Tackling corruption in the world's poorest countries
24 November 2008 (Updated 9 December)
On International Anti-Corruption Day 2008, find out about DFID's work to stamp out this international problem
Image
courtesy of Jenny Matthews/Panos Pictures
Corruption undermines the fight against poverty. It hits the poor hardest. One in five people in the world live in extreme poverty - on less than 65p a day. Ten million children die before their fifth birthday, most of them from preventable diseases, and more than 113 million children do not go to school. These people need our help now.
DFID cannot wait until poor countries are free of corruption before getting engaged. The first thing we can do is to make sure our money is properly used. In addition, we must work to address both the underlying causes of corruption and the international factors that allow it to flourish.
Ensuring aid is used well
Every
pound must go where it is intended. We have a zero tolerance approach to the
misuse of DFID funds and are committed to getting value for money for the
UK taxpayer.
DFID has clear guidelines on how to identify and tackle corruption. It is
mandatory for all our country programmes to undertake an assessment of the
likelihood of corruption in a country’s financial management and procurement
systems (a "fiduciary risk assessment").
They must also undertake a "Country Governance Assessment" (which looks at a country’s political systems and the interactions between people and their governments). Additional safeguards are adopted where needed and programmes are monitored through a range of audits and other reviews.
In cases where we cannot be sure
that governments are committed to human rights, poverty reduction or good public
financial management, we do not provide direct financial aid.
In instances where aid is being provided and we are unhappy with how it is being
used, we can and do withhold funds.
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Addressing the causes
The
key to addressing corruption is to tackle the underlying causes of it, not just
the symptoms. This takes time and a long-term commitment, but at the centre of
DFID’s efforts is a focus on supporting greater transparency and accountability.
At the 3rd High Level Forum on Aid Effectiveness in Accra, Ghana in September, DFID launched the International Aid Transparency Initiative, a global initiative to help make overseas aid work better in helping poor people. Fourteen donors promised to make information on aid flows more accessible, making it easier for poor people and their governments to track how aid is spent at local and national levels.
DFID is also supporting enhanced transparency and accountability directly with partner countries, by strengthening community participation and the reform of state institutions. This approach has yielded some notable successes.
In Kenya, for
example, where schools were not receiving text books, despite funds being
provided, DFID ensured that school committees (made up of parents and teachers)
were put in charge of buying books and other classroom
essentials.
In Uganda, DFID helped to clean up corruption in the public sector by
helping to stop payments to 9,000 ‘ghost workers’ (non-existent employees
featuring on payrolls). The money saved through this and similar efforts has
amounted to some £12 million, which is enough to feed 1,000 children with three
meals a day for over a year. Read more in
Ghostbusting saves
Uganda’s public money.
In Mozambique, DFID support for the Government's customs reforms resulted in a forty-fold improvement in clearance times, strengthening the business environment and reducing the opportunities and incentives for bribery. As a result of these measures, between 1996 and 2005 customs revenues doubled.
With DFID support, Zambia has abolished user fees in the rural areas where the majority of the poor live, reducing the opportunities for corruption in accessing healthcare. DFID has also supported the Zambian Government in recovering over £20 million (in both cash and assets) that was stolen by senior public officials. Recently, the Cabinet decided to use £2 million of the recovered funds to improve maternity facilities.
An international problem
Corruption is not just a problem
that is confined to developing countries. Western companies that offer bribes to win
contracts and Western banks that accept "dirty money" all help to fuel
it. The UK
Government is
proactively tackling this problem.
Encouraging the take-up of the
UN Convention against Corruption (UNCAC) around
the world is a crucial part of this work. In addition, international fora such
as the G8 and the Organisation for
Ecoomic Co-operation and Development (OECD) are
critical in building global commitment.
DFID has also led the development of a number of international initiatives to promote
greater transparency from businesses about their actions. The Extractive
Industries Transparency Initiative (EITI) sets a global standard for oil and
mining companies to publish what they pay and for governments to disclose what
they receive. In Nigeria
in 2004/05, the EITI contributed to the identification and recovery of $1
billion in revenues from oil companies.
Related initiatives in the pharmaceutical and construction sector are now being
launched. For example, the Construction Sector Transparency (CoST) Initiative
works to combat corruption in Government construction projects. Designed and
implemented by national Governments in partnership with business and civil society,
this project is being piloted in
Tanzania and
Zambia.
A central part of DFID's anti-corruption efforts has been to strengthen UK
systems and regulations for countering bribery and money laundering. Funding has
been provided to
police units within the Metropolitan Police and
City of London Police to
investigate allegations of international corruption.
Following a recent Met investigation into allegations that Nigerian State
Governors were keeping "dirty money" in UK banks, funds to the value of £65
million were frozen. So far, £1.2 million has been returned by the UK, with a
further £19.4 million being recovered through the UK courts, and a UK citizen
has been sentenced to three years for money laundering. In Nigeria charges have
been brought against 338 people.
Meanwhile, an investigation by the City of London Police Anti-Corruption Unit
resulted in a Ugandan Government Adviser and the Managing Director of a UK-registered company being convicted
of bribery. The Serious Fraud
Office is currently carrying out 20 ongoing bribery investigations, with a
further 45 under preliminary
investigation. Read more in the Guardian article
Ugandan
is jailed in UK bribery crackdown.
The future
DFID and the UK Government have demonstrated a serious commitment to tackling corruption in developing countries and internationally, and this will continue. For example, on 3 December 2008 DFID hosted the launch the World Bank Governance Partnership Facility (jointly supported by DFID, the Dutch and the Norwegians). This will strengthen governance and anti-corruption approaches in priority developing countries. Read more
Initiatives such as this, together with the ongoing work detailed above, will
ensure that fighting corruption remains at the heart of DFID's efforts to
eradicate poverty.
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Links
- International Anti-Corruption Day 2008
- Millennium Development Goal 8: Aid, trade, growth and global partnerships
- How we fight poverty: Corruption
