Public Organization Review: A Global Journal 1: 465–486 (2001)

# 2001 Kluwer Academic Publishers. Printed in The Netherlands.

Dissecting Public Sector Corruption in Bangladesh:

Issues and Problems of Control
HABIB ZAFARULLAH hzafarul@metz.une.edu.au
School of Social Science, University of New England, Armidale, NSW 2351, Australia

NOORE ALAM SIDDIQUEE

Department of Political Science, International Islamic University, Malaysia, 53100 Kuala Lumpur,
Malaysia

Key words: corruption, accountability, public sector, Bangladesh

Abstract
The public sector in Bangladesh is ridden with corruption of various dimensions and shades. Apart from
bribery, rent-seeking and misappropriation of funds, the performance of public organizations is
adversely affected by a host of other factors like excessive lobbying, delays in service provision,
pilferage and larceny, irresponsible conduct of officials, bureaucratic intemperance, patronage and
clientelism. The several institutional mechanisms to combat administrative malfeasance are rendered
ineffective by a non-committed political leadership, a blaséd bureaucracy, weak accountability
structures, and unproductive legislative labors. The public body for controlling corruption is itself
associated with all sorts of malpractices and conducts its affair most unprofessionally. Despite several
attempts, the constitutionally authorized ombudsman is yet to find its place in the governance
framework.

The worldwide concern for public sector corruption is phenomenal. International

organizations, donor agencies, civil society activists and, in particular, academics
have been unrelenting in their crusade for making public representatives appreci-
ate the damaging effects of corruption and urging them to take concrete and
realistic measures to reduce its incidence in the public domain. Yet, very few
governments, especially those in developing countries, appear to be totally
committed in initiating strategic moves to make public organizations and their
personnel corruption-free and unquestionably accountable for their conduct.
The present concern with corruption can be attributed to a number of factors.
First, there is a widespread perception that corruption is not only ubiquitous but
has recently assumed dangerous proportions in some cases. Secondly, there is
currently a greater awareness of the devastating effects of corruption on national
life. Thirdly, corruption in administration is seen as a serious restraint on the ability
of a government to accomplish some of its vital tasks and functions.
466 H. ZAFARULLAH AND N.A. SIDDIQUEE

The World Bank recognizes the harmful effects of corruption. It argues that the
practice

weakens public service delivery, misdirects public resources, and holds back
the growth that is necessary to pull people out of poverty . . . [Corruption]
undermines the driving forces behind reform . . . Vital resources are siphoned
off shore. Foreign investors turn away in frustration . . . [It] reduces public
revenue, undermines public trust, and weakens the credibility of the state
(World Bank 2000a, p. xiv).

It is common knowledge now that corruption retards economic growth, distorts the
political system, debilitates administration and undermines the interests and
welfare of the community. Corruption is a great impediment to development as
it adversely impacts upon resource allocation and project design, selection and
implementation. Public sector management is destabilized and rendered ineffec-
tive because of corrupt practices like kickbacks, patronage, and inconsistent
application of rules and abuse of official information (ADB, 1998, p. 23). The
phenomenon leads to the forfeiture of public trust at the altar of private gain.
Furthermore, any constructive initiatives toward political and economic liberal-
ization are thwarted by both systemic and personal malfeasance in the public
sector.
Bangladesh presents a typical case where corruption has found a remarkably
fertile ground, despite the ‘existence’ of several mechanisms, albeit ineffective, for
tackling it. Presently, corruption in Bangladesh is so pervasive that it has evoked
widespread condemnation from within the country as well as from outside.
Externally, it has already caused a national embarrassment as the country has
been branded as the most corrupt nation in the world (Daily Star, 28 June, 2001).
Internally, reports and evaluations prepared and commissioned by local think
tanks have already painted an ominous picture of public sector integrity. The
media and civil society groups are vociferous in denouncing the present level of
corruption in administration.
The gravity of the problem is conceivable, as public figures, including the
country’s President and the Prime Minister, have spoken of corruption reaching
endemic proportions (Daily Star, 2 August 1999; 10 July and 14 September 2000).
International agencies such as the World Bank, the Asian Development Bank and
the European Commission are concerned with the extent and intensity of corrup-
tion in the country’s public sector. The World Bank, in particular, has pointed to
‘‘bribery, kickbacks and similar under-the-table payments on investment levels and
misallocated resources’’ as causes for denigrating the country’s developmental
potential (Reported in the Holiday, 7 April 2000). According to Transparency
International, Business International, Political Risk Services and the World
Economic Forum, Bangladesh has ranked for several years now among the
most corrupt nations in the world (Temple, 1999). All this reflects the extent and
depth of corruption in Bangladesh and the urgency of the need to control and
DISSECTING PUBLIC SECTOR CORRUPTION IN BANGLADESH 467

combat the menace if the objectives of economic growth and social justice are to
be realized.
In this paper we view corruption in government not simply as misappropriation of
funds, bribery or rent-seeking but also as a phenomenon that encompasses other
aspects of administrative ethics. Any action that distorts normal administrative
behavior is tantamount to corruption. Thus, a public official who deviates from the
prescribed norm, discriminately administers a law or adopts a subjective or
partisan approach in dealing with clients is perceived to be morally irresponsible.
The main objective of this paper, however, is not to conceptualize corruption but
to present an overview of the malady in Bangladesh and examine the institutional
mechanisms available to combat it. More specifically, it seeks to critically examine
and analyze the effectiveness of these mechanisms in the public sector. The
paper argues that the existing mechanisms are grossly inadequate or futile and,
therefore, there is a need for initiating a serious anti-corruption drive in conjunction
with more definitive measures to reform public institutions and strengthen
governance.

1. The nature and incidence of corruption

Public sector corruption is not a new routine in Bangladesh. It has been an integral
art of bureaucratic culture since pre-colonial times,1 but its incidence has intensi-
fied following the nation’s independence in 1971. Over the past few decades, it
has assumed many forms2 and has engulfed the entire social fabric. While, in the
past, only a few departments were known for corrupt officials and practices, the
vice has now spread throughout the governmental structure and no public agency
is spared of its influence. A survey3 has revealed that corruption is now endemic,
chronic and all pervasive. The police department is the most corrupt department,
followed by customs, taxation and the national secretariat (Ahmad, 1997). Such
findings, by and large, have been supported by other subsequent studies/surveys
conducted by Transparency International, Bangladesh (TIB) and other agencies.
The conclusion that one may draw from the available evidence is that most of the
services offered by the public sector are in the clasp of unfettered corruption.

