The Price that We Collectively Pay for Corruption

Last week, Jeevan Virkar, Director General of the State Anti-Corruption Bureau, addressed the Club on, ‘Corruption in Public Life’.

Introducing him, Rtn Anil Harish said, “Jeevan Virkar joined the IPS in 1972. He is a good swimmer and a squash player. He has held various positions as an IPS officer all over the country. He has been in the Ministry of Home Affairs and External Affairs. He was a Consul in Vancouver, Canada.

“Why is it that in the newspapers that we only see news items about people caught taking petty bribes of a few thousand rupees, and not of people who have taken bribes of lakhs and crores of rupees?” asked Anil. “How would Jeevan handle a situation where he had to investigate a senior politician who has taken money or is suspected of corruption? How would he conduct investigations in case of people whom he knows in the government, for instance?”

To establish at the outset that corruption was a life-and-death issue, Jeevan said, “Let me take you to two days in the history of Bombay city: 12th March 1993, when the serial bomb blast rocked the city of Bombay and 270 people were killed; and 26th July 2005, when floods hit the city and caused over 200 deaths. Twelve years apart, both these days spelt disaster in Bombay. Both these events occured because of corruption. Corruption is not merely about bribing government officers, but it threatens the integrity and security of the nation.

“Think of corruption in defence deals. If we are not getting the best of defense equipment or of technology, then our coountry’s integrity is at stake. I worked in the department of Atomic Energy for several years. Can you visualise a situation where substandard parts are procured for a nuclear reactor? You could have another Chernobyl on your hands. Fortunately, our scientific departments like the Department of Atomic Energy and Department of Space are the least corrupted departments in India, and therefore I think we are in safe hands there.

Transparency International

“The mission statement of Transparency International (TI), a Germany-based NGO, sums up the challenge of corruption very effectively: ‘Corruption is one of the greatest challenges of the contemporary world. It undermines good governments, fundamentally distorts public policy, leads to the misallocation of resoources, harms the public and private sector developments and particularly hurts the poor. Corruption in the ultimate analysis is antisocial.’ In India where a large number of people live below the poverty line, corruption is not about punishing corrupt officials but about saving lives.

“What is corruption doing to our economy? A study conducted by the Punjab, Haryana and Delhi Chamber of Commerce said that investment would increase by 2.9% and GDP growth by 1.3% if the corruption index improved by around 15%. India is losing Rs 63,800 crore additional income per annum and Rs 28,600 crores of consequential national income per annum as a result of corruption. These figures are based on several articles that have been written on corruption. So this is what corruption is capable of doing.

“Let us look at how the world sees us. TI conducts an annual survey of corruption in countries and in 2006, India was ranked 70th out of 163 countries surveyed. TI has a corruption index score from zero to 10. Ten is for countries which are least corrupt and zero is for countries which are most corrupt.

Countries having a score of less than 5 have a serious problem that needs to be recognised and dealt with. India’s score last year was 3.3. Along with us were countries like Egypt, China, Brazil, Ghana, Mexico, Peru, Saudi Arabia and Senegal. The bottom nation on the list, with a score of 1.8, was Haiti. Pakistan was ranked 142nd with a score of 2.2. At the top were Scandinavian countries like Finland, Iceland and New Zealand, with a score of 9.6. “We ranked 88th in 2005, 90th in 2004 and 83th in 2003. In 2006, we are at the 70th position — a considerable improvement. Whether the improvement is noticeable on the ground remains to be seen.

Causative Factors

“Now let us look at the factors that impact the corruption and the extent of corruption. Mr N Vittal, our former Chief Vigilance Commissioner had analysed the situation thus:

Scarcity of goods and services: Whenever there is a short supply, people are willing to pay more than normal, and there is corruption.

Red tape and delay: Things get delayed, government applications are kept pending and you have to pay to speed up the process — speed money.

Lack of transparency: The more complex our laws and regulations are, more the scope for corruption.

Tribalism: The tendency of the corrupt to protect each other and see that they are not exposed is itself a major cause of curruption.

Neta, Babu, Lala & Dada

“The four major players in the area of corruption are the neta or the corrupt politician, the babu or the corrupt official, the lala or the corrupt businessman and the dada, the criminal. So the nexus of this quartet is responsible for corruption in our country. We have to see that whatever measures we take must have an impact on this quartet, because all have great influence in society, and are able to bend the rules and move things their way.

“Our former director of the CBI had an interesting analysis. He said that the surplus legal power of the bureaucrat and the politician alongwith his deficit money power, combined with the surplus money power and deficit legal power of the businessman provided the terra firma for corruption. So the politician and the babu have the power that they can use to extract money. The businessman has the money but not the power, so he pays to get the power. So this is how and where corruption arises.

whether the private sector is the victim of corruption or the origin of corruption. Many businessmen would argue that they are the victims. ‘We have to pay to get our jobs done, to get our licenses, our permissions etc.,’ they might protest. But the CBI director believes that it is actually the other way around: corruption flows from the private sector to the government sector. I am not sitting in judgement, but am merely presenting a viewpoint.

