The Joint Anti-Corruption Mechanism; (Message at the Launching of Joint Anti-Corruption Mechanism, Office of the Ombudsman and Procurement Watch, Inc. at Magellan Room 41/F Discovery Suites, Ortigas Center, July 7, 2006.)

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MR. Ky Johnson, Assistant Representative of the Asia Foundation.

Ms. Josefina U. Esguerra, President and CEO, and other Staff of Procurement Watch, Inc.

Fellow workers at the Office of the Ombudsman, Guests, Ladies and Gentlemen:

What the surveys show

In various surveys conducted locally by the Social Weather Station, corruption was perceived to be most rampant in government procurement, specifically in the building of roads, the purchase of textbooks for public schools, and the purchase of supplies and equipment for government offices.

The World Bank reported in 2003 that almost R113 billion were used by different national agencies in the Philippines from 1977 to 2001 for the procurement of goods, gasoline and related products, land and its improvement, buildings and various civil works, information technology equipment and other services.

Amount lost to corruption

Assuming that only 20 percent goes to corruption, this means that in 2001 when the Philippine government's procurement budget was R82 billion for the national government and R22 billion for local governments, some R21 billion was lost to corruption.

However, a more recent survey showed that about 30 to 50 percent of procurement funds is actually lost to corruption. This is also the estimate believed to be prevailing in the public procurement of locally-funded projects, according to a study released by the Department of Budget and Management in 2003.

Impact of corruption

What is the impact of funds lost to corruption? Well, this huge amount is twice the budget of the department of health. R21 billion could also buy 520 million textbooks for use in our public schools nationwide. Just think that up to the late 1990s, six children in our grade schools and eight in our high schools had to share only one textbook!

Moreover, the same big amount lost to corruption could have constructed 63,000 new classrooms for our school children. Or built 1,500 kilometers of concrete farm-to-market roads to support commerce especially in the countryside.

Had this amount been used, instead, to improve our collective lives, can you imagine how many jobs could have been generated, how many government hospitals could have been built and how much new equipment purchased for law enforcement?

Why corruption is rampant

Corruption, which happens when suppliers and government personnel connive, becomes rampant when it is perceived to be a high-reward, low-risk venture. And where under a procurement system, transparency and accountability rules are not tight, and much discretion is given to those in charge, the pressure to succumb to corruption, like favoring a pre-selected bidder, is enormous, even as the reward therefor becomes too tempting.

Distortions in public service

In her book Robbed published in 2002, Ms. Yvonne Chua identified some corrupt practices that have plagued government bureaucracy. …