnic diversity of Nigeria.
A possible argument can be made about the involvement of women in public service, the argument being that women are less likely to engage in corrupt practices that their male counterparts as such under-involvement of women at both high level and low level public service aids the perpetuation of corruption.
The most pertinent of the research relating the social causes of corruption is that on the culture of corruption. The evidence shows that a person who has paid a bribe at some point in their life is more likely, should the situation arise, to take a bribe themselves. This analysis has been extended to patronage and logically can be extended to embezzlement in that the fact that people have witness massive embezzlement makes them more likely to engage in such practices once in office. The culture of corruption is self-perpetuating as it raises the level of acceptance amongst the general public.
The political causes of corruption are far reaching and often difficult to isolate. The problem is also complicated by trying to establish lines of causality i.e. if the issues mentioned cause the corruption or if corruption causes the issues. The weakness of executive (the police) and the judiciary (the courts) in catching and punishing the perpetrators of corrupt acts reduces the disincentive to be corrupt. There have been several attempts and initiatives made by successive governments to install a virile anti-corruption agency. However, the agencies have often suffered from being (or at least being perceived as being) political in their targets. Prosecutions have been slow at best and the punishments have failed to be proportionate to the crime and make little attempt to regain misappropriated funds. All this has weakened the effectiveness of being caught as a deterrent to engaging in corrupt practices, if anything weak executives and judiciaries further entrench corruption as it merely adds further people who need to be paid off.
It has often been noted that over-centralization in a federal system that rules over a large geography and/or demographic (like Nigeria) is a cause of corruption. As power and resources are concentrated from the centre state governments are totally reliant on the centre. Political aspirants rely on lines of patronage to gain access to office and the centre is able to reward the periphery through pork-barrelling and outright bribery. It creates less accountability to the people as accountability is only to the centre, which gives the state governments more scope for making and taking bribes as well as embezzlement. It has also been argued that state weakness is directly correlated to levels of corruption as such Nigeria fits the bill, the Brookings Institute places Nigeria in the bottom quintile of States in terms of strength with an overall score of 4.88 (with 0 being the worst attainable) and a political strength of only 3.51.
The economic causes of corruption are more straightforward. Corruption is higher in unequal societies because there is greater opportunity and greater reward for it. Poor people are not able to monitor and hold the rich and the powerful accountable, enabling them to misuse their position. This partly explains how in Nigeria so much high level corruption goes unreported as it is easier (cheaper) to buy off lower level actors. A root cause of low level corruption in Nigeria is the insufficiency of public sector salaries. If a police officer didn’t have to harass the average citizen to make his/her ends meet, (s)he probably wouldn’t. The same applies all the way up the civil service even to relatively high jobs, in comparison to their official salaries the amount of money that individuals or companies are willing to offer is more than significant, couple that with the expectation of patronage from family and community networks and the incentive for being corrupt is clearer.
There is also a negative correlation between the ease of doing business and the level of corruption i.e. the more procedures and bureaucracy needed to legally set up and run a business, the more likely people are to engage in corrupt practices. The International Finance Corporation of the World Bank Group measures the ease of doing business by compiling data on the ease of setting up a business, employing workers, registering property etc. The least perceived as corrupt country, New Zealand, is ranked 2nd overall and first in terms of setting up a business, it takes 1 day and 1 procedure and costs 0.4% of the annual income per person to set up a business. Nigeria on the other hand, ranks 120th overall, it takes 8 procedures and 31 days to start a company and it costs 76.7% of the annual income per person to set up a business. In this environment there is an incentive to circumvent the official processes and as such an incentive towards corruption.
Corruption in Nigeria is a horrible beast, corruption itself creates conditions in which there is more opportunity for corruption and more willingness to engage in corrupt practices. As the situation deepens so to does its cost to Nigeria and even more worryingly so to does the scale of the effort needed to break the cycle.
Sorry for the length of the post, but the topic was vast. So vast that part two will be all about the effects of Corruption in Nigeria.

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