Anti Corruption Machinery

“Let me now give you a view of the anti-corruption set-up in India. The basic law that pertains to corruption is the Prevention of Corruption Act of 1998. While there are other sections too in the Indian Penal Code such as the Money Laundering Act etc, which too have provisions regarding corruption, this is the basic Act. The one thing that people dont really know is that this Act applies only to public servants and those who abet them in committing offenses like collecting money for the public servant. Corruption in a private company is not within the purview of this law.

“Under this Act at the apex, you have the Central Vigilance Commissioner, and then the Chief Vigilance Commissioner, with two other vigilance commissioners. The Central Vigilance Commission was set up in 1964 under an executive order. Only in 2003 was it made into a statutory body under an Act of Parliament. So the Central Vigilance Commission is basically a body that supervises the CBI and all the vigilance offices in the Central government departments.

“At the next step is the CBI itself, which is the vigilance or anti-corruption organization for all the Central government departments. If you want to trap a railways man, complain against a telephone lines-man, an officer from the nationalised bank or any government employee, then you need to go to the CBI and not to the Anti-Corruption Bureau.

“Every important public sector organisation like the Indian Airlines, Bharat Petroleum etc has Chief Vigilance Officers who work under the superintendence of the Chief Vigilance Commissioner. So that’s how things are in the Central government.

What State ACB Does

“In the state governments, we have Anti Corruption Bureaus (ACB) which are responsible for curbing corruption among state government employees. At the Maharashtra ACB, we carry out three kinds of operations under Prevention of Corruption Act.

“One is a trap case; when a complainant comes to us and says that a public servant is demanding money from him, then we lay a trap and catch him red-handed. The money that changes hands is treated with chemicals to prove the transfer from one hand to the other.

“The second kind of case is disproportionate assets. When a public servant has assets worth much more than he should be normally having from his known sources of income, we investigate that person. Anybody can lodge this kind of complaint about a public servant, equipped with some kind of basic evidence. Then we work out the public servant’s income from all sources throughout his career, deduct his expenditures and calculate what his legitimate savings can possibly be. Suppose his total income was Rs 50 lakhs, and his expenditure was Rs 25 lakhs, his savings should be Rs 25 lakhs, and his assets should be within that limit. But if he has assets worth Rs 75 lakhs, then it is a clear case of disproportionate assets.

“The third case is what we call criminal misconduct. When a public servant misuses his position for himself or for others close to him, such as his family members, or someone else who is undeserving — and thereby makes some money on the side, he is guilty of criminal misconduct.

“These are the three kinds of cases that the Maharashtra ACB deals with.

How to Curb Corruption

“So what do we do? Can we have a society that is corruption free? Its a difficult question to answer and we should be hoping and working towards reducing corruption in our country. Everybody wants to live in a corruption-free country, but at the same time everybody says, ‘Corruption is everywhere. What can we do about it? We have to be corrupt to survive, we can’t get our jobs done otherwise’. There is a contradiction here.

“Everyone has to understand that the extent of damage being caused by corruption is vast, and we have to change our mindset about corruption. I often meet with a cynical laughter when I tell people that I work with the Anti Corruption Bureau. And they laugh and ask me what I do there. Most of the times, I do not know how to deal with such cynicism!

“A change in morals and social values is a major factor in which each one has a role to play, as teachers, as employers because this is where we learn our basic values. Sometimes you see a parent carrying his two children on a motorcycle. When a policeman stops him at a signal, the man gives him a bribe without any hesitation. Now what kind of values is he imparting to his children? How can he expect his children to be honest citizens?

“During the last fortnight, we had a case where a Police Inspector was offered a bribe by some businessmen. When he refused, an Assistant THE GATEWAY . 20th March 2007 3 Commissioner of Police helped those two businessmen to approach him again, and tried persuading the Inspector to take their bribe and do their work. This Inspector approached us. Acting on his complaint, we arrested both the businessmen as well as the ACP. However, such cases are rare.

“In my personal opinion, corruption is a short-cut to convenience — to our own immediate gain. Why do we pay a bribe? We do it because we do not want to go through a whole legal process. Basically, we want to jump the queue. To me, this is a short-sighted strategy — making a gain today or tomorrow but harming society in the process. By giving a bribe, one undermines an institution. In what state are we going to leave our country for the next generation? We do not think of these things when a bribe is paid.

“Lets look at this issue in the light of the country’s economy. They say 40% of the economy is a parallel economy. If that economy was added to the regular economy, we would all be in such a prosperous state! So there has to be an ideological attack against corruption in which each citizen should play a role.

Right to Information Act

“Let us see some legal provisions to know how we can improve. Corruption arises when laws are complex. People have to give bribes when they cannot get their work done without breaking the law. So the laws need to be made more simple, more transparent. And I think we have taken a very big step by enacting the Right to Information Act last year.

