CPI 2018: My summary and evaluation of this one source out of the 13 used

Civis Mundi Digitaal #88

door Michel van Hulten

Bij dit artikel stond de naam van de auteur aanvankelijk foutief vermeld als Michiel van Hulten. Dat moest uiteraard Michel van Hulten zijn. Onze excuses voor de verwarring - red.

 

Source #2
SGI Sustainable Governance Indicators
http://www.sgi-network.org/2018/
Bertelsmann Stiftung Sustainable Governance Indicators 2018 Survey
[the following texts come from the site of this source for the CPI 2018, with my comments in square brackets]

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Quotes from SGI:
“The Sustainable Governance Indicators (SGI) examine governance and policymaking in all OECD and EU member states in order to evaluate each country’s need for, and ability to carry out, reform.

The indicators are calculated using quantitative data from international organisations and then supplemented by qualitative assessments from recognised country experts. For each SGI Survey, individual countries are evaluated by two (or more) leading experts. The experts’ Questionnaire work is supported by eight coordinators. The SGI Advisory Board discusses and approves the findings” [or disapproves?].

For each SGI Survey, 67 qualitative indicators (phrased as questions) are administered to country experts. These experts provide a written assessment and score for each indicator, which are scaled from 1 (worst) to 10 (best). There are four response options for each indicator, which ensures resonance between the numerical and qualitative assessment. For more on the survey process, go to Methodology. http://www.sgi-network.org/2018/Methodology”

[My comments on this approach:
Inherently subjective
The methodology of the SGI indicators begins with information on its first line: “The assessments of the SGI’s Expert Network - inherently subjective –“. http://www.sgi-network.org/2018/Expert_Network. Keep this in mind, although in the next two lines the report claims that “the subjective bias” is confronted by: “undergo a six-stage peer review within a concise framework. This thorough process ensures the validity and reliability of expert assessments.”]

What did I check?
From the full ‘Methodology’ I went to that part which is titled → ‘Quality of Democracy’ and continued to → ‘Rule of Law’ http://www.sgi-network.org/2018/Democracy/Quality_of_Democracy/Rule_of_Law, as here I found the question ‘Is Corruption prevented?’ Here is also the list of 41 member-countries + results given for OECD, EU, Eurozone (together = ‘the SGI sample’). The country score given for ‘Corruption Prevention’ accounts for 25% of the total score for ‘Rule of Law.
The question posed is:
“To what extent are public officeholders prevented from abusing their position for private interests?”

“Objective as given in the SGI-document:

This question addresses how the state and society prevent public servants and politicians from accepting bribes by applying mechanisms to guarantee the integrity of officeholders: auditing of state spending; regulation of party financing; citizen and media access to information; accountability of officeholders (asset declarations, conflict of interest rules, codes of conduct); transparent public procurement systems; effective prosecution of corruption.”

The SGI-report comments:
“Note: Please be aware that the Corruption Perceptions Index (CPI) of Transparency International uses the data and information given in response to question D4.4 for their assessments. To avoid circularity of assessments, please do not base your evaluation on the CPI.”

My comments on this Note:
[This ‘Note’ is a remarkable warning as given to all experts involved in the scoring process. Nevertheless, we will see in the following text which offers information per country, that in the information as given per country for 11 out of the 41 countries, the CPI 2016 is explicitly mentioned with score and/or rank, and is obviously used for the qualification process (the 11 are: Denmark, New Zealand, Finland, Belgium, Canada, Portugal, Spain, Netherlands, Lithuania, Iceland, Malta).

What does that mean for the value we should attach to the SGI-evaluation? Moreover, note that this also means that for the CPI 2018 this source contributes views/scores dating back at least two years, possibly more, as the CPI 2016 itself which is quoted partly uses older data for its own making.]

 

SGI - Information per country
http://www.sgi-network.org/2018/

http://www.sgi-network.org/docs/2018/basics/SGI2018_Overview.pdf

[All the following are verbatim quotes of the SGI-scores and summarized text].

Legal, political and public integrity mechanisms effectively prevent public officeholders from abusing their positions.

 Score 10

Denmark

In Transparency International’s Corruption Perception Index 2016, Denmark was ranked first together with New Zealand, ahead of Finland and Sweden. Denmark is thus considered one of the least corrupt countries in the world.
This confirms that there is practically no corruption in Denmark. Norms are strong against corruption, and the risk of exposure by an active press is high. In the past, there was the occasional case of a local government official accepting “services” from business in exchange for contracts with the municipality, but such cases are rare. There have also occasionally been cases of officials using their representation accounts rather generously. Again, such cases are rare. Recently, some officials have allegedly accepted gifts from IT companies.

 

New Zealand

New Zealand is one of the least corrupt countries in the world. Prevention of corruption is strongly safeguarded by such independent institutions as the auditor general and the Office of the Ombudsman. In addition, New Zealand has ratified all relevant international anti-bribery conventions of the OECD and the United Nations. All available indices confirm that New Zealand scores particularly high regarding corruption prevention, including in the private sector. Transparency International’s Corruption Perceptions Index 2016 found New Zealand to be the least corrupt country in the world, equal to Denmark.

 Score 9

Finland

The overall level of corruption in Finland is low, with the country offering a solid example of how the consolidation of advanced democratic institutions may lead to the reduction of corruption. The 2016 Corruption Perceptions Index by Transparency International ranked Finland in 3rd place out of 176 countries; the country ranked 3rd place in 2014 and 2nd place in 2015. Several individual mechanisms contribute to the Finnish success, including a strict auditing of state spending; new and more efficient regulations over party financing; legal provisions that criminalize the acceptance of brides; full access by the media and the public to relevant information; public asset declarations; and consistent legal prosecution of corrupt acts. However, the various integrity mechanisms still leave some room for potential abuse, and a 2014 European Commission report emphasized the need to make public-procurement decisions and election funding more transparent. It is also evident that positions in Finland are still filled through political appointment. Whereas only about 5% of citizens are party members, two-thirds of the state and municipal public servants are party members. Recently, several political-corruption charges dealing with bribery and campaign financing have been brought to light and have attracted media attention.

Sweden

Sweden has one of the lowest levels of corruption in the world. As a result, public trust in democratic institutions and public administration is comparatively high. There are, however, significant differences among government agencies in the level of trust they enjoy from citizens, with the National Tax Agency being the most trusted agency and the National Social Insurance Agency and the Labor Market Agency the least trusted.

Corruption at the state level remains extremely rare in Sweden. Regulatory systems safeguarding transparency and accountability, coupled with an overall administrative culture that strongly forbids corrupt behavior, prevent corruption. At the local government level, however, there have been an increasing number of reports of corruption and court decisions on related charges. This tendency has continued during the period of review.

Switzerland

Corruption in Switzerland is rare according to international rankings. Indeed, Switzerland is consistently rated as being among the most successful countries with respect to corruption prevention. It is governed by the rule of law, offers high wages to public officials, and is based on a decentralized democracy with parties that efficiently control and audit public officials.

However, there are opportunities and incentives for political and societal elites to abuse their position for private interests. This is due to the country’s small size and the correspondingly small number of persons interacting in elite positions; to the culture of amicable agreement; and to the very pragmatic problem-solving culture. In addition, holders of elite positions know that they are highly likely to meet again in the future (and probably in different roles). This creates opportunities for the creation of broad informal networks, a reluctance to engage in close mutual surveillance and incentives for the non-observance of formal rules. 

Given the considerable overlap between economic and political elites, critics such as the Swiss office of Transparency International have pointed to processes in which politicians’ economic interests may influence their decisions in parliament.

 

Most integrity mechanisms function effectively and provide disincentives for public officeholders willing to abuse their positions.

