Rot runs deep
In the case of unrestricted appropriations, whatever portion is spent for the benefit of the Filipino people is spent in a scattered way in relatively small amounts.
Daily TribuneIn the case of unrestricted appropriations, whatever portion is spent for the benefit of the Filipino people is spent in a scattered way in relatively small amounts.
Trust an accountant to have the best appreciation of the depth of corruption in government and its effect on the economy and society.
Ben Punongbayan, founder of P&A Grant Thornton, gave an impressive outline of the broad effects of corruption on the nation.
Corruption in government, he explained, has been prevalent in the Philippines for so long and appears undiminished, even for the foreseeable future.
Though widespread, it cannot be categorized as pervasive as to be part of Philippine culture, “as others would do, for the simple reason that it is practiced by only a few.”
Punongbayan said the culprits are “few in relation to the number of perpetrators as compared to the entire Philippine population.”
Conceding that corruption is a crime that regrettably goes generally unpunished, others may claim that a much greater part of the Philippine population tolerates the perpetration of the criminal practice, thus others may say it is part of the culture.
He cited a paper presented by an officer of the Department of Justice at the 13th Regional Seminar on Good Governance for Southeast Asian Countries in Tokyo in 2019, in which the amount of corruption in the Philippines was quantified at about 20 percent of the annual national budget.
“Apply the same proportion on the 2024 national budget, the amount of corruption translates to an estimated P1.6 trillion. And that estimated amount relates only to corruption at the national government level, Punongbayan said.
Factoring in corruption at the local government level and the bribery amounts at both the national and local levels, Punongbayan believes the overall total will be gargantuan.
Corruption in government was classified as overpricing, unrestricted appropriated funds, and bribery.
To enable the corrupt practices, some or much of the completed constructions will generally be of a quality lower than specified in the contract, lamented the top auditor.
As a result, the completed infrastructure would provide benefits only for a much shorter period than planned and will necessarily entail large amounts of opportunity cost during the period of necessary repairs and replacements.
The need for early repairs and replacements necessitates a premature round of sourcing the required funding.
“As a result, this premature funding crowds out new economic development initiatives, which clearly further delays in no small measure economic growth. In addition, this condition creates a cycle that goes on indefinitely under present circumstances,” he explained.
In the case of unrestricted appropriations, whatever portion is spent for the benefit of the Filipino people is spent in a scattered way in relatively small amounts.
The power of using that money in the aggregate to fund large-scale economic development programs that provide much wider and longer-term benefits to the nation is forever lost.
On the part of the corrupt persons, they obtain additional wealth for their own personal benefit and disposal.
To the extent that they deploy this additional wealth in consumption, investments, and savings in the Philippines, such deployment would offset to some extent the harmful effects of the loss of government funds and revenue.
Punongbayan said, however, that based on general observations, much of this corrupt money is not spent in the Philippines but instead is used to purchase foreign, especially expensive, goods and to transfer some portion abroad in the form of foreign currency.
