Combating institutional corruption, saving democracy Roby Arya Brata  ;  A Founding Member of the Asia Association for Public Administration, A Proposed Study Group on Corruption in Asian countries

JAKARTA POST,  13 Januari 2014

                                                                                                                        

Institutional corruption is a serious problem that not only results in lack of public trust in the government institutions of a democratic state but it also weakens their integrity and performance.  However, as this form of “legal” corruption has become “ business as usual”, and has been formally integrated into democratic policymaking and governance processes, we tend to neglect it.  I believe that if the people and government of Indonesia do not seriously tackle this chronic and systemic problem of corruption, within 10 years, the country will turn into a failed democratic state.  But, what is institutional corruption? Different from individual and illegal forms of corruption, institutional corruption is legal and institutionalized. It is a part of the rule of the game in democratic processes.  According to Prof. Lawrence Lessig of Harvard University (2013), institutional corruption occurs when “there is a systemic and strategic influence which is legal, that undermines the institution’s effectiveness by…weakening its ability to achieve its purpose, including, …weakening the public’s trust in that institution”.  On the other hand, unlike institutional corruption, conventional forms of corruption are illegal. In essence, this problem of governance mostly refers to the abuse of power for private gain and assumes that the corrupt persons are in positions of (public) office or power.  Therefore, there are several important distinguishing elements between the concept of institutional corruption on one side, and the individual, conventional forms of corruption and state capture on the other side. First, they are a form of corrupt transactional relationships between public office holders and those parties who have interest in influencing the formation and implementation of public policies.  Second, most importantly, unlike individual corruption, which is illegal, i.e. through illicit payments (e.g. bribery), institutional corruption is a “legal” form of corruption.  In institutional corruption, such payments, for instance for campaign and party contributions, are given through a formal legal channel.  Third, different from individual corruption such as administrative corruption (e.g. bribes), which are forms of ex post policy corruption, i.e. the corrupt payment is transacted after public policy is implemented, institutional corruption is a form of ex ante policy corruption, that is: The corrupt dealings are transacted before public policy implementation or during the policy formulation stage.  The Bank Century case is arguably an example of institutional corruption, in which the central bank’s regulation was “legally” changed for meeting the suspected “corrupt” interests of the parties involved. And fourth, generally all the forms of corruption have damaging effects on the people at large. However, institutional corruption is arguably the most evil form of corruption.  Unlike individual corruption, which has a relatively isolated effect, institutional corruption through corrupting policy and lawmaking processes and outcomes has a wide-ranging impacts on society.  Since the fall of the Soeharto’s authoritarian New Order regime in 1998, the reform governments have adopted some measures to democratize and reform the three branches of government the executive, the legislature and the judiciary.  Such reforms were designed to institutionalize good governance principles in the management and decision-making processes of these democratic institutions.  However, as the reform indicators have shown, the government has been perceived as corrupt, distrusted and ineffective in making and delivering public policies. Having learned from my professional experience as an independent expert tasked by the Indonesia Public Administration Institute to evaluate the implementation effectiveness of the country’s bureaucratic reform, I found the reform was not effective.  The reform objective of creating a clean, accountable and effective government, as stated in Presidential Decree No. 81/2010 on Bureaucratic Reform Grand Design 2010–2025, was not achieved.  As shown by some indicators, the attainment of the mid-term 2010-2014 targets, as stipulated in Administrative Reforms Minister Regulation No. 20/2010 on the bureaucratic 2010-2014 reform road map, was disappointing.  Indonesia’s score on Transparency International’s Corruption Perception Index in 2013, for instance, was only 32 from the target of 50 in 2014 (ranked 114 out of 177 countries surveyed); whereas, the country’s rank on the World Bank’s Ease of Doing Business list in 2013 was just 128th out the 185 countries surveyed (the target in 2014 is 75th); and in 2012, its World Bank Government Effectiveness score was merely -0,29 (on a scale of -2.5 to +2.5) from the 5.0 target in 2014. But what factors have contributed to the unsatisfactory attainment of the objectives of political, judicial and bureaucratic reforms in Indonesia?  Defects in democratic governance and institutional arrangements are the primary causes, which in turn have distorted judicial, bureaucratic and political reforms, thereby weakening the government’s performance. However, institutional corruption is the most responsible factor to blame. Therefore, to make such reforms more effective, we must systematically prevent and curb institutional corruption in our political, bureaucratic and judicial  governance. ●