Transcript PREVENTION AND COMBATING OF CORRUPTION BUREAU …

2008
THE 13th INTERNATIONAL ANTI – CORRUPTION
CONFERENCE [IACC]: Athens, Greece.
THE EMPIRICAL TOOLS FOR GOVERNANCE AND
CORRUPTION ANALYSIS:
The case for Tanzania.
Dr. Edward G. Hoseah – DIRECTOR GENERAL
THE PREVENTION AND COMBATING OF CORRUPTION BUREAU - TANZANIA
10/30/2008
EMPIRICAL TOOLS FOR GOVERNANCE AND
CORRUPTION ANALYSIS
Sensibly evaluating an elusive concept like governance has
become an ever-growing field of research viewed by large
number of enterprise, citizen and expert survey
respondents in industrial and developing countries.
EMPIRICAL: derived from experiment, experience and
observation rather than from theory or logic.
MEASUREMENT TOOLS
1. In measuring governance, the following are common
empirical tools for analysis:
a) Voice and Accountability.
b) Political stability and absence of violence.
c) Effective Government.
d) Quality of Regulatory framework.
e) The Rule of law.
f) Control of corruption.
In the mid-1990s several institutions including the World
Bank, UNDP and EU have tried to asses governance
empirically in order to justify its funding programs.
1.1. For example the World Bank has come up with the
following as tools for assessing governance:
a) Control of corruption as a priority area.
b) Promoting equity.
c) Gender and gender mainstreaming.
d) Economic growth and investments.
e) Delivery of health services, education and
infrastructure development.
f) Preventing market failures.
1.2. The EU measures governance by using the following
indicators:
a) Human rights.
b) Democratization and democracy.
c) The Rule of Law.
d) Civil society.
e) Decentralized power sharing.
f) Sound public administration.
g) Gain importance and relevance as a society develops
into a more sophisticated political system.
e) Electoral system.
1.3. While the UNDP, has developed tools for measuring
governance in collaboration with the citizens and other groups
which are:
a) control of corruption as a priority area.
b) exercise of legal rights and obligations.
c) developing infrastructure.
d) health services and education.
e) Investment level and growth of economy.
The situation above shows that every institution has different
tools for measuring good governance in different Nations. These
differences result in confusion for domestic implementers.
2. Good governance, therefore is to govern well and to
produce results that meet the societal needs for the good of
the citizens. Its underlying principles are:
a) Transparency.
b) Accountability.
c) Participation.
d) Rule of law.
e) Responsiveness.
f) Consensus oriented.
g) Equity and Inclusiveness.
h) Effectiveness and efficiency.
e) Predictability.
2.1. A sensible evaluation of governance in any particular setting is a
very complex task for a number of factors, particularly where
corruption has become a priority area of assessing good
governance by large number of enterprise, citizen, and expert
survey respondents in industrial and developing countries.
2.2. On the other hand, taking Transparency International (TI)
measurement, the following indicators are considered in
measuring governance:
a) Control of corruption as a priority area.
b) The freedom of media.
c) Electoral system.
d) Promoting equity and human rights.
e) Level of investment and economic growth.
2.3. On the other hand, the World Bank on assessing Tanzania
and other countries on governance, their findings are based on
the following:
a) Corruption perception index (CPI) produced annually
Transparency International (TI).
b) World Governance Indicators (WGI).
c) Business Environment and Enterprise Survey
(BEEFS).
However, Transparency international (TI) measures
governance by capturing the views of local stakeholders
who perceive governance problems differently from those
making a judgment from the outside.
2.4. The CPI, commonly called the “poll of polls” which
has revealed as a powerful tool accepted worldwide,
much criticism has been addressed against it in terms of:
a) inaccuracy.
b) inconsistency.
c) real impossibility to asses what a particular given
degree of corruption means for a country.
2.5. Taking the TI measurements, much criticism arises due
to the sampling techniques used which are:
a) basing on the “perception” views.
b) basing on the “polls” and “surveys”.
3. In particular the World Bank in corruption index praises
Tanzania for bits 2007 being one the countries improving
governance. The world’s most corrupt nations named in the
World Bank corruption index 2007 are North Korea, Somalia,
