Corrupt practices like manipulated funds allocated for development expenditure, hoarding of essential items of consumption, speculative trading in stock exchange securities and properties, tax evasion, smuggling, under and over-invoicing continue to grow and have added to undocumented economy.

These practices have resulted in fuelling inflation in recent months despite sound monetary policy in place, sizable loss of revenue to the government and depletion of human development Indicators (HDIs) which is linked to status of social sector development. Thus immense damage has been done to formal economy.

In the recent past, World Bank’s study to identify major causes of corruption had included also Pakistan among the group of six countries, — other being Tanzania, Kenya, Philippines, Guatemala and Liberia. The cause of concern was that rampant corruption in these countries, was found paving the way for continuous increase in income inequalities and poverty.

The lack of good governance and lack of transparency not only impeded the inflow of foreign investment, but also the loan-giving agencies also attached innumerable conditionalities for providing funding to these countries, which in majority of the cases impacted their economies adversely.

The key factors identified through the study for persistent corruption in these countries are:

Ineffectiveness of the State: It is a universally accepted notion that a government‘s role is to rise above private interests to protect the broader public interest. Unfortunately, it is general trend in Pakistan that people holding public offices favour particular group or individual linked to their ethnic, political and geographical interest. This promotes corruption in all spheres thus mitigating the line between public and private interest. Illegal gratification is considered a rather norm of life to get the things done by people holding public offices. Hence service and benefits meant for general public concentrate in the hands of few privileged.

Discriminatory application of rule of law: Where the rule of law and accountability is for general public, the privileged class is taken as above law and not accountable for their misdeeds. The public offices are meant for protecting public interest but nepotism allows floundering of rule of law and accountability. In Pakistan law enforcement agencies are directly responsible for encouraging violation of law.

Role of judiciary, which is a supreme institution to ensure rule of law cannot be taken as totally transparent. Hence rule of law is widely compromised.

To combat rampant corruption and ‘ineffective accountability process’, the World Bank study says that effective accountability agencies are needed. No doubt Pakistan’s Accountability Bureau is striving to arrest rising trend of corruption and other illegal practices among public officials at all levels, their efforts either due to slow process or due to influence exercised by those who abuse power are sometimes found ineffective in nabbing the source of corruption and culprits are exonerated from charges levied against them. There are a number of bank loan defaulters and those who by abusing power furthered their personal interest still go unpunished.

Lack of commitment with legislators/parliamentarians and bureaucracy to fight corruption has also been identified as one of the reasons giving fillip to corrupt practices in these countries. The survey report emphasizes the point that corruption emanates from the upper echelons of society, then penetrates down the line in all spheres of economic, social and political set up of the countries.

In case of Pakistan, integrity of parliamentarians, bureaucrats and those holding key positions in public sector entities and also quite a number of owners of private sector entities, especially in the field of education— cannot be said to be beyond any doubt in all cases.

Even under various army-led governments, heads of the state despite their earnest efforts to eradicate corruption, failed to curb corruption. Thus the underground economy continued to flourish to the extent that it has now outgrown the size of formal economy.

One of the main objective behind introducing power devolution / decentralization plan by the government, was to ensure good governance, and accountability in all matters by delegating powers to the level of local government functionaries viz. Nazims, Naib Nazims and councillors etc.

Since they belong to the area they are looking after and are in direct contact with the residents of that area, neither they themselves can indulge in corrupt practices nor residents of that area dare to get involved in unethical businesses freely. In other words, environment conducive to corrupt practices is difficult to be developed under this system, provided honest people are elected to these positions.

It is unfortunate that despite macro-economic turn around growth rate of social sector remains stagnant. According to latest report released by UNDP, Pakistan’s HDIs relating to rate of literacy, life expectancy, availability of clean drinking water are lowest even among Saarc countries. No doubt allocations for education and health sector are substantially increased every year in the public sector development programme (PSDP), yet more than half of the population remains illiterate.

Since society as a whole is least gender sensitized, rate of literacy among women is even less than 25 per cent. Under such circumstances the Millenium goal of ‘Education For All’ is difficult to be achieved. Due to corrupt practices, funds allocated for education are being widely misused. A number of ghost schools continues to increase in all the four provinces.

The functionaries of local governments, who also come within the ambit of accountability, in collaboration with well reputed senior citizens, can form supervisory committees at each union council level for exercising checks on activities / performance of management and teaching staff of educational institutions in their locality.

These supervisory committees can have surveillance on health sector also. Working of hospitals and dispensaries should be monitored by these watch dog committees. This will ensure proper utilization of funds and positive growth of social sector.

However, effectiveness of such monitoring / watch dog committees depends on initiative on the part of general public to bring to notice (without any hesitation) of these agencies, all unethical and corrupt practices common in organizations operating in their locality to enable them to take immediate action and nab the evil at the very source.

The IMF’s code of good practices on fiscal transparency applicable to all countries, recipient of funding has emphasis on E-/ government initiatives. This has prompted business concerns, government agencies and individuals to use the internet or electronic services for payment of utility bills, taxes and to keep a track on custom duty settlement etc.

However by making it mandatory government can widen tax net and prevent substantial loss of revenue encountered every year. Besides that emphasis has been laid on conduct of expenditure tracking surveys in all the countries and publishing of transparent data on government expenditure on social sector where delivery of service matters, like education and health where corrupt practices usually flourish.

It is desirable that efforts should be intensified for putting in place good governance and transparency in all reporting to public as well as funding agencies to come out of the list of corrupt nations.