 Score 8

Australia

Corruption prevention is reasonably effective. Federal and state governments have established a variety of bodies to investigate corruption by politicians and public officials. Many of these bodies have the powers of Royal Commissions, which means that they can summon witnesses to testify. 

At the federal level, these bodies include the Australian Crime Commission, charged with combating organized crime and public corruption, the Australian Securities and Investments Commission, the main corporate regulator and the Australian National Audit Office.

Nonetheless, significant potential for corruption persists, particularly at the state and territory level. There have been isolated cases of misconduct in anti-corruption commissions. Allegations of corruption in the granting of mining leases have sparked public outcry, and a New South Wales Independent Commission Against Corruption inquiry into corruption in the granting of such leases was in progress throughout the review period. This inquiry has led to the resignations of a number of members of the New South Wales parliament from both the Labor and Liberal parties. 

Questions of propriety are also occasionally raised with respect to the awarding of government contracts. Tender processes are not always open, and “commercial-in-confidence” is often cited as the reason for non-disclosure of contracts with private-sector firms, raising concerns of favorable treatment extended to friends or favored constituents. Questions of inappropriate personal gain have also been raised when ministers leave parliament to immediately take up positions in companies they had been responsible for regulating. 

However, Australia has been reluctant to address cross-border corruption. A notable exception is the recent action of Australian federal police, which in October 2014 commenced to seize assets of allegedly corrupt Chinese officials. This joint operation with Chinese authorities has been a novelty.

Members of the senate and the House of Representatives are required to report on their financial interests within 28 days of taking the oath of office. These registers were adopted by resolution of the House of Representatives on 8 October 1984 and the senate on 17 March 1994. However, there have been instances of failure to comply with this requirement, usually with no consequences for the member concerned. Ministers are further subject to a Ministerial Code of Conduct, introduced in 1996, which articulates guidelines for ministerial conduct. However, this code has no legal standing, and is therefore unenforceable.

Austria

Corruption has become a major topic of discussion in Austria. In recent years, scandals concerning prominent politicians (including former cabinet members) and industries dependent on government decisions have been exposed in increasing numbers, and thoroughly investigated. In consequence, a special branch of the public prosecutor’s office dealing especially with corruption (Korruptionsstaatsanwaltschaft) has been established. This office is seen as a significant improvement on the earlier system, although it remains far from perfect with respect to political independence. The more proactive approach taken by government, represented for example in the activities of the Korruptionsstaaatsanwaltschaft, have yielded positive results.

As a consequence of the bankruptcy of a major bank (Alpen-Adria Hypo), the links between politics and business are more than ever openly discussed. Parliamentary committees at the state and federal levels have been able to bring some light to the affair and courts have successfully prosecuted highly connected persons (including politicians). Compared with evidence from previous decades, the prevention of corruption has improved in Austria, but could of course be further improved.

Belgium

While outright corruption is very uncommon in Belgium, several scandals involving abuse of public-office positions came to the fore in the 2016 – 2017 period. In most of these cases, the public officials involved actually did respect the letter of the law and thus could not be convicted by tribunals. But the scandals were so prominent in the press and shocking for the population that political parties expelled the individuals involved, and when possible also removed them from the positions they were holding. This was also followed by a number of announcements by prominent long-time politicians that they were about to end their political careers. This suggests that more cases existed, but were resolved through “honorable exits.” One consequence has been a decline in Belgium’s performance in the World Economic Forum’s ratings on issues including “public trust in politicians,” “diversion of public funds,” “favoritism in decisions of government officials,” and “efficiency of government spending.”

Most of these “almost legal” abuses involved a combination of very strict rules governing narrowly defined public-office positions with a number of private-public partnerships that legally transformed public entities into private ones. Among other provisions, regulations typically bar public officials from increasing their total earnings above 150% of their base salary by holding additional public positions. However, serving within institutions that have been transformed into private legal entities allow public officeholders to circumvent that law. One of the most shocking instances involved SAMU Social, an institution with the primary goal of “provid[ing] emergency help to the homeless and … assist[ing] them to exit precariousness” (http://samusocial.be/). This institution found to be awarding generous wage supplements to the mayor of Brussels, one of his main political allies, and some family members and close friends. 

According to Cumuleo, an activist group seeking to improve the regulation and oversight of public offices, Belgium has joined Macedonia and Armenia among the lowest-ranked countries with regard to effective implementation of the Council of Europe’s anti-corruption recommendations. Nevertheless, outright corruption, for instance within the public administration or in the police, is extremely rare in Belgium. For example, Transparency International ranked Belgium as the 15th cleanest nation out of 176 countries in its 2016 Corruption Perceptions Index. The cases noted above concern only the ability and propensity of some well-connected officeholders to abuse their position to accumulate wealth.

Canada

Canada has historically ranked very high for the extent to which public officeholders are prevented from abusing their position for private interests. Transparency International’s Corruption Perceptions Index ranks Canada among the top 10 least corrupt countries in the world. 

In recent years, however, the country saw a number of high profile corruption scandals. Perhaps the most consequential scandal revolves around an investigation (which started in 2012) of wrongful travel and living allowance expense claims made by four members of the Canadian Senate. All four senators were suspended and three of them were criminally charged. As a result, the Auditor General of Canada examined expense claims made by all the other senators, identifying in a 2015 report 30 whose claims were ineligible; of these, nine cases were referred for police investigation. The Senate expense scandal renewed calls to reform the Senate or abolish the upper house entirely. In early 2014, Liberal Party leader Justin Trudeau expelled all 32 Liberal senators to sit as Independents, part of a proposed plan to overhaul Senate appointments to ensure it is a non-partisan body.

 

Estonia

Abuses of power and corruption have been the subject of considerable governmental and public concern. On the one hand, Estonia has established a solid institutional and legal structure to prevent corruption, with the National Audit Office, the national parliament’s Select Committee on the Application of Anticorruption Act, the Supervision Committee and the Anticorruption Act of 2013. On the other hand, cases of illegal conduct among high-level civil servants, municipality officials or political-party leaders do emerge from time to time. Such cases can be regarded as evidence of efficient anticorruption policy. However, they also indicate that loopholes remain in the public procurement process and in party-financing regulations, for example.

In 2016, the number of registered corruption offences increased by 18% compared to 2015 (from 450 to 550). At the same time, the number of criminal acts decreased (from 77 to 54), which shows that corruption offences are often committed by the same persons. Most corruption offences (65%) are related to bribery. 
According to survey data, 16% of citizens and 5% employers report that they have been asked to give money, gifts, or take some illegal action for a public service. These figures have been decreasing since 2010. Although only a small percentage of citizens (23%) and civil servants (7%) view that laws can be bought, these figures have increased in recent years. Lobbying remains unregulated, despite Group of States against Corruption (GRECO) recommendations.

Germany

Despite several corruption scandals over the past decade, Germany performs better than most of its peers. According to the World Bank’s 2016 Worldwide Governance Indicators, Germany is in the top category in this area, outperforming countries including France, Japan and the United States, but falls behind Scandinavian countries, Singapore and New Zealand. Germany’s overall performance has also improved relative to other countries. In 2016, Germany ranked 10th out of 215 countries compared to 15th in 2010 (World Bank 2017).

The country’s Federal Court of Audit (Bundesrechnungshof) provides for independent auditing of national spending under the terms of the Basic Law (Art. 114 sec. 2). According to the 2011 Audit Report, the revenues and expenditures of the federal authorities were in general properly documented.