1.1 Corruption — large and small and the magic of ‘Tadbir’

There is a common allegation that the bureaucracy in Bangladesh is corrupt to the

extent that even the simplest things like obtaining birth and death certificates from
relevant authorities, filing a complaint with the police, obtaining a passport, getting
a driving license, registering a vehicle, getting admission into public hospitals,
acquiring a statement on bank and housing loans require some lubrication or
monetary inducements. Other complex matters like getting utility connections,
getting a contract or lease, obtaining approval for a building plan, obtaining jobs in
468 H. ZAFARULLAH AND N.A. SIDDIQUEE

government departments and/or managing transfers to preferable locations invari-

ably require strong lobbying, often accompanied by sizeable bribery. This
culture —usually known as tadbir (promoting one’s case) has immobilized the
administration as virtually nothing happens without the application of this device.
Files wait for tadbir and in its absence they have a strange tendency of getting
‘misplaced’ or even lost forever (Anisuzzaman, 1985, p. 21).
At times, delays in providing service, lack of easy access to service providers
and procedural complications force many clients to use tadbir. It has a magical
power of facilitating action and making possible what is apparently improbable.4
This has created a group of professional brokers and middleman in every
government agency. A citizen in need of a service at any public agency (land
office, police or magistracy at the field level or passport, electricity, water supply
and telephone departments, municipal bodies or education boards) is sure to be
intercepted by these agents/brokers who offer their service for a ‘fee’. While the
clients use brokers for their skills in getting things done rapidly, many officials,
particularly those who are corrupt also prefer their clients to come through the
agents/brokers. The awkward work of negotiating bribes is dealt with by these
brokers. Since the administration is deliberately inflexible or inaccessible, the
brokers and the accompanying bribes serve as a lubricant to overcome the access
encounter, bureaucratic inflexibility or indolence. This is how the ‘public service’ is
‘managed’ by the common people, especially those without any political clout or
strong connections at higher levels.
As elsewhere, corruption in Bangladesh takes many forms and public servants
of all types and levels are engaged in corrupt practices. Bribery is, perhaps, the
most ubiquitous and damaging form of corruption in the public sector in Bangla-
desh. Practically nothing can be done without bribing the concerned officials. In a
sense, it has become a standard practice in most departments. A businessman
cannot expect to obtain a license without commission or a contractor cannot look
forward to getting a work order or payment of his bill without satisfying the
concerned officials. Payments are also required simply to obtain an application
form or a signature, to secure a copy of an approved sanction, to ensure proper
services and billing from telephone, gas and water departments (Kochanek, 1993;
see also Zafarullah, 1987). Bribes related to agricultural loans are said to range
between 10 to 20 percent of the loan amount. In some departments it is as high as
50 percent. The TIB survey revealed that contractors in the Roads and Highways
Department (RHD) are required to pay 40–52 percent of the contract value in order
to secure a job.
A recent TIB study has uncovered how bribes are extorted from students and
institutions in the education sector, from patients in the health sector, from redress-
seekers in the judicial system and police administration, from clients in land-
administration and from subscribers and users in utility departments (see, TIB,
1997). Though departments like customs and taxation and banking and financial
institutions were always known for indulging in corrupt practices, this routine has
now been firmly established in the Bangladesh public sector as a whole.
DISSECTING PUBLIC SECTOR CORRUPTION IN BANGLADESH 469

With corruption becoming a ‘way of life’ and almost unavoidable, some people
argue in favor of legalizing it to ensure proper delivery of services. However,
others strongly oppose the idea, as it would mean a complete surrender to
illegality and immorality. While it is true that bribery expedites the delivery of
services and facilitates action, the problem is that in the process civil servants get
into the habit of delaying decisions until payment is made. Secondly, it means that
it is the quantity of bribe and not the merit of the case that matters most.

1.2 Pilferage and larceny

Another most familiar expression of corruption in Bangladesh is waste and

pilferage in the public sector. Many of the public sector agencies are in total
shambles mainly because of excessive depletion and organized larceny sustained
over the years. The much discussed ‘system loss’ in the power sector is an
example of larceny and deliberate dereliction of official responsibility. Despite so
much talk about ‘system loss’, it has remained as high as 35 percent (TIB, 2000).
A rough estimate suggests that a mere 10 percent reduction in ‘system loss’ would
yield Tk5 3 billion savings annually. While part of the loss can be considered to be
technical, the bulk is due to massive irregularities committed by those involved at
different levels. Apart from meter readers, supervisors, ledger keepers and others
connected with billing and consumer accounting, many lower level engineers and
some high level officers are believed to be involved in this process. On the
consumer side, some people are involved in dishonest practice of stealing
electricity, often in connivance with the officials (TIB, 2000, p. 4). Arguably, this
has compounded the problem thereby rendering the Bangladesh Power Develop-
ment Board (BPDB) incapable both in terms of reducing ‘system loss’ and meeting
the growing demands for electricity.
This, however, is not unique to the BPDB; other utility agencies (water, gas,
telephone) are equally known for the ‘system loss’ syndrome. Pilferage and
larceny are also widespread in the rural works program (RWP)6 and the construc-
tion departments like RHD and Public Works. Due to pilferage and larceny,
between 40 and 60 percent of the development budget is lost every year. This
is confirmed by official statistics, which shows that between 1972 and 1993 the
public sector, due to misappropriation, lost a total of almost Tk 180 billion (Alam,
1996). All this indicates the gravity of the problem, which is compounded further by
the recurring losses in the state-owned enterprises (Muhith, 1999).

