How corruption hurts social sectors

By Zubeida Mustafa
Source: Dawn

THE budget season is here. Reports are being leaked to the press — obviously from official sources to improve the government’s image — about the heavy investment the policymakers plan to make in the development of the country. According to one report, the funding for education, health and other social sector projects in the Public Sector Development Programme will go up by 152 per cent from Rs31.3 billion in 2004-05 to Rs78.9 billion in 2005-06.

It is a positive sign that for once the government seems to be mindful of the development of human resources of the country. The federal minister of state for finance has also let it be known that the budget will be a pro-poor budget and will focus on the quality of life of the people.

But will boosting the financial allocations alone bring about a qualitative change in social sectors? True, for decades the health and education sectors remained starved of funds which affected the quality of their performance as well as their quantity and pace of expansion. An adequate number of new educational institutions and health facilities could not be opened and staffed because enough funds were not available.

Gradually it came to be realized that the education and health sectors have a direct bearing on the quality of life. Emphasis then came to be placed on health and education. Various terms were adopted. Whether referred to as the social sectors, basic needs of the people or human resource development, it meant the same thing.

Budget allocations for these areas were stepped up and aid from foreign donors also began to flow in to promote the health and education of the people. As a result the allocation for education went up from 0.8 per cent of the GNP in the eighties to 1.7 per cent of GNP in 2002-03 (it dipped after peaking at 2.5 per cent of the GNP in 1996-97). Health expenditure went up from 0.6 per cent of the GNP in the 1980s to 0.8 per cent of GNP in 2003-04.

The hefty rise in absolute expenditure notwithstanding the number of educational institutions and health facilities opened every year has declined considerably. This has never been analyzed properly, the blame being placed on inflation or inadequate utilization of funds. Thus the deputy chairman of the Planning Commission in Islamabad told Dawn recently that the PSDP utilization had been 49 per cent in the first seven months of this fiscal year but would go up to 97 per cent by the end of the year. It is surprising that the planners don’t take into account the huge amounts being siphoned off for “other” purposes.

In a book published recently, titled Fighting Corruption in Developing Countries Omar Azfar, a research associate at IRIS at the University of Maryland, makes a succinct observation, “Corruption is widespread in the health and education sectors of developing countries and not uncommon in developed countries. Exams are sold in Indonesia and Pakistan. Some reports state that there are 20,000 ghost schools in Pakistan, the expenses for which find their way into the pockets of bureaucrats. Teachers routinely pay between US$200 and US$1,400 for jobs and then collect their monthly salaries … without working, sharing these salaries with their superiors for turning a blind eye to their absenteeism. Consequently, as many as 32 per cent of teachers in Pakistan never show up for classes.”

Many of the teachers, who are paid for the job of instilling knowledge in their students, use their position for personal gain. Quite a number of them have opened coaching centres (of course not in their own names) and direct their students to enrol there for extra tuitions because the same teachers choose not to perform proficiently in class and neglect their students in school. At the management level, there is misappropriation in the purchase of equipment and other supplies and in the distribution of textbooks.

The same level of corruption is rampant in the health sector as well. Many doctors posted in the rural areas never attend the BHUs or the local dispensaries and live and practise privately in the cities. The tertiary hospitals are usually starved of life saving drugs because their pharmacy staff sell the expensive medicines in the market. They cheat so blatantly that at times they even forget to remove the stamp indicating the name of the government hospital to which they were supplied. Like teachers, many of the doctors in government hospitals do not attend to their patients in hospital hours and treat them in their private clinics for a hefty fee.

Corruption is prevalent in the private sector too, though it takes a different form because there is more accountability in this sector. Generally the lower staff does not indulge in malpractices because it is not tolerated by the top management. But the proprietors and managers have the opportunity to cut corners. The most common malpractice in private sector education is the underpaying of the teachers, jacking the school fees with no logical justification, imposing charges on unnecessary items, tax evasion and denying students the facilities that had originally been promised.

In the private health sector, corruption has grim implications since it can become a matter of life and death. Doctors are known to receive expensive gifts, payments and even paid holidays abroad from pharmaceutical companies as quid pro quo for prescribing their medicines. Prescribing an excess of drugs, and ordering an excess of laboratory tests that are not really needed. Some private clinics which rent out clinics to doctors for their private practice lay down all kinds of conditions. The doctor must get tests done from the hospital lab only and ensure a specified number of hospital admissions every month.

Although ministers and top functionaries of the administration are constantly exhorting their subordinates to work honestly and efficiently, their advice and warning fall on deaf ears. The fact is that corruption cannot be eradicated by word of mouth alone. The need is to analyze the causes and technique of corruption in order to work out strategies to check it. The government will first have to recognize the prevalence of corruption and how it is undermining the delivery of education and health services.

Omar Azfar makes some recommendations, which on paper appear to be effective and logical. But they raise the question: who will bell the cat? If those who are involved in corruption are asked to implement the anti-corruption measures, will they ever succeed? For instance he suggests better accountability, imposing fines, ensuring transparency of financial flows, privatization of service delivery and so on.

But it is more likely, as our experience shows, that imposing fines and punishing absenteeism will only raise the level of corruption by increasing the rates of bribes and “speed money” (bribe to facilitate service delivery). Accountability cannot come from within a corrupt system. The dictum “set a thief to catch a thief” will not apply in this case for the thieves will join hands and share the loot without reporting against the other.

Hence it is important that a third party which is affected by the services provided by the social sectors is empowered to act as a watchdog to monitor the performance of the various agencies. One recommendation by Omar Azfar merits serious consideration, namely, “increasing community oversight of schools and clinics”. This would require the setting up of governing bodies comprising figures respected in the community and with a reputation of integrity. Although the schools and some hospitals have such boards, they are generally ineffective and are sidelined by the bureaucracy.

It is important that these are duly empowered and the education and health departments be made accountable to them. Moreover, it is important that such governing bodies should have cells to receive public complaints against the functionaries who are indulging in corruption. This approach could be tried out on an experimental basis in pilot projects. That would help identify the weaknesses and loopholes if any and would guide the policy makers in fine tuning their strategy.