Tuesday, March 23, 2010

Addressing corruption

Dear Colleagues

A friend sent me the following On 03/23/10
Peter, in the Handbook I mentioned there is a big chapter 19 on Mitigation the risk of corruption. It refers to your business of audits etc. Some www.transparency.org/publications/publications/other/procurement_handbook
http:go.worldbank.org/RPHUYORFIO and
My brief response follows

I have not read this latest tome from transparency international ... but one of the reasons they have made so little progress in the work of reducing corruption is that they are using tools that do not work. If the car engine does not work ... painting the car won't help very much. The problem with corruption is that people make a lot of money very easily ... doing an audit to show that the money has gone does not solve the problem, though you might know more about the problem.

A good accountant ... of which there are very few these days ... knows that to solve the corruption problem you have to have good accounting which included systems of financial control so that it is very very difficult to get your hands on the money! When you have strong control systems the money does not disappear in the first place ... and a lot of the problem goes away.

Why we have not done this in several decades is because (1) a lot of people you would not expect are corrupt; or, (2) a lot of people are a lot more incompetent than you would expect. Neither of these is good. The financial dimension of the official relief and development assistance (ORDA) industry is an absolute disgrace and leadership should be taking some responsibility for this

Peter Burgess
In the last 50 years the power of technology to handle data has improved perhaps by as much as a millionfold! But the use of data for accountability and to make corruption very difficult has hardly moved at all. This is ridiculous and may only be explained by the easy money that a lot of people are making from the maintenance of corrupt systems.

Peter Burgess
Community Analytics (CA)

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