Financial transparency for office holders is another core issue in terms of corruption prevention. Until very recently, provisions concerning required income declarations by members of parliament have been comparatively loose. For example, various NGOs have criticized the requirements for MPs in documenting extra income which merely stipulate that they identify which of the three tax rate intervals they fall under. This procedure provides no clarity with respect to potential external influences related to politicians’ financial interests. However, beginning with the current parliamentary term, members of the German Bundestag have to provide additional details about their ancillary income in a ten-step income list. Auxiliary income exceeding €250,000 is the uppermost category. A total of 164 members of parliament declared additional income. Since the last general election, the auxiliary incomes of four parliament members (all members of the conservative party in government, CDU/CSU) exceeded €1,000,000. In addition, 40 parliamentarians declared additional income of at least €100,000. According to www.abgeordnetenwatch.de, the 10-step system is also flawed. It appears likely that, in order to avoid public attention, members of parliament may resort to partitioning their auxiliary income. Thus, the current system remains an insufficient transparency regime unable to eradicate corruption or conflict of interests. Instead, it incentivizes declaring auxiliary income in slices of lesser amounts.

Ireland

The legal framework and rules regarding standards in public office have been progressively tightened and extended over time in Ireland.
In January 2014, Public Service Reform Plan 2014 – 2016 was published. Its stated goal was to maintain momentum with regard to reducing costs and increasing efficiency in the public sector, “to deliver greater openness, transparency and accountability and to strengthen trust in government and public services.”
Many proposed reforms are still at the planning stage, and it is too early to assess their impact on the integrity of officeholders and public servants.
On 6 September 2017, Assistant Garda Commissioner Michael O’Sullivan published a report showing that of the 3,498,400 breath tests recorded on the Garda’s Pulse computer system only 2,040,179 were actually recorded using alcohol testing devices. This left a discrepancy of 1,458,221 fictive breath tests. Three causes for this glaring deficiency were presented: (1) systems failures, (2) difficulties in understanding Garda policy, and (3) oversight and governance failures. It is highly regretful that the Department of Justice and Garda authorities have not seen fit to prosecute any member of the Garda force because of the massive over-reporting of alcohol breathalyzer tests.

 

Luxembourg

After a parliamentary inquiry into a large building project in Wickrange in 2012, in which the prime minister and other government ministers were suspected of improperly favoring a company, the government adopted a code of conduct in 2014. The code, which references existing codes such as a European Commission code, defines the types of gifts or favors a minister may or may not receive. It also outlines a range of professional activities a minister may undertake after their ministerial term. The overall objective is to avoid conflicts of interests. In addition, an ethics committee will offer opinions concerning the interpretation of specific situations. The revised regulation came into force in December 2015. Transparency International Luxembourg supports the code of conduct, giving credibility to the ministers. But steps need to be taken to ensure sanctions will be imposed on the parties concerned and adjustments are still needed. 
The fourth European evaluation of the Group of States against Corruption (GRECO) called for the rapid implementation of the group’s anti-corruption guidelines, in order to prevent corruption within the public authorities. Only one of the group’s 14 recommendations has been implemented into national law so far and other directives have not been transposed or have been only partially implemented yet.

Norway

There are few well-known instances of corruption in Norway. The few cases of government corruption that have surfaced in recent years have primarily been at the regional or municipal level, or in various public bodies related to social aid. As a rule, corrupt officeholders are prosecuted under established laws. There is a great social stigma against corruption, even in its minor manifestations. However, there are concerns about government corruption in areas such as building permits. During the last few years, some incidences of corruption related to investments and overseas Norwegian business activities have been revealed.

UK

The United Kingdom is comparatively free of explicit corruption like bribery or fraud, and there is little evidence that explicit corruption influences decision-making at national level. Occasional episodes arise of limited and small-scale corruption at local level, usually around property development. The delinquents of recent scandals in UK politics mostly acted within the law. However, these scandals point to a continuing gap between politicians’ attitudes and the public’s expectations. Regulations against corruption have already been formalized to strengthen them, with the 2004 Corruption Bill consolidating and updating regulations into one law. On most international comparisons, the United Kingdom comes out with strong scores.
The MPs’ expenses scandal of 2009 provoked a call for more transparency in this field, but is an example of an informal “British” approach to the political problem of not wanting to raise MPs’ salaries. Instead, there was a tacit understanding that they could claim generous expenses. The rules were tightened very substantially in the wake of the scandal, and an independent body was set up to regulate member of parliaments’ expenses. Codes of practice, such as the Civil Service Code and the Ministerial Code, have been revised (the latter in October 2015, following the election) and are publicly available. The volume of material published has been overwhelming, with examples range from lists of dinner guests at Chequers (the prime minister’s country residence) to details of spending on government credit cards. The most recent report (December 2016) from the independent adviser on ministerial interest appears to present a clean bill of health and notes that no reason to investigate any breaches of the ministerial code since 2012.
At a more subtle level, influence based on connections and friendships can occur, but rarely with direct financial implications. However, some regulatory decisions may be affected by the exercise of such influence.

 Score 7

France

Up to the 1990s, corruption plagued French administration. Much of the problem was linked to secret party financing, as political parties often sought out alternative methods of funding when member fees and/or public subsidies lacked. Judicial investigations revealed extraordinary scandals, which resulted in the conviction and imprisonment of industrial and political leaders. The cases themselves were a key factor for the growing awareness of the prevalence of corruption in France. This led to substantive action to establish stricter rules, both over party financing and transparency in public purchases and concessions. The opportunities to cheat, bypass or evade these rules however are still too many, and too many loopholes still exist. A scandal in March 2013 involving a minister of finance who is accused of alleged tax fraud and money laundering has put the issues of corruption, fiscal evasion and conflict of interest again on the public agenda. In reaction, government ministers have been obliged to make public their personal finances; parliamentarians are also obliged to do so, but their declarations are not made public and media are forbidden from publishing them. Only individual citizens can consult these disclosures and only in the constituency where the member of parliament was elected.
Cases of corruption related to the funding of political campaigns by foreign African states or through unchecked defense contracts are currently (at the time of this writing) before the courts. Moreover, the accounts of the Sarkozy campaign in 2012 were rejected by the Constitutional Council and the public funding refused as a consequence. Since then, the finances of his party are under investigation and some instances of malpractice have been identified. The legal anti-corruption framework has recently been strengthened by the “Sapin law” adopted by the end of 2016, which complements existing legislation on various fronts (conflict of interests, protection of whistleblowers). The 2017 presidential campaign was plagued by a scandal involving the former prime minister and candidate of the right, François Fillon, who was initially considered the favorite after a very successful primary campaign. The media reported that his wife and children had been employed using public money as his parliamentary assistants for more than 10 years. While this dubious practice was not illegal, Fillon was unable to document any real work in spite of nearly €1 million paid over that period of time. In parallel, the leader of the National Front, Marine Le Pen, was accused of misusing funds provided by the European Parliament. Immediately after the elections, Macron and his new minister of justice (François Bayrou) decided, as a symbol, to table a bill dealing with the “moralization of public affairs” (“moralisation de la vie publique”). Unfortunately, the new minister and several other colleagues from the same party were suspected of the same bad practices as Marine Le Pen, which forced their resignations a few days after their appointment. Nevertheless, these scandals show the timeliness of the new law which introduces many additional restrictions, such as the prohibition on parliamentarians employing members of their family, or the suppression of “loose money” that MPs were able to distribute without constraint or control. The new legislation constitutes a major contribution to tackling conflict of interest issues and may help to clean the Augean stables.

Latvia

Latvia’s main integrity mechanism is the Corruption Prevention and Combating Bureau (Korupcijas novēršanas un apkarošanas birojs, KNAB). The Group of States Against Corruption has recognized KNAB as an effective institution, though it has identified the need to further strengthen institutional independence to remove concerns of political interference. KNAB has seen several controversial leadership changes and has been plagued by a persistent state of internal management disarray. Internal conflicts have spilled into the public sphere. For example, the previous KNAB director and deputy director were embroiled in a series of court cases over disciplinary measures in 2015 and 2016. These court cases ended with the director dismissing two deputy directors in the summer of 2016. Both have appealed their dismissal. The director adopted an administrative approach that resulted in a high turnover of qualified staff. Furthermore, these scandals have weakened public trust in the institution. The results of an April 2014 public-opinion poll, commissioned by KNAB itself, found that public trust in KNAB had declined between 2007 and 2014, when public trust in other public institutions had increased. Public trust has declined even further: from 41% in 2014 to 29% in 2016. The director’s term concluded in November 2016 and he was not reappointed for a second term. A new selection process was undertaken and a new well-qualified and seemingly independent director, coming from the military, appointed in 2017. 

