Wednesday, August 26, 2009
CONSTRUCTION AND CORRUPTION: AN UNHOLY ALLIANCE
Construction is an integral part in the development of a country as it forms the mother component behind all activities bordering on infrastructure development. However, a worst evil that can wreck havoc in this extremely important sector is corruption and fraud that can lead to the erosion of ethics in the entire sector.
Of course corruption can be said to have infiltrated many developmental sectors but it is extremely important to note that the ravaging impact of corruption in the construction sector can be severe as it can deeply eat resources that could help develop programmes of significant national importance.
Speaking at a workshop on Project Anti-Corruption Systems held in Dar es Salaam in May 2007, Catherine Stansbury from the Transparency International of United Kingdom said that the construction sector was generally perceived as the most corrupt industry in the world.
Corruption has an edge to penetrate into the construction industry system as it can occur at any phase such as project identification, financing, designing, tendering and execution. This trend of corruption could involve project owners, funding agencies, consultants, contractors, sub-contractors, joint-venture partners and agents.
The worst thing is that the toleration of corrupt practices in the construction industry leads into misuse or poor use of public funds and infrastructure that is inadequate, defective, dangerous, and the chocking of the industry itself as the corrupt and incompetent practitioners prosper.
Corruption does not aid the development of the construction industry. If anything, corruption leads to the tarnishing of the image of this reputable industry and induce questionable perceptions in the minds of the people regarding the sectors’ contribution to national development. In the very end, the more corruption sieges the sector, the more competent and uncorrupt construction firms diminish as they are outmarketed by the most corrupt. This poses a danger in the sense that the corrupt firms dominating the sector end up undertaking projects that are hurriedly completed regardless of expected standards and the impact on the services to be provided.
The world has on several occasions experienced tragic events associated with corruption in the construction sector. The South Asia Investor Review of February 11, 2009 reports that on September 1, 2007 the newly constructed Sher Shah Bridge in Karachi, Pakistan, collapsed killing 14 people and injuring many others. The bridge had just been inaugurated less than a month before by the former president of Pakistan Pervez Musharaf. Shoddy construction and corruption were suspected but an investigation was yet to produce results.
The Investor Review further adds that earthquakes that hit China and Pakistan in the last few years have caused massive destruction. The fact that the damage was significantly disproportionate to government schools and other government buildings raised questions about shoddy construction by government contractors supervised by corrupt officials.
As the Transparency International explains, corruption on construction projects is damaging. It damages developed and developing countries resulting in projects which are unnecessary, unreliable, dangerous, and over-priced. This can lead to loss of life, poverty, economic damage and underdevelopment. The yet to be concluded education scam is a vivid examples of how a country retrogresses when construction projects are mingled with corruption. Up to now, many school blocks keep on existing on paper. Money that was meant to enhance educational development did not serve the intended purpose.
The scope of the damages of corruption in the construction industry stretches as far as companies. This results in tendering uncertainity, wasted tender expenses, increased project cost, economic damage, reduced project opportunities, extortion and blackmail, criminal prosecutions, fines, black listings, and reputational risk.
Of course corruption in the construction industry is a complex issue and difficult to root out easily. A research that was conducted in 2002 by the Chartered Institute of Building on corruption in the UK construction industry reveled that it is generally assumed that corruption occurs but the form and scale of corruption is by its nature difficult to establish. The research shown that many researchers had had direct experience of corruption. For example 41 percent had ever been offered a bribe on at least one occasion.
To really root out the malpractice this malpractice it is imperative that the construction industry adheres to a clear policy on corruption, ethics and transparency that recommends and supports the development and implementation of industry-wide anti-corruption mechanisms.
Strict adherence to ethical guidelines in the construction industry is the best means in the fight against corruption in this industry. As the National Construction Industry Council (NCIC) Code of Ethics for Contractors in the construction industry clarifies ‘Construction services have a direct and vital impact on the quality of life for all people. Accordingly, the services provided by Contractors require honesty, impartiality, fairness, and equity, and must be dedicated to the protection of the public health, safety, and welfare. Contractors must perform under a standard of behaviour that requires adherence to the highest principles of ethical conduct.’
But not only contractors should be expected to adhere to proper ethical codes. As the construction industry involves many players, it is also essential to ensure that consultants strictly adhere to a framework that standardizes their conduct. The NCIC Code of Ethics for consultants in the construction industry gives out fundamental principles that should govern consultants. The principles include: Hold paramount the safety, health, and welfare of the public; Perform services only in areas of their competence; Issue public statements only in an objective and truthful manner; Act for each employer or client as faithful agents or trustees; Avoid deceptive acts; Conduct themselves honorably, responsibly, ethically, and lawfully so as to enhance the honor, reputation, and usefulness of their profession.
The country can successfully wage a must-win war against corruption in the construction industry if the enforcement and monitoring of the industry stakeholders compliance to the stated ethical codes takes centre stage at the aggressive level. The inability to police the conduct of construction stakeholders in the light of the principle ethical guidelines codes breeds a fertile ground for corruption. The Anti Corruption Bureau should further take the initiative to sensitize contractors and the public masses on the repercussions of corruption in the construction industry on national development.