1.3 Responsibility lapses

Negligence of official duties is another familiar expression of corruption in

Bangladesh. Coming to office late and leaving early, absence or unauthorized
leave are rampant in government offices. Often officials who do report for work are
470 H. ZAFARULLAH AND N.A. SIDDIQUEE

hard to be found or accessed for services. This is simply because they either take
extended hours for tea and lunch breaks, prayers and meetings (mainly mean-
ingless) of various types (Khan et al., 1995) or employ their time/energy elsewhere
to advance their personal interests. The spirit of public service does not inspire
them. Since there are no measurable performance standards, a tendency among
officials to dupe the system is not uncommon. Thus, doctors in government
hospitals are engaged in private practice to the utter neglect of their official
duties. While some of the specialists are always on their toes expecting summons
for a surgery from private clinics, others remove kidneys in place of ovaries
causing death of innocent patients. Agricultural extension workers hardly visit
farmers, health and family welfare assistants bother little to keep contact with local
people and police personnel remain reluctant to take any action against criminals
unless some incentives are on offer or pressure originates from above. This is
indicative of the status of work ethics in Bangladesh.
Though it is difficult to quantify the impact of such willful dereliction and
fraudulent practice, it is indisputable that such behavior causes untold public
misery. It also defrauds the government financially for many employees are paid
for work they do not perform. The total person-hours lost in this process every year
would be huge by any estimate.

1.4 Bureaucratic intemperance

Administrative excesses, arbitrary behavior and harassment add to the suffering of

the people. The people have developed fear and wariness about the police
because of the excesses they perpetrate on them and the way they abuse
power. Reports of atrocities committed by law enforcing agencies are routine
and frequent mysterious deaths in police custody indicate the extent of power
abuse in the police department (USDS, 2001). Thus the overall quality of
administration has deteriorated. Not surprisingly, public officials are increasingly
seen as unresponsive to public needs and bereft of any moral and ethical values.

1.5 Raging patronage

Yet another dominant mode of corruption in Bangladesh is the patronage system,

a feature of Bangladeshi society. This often explains why the process of awarding
major contracts bypasses competitive norms, and instead, is governed by the
criterion of personal linkages with key decision makers in government depart-
ments. It is not surprising that the lowest bidder for the lease of a market place or a
ferry ghat (quay) or the highest bidder for a construction project wins the contract
at the intervention of a ‘patron’ at the policy level (Khan et al., 1995). Civil servants,
however, are not to be blamed alone. At times, the political factor becomes crucial
as politicians get involved in the process.7 More often than not, pressure from
DISSECTING PUBLIC SECTOR CORRUPTION IN BANGLADESH 471

politicians to carry out their unfair ‘orders’ and the fear of retribution in the form of
transfer to a less important position or even threats of removal force officials to
sacrifice professional ethics and the public interest. Even honest officials known
for their courage and integrity, may feel utterly helpless and succumb to such
pressures. Some, of course, find it convenient to collude with politicians and share
the booty generated from the abuse of power.

1.6 Impact of corruption

The price that society pays for all unethical practices in the public sector is
considerable in terms of cost and inconvenience. The impact is clearly visible in
social, political and economic spheres. Though billions of dollars have been
injected by major international aid agencies as development assistance over the
years and nearly half a dozen five-year plans have been ‘implemented’, Bangla-
desh has remained one of the poorest countries measured by most socio-
economic indicators. Apart from public inconvenience and hassle, bureaucratic
corruption and inefficiency are taking a heavy toll on the country’s economy
causing hundreds of millions of dollars worth of loss in terms of unrealized
investment and income (Financial Express, 31 July 1997). An estimate shows
that during the first six months of 2000 alone, a total of Tk 115.3 billion has gone
missing in the public sector due to 1,345 corruption incidents in various agencies
(Daily Star, 26 September 2000). According to a very conservative estimate, the
per-capita income in corruption-free Bangladesh would have been double of the
current figure (World Bank, 2000b). It is obvious, therefore, that corruption has
been grinding down the economy and hindering the process of growth and
development. Corruption has social costs as well; it tends to hit the basics of
society destroying moral and ethical values.

2. Combating corruption: institutional mechanisms, policies

and performance

Recent years have witnessed a heightened awareness about the venality and
scale of corruption. Yet, attempts at combating the vice are by no means new. As
elsewhere, successive governments in Bangladesh have expressed their commit-
ment to wipeout corruption from every sphere of administration and proclaimed
executive orders, introduced rules and regulations, enacted anti-corruption legis-
lation and installed institutional mechanisms. A plethora of rules and regulations
framed from time to time in order to deter public officials from undesirable behavior
and action is now extant. The Government Servants (Conduct) Rules, 1979,
Government Servants (Discipline and Appeal) Rules, 1986 are among the rules
that allow disciplinary actions8 against errant civil servants for inefficiency,
472 H. ZAFARULLAH AND N.A. SIDDIQUEE

misconduct, desertion, corruption, deviance from ‘expected’ behavior and subver-

sive activities.
The most significant measure to counter corruption in Bangladesh, however, is
the Bangladesh Anti-Corruption Act, 1974 which provides for the Bureau of Anti-
Corruption (BAC). This Act (modified over the years), along with the Prevention of
Corruption Act, also enacted in 1974, provides detailed framework for dealing with
and controlling bribery and other forms of corruption in the public service. Also,
there is a range of other mechanisms (e.g. Comptroller and Auditor General or
CAG, legislative committees) designed to stamp out corruption in administration.
Nonetheless, despite the prevalence of all these measures, corruption seems to
have outpaced fairness in the disposal of business in the public sector.

2.1 Bureau of anti-corruption

BAC is the most important mechanism responsible for combating corruption.

Headed by a Director General, the Bureau operates through a network of offices
at the district and field levels. It has eight Regional Offices and 66 district and field
offices. Being authorized to investigate into and prosecute cases of corruption,
BAC was expected to play a significant role in curbing malfeasance and abuse of
power in government administration. However, the performance of the agency has
been far from satisfactory. Despite several decades of its existence and changes9
brought about in its status and structure, BAC has failed to emerge as an effective
body in controlling and combating administrative corruption. Currently, it stands as
a toothless organization lacking adequate authority to effectively discharge its
responsibilities. BAC is also ridden with a host of other deficiencies and problems.
It has been rendered ineffective in undertaking investigation and initiating cases
against many individuals and agencies. An estimate shows that, given the
abundance of corruption cases, the Bureau has failed to investigate and file
sufficient numbers of cases annually.
Table 1 shows that the annual average during the period was 1,023 (cases
investigated), 777 (charge-sheets filed) and 252 (number convicted). Other
estimates suggest an equally depressing record in terms of the number of
cases filed by BAC per year (see Rahman et al., 1993). This is partly because
of inadequate personnel and poor logistics and partly because of lengthy and rigid
bureaucratic procedures BAC is required to follow. The system of obtaining
sanction for instituting an inquiry, filing an ejahar (first information report) and a
charge sheet is highly bureaucratic and thus time-consuming. Often BAC holds
other agencies responsible for delays but the small number of convictions that it is
able to carry out demeans the quality of BAC investigations and the filing of cases.
In most instances, the accused are acquitted by the court because of poor framing
of cases, lack of clear evidence and absence of seriousness on the part of public
prosecutors (GOB, 2000).
DISSECTING PUBLIC SECTOR CORRUPTION IN BANGLADESH 473

Table 1. Corruption cases handled by BAC, 1972–1998.