In 2017, a high-profile corruption investigation, dismissed by the prosecutor’s office, has come under public scrutiny. A series of leaked recorded conversations of “oligarchs” colluding to manipulate political decision-making has forced the re-examination of this investigation and the reasons why it failed to lead to prosecution. A parliamentary inquiry process is ongoing. 

The Conflict of Interest Law is the key piece of legislation relating to officeholder integrity. The Conflict of Interest Law created a comprehensive financial disclosure system and introduced a requirement for all violations to be publicly disclosed. In 2012, all Latvian citizens were required to make a one-time asset declaration in order to create a financial baseline against which the assets of public officeholders could be compared. This information is confidential and there is no publicly available evaluation of the efficacy of this policy.

Party-financing regulations contain significant transparency requirements, limitations on donation sources and size, and campaign expenditure caps. In 2011, a major political party voluntarily dissolved to avoid paying a substantial fine for campaign financing violations, while electoral support for a second political party collapsed after they too had received a similar fine. KNAB is charged with oversight of public financing for political parties. In 2012, violations of campaign-finance laws were criminalized, but no criminal cases have yet been presented. In 2016, multiple parties were sanctioned for violations of public financing rules. Vienotība, a major parliamentary party, has had its public funding withdrawn due to violations of campaign finance restrictions.

The slow progress of cases through the court systems undermines efforts to assess the system’s effectiveness. However, the available statistics indicate some positive trends. In 2016, for example, the number of persons tried in the court of first instance increased to 34, from an all-time low of 23 in 2014. Defendants included police officers, customs officers, border guards and one judge. In five cases, sentencing included prison terms. In 2016, the largest bribery case involved a €68,560 bribe, offered to an official of KNAB. The outcome of this case is still pending.

Portugal

Under Portuguese law, abuse of position is prohibited and criminalized. However, as elsewhere, corruption persists despite the legal framework. A 2012 assessment of the Portuguese Integrity System by the Portuguese branch of Transparency International concluded that the “political, cultural, social and economic climate in Portugal does not provide a solid ethical basis for the efficient fight against corruption,” and identified the political system and the enforcement system as the most fragile elements of the country’s integrity system. Transparency International’s 2016 Corruption Perceptions Index ranked Portugal 29th out of 176 countries, a decrease of one position as compared to the previous year. However, Transparency International’s ratings are based on public perceptions and are entirely subjective. Therefore, either recent laws are taking effect, the prosecution of high-profile corruption cases has affected public perceptions or other countries have become more corrupt. 
A law was approved by the Assembly of the Republic in September 2011 on the illicit enrichment of public officeholders. However, this legislation was deemed unconstitutional by the Constitutional Court in April 2012. While practically all the parties that voted for the legislation declared that they would bring new legislation on this issue, no new legislation had been approved by the end of the review period. 
Efforts have been made at the state level to impede corruption, although there remains room for improvement in terms of the implementation of anti-corruption plans. A survey by the Council for the Prevention of Corruption, published in June 2015, noted that half of the country’s public entities admitted to having applied only portions of their corruption-prevention plans. The reasons given were largely related to a lack of human, technical and financial resources.
In October 2016, the Council of Europe’s Group of States against Corruption (GRECO) released a report focusing on corruption involving deputies, judges and district attorneys. It analyzed weaknesses in various administrative and legal systems that facilitate corruption. 
A GRECO report published in April 2017 stated that Portugal had satisfactorily implemented 10 of the 13 recommendations the body had made regarding the country in 2010, and that the remaining three had been partially implemented. However, this report also noted deficiencies in Portuguese legislation.
Former Prime Minister José Sócrates (2005 – 2011) remains under investigation for alleged corruption, money laundering and tax fraud, and was formally charged with 31 crimes in October 2017. The review period also saw the beginning of a trial on the so-called Golden Visa case, which involves a number of high-ranking civil servants and a former minister of internal affairs, Miguel Macedo (2011 – 2014).

Spain

Corruption levels have declined in Spain since the real-estate bubble burst in the wake of the 2008 crisis. Massive spending cuts since that time have also arguably helped bring down corruption levels. Nonetheless, perceived corruption levels and Spain’s position in international indices such as Transparency International’s CPI have worsened since the early 2000s. Spain was ranked at 20th place worldwide at the beginning of last decade, but has fallen to 42nd place in 2017. This can be attributed to the fact that cases currently moving through the legal system are based on past events and activities that are now receiving considerable media attention. 
Recent trials and public debate on corruption increased awareness among the public. The PP minority government survived a vote of no-confidence in June 2017 brought to parliament by Podemos to denounce rampant corruption. Also, President Rajoy was obliged to testify as a witness in a corruption case in August. 
The corruption cases now being investigated typically involve illegal donations by private companies to specific parties in exchange for favors from the administration, or simply personal enrichment on the part of officeholders. There have also been several cases of fraudulent subsidies received by individuals close to the governing political parties and some “revolving door” conflict-of-interest cases involving politicians and industries affected by regulation.
Legislation intended to dissuade such behavior has produced first results. This anti-corruption legislation involves a change to party-funding regulations, a transparency law, and reforms to the criminal code and public-procurement law. In addition, systematic audits of public accounts are mandatory and officeholders must make an asset declaration. Very few corruption cases have involved career civil servants and everyday interactions between citizens and the administration are typically characterized by a high level of integrity. 

During 2017, the parliamentary Committee for the Auditing of Democratic Quality, created in 2016, initiated a series of public hearings aimed at gathering the knowledge of Spanish and foreign experts on the financing of political parties. As of November 2017, the committee has held 28 hearings and begun drafting its report. The Law 9/2017 (Contratos del Sector Público) on public procurement was approved in November. In addition, the Directive 2014/23/EU of 26 February, concerning application thresholds for the procedures for awarding contracts, was implemented into Spanish law. These new legal frameworks will come into force on 9 March 2018 and aim to achieve greater transparency in public procurement.

Netherlands

The Netherlands is considered a corruption-free country. In Transparency International’s Corruption Perception Index 2016, the Netherlands ranked 8 out of 168 countries. This may well explain why its anti-corruption policy is relatively underdeveloped. The Dutch prefer to talk about “committing fraud” rather than “corrupt practices,” and about improving “integrity” and “transparency” rather than openly talking of fighting or preventing corruption, which appears to be a taboo issue.

Research on corruption is mostly focused on the public sector and much more on petty corruption by civil servants than on mega-corruption by mayors, aldermen, top-level provincial administrators, elected representatives or ministers. Almost all public-sector organizations now have an integrity code of conduct. However, the soft law approach to integrity means that “hard” rules and sanctions against fraud, corruption and inappropriate use of administrative power are underdeveloped. In at least three (out of 17) areas, the Netherlands does not meet the standards for effective integrity policy as identified by Transparency International, with all three areas failing to prevent and appropriately sanction corruption. A good example is the case against a former alderman of the city of Roermond who, convicted for corruption, electoral fraud and violating secrecy rules, was not given the two-year prison sentence demanded by the public prosecution, but a light community service penalty. (Both the public prosecutor and the accused have appealed the verdict, with the latter seeking an acquittal arguing that “Everybody acts the way I did.”) 
There have been more and more frequent prosecutions in major corruption scandals in the public sector involving top-executives – particularly in (government-commissioned) construction of infrastructure and housing, but also in education, health care and transport. Transparency problems in the public sector also involve lower ranks, job nominations salaries for top-level administrators. Recently, police and customs officers have been prosecuted for assisting criminal organizations. One high-level police officer in a lecture for the Police Academy used the term “Netherlands Narcostate” to characterize the dire state of affairs. 

