Fight against corruption

On April 10, the House of Representatives proceeded to debate a bill to amend the Civil Code, opening the way for victims of corruption to claim damages. The bill will also protect whistle blowers in that it lays down that no action could be taken against an employee, in the public or private sector, who would have reported any suspected act of corruption in good faith. The bill has now been given a second reading.

Incredible though it may sound, corruption had, to date only been considered as a criminal offence and, at that, only if it involved the area of public administration. Bribing the manager of a private bank to authorise a loan did not qualify as a criminal offence until recently, when the Criminal Code was belatedly amended to remove this distinction between the public and private sectors.

Once the new bill becomes law, the way will be open for Malta to sign and ratify the Council of Europe Civil Law Convention on Corruption.

With the honourable exception of The Times, the local media were (initially) insensitive to this sea change. The significance of the text of the new Bill was not highlighted in anticipation of the debate - and the proceedings of the first debating session was ignored by all the other media.

The proposed law protects and promotes the public interest in more ways than one, even though it could, arguably, have gone further. Yet, the main body of parliamentary reporters did not bat an eyelid.

This remarkable omission begs the question as to whether the democratic antannae of the main body of the media need repair, or whether this was an unintended demonstration of Mediterranean cynicism. In each case, the situation should give rise to democratic concern.

The price of freedom is eternal vigilance. An alert, investigative media and adequate armour against corruption are bound to make vigilance credible.

Corruption corrodes the standards of public life, damages the institutions of government, the cohesion of society and the management of the economy.

In a developing economy, where the political fabric may be fragile or thin and the economy is by definition more vulnerable, corruption is doubly harmful, because it is also a heavy tax on economic activity. It blunts competitiveness and escalates costs. By making it more difficult to measure the exact consequences of investment, spending, taxation and regulatory decision, it throws the management of the economy out of gear.

It also distorts policy-making because bribery could entice governments and departments into entering into specific commitments just as heavy dollops of financing from donor countries can entice governments into undertaking big projects.

The reform of public institutions may be delayed by fear on the part of board members that loss of their powers may result in loss of income.

Corruption deters sensible foreign investors from risking their money. It certainly can give a shot in the arm to the rich and the powerful at the expense of the poor. It therefore becomes a political irritant with the potential of destabilising the democratic process.

Corruption is easier to get away with in an authoritarian economy. But the introduction of the free market and the democratic process does not necessarily end it.

Liberalisation and privatisation are obvious danger spots. Carried out in a half-baked way, they are prone to temptation. Every act of discretion could prove lucrative.

To start changing the economic environment does not necessarily do more than change the opportunities for and the scale of graft. This was, for example, the experience in India and some other Asian countries when telecommunications were liberalised.

Equally, it does not follow automatically that the introduction of democracy puts an end to graft. Corruption has managed to survive and to rear its head again and again, in the older western democracies.

On the other hand, corruption is more likely to be exposed and confronted in a society where free elections are viable and established institutions. Allegations of corruption have toppled several governments and put notorious politicians out of harm`s way when corruption could be proved.

It is in this context that the role of an alert, investigative media assumes considerable importance. Because, as an active watchdog of the public interest, the media could help expose, restrain and render more difficult all sorts of corrupt practices.

Corruption and crony capitalism are like-minded twins: their mother`s milk is graft. In the absence of firm democratic restraint they can grow into monsters in no time.

It is not enough to introduce new laws and to sign conventions. Equally important is a strong will to implement them and a firm conviction in their democratic need.