BRIBING for public sector contracts has declined significantly in Metro Manila, but in all regions surveyed, corruption is still pervasive in the public sector.

These were the main findings of the seventh Business Survey on Corruption made public by the Social Weather Stations (SWS) this morning at a Makati Business Club forum. The survey sounded out 705 top and middle-level managers in businesses throughout the National Capital Region, Metro Cebu, Metro Davao, and the clustered areas of Cavite-Laguna-Batangas and Cagayan de Oro-Iligan.

This year’s survey results are especially interesting in light of the Philippines’s discouraging last-place finish in the January-February 2007 survey conducted among foreign businessmen by the Hong Kong-based Political and Economic Risk Consultancy (PERC). The country replaced Indonesia as the economy perceived as most corrupt among 13 countries surveyed in Asia.

Without making comparisons to other countries, the SWS confirms the high amount of corruption in the Philippines, as reported in previous surveys. Of 29 government agencies, 17 received negative ratings for their sincerity in fighting corruption. The Department of Trade and Industry (DTI), the Social Security System (SSS), the Supreme Court, and the Department of Health (DOH) rated highly for sincere efforts to fight corruption.

View the SWS slide presentation.

The Bureau of Customs (BoC), Department of Public Works and Highways (DPWH), Bureau of Internal Revenue (BIR), Commission on Elections (Comelec), House of Representatives, Land Transportation Office (LTO), and Philippine National Police (PNP) were rated worst for sincerity in fighting corruption.

2007 SWS Survey of Enterprises on Corruption
Filipino Business Associations
Very Good
(over +50)
Department of Trade and Industry
Social Security System
Supreme Court
(+31 to +50)
Department of Health
City/Municipal Government
(+11 to +30)
Commission on Audit
Government Service Insurance System
Department of Education
(-10 to +10)
Trial Courts
Department of Budget and Management
Office of the President
Presidential Anti-Graft Commission
Department of Agriculture
Armed Forces of the Philippines
Department of Transportation and Communication
(-11 to -30)
Department of Interior and Local Government
Department of Justice
Presidential Commission on Good Government
Department of Environment and Natural Resources
Philippine National Police
Land Transportation Office
(-31 to -50)
House of Representatives
Commission on Elections
Bureau of Internal Revenue
Department of Public Works and Highway
Very Bad
(below -50)
Bureau of Customs

However, each of the worst offenders improved significantly in their rating since the previous survey. In fact, almost all the agencies’ ratings have improved or at least stayed the same since the 2006 survey. Bribe solicitation increased in 2006 and three of every five managers reported being asked for a bribe in 2006.

Despite these findings, Dr. Mahar Mangahas, SWS president, is optimistic that the enthusiasm of managers for establishing a Transparency Information Bureau (TIB) is a sign that businesses are showing new willingness to take practical steps to regulate corruption rather than wait for government solutions. Mangahas and the respondents to his presentation agreed that, given the survey’s finding that most managers expect their income to increase as corruption decreases, businesses need to, and can be expected to become more active in fighting corruption.

Accordingly, the TIB concept was suggested by business people in SWS focus groups. SWS explains TIB as “like a Credit Information Bureau, except that, instead of credit ratings, it will make transparency ratings on the reputation of individuals, companies, and agencies regarding honesty and ethics in business.” Businesses could work with partners such the Coalition Against Corruption to establish, fund and provide information for, the TIB, independently from government.

The TIB would provide businesses and individuals with incentive to avoid corruption so as to not risk incurring financial losses because of losing the confidence of investors and industry partners. In the survey, 82 percent of respondents indicated a willingness to share information with a TIB; 76 percent reported that a TIB would be useful for their company.

A major setback in the business community’s fight against corruption, as reported by the SWS, is that businesses indicated less willingness this year to contribute to an Anti-Corruption Fund. This may be due to the perceived lack of results from such efforts with no big criminal convictions for corruption so far. However, an increasing number of managers are planning to make expenditures within their company to fight corruption and to contribute to a private anti-corruption program.

Managers also expressed commitment to having citizens observe bidding for public sector contracts, with 67 percent disagreeing with the statement that “a person like me cannot do anything to reduce corruption in the government.”

These signs of hope notwithstanding, the SWS confirms that businesses and government departments still have a very long way to go in fighting corruption, and that some have shown evidence of increased corruption in the past year.

Philip Ney is a senior political science and economics student from the University of Lethbridge in Alberta, Canada. He is taking summer internship credits with the PCIJ.

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