In July 2016, a new law for the protection of whistle-blowers entered into force. Experts consider the law to be largely symbolic, with real legal protection remaining low and administrative costs high.

USA

The first year of the Trump presidency has brought a brazen and unprecedented disregard of established practices to prevent conflict of interest. 
The U.S. federal government has long had elaborate and extensive mechanisms for auditing financial transactions, investigating potential abuses and prosecuting criminal misconduct. The Federal Bureau of Investigation (FBI) has an ongoing, major focus on official corruption. Auditing of federal-spending programs occurs through congressional oversight as well as independent control agencies such as the General Accountability Office (GAO) – which reports to Congress, rather than to the executive branch. The GAO also oversees federal public procurement. With all of these controls, executive-branch officials have been effectively deterred from using their authority for private gain and prosecutions for such offenses have been rare. 
President Trump has openly flouted established practices, if not the law, with respect to conflict of interest. Most obvious, he has refused to sell off his extensive domestic and international business interests (especially hotels, casinos, and resorts) and to put the proceeds in a blind trust to avoid the potential of his financial interests influencing presidential decisions. Many individuals and groups, including foreign governments, stay at or hold events in his hotels in Washington, D.C. and other locations, often at inflated prices – thus directly contributing revenue to Trump’s businesses. He visited his various properties 100 times in his first year. Trump has defended his refusal to move his assets into a blind trust on the grounds that (in contrast with other federal officials) there is no conflict-of-interest statute that pertains to the president. His son-in-law Jared Kushner and daughter Ivanka have continued to run separate business while performing White House roles. The administration has been heedless of conflict-of-interest in appointments to regulatory and other positions. The administration simply refused to provide information to the Office of Government Ethics concerning potential conflicts among appointees, prompting the respected nonpartisan director of the office to resign in protest. Several Trump officials have been embroiled in scandals involving abuse of public resources (such as using military aircraft for vacation travel).

 Score 6

Chile

In general terms, the integrity of the public sector is a given, especially on the national level. The most notable problem consists in the strong ties between high-level officials and the private sector. Political and economic elites overlap significantly, thus reinforcing privilege. This phenomenon was particularly problematic under the previous government of Sebastián Piñera, as many members of the Alianza – including President Sebastián Piñera himself – were powerful businesspeople. The phenomenon can still be observed in the government of Michelle Bachelet, though at a less extreme level. Such entanglements produce conflicts of interest in the policymaking process (e.g., in regulatory affairs). There are no regulations enabling monitoring of conflicts of interest for high-ranking politicians (e.g., the president and ministers). However, there are some independent projects on the rise to arouse public awareness on this issue.
The scandals revealed in recent years have shown that corruption and abuses of power within Chile’s political and economic elite, as well as some cases of higher ranked public servants (as in the case of the police and the military), is in fact more common than (international) indicators regarding corruption and transparency suggest. It is unclear how state institutions will confront these challenges. During the period under review, a minister and an undersecretary of state of the former government were convicted of corruption. As a response to this crisis, President Bachelet convoked a council (Consejo Asesor Presidencial contra los Conflictos de Interés, el Tráfico de Influencias y la Corrupción) that in its final report (April 2015) proposed several anti-corruption measures intended to prevent abuse of office. Due to their conclusions, restrictions on private campaign funding (Ley sobre Fortalecimiento y Transparencia de la Democracia) and the creation of a public register for all lobbyists were implemented in 2016.

Czech Republic.

In the Czech Republic, corruption has remained widespread. Subsequent governments have emphasized their commitment to fight corruption but have done little to adequately address the issue. Two significant changes were implemented in 2017: amendments to the law on party finance and law on conflict of interest. In addition to making media ownership and governmental positions incompatible, the latter law prevents companies in which members of government hold more than 25% of shares from participating in public procurement processes and from receiving public subsidies. The key test of the law relates to Andrej Babiš. To comply, he transferred all his property into two blind trusts, although there is some doubt over their blindness as there are family members among the trustees. In August 2017, the Chamber of Deputies received a request from the police to lift the immunity of two ANO members of parliament – Andrej Babiš (ANO chairman) and Jaroslav Faltýnek (head of the ANO parliamentary faction) – for prosecution in connection with possible embezzlement of EU funds. Their parliamentary immunity was lifted in September 2017 but regained on their reelection in October 2017. The Czech police are awaiting the findings of the European Anti-Fraud Office (OLAF). In October 2017, prosecutors also charged Babiš’s wife, brother-in-law, adult children and several other persons (11 in total) for their part in the fraud.

Israel

A survey of the Israeli legal framework identifies three primary channels of a corruption-prevention strategy: 1) maintaining popular trust in public management (including bank managers and large public-oriented corporations’ owners), 2) ensuring the proper conduct of public servants and 3) ensuring accountability within the civil service. Israel pursues these goals by various means: It established a legal and ethical framework to guide civil servants and the courts, reinforced the position of the State Comptroller through the passage of a basic law (1988) in order insure government accountability, adapted the civil service commission’s authority to manage human resources (e.g., appointments, salaries) and so forth. In 2005, Israel was one of 140 states to sign a national anti-corruption treaty and began implementing it in 2009, issuing annual progress reports. 
Annual opinion surveys demonstrate that Israeli citizens are concerned about high levels of corruption in their country. Criticism of Israel’s centralized public-service structure have been mounting, in part because it is characterized by several very powerful ministries with broad ability to engage in discretionary spending. These powers detract from accountability, leaving room for corruption.
Criminal inquiries into politicians are common. Former Foreign Minister Avigdor Liberman was tried for fraud, money laundering and breach of trust, though ultimately acquitted. Former Tourism Minister Stas Misezhnikov, a member of the Yisrael Beytenu party, was sentenced to a 15-month sentence for fraud and breach of trust. In addition, former Deputy Interior Minister Faina Kirshenbaum and nine other officials linked to Yisrael Beytenu were indicted for a litany of corruption charges, including bribery, fraud and money laundering. 

In 2014 the courts issued an historical ruling sentencing former Prime Minister Ehud Olmert to six years in prison for accepting bribes while serving as mayor of Jerusalem. Recently, Prime Minister Netanyahu has been suspected of involvement in several corruption affairs (the “submarine affair,” the “expensive gifts affair,” and an alleged attempt to negotiate sympathetic coverage in the Yediot Aharonot newspaper in return for support for legislation that would weaken Yediot competitor Israel Hayom).
According to Meni Yitzhaki, who heads the Israel Police’s fraud investigations task force, Israel does not suffer from widespread corruption, but rather features “islands of corruption.” Yitzhaki stated that the Israeli police address corruption as they would any criminal organization.

Italy

The Italian legal system has a significant set of rules and judicial and administrative mechanisms (with ex ante and ex post controls) to prevent officeholders from abusing their position, but their effectiveness is doubtful. The Audit Court (Corte dei Conti) itself – one of the main institutions responsible for the fight against corruption – indicates in its annual reports that corruption remains one of the biggest problems of the Italian administration. The high number of cases exposed by the judiciary and the press indicates that the extent of corruption is high, and is particularly common in the areas of public works, procurement, and local building permits. It suggests also that existing instruments for the fight against corruption must be significantly reconsidered to make them less legalistic and more practically efficient. With the reforms of the Monti, Letta, Renzi and Gentiloni governments, the Anti-Corruption Authority has been significantly strengthened and its anti-corruption activity progressively increased (see 2017 ANAC Report).
In general, the ongoing reform of public administration should also contribute to reducing administrative abuses.

