Economist Nii Moi Thompson says the best response to corruption is a continuous, credible, and transparent process of institutional regeneration and policy recalibration.
In an article on the raging debate on the fight against corruption following the a damning report on the rot the Tema Port by investigative Anas Aremeyaw Anas, Dr Nii Moi said: “The best response then to corruption is not the heavy-handedness, even the draconian measures of the past, or the emotional responses of the present, but a continuous, credible, and transparent process of institutional regeneration and policy recalibration, taking cognizance of changed circumstances and the need to do things differently at different times for better results.”
He said the evidence suggested that some efforts were made in this regard in the past but the fact that the rot persisted at the ports and other corners of the bureaucracy indicated that either not enough was done or the wrong solutions were applied or some combination of these and other factors.
“Something certainly went wrong somewhere. Forceful, purposely and decisive leadership may well make the difference this time around.”
Dr Nii Moi said the reaction to Anas’ investigation was “the same reckless hysteria with which we greeted his 2010 exposé of cocoa smuggling along the country's western border: Fire them! Prosecute them! Jail them and throw away the keys!”
He said most of these calls were heeded by the government, which even increased troop presence along the borders ostensibly to curb cocoa smuggling.
However, Dr Nii Moi noted, the practice was continuing, adding “the smugglers simply weigh the potential benefits against the cost and then take the necessary risks…”
“Over the years, we have fired and jailed and even executed, including three former heads of state in 1979, and yet public sector corruption remains -- doggedly.
“Not even the “glorious 31st December revolution” of 1981 - which followed the bloody “house cleaning” of 1979 - could minimize it, much less eliminate it.”
Dr Nii Moi said proof of that came in 1999, when the Queen of England visited Ghana and former President Jerry John Rawlings asked for her help in fighting corruption in his government.
“In the 12 years since then, Ghanaians have watched somewhat helplessly as officials in high places dip their hands in the public kitty at will and bureaucratic corruption, such as exposed by Anas, gradually eats away at public confidence in the state.
“The jailing of some public officials for “causing financial loss to the state” in 2001 was only highlighting of a cosmetic attempt at fighting corruption which, not surprisingly, barely deterred others from stealing from the state later. Corruption, we were later reminded, was as old as Adam.”
It said while Anas deserved commendation for his enterprising work, the “inconvenient truth” is that there was nothing substantially new in his latest revelations.
“As far back as September 6, 2007, Ghanaweb ran a GNA story titled, '40,000 vehicles escape payment of customs duty'.
“In that story, an investigator hired by the Ministry of Finance expressed concern about the ‘huge loss of revenue to the state (through) tax evasion, and said the leakage was coming from some officials of the CEPS and the Driver and Vehicle Licensing Authority (DVLA)’”
“The investigator said some officials of the CEPS (Customs, Excise and Preventive Service) and the VELD (Vehicle Examination and Licensing Division) used the paid duties of vehicles of already registered vehicles to register new ones.
“In that instance, the officials collect data from the Ghana Community Networks computer monitoring system for vehicles whose customs duties had already been paid to satisfy the duty payment requirement for registering new vehicles.
“In some cases, payment for a bicycle, motorbikes and fishing nets had been used for vehicles that would have attracted higher duties when in reality nothing was paid for them.”
Dr Nii Moi said the story spoke of a four-member committee established by the then finance minister to “investigate allegations of operational malpractices at CEPS to establish administrative actions against culpable personnel and identify management weaknesses in dealing expeditiously with disciplinary matters”.
The committee was said to be “reviewing the systems, procedures, processes, rules and regulations of CEPS in relation to its auction procedures to recommend specific actions or alternatives of disposing of seized goods. The committee would also examine the role of clearing agents, auctioneers and other related matters.”
“At about the same time, a study commissioned by the ministry found that government was losing about GH¢3 billion (the cedi was roughly equivalent to the US dollar then) in tax exemptions to a range of beneficiaries, including diplomatic missions, NGOs and so-called foreign investors, at least one of which used its exemption to import chicken eggs.”
Dr Nii Moi said it was clear that corruption was an institutional not a personality problem, transcending revolutions and governments.
“In the case of the ports, cumbersome procedures, along with an irrational and prohibitive tariff regime, only succeed in making criminals of otherwise decent and honest citizens.
“Some defend higher tariffs in the name of revenue for development. But common sense tells us that beyond a certain threshold, higher tax rates actually yield less, not more, revenue through evasion or a decline in the underlying economic activity.
“Nor is it true that we need higher tariffs to protect and grow local industry. What local industry actually needs are reliable electricity, affordable credit, good infrastructure, a skilled and productive labour force, a competent government, and of course efficient port services. Higher tariffs impede development by raising the cost of doing business, suppressing industrial growth, and of course suppressing job creation.”
Dr Nii Moi added that the illogic of punitive tariffs applied equally to cocoa taxes, saying so long as government insisted on paying farmers below-market prices, the rational incentive to beat the system through smuggling will persist, damn the consequences.