30 July 2013

Corruption and Financial Crimes in Public Service

After a spate of high-profile cheating and corruption cases involving civil servants, the Prime Minister's Office commissioned a study by Commercial Affairs Department ("CAD") and Corrupt Practices Investigation Bureau ("CPIB") of public officers over the past five years.

The following are my comments on some of the findings, as reported by the local media.

Most cases of corruption and financial crimes within the civil service involved junior front-line officers.

It is rather evident that most cases of corruption and financial crimes will involve junior, rather than mid-level or senior, officers.  The manpower structure of most, if not all, civil service agencies is like pyramids, with junior officers outnumbering mid-level officers, and both outnumbering senior officers.

Most cases of corruption and financial crimes within the civil service involved junior front-line officers.

Of the public officers investigated under the Prevention of Corruption Act, letting an offender off or showing “unwarranted leniency” was the most common act (53 per cent), followed by unauthorised provision of service or information (21 per cent), and providing favourable treatment in employment or opportunities (15 per cent).

It is rather evident that front-line officers such as those in agencies such as Home Team, Housing and Development Board, National Environment Agency and Manpower Ministry that have dealings with the public are the most exposed to opportunities for corruption and financial crime.

40 per cent of the monetary gratification or reward cases involved sums of less than $1,000; approximately 40 per cent involved sums of between $1,000 and $30,000; and nearly 20 per cent involved sums of more than $30,000.

GPC for Home Affairs and Law Chairman Hri Kumar Nair said that the vast majority of the cases involved small amounts of money below $1,000.

Hri Kumar is wrong.  40 per cent of the monetary gratification or reward involved sums of less than $1,000; a majority means not less than 50 per cent.

Even if the majority of the monetary gratification or reward cases involved sums of, say, $2,000 (which is a likely scenario), the fact that nearly 20 per cent, or one in five, cases involved sums of more than $30,000 is troubling.

About one in five cases opened for investigation by CPIB in 2008-2012 involved the public sector.

The public sector employs 136,000 officers[1][2], or only 4.0 per cent of the 3,357,600 employed persons as at end-2012[3], yet it accounts for 19.8 per cent of the cases opened for investigation by CPIB.

This does not necessarily mean that public sector employees are more corrupt.  The higher incidence may be due to greater awareness, greater vigilance, lower tolerance by the public of corruption in the public sector etc.

Among errant public service officers, 23 per cent had university degrees, 29 per cent had A-level and/or diplomas, and 48 per cent had O-level or below.

This information is rather useless unless we know what percentage of public service officers have university degress, A-level etc.  We can't tell if public service officers who are, for example, university graduates have a higher or lower propensity to be involved in corruption or other financial crimes.

Among residents employed in public administration and education, 40.0 per cent had university degrees, 43.1 per cent had diploma or professional or post-secondary (non-tertiary) qualifications, and 16.9 per cent had secondary school or lower qualifications.[4]  Unfortunately, these data are distorted by the inclusion of education employees in the private sector, who likely have university or A-level qualifications.

92 per cent of errant public officers were male.

This is a very interesting conclusion.  More on this in a later article.
 
Public Service Division is considering if it should introduce more regulations on casino visits for public servants involved in procurement or enforcement, especially if they work in areas where conflict of interest may arise or they risk being exploited if they fall into financial embarrassment.

The social costs of the casinos are becoming more evident over time.

Can we continue to ignore the social costs of the casinos on our population — citizens, permanent residents and non-residents — and people from neighbouring countries, in the name of economic benefit that the casinos provide?

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Notes

1. PUBLIC SERVICE DIVISION media release 20 May 2013.  The number includes officers in 16 ministries and more than 50 statutory boards.

2. The number of residents excluding full-time national servicemen in public administration and education was 222,500 (e.g., table 23) or 275,100 (e.g., table 40)[4].  There is no explanation for the difference between the two numbers, nor why both are so much higher than PSD's number of 136,000[1].  It is possible that some persons in education may be employed by private institutions.

Not all government activities are classified under Section O Public Administration and Defence; activities carried out by government units that are specifically attributable to other sections of the Singapore Standard of Industrial Classification are classified in those sections.  For example, government schools are classified under Section P Education, and monetary authority is classified under Section K Financial and Insurance Activities.

3. DEPARTMENT OF STATISTICS Labour Market First Quarter 2013.

4. DEPARTMENT OF STATISTICS Labour Force in Singapore 2012.

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