Lithuania

Corruption is not sufficiently contained in Lithuania. In the World Bank’s 2016 Worldwide Governance Indicators, Lithuania scored 73 out of 100 on the issue of corruption control, up from 68.8 in 2014. The 2013 Eurobarometer poll revealed that Lithuania had the European Union’s highest percentage (29%) of respondents who claimed that they had been asked for or expected to pay a bribe for services over the past 12 months, compared to an EU average of 4%. In the Transparency International Corruption Perception index, Lithuania scored 59 out of 100 and ranked 38 out of 176 countries in 2016, down from 32 in 2015. According to the new Index of Public Integrity, Lithuania was ranked 25 out of 105 countries overall, but only 85 out of 105 countries for budget transparency.
Anti-corruption policy is based on the National Program on the Fight Against Corruption (2011– 2014), which has two primary building blocks: eliminating or minimizing conditions that enable corruption, and enforcing penalties in cases of identified corruption. One of Lithuania’s key corruption prevention measures is an anti-corruption assessment of draft legislation, which grants the Special Investigation Service the authority to carry out corruption tests. According to the Lithuanian Corruption Map of 2011, the most corrupt institutions were the health care sector, the parliament, the courts, the police, and the local authorities. Bribery is perceived to be the main form of corruption by most average Lithuanians, while businesspeople and civil servants respectively identified nepotism and party patronage as the most frequent forms of corruption. In September 2017, the Special Investigation Service investigated allegations of corruption involving Lithuania’s Liberal Movement and Labor Party. The parties are suspected of accepting bribes and selling political influence. For instance, two Liberal Movement members are alleged to have accepted bribes of more than €100,000 on behalf of the party from a vice president of a major business group in exchange for political decisions that benefitted the corporation.
According to the World Economic Forum, Lithuanian firms perceive corruption as one of the most problematic factors for doing business in the country. Since state and municipal institutions often inadequately estimate the likelihood of corruption risks, not all corruption causes and conditions are addressed in anti-corruption action plans. The European Commission has suggested that Lithuania should develop a strategy to tackle informal payments in health care, and improve the control of conflicts of interest declarations made by public officials. To advance its preparations for OECD membership, the country became a member of the OECD Anti-Bribery Convention in July 2017.

Slovenia

Corruption has been publicly perceived as one of the most serious problems in Slovenia since 2011. While the Commission for the Prevention of Corruption (CPC), the central anti-corruption body, managed to upgrade its Supervisor web-platform and launch its successor Erar in July 2016, it has remained under fire for its lack of determination and professionalism, especially after the resignation of Alma Sedlar, one of the three-strong CPC leadership in September 2017. Allegations of corruption have featured prominently in the debates about the investment by Magna, the construction of the second railway track from Divača to the port of Koper and the health system. The continuing failure of parliament to adopt an ethical code for members of parliament and the re-election of Franc Kangler, the corrupt former mayor of Maribor, into the National Council, the second chamber of the Slovenian parliament, have further raised the doubts about the political elite’s commitment to fight corruption.

South Korea

The massive recent corruption and abuse-of-power scandal that led to the impeachment of President Park revealed systematic corruption and collusion between the government and big business groups. The scandal also revealed weaknesses in the country’s integrity mechanisms and anti-corruption institutions, which failed to uncover these illegal activities taking place at the highest level. At the same time, the scandal showed that the Korean public, civil-society organizations and the media are vigilant and ready to effectively protest top-level abuses of power at the top. 
Courts have also been tough on those involved in corruption scandals, handing down prison sentences to many involved. President Park’s confidante Choi Soon-sil received three years in prison, and Samsung Vice-Chairman Lee Jae-yong, who is also the heir of the Samsung business group, received five years in prison for his involvement in the scandal. In the aftermath of the scandal, President Moon promised to strengthen anti-corruption initiatives and announced not to pardon members of the elite involved in corruption scandals, as has been common practice in Korea in the past. In September 2017, President Moon presided over the First Anti-Corruption Policy Consultation Council. This council is tasked with establishing more systematic anti-corruption policies at the national level. The recent corruption scandals are mainly related to lobbying activities involving high-ranking officials, politicians and businesspeople. With an eye to reducing future potential corruption, a new lobbying act is being debated.
Another positive development is that the Kim Young-ran Act that came into effect in September 2016, also known as the anti-graft law (improper solicitation and graft act), has received largely positive feedback and might lead to a deeper cultural change to the gift-giving culture in Korea. The law bans public servants, teachers and journalists from receiving free meals valued over KRW 30,000 ($27), gifts more than KRW 50,000 won, or congratulatory or condolence payments of more than KRW 100,000. In surveys, nearly nine out of 10 citizens have indicated that they believe the law to be effective, with 53% saying that the frequency of requests for job-related favors has declined, and 55.4% responding that their own exchanges of gifts have been reduced.

 

Some integrity mechanisms function, but do not effectively prevent public officeholders from abusing their positions.

 Score 5

Croatia

Corruption ranked high on the agenda of the accession negotiations with the European Union and remains one of the key issues facing the political system. During the period under review, a number of high-profile corruption cases surfaced or were under investigation, involving, among others, a close aide to former Prime Minister Milanović and the most powerful man in Croatian soccer. The Agrokor case has also revealed the co-mingling of economic and political interests in the country. While the main anti-corruption office, the USKOK (Ured za Suzbijanje Korupcije i Organiziranog Kriminala, Croatian State Prosecutor’s Office for the Suppression of Organized Crime and Corruption), and the parliament’s commission for the conflict of interests have been quite active in opening and investigating cases, the courts have often failed to sanction corruption either as a result of external pressure or a lack of competence.

Greece

After Syriza’s rise to power in January 2015, the earlier lack of resolve among political and administrative elites to control corruption was reversed. However, the Syriza-ANEL coalition was undecided on how to steer anti-corruption policy. In January 2015, a new post of Minister for Anti-Corruption was established; in September the post was abolished and a post of Deputy Minister for Anti-Corruption was created and subsumed under the supervision of the Minister of Justice. A new General Secretariat on Anti-Corruption was created under the aforementioned minister, but remains understaffed. 
Instability has plagued anti-corruption mechanisms. In March 2017, the resignation and replacement of Greece’s very experienced anti-corruption prosecutor (a new post established in 2011) was a setback for the government’s anti-corruption policy. The prosecutor’s resignation reflected tensions between the government and the judiciary, and complicated relations between the different prosecuting authorities entrusted with fighting corruption. Meanwhile, between 2016 and 2017, the laxity with which government ministers dealt with issues of corruption among members of the civil service sent the wrong message to past and future offenders.
Yet, in the period under review, the justice system intensified its efforts, not so much to prevent as to punish corruption. In the most important trial, Akis Tsochatzopoulos, the former minister of defense and deputy prime minister of the PASOK governments of the 1990s, was accused of receiving large kickbacks for armament deals. In November 2017, he was sentenced to prison and received a very large fine from an Athens-based second-instance criminal court. Meanwhile, throughout 2017, Greek authorities were preparing new anti-corruption legislation to abide by policy guidelines set by the European Commission and the Council of Europe. 

According to a July 2017 report by the Hellenic Federation of Enterprises (SEV), the state has shown a fragmentary approach, and a lack of determination toward combating corruption and promoting transparency in six kinds of state bodies: ministries, town planning authorities, municipal authorities, courts, custom offices, and economic and trade offices at Greek embassies abroad.