Of course corruption can be said to have infiltrated many developmental sectors but it is extremely important to note that the ravaging impact of corruption in the construction sector can be severe as it can deeply eat resources that could help develop programmes of significant national importance.
Speaking at a workshop on Project Anti-Corruption Systems held in Dar es Salaam in May 2007, Catherine Stansbury from the Transparency International of United Kingdom said that the construction sector was generally perceived as the most corrupt industry in the world.
Corruption has an edge to penetrate into the construction industry system as it can occur at any phase such as project identification, financing, designing, tendering and execution. This trend of corruption could involve project owners, funding agencies, consultants, contractors, sub-contractors, joint-venture partners and agents.
The worst thing is that the toleration of corrupt practices in the construction industry leads into misuse or poor use of public funds and infrastructure that is inadequate, defective, dangerous, and the chocking of the industry itself as the corrupt and incompetent practitioners prosper.
Corruption does not aid the development of the construction industry. If anything, corruption leads to the tarnishing of the image of this reputable industry and induce questionable perceptions in the minds of the people regarding the sectors’ contribution to national development. In the very end, the more corruption sieges the sector, the more competent and uncorrupt construction firms diminish as they are outmarketed by the most corrupt. This poses a danger in the sense that the corrupt firms dominating the sector end up undertaking projects that are hurriedly completed regardless of expected standards and the impact on the services to be provided.
The world has on several occasions experienced tragic events associated with corruption in the construction sector. The South Asia Investor Review of February 11, 2009 reports that on September 1, 2007 the newly constructed Sher Shah Bridge in Karachi, Pakistan, collapsed killing 14 people and injuring many others. The bridge had just been inaugurated less than a month before by the former president of Pakistan Pervez Musharaf. Shoddy construction and corruption were suspected but an investigation was yet to produce results.
The Investor Review further adds that earthquakes that hit China and Pakistan in the last few years have caused massive destruction. The fact that the damage was significantly disproportionate to government schools and other government buildings raised questions about shoddy construction by government contractors supervised by corrupt officials.
As the Transparency International explains, corruption on construction projects is damaging. It damages developed and developing countries resulting in projects which are unnecessary, unreliable, dangerous, and over-priced. This can lead to loss of life, poverty, economic damage and underdevelopment. The yet to be concluded education scam is a vivid examples of how a country retrogresses when construction projects are mingled with corruption. Up to now, many school blocks keep on existing on paper. Money that was meant to enhance educational development did not serve the intended purpose.
The scope of the damages of corruption in the construction industry stretches as far as companies. This results in tendering uncertainity, wasted tender expenses, increased project cost, economic damage, reduced project opportunities, extortion and blackmail, criminal prosecutions, fines, black listings, and reputational risk.
Of course corruption in the construction industry is a complex issue and difficult to root out easily. A research that was conducted in 2002 by the Chartered Institute of Building on corruption in the UK construction industry reveled that it is generally assumed that corruption occurs but the form and scale of corruption is by its nature difficult to establish. The research shown that many researchers had had direct experience of corruption. For example 41 percent had ever been offered a bribe on at least one occasion.
To really root out the malpractice this malpractice it is imperative that the construction industry adheres to a clear policy on corruption, ethics and transparency that recommends and supports the development and implementation of industry-wide anti-corruption mechanisms.
Strict adherence to ethical guidelines in the construction industry is the best means in the fight against corruption in this industry. As the National Construction Industry Council (NCIC) Code of Ethics for Contractors in the construction industry clarifies ‘Construction services have a direct and vital impact on the quality of life for all people. Accordingly, the services provided by Contractors require honesty, impartiality, fairness, and equity, and must be dedicated to the protection of the public health, safety, and welfare. Contractors must perform under a standard of behaviour that requires adherence to the highest principles of ethical conduct.’
But not only contractors should be expected to adhere to proper ethical codes. As the construction industry involves many players, it is also essential to ensure that consultants strictly adhere to a framework that standardizes their conduct. The NCIC Code of Ethics for consultants in the construction industry gives out fundamental principles that should govern consultants. The principles include: Hold paramount the safety, health, and welfare of the public; Perform services only in areas of their competence; Issue public statements only in an objective and truthful manner; Act for each employer or client as faithful agents or trustees; Avoid deceptive acts; Conduct themselves honorably, responsibly, ethically, and lawfully so as to enhance the honor, reputation, and usefulness of their profession.
The country can successfully wage a must-win war against corruption in the construction industry if the enforcement and monitoring of the industry stakeholders compliance to the stated ethical codes takes centre stage at the aggressive level. The inability to police the conduct of construction stakeholders in the light of the principle ethical guidelines codes breeds a fertile ground for corruption. The Anti Corruption Bureau should further take the initiative to sensitize contractors and the public masses on the repercussions of corruption in the construction industry on national development.
