Transparency International Bangladesh (TIB)
71pc households of the country victims of corruption: TIB
Around 70.9 per cent of the country’s households have to pay bribes in getting government services from various sectors, said a household survey of the Transparency International Bangladesh (TIB) on Wednesday.
The survey, titled ‘Corruption in Service Sectors: National Household Survey 2021’, also revealed that the law enforcement agencies are the most corrupt service sector (74.4 pc) followed by the Department of Immigration and Passports (DIP) (70.5 pc) and Bangladesh Road Transport Authority (BRTA) (68.3 pc).
Other most corrupt services sectors include judiciary (56.8 pc), health (48.7 pc), local government institutions (46.6 pc) and land services (46.3 pc).
The survey report said that the country’s overall bribery rate is 40.1 per cent, with the top three sectors receiving bribes being passports, law enforcement agencies and BRTA.
Up to 72.1 percent of the victims of bribery mentioned “service not available without bribery” as the reason for paying bribes, which means that bribery continues to be institutionalized.
Every household, on average, has to pay a bribe of Tk 6,636 annually and the three most bribe-taking sectors are insurance, judiciary and gas services, said the report.
The survey revealed that an amount of Tk 10,830 crore was exchanged as bribe in the services sector during the survey period from December 2020 to November 2021, which was 0.4 per cent of the country's GDP in fiscal year 2020-21 and 5.9 per cent of revised budget of the same financial year.
The TIB has conducted nine National Household Surveys since 1997.
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According to the survey, the rate of corruption in the service sectors has increased compared to 2017. In 2021, while the rate of corruption in the same sectors was found to be 70.8 percent, in 2017 this rate was 66.5 percent. Compared to 2017, the rate of bribes or unauthorized payments has decreased in 2021 but the amount of bribes has increased.
Due to the government’s digitization process, corruption in some sectors remains the same (law enforcement agencies, passport, BRTA, etc.) and has increased in some sectors (local government institutions, NGOs, insurance, etc.). In addition, compared to 2017, the rate of bribery increased in some sectors (local government institutions) and decreased in some sectors (agriculture, education and health) in 2021.
The survey shows that in 2021, the incidence of bribery in the service sectors was higher in rural areas than in urban areas (36.6pc vs. 46.5 pc). The burden of corruption is higher on low-income households than on high-income households. Low-income households are forced to pay a higher proportion of their annual income in bribes than high-income households in order to receive services.
The survey result also shows that female service recipients were victims of corruption more than male service recipients in some sectors (health, local government institutions, other sectors) and male service recipients were victims of corruption more than women in certain sectors (education, public services). In addition, service recipients aged 36 and above are relatively more victims of corruption compared to service recipients below 35 years.
The graft watchdog has put forward a 10-point recommendation based on the opinions of households which took part in the survey. The recommendations include ensuring legal accountability for those involved in corruption, digitalization of all government services, implementing the code of conduct for service providers and wide publicity of the government’s Grievance Redress Mechanism (GRM).
Dr Iftekharuzzaman, Executive Director of TIB, said this household survey does not have any connection with Transparency International’s Corruption Perception Index (CPI).
The global body does not use the findings from this survey and other research conducted by the TIB while preparing the CPI, he said.
TIB for logical wage hike of tea workers
Transparency International Bangladesh (TIB) has urged the authorities concerned to raise the wage of the tea workers logically through discussion instead of threating them to stop the ongoing peaceful movement across the country.
Tea workers’ daily wage of only Tk 120 after working for eight hours and sometimes even more, with limited facilities is discriminatory and unconstitutional, the graft watchdog body said in a statement on Tuesday.
Following the strike of the tea workers amid the rise in commodity prices, the proposal to increase their wages by only Tk 14 is a violation of their rights, it added.
TIB Executive Director Iftekharuzzaman said the ministries concerned should take steps to determine the logical wages acceptable to the tea workers through equality-based discussions considering the rights of the tea workers as citizens of the country.
While the workers have been trying to draw the attention of the tea garden authorities through strike for the past several days, the Director General of Labor Department recently termed the strike as ‘violation of labor law’ in a letter, said Zaman.
“It is nothing but an expression of solidarity with the colonial mentality of the tea industry owners,” he said.
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He also said ‘The Minimum Wage Board’ of the country has set the minimum wage several times higher than other sectors.
“But the Ministry of Labour and Employment recommended to maintain the minimum wage set by the tea garden owners ignoring the ‘guideline’ of the ministry being influenced by some invisible force. And it needs to be looked into,” he added.
There is a rule of renewing the wage agreement between the tea workers and the garden authorities every two years.
