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Stifled by unchallenged corruption

Thursday, May 17, 2018

People who have been around a long time will remember former PNM minister Johnny O’Halloran, a high-ranking member of the Eric Williams Cabinet, who lined his pockets with millions of dollars from foreign firms wanting to secure local contracts.

Among these was the Caroni Racing Complex project, where tonnes of steel and concrete worth close to $100 million disappeared into the Caroni Swamp in a scandal in which Texas construction firm Sam P Wallace was also implicated. That project that was never completed.

Another scandal erupted during the time that he held the portfolio of Industry and Commerce in 1956 and reportedly collected kickbacks for a $43 million sewerage scheme, then as chairman of the Chaguaramas Development Authority, O’Halloran—a close confidant of Williams—rented out state lands to companies without proper procedure.

Some of these incidents date back to before I was born, while other took place in the years just after Independence in 1962, the year of my birth, so I had to rely on historical records for some of these cases.

However few decades later, just as I was completing secondary school, there was another case of corruption which I can remember because it occurred in the latter part of the Williams administration in July 1980. I remember reading all the newspaper accounts of the DC-9 scandal—a questionable deal for purchase of four new DC-9 aircraft for BWIA from the US-based McDonnel Douglas Corporation. A $1.3 million bribe was reportedly paid to another senior government official, Francis Prevatt, for securing this deal.

I recount some of these corruption scandals just to illustrate the fact that here has hardly been a time in this country’s modern history when there hasn’t been that taint over one political administration or another.

In recent times, corruption has shrouded mega projects such as the Brian Lara Cricket Academy (Tarouba Stadium), the Scarborough Hospital and even the Guanapo church scandal.

The jury is still out on the Piarco Airport scandal, which erupted during a UNC administration. Two decades later, former public officials and business figures are still before the courts in cases arising out of that matter.

These cases have cost T&T billions of dollars that could have gone toward development of this country, construction and maintenance of infrastructure and other important state projects. Taxpayers funds which should have been used for the benefit of the wider population, funnel into private bank accounts, siphoned off and accumulated as ill-gotten wealth for a select few.

These incidents—and there are many others that space does not allow me to recount here—fit into the World Bank’s definition of corruption, “the abuse of public office for private gains.”

The World Bank expands on that explanation as follows:

“Public office is abused for private gain when an official accepts edicts or extorts a bribe. It is also abused when private agents actively offer bribes to circumvent public policies and processes for competitive advantage and profit. Public office can also be abused for personal benefit even if no bribery occurs through patronage and nepotism, the thereof state assets or the diversion of state resources.”

The fact is so many cases of corruption—in most instances the perpetrators have been caught or convicted—have been serious hindrances to T&T’s development.

Prospects for prosperity have been reduced over the years because an environment has been allowed to develop where there has not been a consistent demand for transparency and accountability in the conduct of public affairs.

The World Bank and Transparency International have found that in countries like ours where there are higher levels of corruption, less funds are used for the public good and investment. It is just too easy for criminals of the white collar variety, as well as gangs, to circumvent and undermine laws.

O’Halloran, Prevatt and others fled the country, finding safety from arrest and conviction in other jurisdictions. In fact, their easy escapes is highlighted in David Rudder’s 1987 hit, Panama.

Sadly, cases like those, where corruption goes unchallenged, are the norm rather than the exception in this country.

In addition to hampering efforts to fight poverty and inequality, corruption stifles economic growth and diverts desperately needed funds from essential public services, such as education and health.

According to the World Bank, approximately US$1 trillion is siphoned off through bribes every year.

In our corner of the world, corruption allows the illegal drug trade to flourish, as across the region bribes are paid for government, law enforcement and justice system officials to “look the other way.”

Bribery and other corrupt activities have a major economic effect on developing countries like ours, decreasing overall economic GDP per capita and reduces capital formation.

Here in T&T, there are several pieces of anti-corruption legislation. The Integrity in Public Life Act requires public officials to disclose assets throughout their time in office and the Prevention of Corruption Act provides for punishment of corruption in public office. However, to turn things around, there must be enforcement of these laws

But laws are only part of the framework needed to detect and deter acts of corruption. Unfortunately, in this country, many challenges persist. For example, procurement processes are not fully transparent and there have been claims that they can still be manipulated or bypassed.

The Government needs to try harder to prove that it is indeed committed to systems of transparency by setting a time table and pressing ahead with long promised laws and other reforms. The recent improvement in T&T’s ranking in the Corruption Perceptions Index is just not enough, not in a country where the all-time high was 101 in 2016 the record low in 2001.

There is need for improvement in the management of public resources, ensuring more efficiency and fairness with subsidies, tax exemptions, procurement of goods and services and other process. T&T needs more open and transparent processes so that there is less chance for malfeasance and abuse.

Cutting away the miles of extremely burdensome bureaucratic red tape that make it so difficult to conduct business will eliminate many of the practices that breed corruption.

Reducing subsidies, also reduces opportunities for corruption. It has been proven that subsidies can encourage hoarding, shortages, and the emergence of black markets, leading to corruption-generating schemes.

In terms of operating systems and processes, available technologies can be powerful weapons in the fight against corruption. In other parts of the world, online platforms have been successful for tax collection, public procurement and reducing red tape.

Public procurement is also a fertile breeding ground for corruption because purchases of goods and services and awarding of contracts, facilitates graft, kickbacks and collusion. This is an area of particular concern since long-awaited legislation is yet to be fully implemented.

Not too long ago, Prime Minister Dr Keith Rowley lamented the high level of corruption that persists in the country. His PNM administration came into power on manifesto promises of tackling corruption. It is time to keep those promises.

T&T can move beyond its current developing country status and finally achieve long-term economic stability but to get there, cutting out the corruption is essential.


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