Period No. of cases investigated No. of charge-sheets filed No. of convictions

1972–1975 2,857 1,957 938

1976–1981 6,791 4,369 735
1982–1990 11,102 7,176 3,349
1991–1994 4,746 4,403 989
1995–1998 2,126 3,062 806
Total 27,622 20,967 6,817

Source: Adapted from (Alam, 1996), World Bank (2000b).

What is more significant to note is that BAC seems to be pre-occupied with

snaring small fries and processing cases of ‘petty corruption’ while leaving the big
players uninterrupted and matters of grand corruption unexplored. Though sensa-
tional news of blatant corruption (the Alcatel telephone system deal, the Japanese
investment or KAFCO debacle, purchase of aircraft for the national airline, the
MIG-29 bungling, among others) often makes headlines in the print media, very
few such cases are investigated by BAC. This failure or inability of the agency
raises a host of questions about its sincerity and that of the government in
combating corruption. Indeed, BAC’s authority to investigate allegations against
high government officials has been greatly circumscribed, as it cannot proceed
without the green signal from the higher political echelons. The institutional
location of BAC under the Prime Minister’s office and its subservience to political
caprice with regard to filing cases or indictment against senior officials and
important individuals in political circles, is seen as a major deterrent to its task.
Even though it is necessary to insulate BAC from ruling party pressures and to
accord it a very high status within the administrative structure (Siddiqui, 1996), the
agency is fraught with the danger of politicization. The fear that it may be used as a
tool for intimidating and punishing dissenting people in politics and bureaucracy
has been corroborated by recent evidence. Indeed, there are instances of political
considerations swaying the decisions of the government to enable BAC to initiate
action against corrupt officials. There are many corrupt officials and politicians who
have managed not only to escape conviction but also to obtain important positions
by aligning themselves with the ruling party (Alam, 1996; Siddiquee, 1999). Thus,
instead of helping curb malfeasance and abuse of power, BAC serves as a
political tool in the hands of the government. This statutory public body amply
complements the bureaucrat-politician nexus in corruption.
Apart from its institutional weaknesses and the lack of independence, BAC has
a very poor image in society. Despite half a century of its existence, it has failed to
establish any reputation as an effective organization and to generate confidence
among the people. There is a common allegation that BAC inspectors and other
officials use their positions mainly to advance their personal gain. Often they
harass the people including public officials, extort money from them and threaten
474 H. ZAFARULLAH AND N.A. SIDDIQUEE

them of roping in corruption cases against them. Indeed, it is so intensely ridden

with corruption, irregularities and venalities that at times it is seen as ‘‘the most
corrupt wing of the government’’ (New Nation, 21 June 2000). In such circum-
stances, BAC cannot serve its purposes well.

2.2 Fiscal and administrative mechanisms

The collection and utilization of public funds are among the most important
responsibilities of public servants. However, they tend to be vulnerable to financial
irregularities and indiscipline. Apart from formulating a set of rules and regulations,
the government has devised an elaborate institutional framework in order to
maintain financial discipline and to control the misappropriation of public money
by government officials. The system of audit and accounts is at the center of fiscal
accountability and control. As elsewhere in the British Commonwealth, the office
of the Comptroller and Auditor General (CAG) is responsible for keeping the
accounts of the government and for detecting irregularities in terms of compliance
of relevant rules and regulations and/or fraud and embezzlement in public
expenditure. In many respects CAG is the financial ombudsman and is empow-
ered to audit the accounts of all government departments, state owned enterprises
(SOEs) and development projects. The Comptroller General or any other person
authorized by him has access to all records, books, vouchers, documents, cash,
securities and other government property in the possession of any person in the
service of the republic. Audit officials are expected to detect cases of financial
irregularities, malpractice, deviation from fiscal rules, waste and extravagance and
reflect this in CAG’s annual reports submitted to the government.
However, there is a wide discrepancy between CAG’s stipulated functions and
its actual operation. Evidence suggests that the audit and accounts system is
faulty and there is a series of problems that render the whole exercise ineffective.
Like BAC, CAG does not enjoy the independence and operational autonomy
required for the proper discharge of its functions although the Auditor General and
his office have been accorded constitutional status. This status has been subse-
quently downgraded by making it subservient to the executive (Zafarullah, 1994).
Currently, CAG is seen more as an appendage to the Ministry of Finance rather
than as an autonomous body to enforce fiscal discipline in public departments and
scrutinize their financial activities. Furthermore, inadequate resources including
skilled and professionally competent personnel and logistics severely limit its
capacity to undertake systematic and comprehensive auditing of government
accounts.10 In the absence of professionally accredited chartered accountants
(World Bank, 1996), CAG mostly relies on under-trained clerks who are neither
efficient nor committed to their jobs. They are ‘‘generally noted for being either
highly fastidious at one extreme, and for being highly amenable at the other,
depending on how they are treated by the organisations and officials being
audited’’ (Siddiqui, 1996, p. 158).
DISSECTING PUBLIC SECTOR CORRUPTION IN BANGLADESH 475

The effectiveness of audit as a tool for controlling financial mismanagement

depends, among other things, on the quality of reports prepared, the thoroughness
of probes and enquiries and the sincerity of the legislature in getting the report
implemented.
The Controller General of Accounts (CGA) is expected to exercise accounting
control in respect of government receipt and expenditure at different levels.
However, the impact of accounts control in general and the pre-audit in particular
appears to be very limited, if not non-existent. The well-known study undertaken
by an inter-ministerial Committee on Reforms in Budgeting and Expenditure
Control observes a plethora of weaknesses of this approach:

CAOs have an ineffective accounting control; and PAOs/Secretaries are more

concerned with administrative management than financial propriety and finan-
cial accountability. The creation of DAOs and UZAOs within a short space of
time have expanded the accounts administration outfit which have been filled
up by persons without adequate training and experience (GOB, 1993, p. 43).

