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Want to end petty corruption? Free the bribe giver

Let the briber giver go scot free, punish the bribe taker. Could this simple model from India’s chief economic adviser and brilliant economist Kaushik Basu end one sort of corruption — harassment bribery? Gautam Chikermane writes.

columns Updated: Apr 18, 2011 02:23 IST
Gautam Chikermane

Let the briber giver go scot free, punish the bribe taker. Could this simple model from India’s chief economic adviser and brilliant economist Kaushik Basu end one sort of corruption — harassment bribery? I tend to agree. The simplicity of this solution goes under the skin of its creation, under laws that were created to encourage petty corruption and protect incumbent bureaucrats, officials and politicians.

At a moral level, there is no denying that a person who pays a bribe is as guilty of the crime as one who receives it. But does the person entitled to a tax refund, for instance, really have a choice in not bribing the official there? In ‘We the extorted’, a story I wrote in December 2010, I learnt that 85% of all reports on ipaidabribe.com said they had to bribe to get a routine job done. Its programme coordinator TR Raghunandan said “10% were asked to pay a bribe but didn’t, and only 5% faced honest government officials.”

Lawmakers have invented all kinds of weapons with which to harass honest citizens. So complex have these missiles become that I often wonder whether I’ve broken some law, by-law, rule, sub-rule, regulation, sub-clause, in the simplest act of thinking, writing, breathing. With harassment power concentrated in the hands of the few, how can a single citizen even think of fighting the system?

The incentive system encourages corruption. A powerful official can demand a bribe and get away with it only because once the bribe is given the giver of the bribe is guilty of the same crime. The interests of the two get aligned. The citizen gets his entitlement with a small bribery tax — better to get 75% of the entitlement rather than nothing at all. The official gets a commission to ensure the job gets done on time — it will have to be done in any case, why not speed up the process and buy that flat screen TV the family has been asking for? Win-win.

By changing the incentive system, offer the briber giver legal legitimacy and transfer the weight of the crime to the bribe taker — the more powerful party in the case — Basu is attacking the root of India’s corrupted incentive system. “The central message of this paper is that we should declare the act of giving a bribe in all such cases as legitimate activity,” Basu proposes in his recent paper, Why, for a Class of Bribes, the Act of Giving a Bribe should be Treated as Legal. “In other words the giver of a harassment bribe should have full immunity from any punitive action by the state.”

Under this model, the interests of the two become orthogonal: “If caught, the bribe giver will go scot free and will be able to collect his bribe money back,” Basu writes. “The bribe taker, on the other hand, loses the booty of bribe and faces a hefty punishment. Hence, in the post-bribe situation…it will be in the interest of the bribe giver to have the taker get caught, since that way the bribe giver can get back the money she gave as bribe. Since the bribe taker knows this, he will be much less inclined to take the bribe in the first place.” The total fine on the transaction will remain the same, Basu says, but the burden of payment will double on the bribe taker, rather than be equally distributed between the two.

How do we change the stakes institutionally? By revoking Section 12 of Prevention of Corruption Act, 1988. “Whoever abets any offence [pertaining to bribery],” it says, “shall be punishable with imprisonment for a term which shall be not less than 6 months but which may extend up to five years and shall also be liable to fine.”

This revocation is necessary because of ambiguity of the word “unwillingly” that’s been embedded in Section 24 (I believe, it’s been consciously inserted to protect corrupt officials).

Following the Anna Hazare phenomenon, I hope the government has got the message: democratic or not, corruption must end. And while the Lokpal Bill will attempt to create an institution for corruption in high places, we are not going to wait another half century for it to trickle down. We want to end it now. On our part, Hindustan Times has begun its initiative against this malaise, in our series, Reimagining India. Join in.