“This is a big weapon in the hands of the citizenry against corruption. Under this Act, the citizen can demand from any government official an explanation for why a certain decision is being taken or not taken. If somebody has applied for a ration card and has not got a response for three months, then he can apply under the RTI Act and ask the Rationing Officer the status of his application, and the reason for the delay and if the card has not been granted, why it has not been granted.

Similarly, if a newly constucted road has crumbled, any citizen can ask the Municipal Commissioner as to why this has happened? To whom was the contract given? What did he bid in the contract? What did the others bid? Why was this particular party given the contract? All these questions can be asked by a common citizen.

Legal & Electoral Reforms

“We need to have laws that enable the assets of corrupt public servants to be confiscated. Take the case of a corrupt public servant who makes a lot of money and uses it to buy property. He is finally caught, but by the time the case goes to court, he is found guilty, and he goes in appeal to higher courts, the matter drags on for 15-20 years. Meanwhile, he continues to enjoy the fruit of his ill-gotten properties, because under the current laws, the property can be confiscated by the state only after he is convicted. We need a deterrent there. The laws need to be strengthened in order to enable the fruits of his illgotten wealth to be consficated by the government.

“It is generally believed that electoral process in India is at the root of all corruptions, because politicians need money for elections. They have to get their monies from the officers and so the officers make money and pass it on to the politicians. So cleaning up of the electoral process either through a process of state funding of elections or having limitations over what amount the candidates can spend on electoral expenses are also initiatives that need to be considered.

“We need the help of NGOs and voluntary bodies in the state. We have NGOs like AGNI, PCGT Republic Concerns for Governance Trust etc doing excellent work in anti-corruption. They are enlightening people, bringing cases to the ACB and taking the culprits to the courts. In fact, we feel that each trade association and chamber of commerce should have an anticorruption cell to take up the cases of its members. An individual feels scared to go to an official with his complaints, because he fears harassment. Maybe going through his association’s anticorruption cell can make it easier for him.

“One of the big success stories in fighting corruption has been Hong Kong. Hong Kong was a colonial country like ours, though there is a huge difference in size between the two. In the scale of Transparency International, today Hong Kong stands at number 15 and India at 70. This is because in 1974, they formed an Independent Commission Against Corruption, which worked independantly of the executive branch of the government and reported directly to the Chief Executive of Hong Kong.

“All its officials and members are recruited independently of the government. It has three arms: (i) an investigation arm, which conducts investigation into corruption crimes etc (ii) a corruption prevention department which goes around studying the practices and procedures of various departments, recommending how they can be improved and made more transparent and suggesting best practise packages to both public and private sectors.

(iii) the community relations department which educates the public against the evils of corruption and promotes business ethics. In fact, they formed the Hong Kong Ethics Development Centre in 1995, in conjunction with chambers of commerce to promote business ethics in the country. Maybe that’s a step we need to emulate.

The Way Forward

“In conclusion, our country is at the crossroads, our economy is booming, our growth rate is at 9%. The spending power of the middle class is increasing by leaps and bounds. We have the fancy malls everywhere, in huge buildings. But what is the real state of the health of our country? What is the health of our polity and our society?

“It is as though the AIDS of corruption has affected our institutions. It is like a person with AIDS, who looks completely healthy on the outside, despite his immune systems being eroded within. One day, these systems completely fail, and the person dies. Something similar is happening in India. Corruption is eating into the vitals of our institutions, our bureaucracy, our police, our judiciary and even the defence forces.

“So which way will we go? Will we go on to become a great power, a great economy, or will we let this AIDS of Corruption eat through our system and suffer a collapse later on?” asked Jeevan Virkar.

In a Lighter Vein

To conclude on a lighter note, Jeevan told a joke about how corruption worked. “Mr Vittal, our former Vigilance Comissioner used to tell this joke: Our space department makes a spaceship to send an Indian to the moon, and looks out for someone who is willing to go up in that spaceship. Not many people have confidence in the rocket, and so not many people are forthcoming.

“So the department’s official approaches a Bengali, because Bengalis are supposed to be patriotic. The Bengali demands Rs 1 crore, to provide for his family in case he does not return alive. The official says, ‘we will see’ and goes looking for someone else who may charge less.

“So the official approaches a Sardar, because they are considered valiant. The Sardar agrees but demands Rs 2 crores. Why Rs 2 crore? Well, one crore for his family and another crore for making merry before climbing on the spaceship, says the Sardar.

“The official decides to keep looking. Along comes a middleman, who demands Rs 3 crore. The official is amazed. Why Rs 3 crores, he asks. And the middleman explains, “I’ll give you one crore, I’ll keep one crore, and we will give one crore to the Bengali and send him to to the moon!”

“That’s how corruption works,” concluded Jeevan Virkar, amidst laughter and applause.