Although in most cases the wages are fixed unilaterally by the garden authorities, the tea workers have been out of the wage agreement for the past 19 months.
In December 2018, TIB released a research report titled “Tea Garden Working Environment and Workers' Rights: Good Governance Challenges and Pathways” where some recommendations were put forward to the government and authorities concerned to improve the tea workers living standard and fixing minimum wage compared with other sectors.
The organisation thinks that the research and recommendations are still equally relevant as a humanitarian solution to end the ongoing crisis.
TIB urges govt to spare people the burden of foreign debt
Transparency International Bangladesh (TIB) has suggested the government to prevent tax evasion and money laundering by adopting 'Common Reporting Standard (CRS)' to stabilise foreign exchange reserves without burdening the people with foreign debt.
Taking loan from the International Monetary Fund (IMF) and other international institutions is considered normal for stabilising foreign exchange reserves, the graft watchdog body said in a statement on Tuesday.
But the public has to bear the entire burden of repaying such loans along with the interest, it added.
TIB Executive Director Iftekharuzzaman said, "Our question is - to deal with the financial crisis, especially the growing shortage of foreign currency, foreign loan assistance and other ongoing initiatives have been taken with the highest priority of public interest or not! In other words, without increasing the burden of debt on the people, is there an alternative way to be considered?”
In this context, TIB suggested that there is a way open for the government to earn many times more money than the proposed foreign loan annually and sustainably by preventing tax evasion and money laundering at almost no cost.
According to data from Global Financial Integrity, the amount of money laundered through invoice fraud during the 2008-2015 was $8.2 billion annually, which would already be at least $12 billion if data were available to be updated.
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Iftekharuzzaman said, "Growing money laundering is a huge challenge for Bangladesh."
The bulk of money laundering in Bangladesh is organised through misinvoicing or invoice fraud in the import and export trade. As a result, there is massive tax evasion.
It is a legal and moral responsibility for the government to adopt an effective CRS to prevent the large-scale money laundering as well as increase revenue collection, reads the statement.
And it will be helpful in increasing the foreign exchange and national income in a cheap and sustainable manner at a rate many times higher than the one-time proposed international loan of the IMF.
The countries where money is laundered from Bangladesh, even the so-called tax-haven countries or regions are already listed in CRS and are exchanging information, said Dr Zaman.
TIB urged the government to set an example of political will to adopt CRS to tackle the financial crisis in the short term and control tax evasion and money laundering sustainably in the medium and long term.
"We hope that the government will take necessary legal reforms at the national level in addition to the necessary international steps immediately," he added.
More than 120 countries of the world, including many neighboring countries of Bangladesh, are monitoring all types of banking and financial transaction information of citizens located in the country and outside the country automatically through the CRS, which is an initiative of the OECD formed in 2014 and has been effective since 2017.
CRS has helped countries in controlling tax evasion and revenue collection at home and abroad on the one hand and ensuring accountability including preventing, identifying and recovering the laundered money through the exchange of information.
TIB urges to withdraw provision of legalising laundered cash
Transparency International Bangladesh (TIB) has urged the government to withdraw the proposed budgetary provision of allowing launderers to legalise their undeclared money, saying such provision will discourage genuine taxpayers.
It is immoral, discriminatory and conflicts with the existing laws to allow legalising laundered money from abroad without questioning, announced in the national budget for FY2022-23, the graft watchdog body said in a statement on Friday.
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But, according to the Money Laundering Prevention Act, 2012 and the relevant international law, money laundering is a serious crime and such provision will encourage money laundering and corruption in general, said TIB Executive Director Iftekharuzzaman.
It is expected this provision will increase the foreign exchange flow and income tax revenue through the integration of money and assets earned abroad into the mainstream of the country's economy, he said.
“But our past experience has shown that despite repeated opportunities to whiten black money in the country's economy, it has not yielded the expected results, nor has the government received the desired revenue.”
It is impossible to bring back this laundered money or assets without a legal assistance agreement of our country with the authorities concerned in the country where the money is laundered, said Iftekharuzzaman.
Besides, for those who are genuine taxpayers, the provision is blatantly discriminatory, as they pay at least three times the tax rate of 7 percent. This is discrimination and against the principles of the constitution, he added.
In the proposed budget, the finance minister acknowledged the existing economic crises such as inflation, holding the value of the Taka against the dollar, increasing import costs and declining foreign exchange reserves, but could not provide effective strategies or guidelines to address them, he said.
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The TIB executive director said although there is an expectation to expand social security programmes to reduce inflationary pressures on marginalised and low-income people, the proposed budget does not show much.
“Rather, it has been shown to include government employees' pensions, interest on savings certificates, and loan waivers that were provided during Covid pandemic in order to maximize spending on the social security sector, which are not part of the Social Security programme."