Iceland

Financial corruption in politics is not viewed as a serious problem in Iceland, but in-kind corruption – such as granting favors and paying for personal goods with public funds – does occur. Regulatory amendments in 2006, which introduced requirements to disclose sources of political party financing, should reduce such corruption in the future.
In very rare cases, politicians are put on trial for corruption. Iceland has no policy framework specifically addressing corruption because historically corruption has been considered a peripheral subject. However, the appointment of unqualified persons to public office, a form of in-kind corruption, has been and remains a serious concern. Other, subtle forms of in-kind corruption, which are hard to quantify, also exist. The political scientist Gissur Ó. Erlingsson claims that corruption in mature democracies, including Iceland, is perhaps more of the character of nepotism, cronyism, and “You scratch my back, I’ll scratch yours.” A recent article by Gissur and another Icelandic political scientist, Gunnar Helgi Kristinsson, concluded that “corruption is rare but still clearly discernible. Less serious types of corruption, such as favoritism in public appointments and failure to disclose information, are more common than more serious forms, such as extortion, bribes and embezzlement. Nonetheless, it should be noted that a sizable minority of experts still believe corruption is common, especially in the case of favoritism and fraud.”
The collapse of the Icelandic banks in 2008 and the subsequent investigation by the Special Investigation Committee (SIC), among other bodies, highlighted the weak attitude of government and public agencies toward the banks, including weak restraints and lax supervision before 2008. Moreover, three of the four main political parties, as well as individual politicians, accepted large donations from the banks and affiliated interests. When the banks crashed, 10 out of the 63 members of parliament owed the banks the equivalent of more than €1 million each. Indeed, these personal debts ranged from €1 million to €40 million, with the average debt of the 10 members of parliament standing at €9 million. Two of the ten members of parliament in question are still in parliament and the cabinet without having divulged whether they have settled their debts or not. The SIC did not report on legislators that owed the banks lesser sums, e.g., €500,000. GRECO has repeatedly highlighted the need for Icelandic members of parliament to disclose all their debts beyond standard mortgage loans. In 2015, GRECO formally complained that Iceland had not responded to any of its recommendations in its 2013 report on Iceland.
In November 2011, parliament passed a law that obliges members of parliament to declare their financial interests, including salaries, means of financial support, assets, and jobs outside parliament. This information is publicly available on the parliament’s website.
According to Transparency International’s Corruption Perceptions Index 2016, which measures business corruption, Iceland scored 78 out of 100, where a score of 100 means absolutely no corruption. Although this score implies that Iceland is relatively free of corruption, it is still well behind the other Nordic countries, which score between 85 and 90. In an assessment of political corruption in 2012, Gallup reported that 67% of Icelandic respondents view corruption as being widespread in government compared with 14% to 15% in Sweden and Denmark.
New information, including emails leaked from one of the failed banks, about corruption surrounding the crash of 2008 and involving the outgoing prime minister, has come to light This information led to a gag order being imposed on the newspaper Stundin shortly before the election. The case will be heard in court in early 2018.

Japan

In recent decades, corruption and bribery scandals have emerged frequently in Japanese politics. These problems are deeply entrenched and are related to prevailing practices of representation and voter mobilization. Japanese politicians rely on local support networks to raise campaign funds and are expected to “deliver” to their constituencies and supporters in return. Scandals have involved politicians from most parties except for the few parties with genuine membership-based organizations (i.e., the Japanese Communist Party and the Komeito). 
However, financial and office-abuse scandals involving bureaucrats have been quite rare in recent years. This may be a consequence of stricter accountability rules devised after a string of ethics-related scandals came to light in the late 1990s and early 2000s. A new criminal-justice plea-bargaining system, slated for implementation in June 2018, will create additional pressure on companies to comply with anti-corruption laws.
In the past, the country has had a reputation for weak enforcement with respect to anti-bribery enforcement abroad, an issue relevant for Japan’s multinational companies. The OECD urged Japan in 2016 to step up its efforts, and the government has promised to take a stiffer line, with the Ministry of Economy, Trade and Industry (METI) also issuing warnings to companies. In 2017, Japan decided to join the UN Convention against Transnational Crime and the UN Convention against Corruption, which have respectively existed since 2000 and 2005.
Following the 3/11 disasters, the public debate on regulatory failures with respect to the planning and execution of nuclear-power projects supported a widely held view that, at least at the regional level, collusive networks between authorities and companies still prevail and can involve corruption and bribery.

Malta

A number of institutions and processes work to prevent corruption and guarantee the integrity of government officials, including the Permanent Commission Against Corruption, the National Audit Office, the Ombudsman Office and the Public Service Commission. The government also abides by a separate Code of Ethics, set out for ministers, members of parliament and public servants. Ministers and members of parliament are also expected to make an annual asset declaration. The Public Accounts Committee of the unicameral House of Representatives can also investigate public expenditure decisions to ensure that money spent or contracts awarded are transparent and conducted according to law and general financial regulations. 
Until recently, with the exception of the National Audit Office and the Ombudsman Office, these mechanisms provided insufficient guarantees against corruption. Internal audit systems can also be found in every department and ministry, but it is difficult to assess their effectiveness. The 2016 report of the audit office also highlighted regulatory abuse regarding procurement, inventory inadequacies, and non-compliance with tender requirements and ministries’ fiscal obligations. A recent academic report has shown decades long corruption at the planning authority. In the 2016 Corruption Perceptions Index, Malta slipped one point from 5.6 to 5.5. In the Global Competitiveness Index 2017, Malta obtained the following scores in a ranking of 1 to 7 (7 being the best score): public trust in politicians (2.9), irregular payments and bribes (4.7), and favoritism in decisions of government officials (2.8). However, the overall score for functioning institutions was 4.5, yielding an overall ranking of 38th out of 137. Both the National Audit Office and the Ombudsman Office are independent, but neither enjoys the necessary executive powers to follow up on their investigations. The Public Service Commission has consistently lacked sufficient resources for it to work effectively. The Permanent Commission Against Corruption was setup in 1988. Since then, over 300 cases has been investigated, though none have been prosecuted. Since the 2017 election, the commission has not been reconstituted as a result of the opposition party not yet having selected their candidate. In 2018, the ombudsman called for greater government transparency and accountability. The setting up of a new parliamentary committee to scrutinize public appointments is a move in the right direction, though it has been criticized for not going far enough and ensuring that all candidates be grilled by the board. The 2017 ombudsman’s report mentioned the need for legislation to regulate lobbying and how this relates to the right of individuals to receive correct and timely information on the activities of government. This is especially important in light of the link between lobbying and corruption.
In 2013, the government strengthened the fight against corruption by reducing elected political figures’ ability to evade corruption charges and introduced a more effective Whistleblower Act. Nonetheless, conflicts of interest remain prevalent. These are a result of the face-to-face relationships common in small countries and the fact that Malta’s members of parliament work part-time and maintain private interests. Presently, a number of magisterial inquiries are ongoing on alleged cases of corruption in government.

Poland

Corruption has been a major political issue in the period under review. On the one hand, the PiS government has accused the previous government of corruption. However, the evidence for this claim provided in the government’s May 2016 report on the wrongdoings of the PO-PSL governments has been meager. The report has not yet led to many investigations and arrests. On the other hand, the PiS government has itself been under fire for corruption and cronyism in state-owned enterprises. Thousands of PiS apparatchiks and followers have been placed in management positions, so that a widespread clientelistic network has emerged.

Romania

Corruption has been a major political issue in Romania for some time and became even more so in the period of review. As early as in January 2017, the newly installed government launched legislation aimed at decriminalizing and pardoning certain offenses. Broadly understood as an attempt to help politicians and others either accused or convicted of corruption, including PSD leader Liviu Dragnea, these initiatives prompted an unexpectedly strong public outcry that led the government to withdraw them. Next, the governing coalition has sought to discredit and weaken the much-acclaimed National Anti-Corruption Directorate (DNA) while strengthening its control over the judiciary, with limited success until the end of the year. Led by the combative Laura Codruta Kövesi, the DNA, which has achieved many high-profile convictions, continued its investigations in 2017. In June 2017, a new system for identifying conflicts of interest in public procurement went online. Because of weak regulation and enforcement, public procurement, which comprises sales worth more than 15bil Euros and more than 20,000 individual tendering procedures per year, has been prone to corruption.