Myanmar; formerly known as Burma, Afghanistan, Congo, Iraq,
Zimbabwe, Bangladesh, Nigeria, Turkmenistan, Cambodia,
Chad, Ivory Coast, Angola, Papua New Guinea, Sierra Leone
accordingly.
3.1. But from the Transparency International corruption perception
index of 2008 (CPI 2008) Tanzania has positioned at 102 group
among around 180 Nations
assessed.
3.2. Applying the Transparency International measuring tools to
Tanzania setting, the following are missing out in the TI
considerations:
4. The case of Tanzania:
 The National Strategy for Growth and Reduction of Poverty
(MKUKUTA:2005-2010) whose target is to reduce poverty in line
with the Millennium Development Goals (MDGs). The
Government of Tanzania has and continues to address the
problem of corruption by employing the principles of good
governance and Rule of law, Accountability of leaders and public
servants, Democracy, political and social tolerance, deepening
peace, political stability, national unity and social cohesion
(Cluster Three of MKUKUTA).
 In addition, the Government by ensuring sound macro-
economic management, promoting sustainable and broad based
growth and reducing income poverty of both men and women in
urban and rural areas (Cluster One of MKUKUTA).
Direct Measures undertaken by Government to address
corruption include:
 Introducing the National Anti-corruption Strategy and
Action Plan (NACSAP) as tool for prevention of corruption
in the public, the civil society, the private sector and media.
 Promulgating
the Prevention and Combating of
Corruption Act, 2007 which has domesticated the UNCAC,
2003.
 Introducing Integrity Committees in all public Institutions
(MDAs) to ensure integrity values are inculcated and
remain a permanent feature in public service delivery.
4.2.1. GDP and Inflation:
 Transparency International should consider also GDP, price
inflation, per capital income and revenue to GDP ratio as one of
the tools for the assessment of control of corruption and good
governance. Tanzania’s economic performance during the last
ten years indicates that GDP growth increased from 4.1 percent
in 1998 to 7.1 percent in 2007. GDP growth averaged 7.2 percent
for seven years since 2002.
 Inflation was reduced from around 30% in mid 1990s to 3.5% in
2003 and progressively increased to 7% in 2007. Nevertheless,
the same has been kept below double digits despite recent
increases in oil and food prices in the world market. Per capital
income increased from USD 315.1 in 1998 to USD 439.5 in 2007.
Revenue to GDP ratio increased from 11.5% in 1998 to 17.1% in
2006. Thus economic indicators should also be used to measure
good governance.
Economic Performance (Selected Macro Variable)
(Vertical axis represents rates in percentage %)
Revenue collection:
 Transparency International (TI) should also consider
that Country’s Revenue collections is one of the key
component in measuring corruption and good governance.
Tanzania Revenue collection has improved since 1995/96
financial year with annual collections of USD 336,723,333.3
to USD 1,700,327,500 in the financial year 2005/06.
 From practitioner’s point of views, there is a need to
consider the above factors in developing empirical tools for
measuring governance because we need to have a fair and
realistic assessment of the realities on the ground,
particularly stakeholders views.
TANZANIA REVENUE COLLECTION
Note: Revenue collections reported in millions Tanzanian shillings (Tshs).
Source: Tanzania Revenue Authority (TRA) 2006.
Fiscal Year
1995/96
1996/97
1997/98
1998/99
1999/00
2000/01
2001/02
2002/03
2003/04
2004/05
2005/06
Income
tax-PAYE
25,695
38,358
47,722
54,862
73,291
92,744
116,567
139,694
183,237
233,460
277,759
Income
taxcorporate
47,759
54,690
64,773
64,787
54,502
46,634
57,057
78,390
109,072
152,449
195,279
Income
tax- other
38,735
41,075
47,626
52,025
98,486
77,022
82,547
94,032
96,045
107,501
146,317
VAT-local
51,573
67,053
61,758
115,580
126,968
140,035
165,908
201,543
181,109
296,203
329,219
Excise
dutieslocal
44,107
61,923
78,783
57,796
66,960
68,999
72,837
85,263
92,869
108,985
135,173
Other
domestic
taxes &
charges
28,199
43,337
43,656
22,829
22,742
22,087
24,982
26,140
32,020
25,434
41,648
Internatio
nal trade
168,000
208,709
227,086
261,739
279,306
413,806
456,710
520,099
624,955
754,975
914,998
Total
404,068
515,144
571,404
629,618
722,254
861,327
976,608
1,145,161
1,319,306
1,679,008
2,040,393
Tax item
Graphical presentation of the Tanzania Revenue collections
4.2.3. Performance of the Prevention and Combating of
Corruption Bureau (PCCB):