Departmental accounting system, introduced in the early 1980s as a step for

separating accounts from audit is yet to take an institutional shape. Serious
anomalies like the power of the Secretary to overrule the CAO have not only
rendered the latter powerless but also virtually abolished effective accounting and
internal audit within the government. On the other hand, there are many who argue
that rather than helping reduce corruption the so-called pre-audit system has
expanded opportunities for rent seeking.
The internal control system is designed to minimize corruption in terms of
administrative behavior and expenditure. But for various reasons, this is either
weak or non-functional in the Bangladesh public sector. The numerous rules and
regulations have hardly altered bureaucratic culture and work ethics. In many
cases, willingness of senior officials to enforce these rules seems to be lacking.
Higher officials often tend to protect themselves and their subordinates as spoils of
corruption are shared. As such, flouting of regulations and violation of rules and
procedures are commonplace in administration. ‘Whistle blowing’ from within the
bureaucracy itself is limited, if not missing altogether. There are examples that
indicate that whistle blowing is indeed a risky occupation and whistle blowers have
to suffer as a result of sounding the alarm. All these weaknesses facilitate fraud of
various kinds, colossal levels of waste and misuse of resources in the public
sector.

2.3 Legislative mechanisms

Legislative accountability is the bedrock of good governance. Parliamentary

debates, questions and motions are among the devices that are available to
members of Parliament (MPs) to scrutinize the activities of various ministers and
476 H. ZAFARULLAH AND N.A. SIDDIQUEE

those of senior bureaucrats within these ministries. The purpose of question hour
is to enable MPs to ventilate public grievances and to draw the attention of the
people toward the failure of the government and its administration. Also there can
be unscheduled debates on any specific issue. However, the Bangladesh experi-
ence shows that the impact of debates and questions has been minimal. Rarely, if
ever, parliamentary debates and question hours focus on administrative lapses,
cases of corruption and other malpractices. Indeed, the Parliament in Bangladesh
is yet to establish itself as a scrutineer of administrative actions and bureaucratic
excesses and corruption (Ahmed and Khan, 1995; Siddiquee, 1999).
The effectiveness of legislative committees is greatly reduced by a number of
factors (Ahmed, 1998). The important committees like the Public Accounts
Committee rely on CAG reports. However, as already noted, financial and
management control within the government being generally weak and the public
accounts and audit reports being inadequate, unrealistic and almost always
behind schedule, these have an incapacitating effect on the Committee’s opera-
tions. Until recently, parliamentary committees were ineffective entities as they
were headed by relevant ministers who had a propensity to influence their
deliberations. These committees also suffered from the lack of requisite authority
and resources. Even after some reorganization, they continue with restricted
power and various ministries are unwilling to act upon their directives in terms
of checking financial irregularities (World Bank, 2000b). Thus legislative oversight,
in general, and the committee system, in particular, has failed to play any notable
role in checking bureaucratic corruption and venality.

2.4 Media and civil society

Since the transition to democracy began in the early 1990s, emerging civil society
organizations are increasingly becoming active in building public opinion against
the violation of human rights, breaches of law and discipline, administrative
corruption and mal-governance, among other things. The Bangladesh chapter of
Transparency International (TIB), Civic Watch, Association of Development
Agencies in Bangladesh, Ain-O-Salish Kendro are among the prominent civil
society organizations, which, apart from keeping the public informed about the
pervasiveness of waste and corruption in the state sector, have come up with
concrete ideas to confront governmental maladies. TIB’s ‘Survey of Corruption in
Bangladesh’ and subsequent workshops, discussions and roundtables have
generated a considerable interest in different circles and prompted the govern-
ment to initiate some changes, albeit minor, in regulatory and administrative
procedures to reduce administrative discretion and the scope for corruption.
The electronic media has always been state property and continually abused by
all ruling parties. The print media, on the other hand, has shown much fortitude
and buoyancy in investigating and exposing both political and administrative
corruption. The latter has been playing a noteworthy role in highlighting public
DISSECTING PUBLIC SECTOR CORRUPTION IN BANGLADESH 477

grievances and mal-administration. Some newspapers are active and well-timed in

publishing reports on bureaucratic irregularities, highhandedness, abuse of power,
mismanagement, inefficiency and corruption. To some extent, this acts as a
deterrent for public servants as they constantly remain cautious while discharging
their official responsibilities (Siddiquee, 1999). However, the impact of such
exercises is bound to be limited. Having no executive authority, the media and
civil society cannot go beyond exposing cases of corruption except in arousing
public opinion against the vice. Instances of remedial measures initiated by the
government following reports by the print media are few and far between.

3. Combating corruption in Bangladesh: issues and experiences

The preceding discussion leads one to the conclusion that corruption has been
rampant and deep-rooted in every sphere of administration in Bangladesh. It also
shows that the performance of existing instruments for controlling and uprooting
corruption has fallen far short of expectations and intended objectives. As a matter
of fact, there are some formidable barriers that render the institutional mechan-
isms weak and virtually ineffective. Neither BAC nor CAG, the two most important
agencies, is endowed with adequate power and authority to discharge its respon-
sibilities effectively. This means that neither is in a position to handle the onerous
task of auditing all transactions made by public authorities and investigating an
ever-increasing number of cases. An estimate shows that BAC takes an average
of three years to investigate cases, of which only 15 percent actually get to the
courts and the rest are disposed off at lower levels. Only four percent of the cases
sent to the courts end up in some kind of sentence (TIB, 2000). Even more
disconcerting is the number of cases pending in the courts of law.11 What this
reflects is the fundamental flaw in the institutional capacity of BAC and the law
courts to deal promptly with corruption cases.
The Bangladesh experience also shows that the merit of an investigating body
relies, among other things, on its institutional capacity, operational freedom and
the sincerity of the political leadership. A weak and vulnerable anti-corruption outfit
is not effective in combating corruption. Lack of qualified and trained manpower
have made it difficult for BAC to make any headway in investigating officials known
for massive corruption in various departments.12 On the other hand, successive
governments failed to display their commitment for a strong and effective
surveillance regime. Instead of permitting BAC to operate independently, they
merely used it as a tool for intimidating political opponents. The government also
remained oblivious to allegations of massive corruption within BAC itself, which is
not only a further source of corruption but has expanded the web of corruption to
previously untainted areas.
The fiscal measures have not met with much success in controlling the situation.
On the one hand, CAG has remained crippled and unable to undertake a detailed
and comprehensive audit of government expenditure, on the other, departmental
478 H. ZAFARULLAH AND N.A. SIDDIQUEE

