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Thursday, 2 September 2010   |   Issue: Vol.27 No.41  |  Wednesday, 17 March 2010
Business
Botswana barely escapes censure in World Bank report

Botswana has been overlooked in a scathing World Bank report on selected African countries' poor public service delivery.


 
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Released yesterday, the African Development Indicators 2010 Report focuses on "quiet corruption, " which it describes as the failure by public servants to deliver services or inputs paid for by government.

The African Development Indicators (ADI) report samples 53 African countries and contains more than 450 macroeconomic, sectoral and social indicators.

The ADI's researchers largely ignored Botswana's rising problem of public service non-delivery, focusing rather on more troubled administrations on the continent where "quiet corruption" has led to rising poverty, illiteracy, disease and deaths. However, in comparing textbook corruption to "quiet corruption," the ADI did indicate that Botswana no longer occupied the highest ranks of corruption-free African states.  A corruption perception study contained in the ADI shows that 22.6 percent of interviewed firms identified public corruption as a major constraint.

Regionally, the statistics mean that firms in Botswana view the country as containing more public corruption than firms in South Africa, Zambia and Namibia.

Botswana, however, compares favourably against Lesotho, Mozambique and Malawi. Continent-wide, Benin, Cote d'Ivoire, Republic of Congo and Cameroon are viewed as the most corrupt by their firms, while Rwanda, Zambia and Mali are among those viewed as least corrupt by their firms.

In terms of "quiet corruption", the 2010 ADI overlooked Botswana's ongoing battle to bolster public service delivery and management of public finances. Besides President Ian Khama's addition of a fifth 'D' for Delivery in his campaign, Finance Minister Kenneth Matambo is planning to invoke a rarely used section of the Finance and Audit Act to crack the whip on lax or corrupt officers who lose taxpayers' funds by omission or commission.

"Section 39 of the Finance and Audit Act calls for the surcharge of public officers who cause Government nugatory expenditure," Matambo said in his presentation of the 2010/11 Budget last month. Henceforth, any officer who violates the Act will be surcharged.  "At the same time, project appraisal will be tightened to make it more robust to ensure that only projects with the highest potential added value are approved under the Domestic Development Fund, and that any subsequent project changes do not change the favourable net appraisal of the project."

Section 39 empowers the Minister to surcharge public officers for failing to collect government monies, causing losses of funds to the government, incurring excess costs to the government or being negligent in handling public funds. Public officers who, by omission or commission, waste taxpayer funds could be fined up to a sixth of their salaries until the amount is recovered.

Meanwhile, ADI researchers said "quiet corruption" - as opposed to corruption that involves an exchange of money - was less "noisy" and consequently less likely to attract public attention. "However, despite its low visibility, quiet corruption is ubiquitous and it is associated with harmful long-term consequences, particularly for the poor who are more exposed to adverse shocks and more reliant on government services to satisfy their most basic needs," the researchers said. "Worse still, it can have long-term consequences."

The ADI points to several studies as examples of quiet corruption. In one, a survey of malaria fatalities in rural Tanzania found that nearly four of five children who died sought medical attention from modern health facilities. However, effective treatment was hampered by drug pilfering, doctor/nurse/health worker absenteeism and very low levels of diagnostic efforts, all symptomatic of quiet corruption.

Another study showed that West African farmers suffered losses and poverty due to the usage of poor quality fertiliser during the 1990s and are consequently reluctant to use fertilisers even today. Other studies showed shocking levels of teacher absenteeism of between 20 and 27 percent in a month in Ugandan, Kenyan and Zambian schools.

The ADI researchers also found that quiet corruption takes a variety of forms in public utilities, including over-staffing, under-collection of bills and distribution losses. Recent estimates suggest that these forms of corruption cost Africa about US$5.7 billion a year.

"Over-staffing takes place when state-owned enterprises retain more employees than is strictly necessary to discharge their functions, often because of political pressure to provide jobs for members of certain interest groups," said the researchers.

"Over-staffing is found to be particularly material in the case of state-owned telephone utilities, which amounts to US$1.5 billion a year. Under-collection of bills is a result of lack of effort on the part of revenue collection officers or their petty corruption in collusion with consumers and is most frequently due to non-payment of bills by government departments. This problem is prevalent in power and water utilities where non-payment can be found across the income spectrum and carries an overall cost of US$2.4 billion a year."

The report explains that distribution losses take place when utilities fail to adequately maintain distribution networks and tolerate clandestine connections, which amount to theft of scarce energy and water resources. African power utilities typically lose 23 percent of their energy in distribution losses, the ADI said."Quiet corruption does not make headlines the way bribery scandals do, but it is just as corrosive to societies. Tackling quiet corruption will require a combination of strong and committed leadership, policies and institutions at the sectoral level, and - most important - increased accountability and participation by citizens," said Shanta Devarajan, the World Bank's Chief Economist for Africa.

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