"Replacing paper-based processes with electronic ones not only increases efficiency but also guarantees transparency."
"Replacing paper-based processes with electronic ones not only increases efficiency but also guarantees transparency."
Perhaps the least polarizing thing that came out of President Rodrigo Duterte’s fourth State of the Nation Address (SONA) last week was his harangue against corruption, which he described as “pervasive.”
“We find corruption everywhere in government with every malefactor watching his cohort’s back in blatant disregard of his oath when he assumed public office,” he said. “For every transaction, a commission; for every action, extortion; and a request that goes on and on—endlessly and shamelessly.”
He cited the systemic fraud carried out in the Philippine Health Insurance Corp, in which massive medical funds were disbursed to pay padded claims and ghost treatments of fictitious patients.
“I am grossly disappointed,” Duterte said. “The government is conned of millions of pesos, which could be used to treat illnesses and possibly save the lives of many.”
He also lambasted the Bureau of Customs, which had been notoriously prone to corruption since time immemorial and said he would remove its employees who are under investigation.
He claimed that the government had been “unyielding” in its attempt to weed out “the unscrupulous persons manning our ports and scalawags in uniform, with the firing or resignation of more than a hundred officials and appointees.
Worse, corruption is normalized in government, he said, by using language that seems to make the otherwise heinous act seem casual, like describing a corrupt act as “for the boys” or “sponsoring an event.”
“No amount of euphemism can trivialize and normalize betrayal of public trust or any other criminal offense. It is an injury laced with insult. It is both a national embarrassment and a national shame.”
Only something substantial, like an immediate “self-purgation,” can probably cure the deeply entrenched culture, which he said “exasperates” and “frustrates” him. He also toyed with the idea that “perhaps it is blood that we need to cleanse and rinse away the dirt and the muck that stick to the flesh like leeches.”
Corruption is even more disastrous in the context of the Philippines as an emerging economy. The literature is clear about the correlation between levels of corruption and growth and prosperity. Economies in which corruption is endemic cannot simply prosper as it highjacks the so-called natural laws of the economy.
This is evident, for instance, in data from the World Bank that reveals a wide disparity between average incomes in countries with a high level of corruption versus those with a low level of corruption, such as those in North America, Western Europe, and Australia.
And corruption is not a victimless crime as it is sometimes portrayed. Be it resources or opportunities, whatever is gained via corrupt acts carries implications that reverberate throughout the economy.
High costs of goods and services, for instance, can be a result of monopolies or oligopolies in the economy, which are in turn enabled and maintained by corruption. Business owners with connections to government or bribe money to go around can manipulate policies and market mechanisms to favor them and weed out the competition.
With so-called market forces kept at bay, they then become free to dictate the prices of goods and services, often at a rate that is unaffordable to most and with no need to account for quality because consumers are trapped one way or another into patronizing what they offer.
Corruption also helps sustain heinous inequality by guaranteeing that capital remains in the hands of oligarchs or whoever has public officials in their payroll. In this kind of economic environment, small businesses have a hard time competing with conglomerates because of unfair competition. Entrepreneurship is stripped of its potential to power the entrepreneur out of poverty.
The result is that economies plagued by corruption have a typically small middle class right smack in the middle of a wide gulf separating the rich and the poor. With other aggravating factors at play, this middle class continues to diminish, the poor gets poorer, and the rich gets richer.
It is no surprise, too, that corruption has a direct link to substandard and inaccessible education and healthcare. An International Monetary Fund report shows that corruption increases the cost of education and healthcare in corrupted economies, with compromised bureaucratic processes.
The other ills of corruption are also well documented: in terms of inefficiently allocated resources, in deadening stimulus for innovation, in creating shadow economies and black markets, and in disincentivizing foreign investments, among others. But the worst, most enervating impact of corruption is probably in the degradation of social values, which is the best breeding ground itself and thus creates a vicious cycle.
A relatively untapped mechanism to prevent corruption is technology. Something like “E-procurement,” for instance, which takes away the personal element and increases visibility in transactions, has been shown to curb the incidence of bribes. Replacing paper-based processes with electronic ones not only increases efficiency but also guarantees transparency.
The same thing can be applied to processes like taxation and customs processing, two areas long beleaguered by seemingly incurable corruption. Again, the rationale is the same: by automating the process, the need for personal interaction between individuals and public officials are lessened, which means the opportunities to bargain are also reduced.
The President’s SONA directives to the Anti Red Tape Authority and the Department of Interior and Local Government to strictly enforce a three-day limit on simple transactions is a strong message to local government leaders and front-line agencies to move fast on their constituent facing transactions.
While political will and a widespread culture change might seem to be seductive places from which to begin a frank anti-corruption initiative, the rational harnessing of appropriate technologies as an anti-corruption and productivity tool is the most logical option that government can rapidly operationalize. If corruption is left unaddressed, many of President Duterte’s SONA dreams will not come true.