control is virtually non-existent.13 Thus, the overall impact of audit and other fiscal
tools is limited. For many, combining accounts and the audit function into one and
the lack of institutional separation in this regard is a serious anomaly that explains
poor performance in government. Performance audit is almost unknown in
Bangladesh as audit is rarely geared to examine whether a particular expenditure
was made in the ‘public interest’ and in the most efficient manner, or whether
policy goals were at all achieved (GOB, 1993). There are allegations that rather
than helping reduce corruption, the so-called ‘pre-audit’ policy has contributed
toward its aggravation.
The effectiveness of legislative mechanisms in containing corruption, bureau-
cratic lapses and excesses has been greatly eroded by a number of factors. The
Bangladesh parliament failed to serve as an effective watchdog for much of the
period since independence as it remained either suspended or crippled under the
presidential system. The reintroduction of the parliamentary system in 1991 and
the subsequent policy changes have certainly invigorated the legislative arena by
allowing it to play an important role in controlling the behavior of the executive in
general and the bureaucracy in particular. But majoritarian rule and enduring
boycott of parliamentary sessions by the mainstream opposition parties seriously
undermined that prospect. Even when the Parliament has been vibrant with the
opposition, questions and debates are usually less effective in addressing
government failures and in exacting bureaucratic responsiveness and
accountability.
The Bangladesh experience also points to the ineffectiveness of ministerial
control compared to that in other parliamentary democracies. Though ministers,
as heads of executive departments, are assumed to exercise control over the
members of the bureaucracy, they are unable to do so mainly for their lack of
necessary knowledge, education and experience in running the administration.
Consequently, they have to depend, at times heavily, on senior bureaucrats for
advice and support. The superiority of senior bureaucrats in terms of education,
training and experience and their monopoly in technical knowledge enable them to
have considerable influence on ministers and also at times to be cynical of
ministerial control. This is complicated further by bureaucratic discretion permis-
sible by rules and the absence of performance standards in the public service.
This practically means that ministers have to turn a blind eye to the many failures
and deviations of civil servants and seek explanations for only the most obvious
and appalling lapses. Thus, the barriers of holding bureaucracy accountable are
so formidable that the formal theory of accountability is clearly at odds with the
reality (see Rosenbloom, 1998).
This largely explains why the internal control mechanisms remain so weak
despite the prevalence of so many regulations. In the prevailing administrative
culture, officials often tend to protect each other, thus making hierarchical control
irrelevant. Besides, superiors do not find enough incentives to engage in fruitful
and rigorous oversight on a regular basis. They prefer to avoid getting involved in
the cumbersome and difficult process of staff discipline and instead allow
DISSECTING PUBLIC SECTOR CORRUPTION IN BANGLADESH 479

deviations from administrative rules and cases of petty corruptions go unpunished.

Further, there are serious defects in administrative measures for dealing with
corrupt acts. In a few cases where disciplinary action is taken, punishment is too
light and the person is rehabilitated too quickly either because of political connec-
tions or pressures from employee/trade unions. Long-term imprisonment, heavy
fines and confiscation of assets of the corrupt officials are rare. Though the BPDB,
in particular, is well known for perennial corruption of various types, a recent study
observes:

There have been no significant anti corruption drives within the BPDB nor any
court actions against corrupt employees. On occasions, mid level officers have
been suspended from duty on suspicion of moral turpitude and financial
irregularities. But most were reinstated for lack of evidence. Instances of
departmental enquiries or disciplinary actions against lower grade employees
are even rarer due to the supposed or real fear of retaliation by trade unions
(TIB, 2000, p. 5).

BPDB typifies other public sector departments where corruption continues

unabated. One of the toughest barriers in the wrestle against corruption is not
the absence of laws/rules but the lack of their enforcement.
Though laws require stern action against those public servants who (or their
dependents) are in possession of money or property disproportionate to their
known source of income or enjoy a lifestyle beyond their actual means, hardly
anything is done to hold offenders accountable. Despite public pronouncements
made by successive governments to root out corruption from the body politic of the
country no single public official has so far been imprisoned or had his property
acquired through dubious means confiscated. This reflects a wide gap between
rhetoric and reality, and policy and practice. Special anti-corruption drives
mounted by the military rulers ended in fiasco as they or their supporters
themselves resorted to massive corruption subsequently. This has emboldened
government officials to indulge in systematic corruption.
The political-bureaucratic nexus in corruption has its roots deep in the political
history of the country. Ever since independence, democracy and democratic
culture were hardly allowed to flourish. The country witnessed monolithic one-
party rule, prolonged military rule and overt and covert manipulation for super-
imposing one-party hegemony. Democratic practices like accountability and
transparency in government business were overturned and press freedom was
restricted. Military administrators not only failed to arrest the steady decline in the
standard and quality of services, but in many ways also contributed to making
corruption rampant and freewheeling in all tiers of administration. The military and
quasi-democratic rulers often made use of public funds in the most arbitrary and
non-transparent manner thus creating opportunities for themselves and their
protégés to channel state resources for personal gain. As a result, numerous
administrative irregularities, mismanagement and corruption were effectively kept
480 H. ZAFARULLAH AND N.A. SIDDIQUEE