Transparency International should cooperate with
PCCB which is the leading Institution for preventing
and combating of corruption in Tanzania before
publishing their annual CPI. An increasing
performance of PCCB has increased the citizen’s
awareness and participation in the areas of prevention
and combating of corruption in Tanzania.
Measuring PCCB’s performance in preventing and
combating of corruption in Tanzania has taken into
account, inter alia, the following:
a) Corruption cases reported to the institution by citizens.
b) Corruption cases investigated by the institution .
c) Completed investigation cases.
d) Administrative actions taken against public officials of
questionable character.
e) New cases filed into courts of law by the institution.
f) Convictions recorded in the courts of law.
See the Institution’s performance table next slide:
OUTPUT REPORT FROM THE INVESTIGATION AND PROSECUTION FUNCTIONS: 2001 – 2007
(Source: PCCB/HQ-2007)
OUTPUT
2001
2002
2003
2004
2005
2006
2007
Cases reported
1,354
(100%)
1,383
(102%)
2,285
(169%)
2,223
(164%)
3,121
(230%)
6,320
(467%)
8,235
(608%)
Cases
Investigated
1,354
(100%)
1,383
(102%)
1,796
(133%)
1,149
(85%)
677
(50%)
1,528
(113%)
1,266
(94%)
Cases
completed
285
(100%)
732
(257%)
540
(189%)
458
(161%)
540
(189%)
1,688
(592%)
2,015
(707%)
Cases
transferred
154
(100%)
222
(144%)
36
(23%)
25
(16%)
2
(1%)
496
(322%)
460
(299%)
New cases filed
into court
57
(100%)
52
(91%)
60
(105%)
60
(105%)
50
(88%)
71
(125%)
196
(344%)
Total cases
prosecuted
110
(100%)
191
(174%)
178
(162%)
202
(184%)
218
(198%)
251
(228%)
352
(320%)
Convictions
0
(0%)
12
(100%)
9
(75%)
6
(50%)
6
(50%)
18
(150%)
35
(292%)
Acquittals
0
(0%)
26
(100%)
28
(108%)
8
(31%)
10
(38%)
28
(108%)
45
(173%)
Administrative
actions
1
(0%)
42
(100%)
21
(50%)
126
(300%)
111
(264%)
209
(497%)
280
(667%)
Graphical presentation of the output from investigation function
The cases of corruption being reported in year 2007 has increased to 608% compared to what has
been observed in year 2001. Cases being completed investigated in year 2007 have also increased
to 707% compared to the cases recorded in year 2001.
Graphical presentation of the output from prosecution and
administration actions function
Prosecution function has been increasing annually as cases sent to court in
year 2007 had increased to 344% compared to those filed in court for the
year 2001.
Graphical presentation of the output from the cases completed from
courts and administrative actions taken.
More conviction was recorded in year 2007 by 292% compared to the convicted rate in the year 2002. More
administrative actions has been taken against public officials with unethical and questionable integrity increasing by
667% compared to actions taken in the year 2002.
Concluding Remarks and Recommendations
 The state of corruption produced annually by the
Transparency International may not be realistic or their
surveys used may lack some vital information which could
make their qualitative surveyed data more realistic.
 Their sampling methods and techniques which do not
cover certain critical groups of the society denies TI a vital
information/data that may increase the vitality of their
findings.
 Transparency International should cooperate with lead
Institutions for preventing and combating of corruption to
have a fair opinion in their surveys which are important for
improvement of good governance at global level.
References

Joel Hellman, Geraint Jones, and Daniel Kaufmann, 2000, “Seize the state, Seize the day: An
Empirical Analysis of State capture and Corruption in Transition,” paper presented at the World Bank’s
Annual Bank Conference on Development Economics, April (Washington: World Bank),
www.worldbank.org/wbi/governance/

Daniel Kaufmann, art Kraay, and Pablo Zoido-Lobaton (1999 a),” Aggregating Governance
Indicators,” World Bank Policy Research Working Paper No. 2195 (Washington),
www.worldbank.org/wbi/governance/.

Daniel Kaufmann, art Kraay, and Pablo Zoido-Lobaton (1999 b), “Governance Matters,” World
Bank Policy Research Working Paper No. 2196 (Washington), www.worldbank.org/wbi/governance/.

World Bank Institute and Europe and Central Asia Public Sector Group, 1999, “New Empirical
tools for Anti-Corruption and Institutional Reform: A Step-by-Step Guide to Their Implementation”
(Washington), www.worldbank.org/wbi/governance/.

Francesca Recanatini, World Bank Institute, October 30 2003 report, “The role of Empirical Analysis in
Addressing Governance”.

Bank of Tanzania, Monthly Economic Review, August 2008