As we gather here in Makati, there is a real danger of us gentrifying corruption. I know that our intention is the exact opposite. By giving conferences titles such as integrity and transparency, we perhaps generate an acceptance that there is a difference between a common thief and a corrupt person. Just because a person wears a suit or a uniform, he does not become a better class of criminal than holdaper that you may have the misfortune of encountering on a jeepney. In truth, if we were gathered today to discuss how best to catch and punish a burglar or bag snatcher, we would probably be better off talking about the problem at a Police station and not in this splendid hotel ballroom.
There cannot be an attitude that puts white collar criminals in the business class section of the courts and prisons whilst the ordinary pick pocket and thief sits in economy. So let us begin today by seeing the issue of corruption for what it is - it is theft. And theft on scale that harms people especially those who are the most vulnerable in our communities.
Corruption is not a victimless crime.
The price of corruption is ultimately paid by ordinary consumers and citizens. Less money trickles down to patients in public hospitals. Mothers and infants die because there is less equipment and staff to provide treatment. Roads to rural areas don’t reach the distant and isolated communities. And they, in turn, cannot have livelihoods that link them to the global economy.
Companies simply pass on the cost of bribes as just another cost of doing business. The WEF says that on average, 10% is added to the cost of business by corruption. And if we were able to cut corruption by only 10%, the global economy would be better off by 380 billion dollars each year.
So let me rephrase the topic that I was asked to address. Instead of transparency and international cooperation in the fight against corruption, I will talk about how we should catch and punish thieves around the world.
International Anti-Corruption Day cannot just be one date in the calendar. Our efforts have to be sustained for 365 days. That is why, beyond this week, in 2016, we will partner with the Integrity Initiative in a National Forum. This is another effort by the UK to reduce theft affecting business and improving governance.
The economic and social wellbeing of each and every country in the world is impacted by corruption. Investors, both local and foreign, gravitate towards countries that have strong measures. It is no surprise that the United States and the United Kingdom are ranked world number 1 and 2 for receiving foreign direct investment. We have not eliminated all the thieves that want to profit from corruption, but we have a deep-rooted culture that has made it unacceptable. In our Parliament, a few lost their political reputations for ever for being judged to have made claims that they are not entitled to. The amounts were very small. But the principle of honesty carries a high value.
As a civil servant, my salary is disclosed to the public. Any expenditure I put on my Government credit card above 35,000 Pesos is in the public domain. This is one of the many features of Freedom of Information that we comply with even before we are asked to make a disclosure. If a government official is called by the Parliamentary Public Accounts Committee to explain suspicious expenditure, he is in for a very torrid time in full public glare.
Civil Servants in the UK are empowered to challenge proposals by politicians serving as Ministers if they deem it to be not in the public interest. The mechanism is to get a written statement that, despite advice, the Minister is directing the money to be spent. This is an extremely rare event and just the threat of seeking such direction is usually enough stop a bad idea in its tracks. We maintain a gift register for everything that is sent to us by our contacts. We are not permitted to keep any item valued at more than 9,800 Pesos. We have anti-bribery laws that cover not just people within Great Britain but reach out to grab any British citizen or company that offers or accepts a bribe anywhere in the world. This is our answer to the challenge of corruption that knows no borders.
Here in the Philippines and in many parts of the world, we have negotiated Mutual Legal Assistance Treaties, so that we can gather evidence and prosecute criminals. We have also gone a step further and outlawed the practice of subcontracting the payment of a bribe. A British company cannot get a middleman to do their dirty work for them. The message is clear, if you have a British partner, the terms of doing business can only be on the basis of clean hands.
The scale of corruption globally, is huge. In developing countries alone, the UN estimates the cost of illicit commissions, bribery and tax evasion to be over 1.26 trillion dollars. Over 40% of business executives have told Transparency International they have been asked for a bribe by a government official. The United Kingdom has made a firm and legally binding commitment to spend 0.7 per cent of our Gross National Income on foreign aid. Sadly, the World Bank reports that each year up to 40% of global development assistance is stolen by government officials in developing countries and hidden in overseas bank accounts. We have put in additional safeguards and have a rigorous audit process for our aid programme. We deal with trusted partners and, where there is a history of significant corruption, we deliver aid direct to the victims and avoid the risk of money falling into the wrong hands. Our aid programme targets the most vulnerable people in society. And that includes victims of terrorism and conflict. A significant chunk of UK aid goes to places that have been impacted by extremism and violence.
The inescapable conclusion is that those who steal our programme funds are also a threat to our security be it here in Manila, Mindanao, London or Paris. The impact of a corrupt official is not unlike a terrorist. They destroy lives; they undermine confidence and degrade the fabric of our nations. We have to take our fight to the banking sector and track down the loot horded by those who rob the poor and hungry. We believe in using anti-money laundering measures across international borders. We are taking action to improve disclosure and access to information from so called tax havens.
The Philippines has made very good progress in tackling corruption. That is reflected in the movement in the Corruption Perceptions Index report of Transparency International.
We have been your partner in a number of initiatives. In the quest for more Open Government, the Philippines has been a good model, and this has been recognised in the UK. Our projects with Ombudsman’s Office have enabled officers to investigate and prosecute suspects more effectively. In the mining industry, we have over the years been a strong advocate of EITI. We believe that corruption in mining is not eliminated by stopping the industry. By adopting the extractive industry transparency initiative, all stakeholder benefit from disclosure. The standards are recognised internationally. And that means stronger assurances for business partners in the supply chain.
Integrity, as we will hear throughout the day is as much about ethos and culture as it is about rules and penalties.
Integrity, however, cannot be bought on the cheap.
Elected officials have to be paid a salary that is comparable to the responsibilities they have. The Police, Customs Officers and Regulators have to have earnings that are set at levels which make it possible to lead respectable lives. In return for paying their taxes, the public then has every right to expect their elected representatives and public servants to remain honest.
Nothing I have talked about this morning has any weight unless there is a will to catch and jail thieves. The law is important, but without enforcement, laws are just empty prose. Justice is vital but justice is not served if the Courts process cases at a slow pace. So slow, that the human rights of detainees are abused. The cycle of incomplete cases that are abandoned or convicted criminals are pardoned has to stop. Otherwise the message to citizens and businesses is that anyone can buy their way out of trouble. They can do this by buying time or by buying their freedom.
Ladies and gentlemen, I commend the Trustees of the Integrity Initiative for this intense focus on corruption. I can assure you that the United Kingdom will be a steadfast partner in the years ahead as we join hands to fight those who hold out their thieving hands. Thank you for the opportunity to share our views with each other.