out of the public eye. Military rulers needed funds to launch their own political
parties and organize elections when pressures to civilianize their regimes
mounted. Indeed, corruption during military rule was ‘‘converted from a crime to
a habit’’ (Puchkov, 1989, p. 133; see also Kochanek, 1993, pp. 258–62).
Even under democratic rule, the nexus between corrupt officials and politicians
is still pervasive in the administrative hierarchy. Politicians in Bangladesh are
believed to have a direct hand in sustaining corruption in administration. They
have lucrative shares in all state deals, they receive commissions from terrorists
and smugglers and they patronise corrupt officials for personal gains. Sometimes,
it is extremely difficult for someone to honestly discharge his/her responsibilities
because of pressures from above. Most often pressures from political elites to
carry out their illegal orders force bureaucrats to sacrifice professional ethics and
public interests. All this shows why the system of political control is weak and
ineffective. This also explicates why superiors in political circles have lost the
moral courage to question the officials under them for proven malfeasance and
corrupt practices.
There is no avenue for citizens to redress their grievances or lodge a complaint
against any action of corruption or irregularity committed by public officials.
Actually, they are demotivated to do so because the head of the agency against
whom the complaint will be lodged would be the judge, the jury and the defendant.
If a person is aggrieved at the action of any public official such as the chief
executive of a district or the chief officer of a police station, it will be hazardous to
lodge a complaint against him. Of course, one can go to court but it is not only
costly and time consuming but there is little chance for him to win the case against
the mighty state officials.
The higher courts have played a significant role in delivering their verdicts
against corruption mainly involving those who have held offices of trust and
responsibility. Even presidents and ministers were not spared. The higher judiciary
thus continues to command the respect of the majority. However, there is a
perception among the people that fair judgment in a lower court is hard to come by
without money and/or influence. Hence, the ordinary people accept bureaucratic
malfeasance as fait accompli and rarely bother to seek any redress. The link
between the executive and the judiciary, a legacy of colonial rule, has always
served as an impediment to the independence of the courts, especially those at
the lower levels.
Unable to challenge government failures or administrative corruption at any
stage, the people, especially the poor majority in rural areas, have opted to exit
state services and have increasingly been using alternative channels to access
credit, health and education (Hulme and Siddiquee, 1999). The phenomenal
growth of non-governmental organizations (NGO) and the quality and growing
popularity of the services offered by them and their widespread use by citizens
reflect their disillusionment with the public sector and the government’s inability to
adequately serve them. The NGOs have gradually become integral to the process
of poverty alleviation and service delivery in rural Bangladesh. They are not only
DISSECTING PUBLIC SECTOR CORRUPTION IN BANGLADESH 481

known for their huge size, coverage and innovations, but also for the international
acclaim they have earned for their successes in different areas. Some of these
NGOs (like Grameen Bank, BRAC and PROSIKA) have focused on poverty
alleviation through the provision of micro-credit (Lovell, 1992), training and support
services, as well as formal and non-formal education, environmental conservation,
disaster management, human rights, policy advocacy and legal aid support
services. The NGO strategy for empowerment has contributed to making the
rural poor increasingly vocal and assertive in their demands for improved services
from government agencies (Kramsjo and Wood, 1992). Some NGO groups and
networks have achieved some degree of success in making the administration
more responsive to the needs of the poor, but they are yet to have any lasting
impact as far as bureaucratic corruption is concerned. In many cases, the NGOs
and their groups face a range of problems in their quest for ensuring an
accountable and transparent administration (Hoque and Siddiquee, 1998).

3.1 Recreating accountability structures

The entreaties for reforming the public integrity system in Bangladesh have
emanated from both within and outside the country. One of the most pressing
demands has been the appointment of the Ombudsman. In 1972, the original
Bangladesh constitution provided for the ombudsman with the power to investigate
public complaints against a ministry, an official or a statutory public authority
(GOB, 1972, Article 77). The ombudsman had the potential to become a viable
tool to keep the public bureaucracy under constant surveillance as it was expected
to be clothed with the authority to look into such administrative matters as serious
delays in taking action, discriminatory behavior, insolence, harassment or failure to
render services to the public. It also could serve as a useful device in fostering
bureaucratic responsiveness and minimizing corrupt tendencies among officials.
While other countries in the region forged ahead with this concept, successive
governments in Bangladesh failed to establish an ombudsman even after a
decade of the country’s transition to democracy and the professed commitment
of major political parties and leaders in this regard. The strong plea made by all
major administrative reform commissions/committees went unheeded and there is
little indication that ombudsman will be put in place in the near future (PARC,
2000). There appears to be a deep-seated resistance from the bureaucracy to
establish the ombudsman and political leaders are nervous of the role it is likely to
take on in addressing the issue of corruption in the high political offices.
The World Bank, the Asian Development Bank and other international organiza-
tions have also provided their suggestions for creating the structures to combat
corruption and enforcing accountability in the public sector. Some specific ideas
advanced include: the creation of an independent agency against corruption,
simplifying governmental rules and regulations, constituting legislative committees
on corruption; exposing corrupt officials, monitoring the accounts of politicians and
482 H. ZAFARULLAH AND N.A. SIDDIQUEE

civil servants, making mandatory the submission of asset reports of public

organizations and performance reviews of agencies and projects, separating the
judiciary from the executive, creating awareness among the citizens about their
rights and ways of accessing government resources, involving grassroots level
organizations in fighting the corruption menace and so on (PARC, 2000; World
Bank, 1996; ADAB, 2000).

