The unfair and discriminatory face of corruption

Corruption increases injustice and discrimination; its impact is multidimensional. Grand corruption, the collusive abuse of political, governmental and commercial power for private gain through the manipulation of public interest decisions, benefits the few at the expense of all. the society. Vast sums of public money are being siphoned off through high-level corruption by perpetrators, depriving ordinary people. When grand corruption grows into state capture, institutional, legislative, regulatory and law enforcement capacities are systematically designed to protect and promote impunity.

The cost of grand corruption in Bangladesh is high. A former finance minister reportedly acknowledged in 2015 that at least two to three percent of our GDP is lost each year to corruption. Credible data on illicit financial transfers out of the country, as reported by Global Financial Integrity, shows that due to trade-related misinvoicing alone, Bangladesh lost $8.275 billion annually between 2008 and 2015. More updated data would show the amount to be much higher, at as much as $12 billion a year. Illicit financial outflows occur in several other ways, including the conventional hundi method. Validated or not, the Police Criminal Investigation Department (CID) recently reported that Bangladesh is losing $7.8 billion in remittances per year via mobile financial services (MFS).

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Corruption generates disproportion and inequality. Corruption affects the poor and marginalized through unduly increased cost of public services and limited, if any, access to public services. They also suffer from the fact that government resources are diverted away from investments in the public sectors.

When grand corruption flourishes unabated, petty corruption involving service delivery managers also spreads deep and wide, to the point of becoming a way of life. For the perpetrators, corruption is a matter of illicit enrichment drug addiction, while for the victims – ordinary people – it is an extremely painful experience of daily life, unfair and discriminatory. This is the key message of the 2021 National Household Survey on Corruption in Services Sectors, released by Transparency International Bangladesh (TIB) on August 31, 2022.

Nearly 71% of survey respondents have experienced various forms of corruption, including bribery in more than 16 service sectors covered by the survey. Meanwhile, 72.1% of victims of corruption said they were forced to pay bribes because they would otherwise not have access to public services. There is also strong evidence from the survey that corruption affects marginalized sections of society more than average victims.

The sectors most affected by corruption, according to the experiences of respondents who had interactions in the respective service sectors, are law enforcement (74.4%), followed by passport issuance (70.5 %), public road transport services (68.3%), legal services. services (56.8%), health services (48.7%), local administration (46.6%) and land (46.3%). Besides bribes, corrupt practices include extortion, fraud, embezzlement, neglect of duty, nepotism and harassment. The survey data period was December 2020 to November 2021.

It shows that the perpetrators of corruption are generally indifferent to the socio-economic or gender identities of service recipients, which means that corruption affects everyone. However, it affects the relatively weaker and marginalized sections of society more. The corruption victimization rate among rural households, for example, is significantly higher (46.5%) than those in urban areas (36.6%).

The amount of bribes collected by corrupt bondholders from an average household is estimated at Tk 6,640 crore, based on which the estimated annual amount of bribery is Tk 10,830 crore, equivalent to to 5.9% of the 2020-21 national budget or 0.4% of GDP. The burden of corruption in terms of proportion of average annual income is seven times higher (2.1% against 0.3%) on the category of low-income households (annual income up to 24,000 Tk) compared to higher income households (85,001 Tk or more). ).

The discriminatory nature of corruption is further manifested in terms of victimization of households headed by persons with disabilities (PD). At least 80.3% of these households have been victims of corruption, compared to a national average of 70.6%. In terms of corruption, the victimization rate is 51.8% for households headed by people with disabilities, compared to 39.8% overall.

Although there is little variation in the victimization of corruption based on the professional identity of household heads, it is interesting to note that more than 51% of civil servants are also victims of corruption. More strikingly, retired civil servants are victims of corruption at a higher rate (68.3%) than their peers in service, which confirms that if corruption spares no one, the weaker the recipients of services are in terms of identity and status, the more vulnerable they are to corruption.

Corruption – big or small – is a major obstacle to inclusive development and democratic governance. It weakens institutions, undermines the rule of law and erodes public trust in government. Corruption is protected and perpetuated by biased political regimes and flawed governance practices that favor the wealthy and the well-connected. As a result, the more pervasive corruption is, the more income inequality and social exclusion increase.

It is therefore not surprising that Bangladesh is placed at the top of the world’s list of the fastest growing countries in terms of the super rich, according to Wealth-X. The Global Inequality Lab reported that in 2021, 44% of Bangladesh’s total national income was held by just 10% of high-income people, while the bottom 50% owned just 17.1% of GDP. Only one percent of the population holds more than 16 percent of the total national income.

The promotion of integrity in the public service is crucial in the fight against corruption. As long as there remain opportunities for abuse of power with impunity, relevant laws, rules and regulations are not enforced, and institutions of accountability remain politicized and dysfunctional, corruption will only thrive. It all depends on how much political and governmental appetite, courage and commitment to serve the public interest and deliver accountability without fear or favour.

Dr Iftekharuzzaman is the Executive Director of Transparency International Bangladesh (TIB).

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