'Monitoring body for pvt healthcare sector needed in Bangladesh'
Transparency International Bangladesh (TIB) has urged the government to set up an oversight body for monitoring, controlling and ensuring good governance in private sector medical services.
The ongoing campaign of the department of health against illegal private healthcare institutions across the country is positive.However, according to TIB, it is not enough to ensure the overall good governance of the sector as irregularities, corruption and mismanagement have established a long-standing cycle.
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And that’s why the organisation has sought an oversight body as a long-term solution, TIB has said in a release.
Referring to the 2018 research of TIB on the challenges of good governance in the private medical sector, executive director Dr Iftekharuzzaman said, "The huge number of new licences and renewal applications submitted just one day after the government drive began proves that there is a clear lack of proper supervision in the private healthcare sector."
He said that in such a situation, it was questionable how effective the ongoing campaign will be in ensuring good governance "in the current and anarchic sector".
In order to reap the long-term benefits, the long-awaited draft law for the control and supervision of private medical services needed to be finalised and it was important to establish a strong and impartial oversight body to monitor the quality of the private healthcare sector that could ensure good governance, he said.
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The report, 'Private Medical Services: Challenges of Good Governance and Ways to Overcome', elaborates how the trends of commercialisation of the sector, the profit-oriented service system, and the lack of inspection and supervision by the government have made the general people hostages to them.
TIB considers it a vital responsibility of all concerned, including the government, to take effective measures to control inhumanely corrupt people; the question of life and death is a fundamental issue in healthcare, according to the release.
Corruption in land purchase eats away Tk 390 crore in 3 power projects, says TIB
In a research study Transparency International Bangladesh (TIB) has allegedly found substantive corruption involving three power plants—two coal fired and one LNG-based—in the country.
According to the TIB study presented on Wednesday, the corruption involved at least Tk 390.49 crore which was allegedly grabbed by government officials, local representatives and influential political circles.
Moreover, power tariffs were set at higher rates compared with similar projects which also involved corruption, it said.
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The power plants are: Powerchina consortium’s Barishal 350 MW Coal-based power plant, S Alam Group’s Banshkhali 1320 MW SS Power plant and the state-owned Coal Power Generation Company’s Matarbari 600 MW LNG-based power plant.
“We’ve maintained recognized international standards and practices in conducting our research to find out the corruption... We have necessary substantive documents in our hands to prove the allegations”, said Dr Iftekharuzzaman, executive director of the TIB, while briefing reporters virtually during the presentation of the report.
Mahfuzul Haque and Newazul Maula of TIB presented the report titled: “Coal and LNG-based Power Projects in Bangladesh: Governance Challenges and Way Out.
Iftekharuzzaman said if any individual or civil society representative can move the court on the basis of the allegations his organization will cooperate.
“TIB will cooperate with such an initiative as per its policy and standard”, he said, adding that the corruption watchdog body will share the study with the government and other agencies.
The TIB said that the land of the projects was purchased by the sponsors of the projects at huge inflated prices to show the higher cost to take financial benefits. Corruption took place in land acquisition as well, it said.
The watchdog body found that the existing laws and regulations were not properly followed in purchasing lands and also signing the power purchase contracts with the government.
It alleged that the Power and Energy Speedy Supply (Special) Act was used to award the contracts of these power plants to certain companies in order to avert the competitive bidding process despite there being many efficient companies for the projects.
They said the Special Act was extended up to 2026 despite the fact that this law has no necessity to exist at this point of time.
The TIB also found that some scopes were deliberately kept in the power purchase agreements (PPA) signed with the government to further increase the power tariffs of the plants.
Regarding the environmental issues, the TIB said that the department of environment has miserably failed to enforce environmental obligations in implementation of the plants.
It said that the government is not moving towards renewable energy options to generate electricity despite its commitment to increase the green energy’s share to 40 per cent in electricity generation.
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It observed that despite cancellation of the 12 coal-based power plants, s the share of coal-based power plants is still one-fourth of the total generation.
It said there is a lack of commitments on the part of the government to go for renewable energy though its production cost fell by 89 per cent.
The government targeted to generate 10 per cent electricity from renewable sources by 2020. But only 2.3 per cent of power now comes from renewable sources, it added.
The TIB placed 7-point recommendations for the government which include framing an integrated energy and power master plan keeping the focus on renewable energy, cancellation of Power and Energy Speedy Supply (Special) Act 2010 and not allowing any fossils-fuel based projects after 2022, ensuring transparency, accountability in approving and awarding power projects, suspending all coal projects considering environmental risks and taking legal action against the persons involved in the corruption in power projects.
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