4. Concluding observations

Corruption in the public sector in Bangladesh does not work in isolation; it is

fostered by corrupt acts of political leaders in power. Politicians of the country are
believed to be involved in large-scale corruption. As such, administrative corrup-
tion is an appendage of political corruption. Often pressures from politicians to
carry out their illegal orders, the fear of punitive transfers and perceived or real
threats of removal force bureaucrats to sacrifice professional ethics and the public
interest. Since most officials do not want to risk losing their jobs/positions, they
prefer to collude with their political masters and share the booty generated from
the abuse of official positions. It is now an open secret that there is a comfortable
nexus between malevolent politicians and corrupt bureaucrats and that they have
lucrative shares in most deals and undertakings made on behalf of the state. Such
a nexus can be found throughout the administrative hierarchy. This is a mutually
convenient arrangement in which private gains of both sides are protected.
Needless to say that this renders the system of control weak and ineffective as
the superiors, be they in officialdom or in political circles, lose moral fortitude to
question their subordinates for negligent behavior and/or proven malpractice. The
Bangladesh experience also shows that bureaucrats who establish ‘god-fatherly’
relationships with political leaders are largely immune from external control as the
latter come to their rescue in the event of any trouble. In this process, some
officials become sacred cows and roam scot-free as hardly any authority has the
courage to attack them even when they are clearly at fault.
The culture of ministerial responsibility, as is seen in mature democracies, is
either missing or weak in Bangladesh. Despite massive corruption, unusual delays
in decision making, huge wastage and misappropriation of resources that char-
acterize every department causing untold public inconvenience, rarely a minister
chooses to accept responsibility for such lapses in his ministry and offer his/her
resignation (Siddiquee, forthcoming). Instead, ministers have tended to defend
themselves and their personnel.
The public sector in Bangladesh has failed to perform to acceptable standards.
The quality of service is poor and the level of client satisfaction is low. Apart from
systemic defects —the offshoot of outmoded structures and procedures, the
bureaucracy is still entrenched in an administrative culture, which is influenced
by notions of clientelism and an attitude of paternalism toward the people. Public
organizations lack a sense of mission, do not optimize their performance, are too
DISSECTING PUBLIC SECTOR CORRUPTION IN BANGLADESH 483

protective of their organizational interests, are reluctant to expose themselves to

accountability and control measures and are captives of ‘parochial and group-
centered politics’ (Zafarullah and Khan 2001, p. 994) The ordinary citizens are the
victims of poor governance, exemplified by mal-administration, bureaucratic
disdain, wayward enforcement of rules and regulations, raging misdemeanor
and slapdash implementation of public policies and programs. They are deprived
of the wherewithal and the wisdom to make a claim to what is due to them by the
state apparatus.
The transition to democracy that began in 1991 is yet to be completed.
Democratic consolidation requires more than periodic free elections and the
meeting of legislators to approve executive choices. Among the several key
components of consolidation is a sound national integrity system that will
manage the accountability structures, monitor bureaucratic performance, correct
administrative delinquency, keep a close watch on governmental operations, and
facilitate public access to grievance mechanisms. Corruption can be rooted out of
the administrative system by the combined efforts of an independent anti-corrup-
tion agency, the Parliament, civil society organizations, a responsible media and
an informed public. This has not been happening in Bangladesh.
Pervasive corruption, which has assumed immense proportions in recent years,
has further added to the woes of the public. Although its prevalence is widely
acknowledged in political, civil society and business circles, successive demo-
cratic governments have been lukewarm in making any concerted effort to combat
corruption. The ruling political leadership ignores the continued overtures of the
international donor community to address the issue and its failure to reform the
public integrity system has resulted in policy failures, colossal economic waste,
abortive projects, social degeneration and hence public suffering.

Notes

1. Bureaucratic corruption and embezzlement had been a part of the political and administrative
system during the Mughal, British and Pakistan periods. It became so widespread during
Ayub Khan’s military rule in Pakistan that hundreds of civil servants were dismissed from
their services while close to another 900 were offered compulsory retirement in 1959–60 on
various charges of corruption.
2. Bribery, nepotism and favoritism, misuse of power, neglect of official duties, fraud, misap-
propriation of funds, false and inflated invoicing are some common forms of corruption in the
public sector. Other types of corruption like terrorism, extortion, defaulting of bank loans,
black marketing, trafficking of children and women, adulteration of food and medicine and
even contract killings are now common in Bangladesh society.
3. Conducted in 1997 on a sample of 2,197 individuals chosen proportionately from the
country’s rural as well as urban population.
4. Tadbir is very effective in that it helps one to avoid the long delay and the hassles of being on
the queue. For instance, the average waiting period for gas and water connection is 3–4
months but with speed-money of Tk 20,000–30,000 one can get connections in a week. Until
recently (before the cell/mobile telephone was introduced), the average waiting time for a
484 H. ZAFARULLAH AND N.A. SIDDIQUEE

telephone connection was 10–12 years, but one could obtain telephone connection instantly
by paying an extra Tk 30,000–70,000 under the table (see Muhith, 1999).
5. Tk is the abbreviation of Taka, the currency of Bangladesh. One US dollar is roughly
equivalent to Tk 53.
6. While estimates vary, it has been found that up to 70 percent of the resources earmarked for
RWP schemes get lost at different stages and both government officials and people’s
representatives are involved in the process (Siddiquee, 1999).
7. Politicians, while in power, use or abuse their positions by distributing patronage of various
kinds. In fact, using positions to grant undue favor and benefit to one’s relatives, friends and
key supporters is one of the hallmarks of Bangladesh politics.
8. Penalties include censure, withholding promotion for specific period of time and reduction in
pay, (minor) demotion and dismissal from the service (major).
9. Established in the early 1950s, BAC witnessed a series of changes in its structure and
institutional affiliation. In the later part of the 1980s, the Bureau was transferred from the
Cabinet Division to the President’s Secretariat. Following the country’s transition to the
Westminster type of government, BAC has been brought under the Prime Minister’s Office.
10. This is precisely the reason that the idea has been mooted in a recent conference that the
CAG be totally separated from the executive branch and placed directly under the Parliament
with independent budget and staff (see Daily Star, 16 September 2000).
11. An estimate shows that thousands of cases are now pending in different courts of law.
12. Though the Customs Department is one of the most corrupt departments, BAC’s impotency
there is clear as not a single prosecution has resulted in successful conviction in recent years
(TIB, 2000).
13. In its 1998 annual report, CAG observes that for all practical purposes no internal control
system exists in government ministries.

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486 H. ZAFARULLAH AND N.A. SIDDIQUEE

Habib Zafarullah Habib Zafarullah teaches political science, public policy and Asian studies at
the University of New England, Australia. His research interests are in Third World politics,
comparative bureaucracy, policy analysis and development management with focus on South
Asia. He has published several books and book chapters and numerous articles in international
refereed journals.

Noore Alam Siddiquee Noore Alam Siddiquee is Head of the Department of Political Science,
International Islamic University, Malaysia. He has a PhD from the University of Manchester. He
has published extensively on local government, decentralization, NGOs and development, public
sector management and bureaucratic accountability.