Slovakia

Corruption is the most sensitive political problem undermining political stability and quality of democracy in Slovakia. The previous two governments headed by Robert Fico did not pay much attention to anti-corruption efforts and were shaken by several corruption scandals. The government manifesto of the third Fico government contained some anti-corruption measures, and the new minister of justice, Lucia Žitňanská (Most-Híd) initiated several reforms to fight corruption. In the period under review, the alleged corruption case involving Minister of Interior Robert Kaliňák and Prime Minister Fico has continued to attract the most attention. Their links to Ladislav Basternak, a business man involved in fraud, have led to several votes of no confidence. Thanks to the government’s parliamentary majority, the interior minister survived all of them. Given the governing coalition’s intransigence on this issue, all attempts by the justice minister to introduce and strengthen transparency, the new rules to protect whistleblowers, the cooperation of the government with the OECD on combating corruption, and the establishment of the Department for the Prevention of Corruption at the Slovak Government Office have not achieved any substantial change.

 Score 4

Bulgaria

As successive European Commission reports under the Cooperation and Verification Mechanism have shown, Bulgaria’s formal legal anti-corruption framework is quite extensive, but has not proven very effective. Despite some improvement in the standard corruption perception indices in the past three years, corruption has remained a serious problem. While the executive and state prosecutors have initiated numerous criminal prosecutions against high-profile political actors, the conviction rate in those high-profile cases has been very small. After coming to office, the Borissov government, in line with recommendations by the European Commission and the Council of Europe, attempted to create a unified anti-corruption agency. The new legislation was adopted by parliament in December 2017.

Cyprus

The auditor general’s office is constitutionally independent and assigned to audit state accounts and legal compliance. Adequate responses to the office’s observations have been rare. However, numerous prosecutions for notable cases of corruption have occurred since 2014. The privacy constitutional clause (Art. 15) was amended (2016) to serve transparency and fight corruption. A new national anti-corruption strategy is currently being designed.
A Transparency Cyprus survey showed 81% of the public considers corruption to be present at both the local and national levels, with 83% deem it a serious problem. The numerous relevant recommendations by GRECO are indicative of the problem.
Pressures from civil society organizations and media for more transparency have had some positive effects. However, the European Commission noted in 2017 that “the Coordinating Body against Corruption is not adequately staffed, and weaknesses in the disciplinary regime for public servants remain unaddressed.” We note, for example, that no report is available on how a public service code of conduct has been implemented since 2013.

 Score 3

Hungary

Widespread corruption has been a systemic feature of the Orbán governments, with benefits and influence growing through Fidesz’s informal political-business networks. Members of the Fidesz elite have been involved in a number of corruption scandals, with many people accumulating substantial wealth in a short period of time. After the conflict with Lajos Simicska, the previous “Czar” of business and media, Orbán has made a radical rearrangement in the camp of the Fidesz-linked oligarchs by pushing out all Simicska-related businessmen from public procurement and promoting new oligarchs, most notably Lőrinc Mészáros, István Garancsi and István Tiborcz (the son in law of Orbán). According to Forbes Hungary, Mészáros, for example, has tripled his fortune in 2017. Corruption has become so pervasive that even some senior Fidesz figures have begun openly criticizing the Fidesz elite’s rapid wealth accumulation. Corruption in Hungary has to be seen through the prism of oligarchic structures and is strongly linked to public procurement, often related to investments based on EU funds and facilitated by the new public procurement law of 2012. A general problem here is that there is comparably little competition in this field, with Poland and Hungary ranking last. Its political power has allowed the Orbán government to keep corruption under the carpet. De-democratization and growing corruption are thus mutually reinforcing processes. As a result, the fight against corruption has largely rested with the political opposition and some independent NGOs. In addition to Transparency International Hungary and Átlátszó (Transparent), Á. Hadházy, the co-president of the opposition party Politics Can Be Different (LMP), has been very active and effective in investigating the corruption by the leading Fidesz politicians and oligarchs.

Mexico

Throughout 2017, Mexico has been rattled by a number of high-profile corruption cases. The cases of several former governors, who embezzled and laundered exorbitant amounts of public funds and left their states with financial troubles, were particularly notorious. The revelations about rampant, high-level corruption were all the more painful as some of these governors had been close allies of President Peña Nieto and were the public faces of his effort to re-launch the PRI in order to give the party a new start after its decades-long association with corruption and bribery. Beyond the governors, the former director of the state-owned oil company Pemex, another close Nieto ally, has also been accused of corruption in the fallout of the scandal surrounding the Brazilian engineering firm Odebrecht. The Odebrecht scandal has rattled several Latin American countries, and now also engulfs high-placed public officials in Mexico. The aftermath of the September 19th earthquake also revealed evidence of corruption and negligence at lower levels of government. For instance, an apartment made of marble and including a jacuzzi had been added to the fourth floor of a primary school that collapsed during the quake, killing 27 students and staff. The expansion was commissioned by the school’s director for personal use. 
These high-profile cases revealed the inability of the Mexican justice system to effectively deal with corruption, especially if the perpetrators are politically well connected. In the Odebrecht scandal, Mexican prosecutors only sprang into action after Brazilian media broke the story, despite previous evidence of illicit transactions between Odebrecht and Pemex. Equally painful was the revelation that the electronic surveillance software “Pegasus,” purchased by the Mexican government, has been used to spy on anti-corruption activists affiliated with the Instituto Mexicano para la Competividad (Imco). Overall, these cases illustrate the pervasiveness of corruption, and the inability and unwillingness of authorities to effectively deal with the issue, despite statements to the contrary. 
At the same time that corruption scandals roiled the political arena, efforts to implement the National Anti-Corruption System (SNA), which had been signed into law by President Nieto in 2016, floundered. Neither the special anti-corruption prosecutor nor the judges for the specialized administrative tribunal have been appointed. At the subnational level, not even half of Mexico’s states have approved the required secondary legislation to implement the SNA. According to a May 2017 study by Corparmex, the Mexican confederation of business owners, corruption costs Mexico around 10% of its GDP. The main positive development with regard to corruption is sustained pressure from civil society for more transparency and accountability.

 

Public officeholders can exploit their offices for private gain as they see fit without fear of legal consequences or adverse publicity.

 Score 2

Turkey

Law 5018 regarding public financial management and oversight also touches on issues of legality, transparency and predictability. However, these concepts, as well as instruments such as the formation of strategic plans, performance budgets and regulatory impact assessments, are not effectively incorporated into government oversight processes. An amendment to the law on audit court has limited the degree to which state expenditures can be audited. Public-procurement safeguards have deteriorated thanks to legislation allowing municipalities to operate in a less than transparent fashion. There are no codes of conduct guiding members of the legislature or judiciary in their actions. Conflicts of interest are not broadly deemed a concern, and there is no effective asset-declaration system in place for elected and appointed public officials.
The asset-declaration system was established in 1990 by Law 3628 on Asset Disclosure and Fighting Bribery and Corruption. All public officials (legislative, executive and judicial, including nationally and locally elected officials) must disclose their assets within one month of taking office and renew their declaration every five years. However, these declarations are not made public unless there is an administrative or judicial investigation. The Regulation on Procedure and Basis of Application of the Civil Servants Ethical Behavior Principles defines civil service restrictions, conflicts of interest and incompatibilities. The Council of Ethics for Public Officials lacks the power to enforce its decisions through disciplinary measures. Codes of ethics do not exist for military personnel or academics. Legal loopholes (e.g., regarding disclosure of gifts, financial interests and holdings, and foreign travel paid for by outside sources) in the code of ethics for parliamentarians remain in place. In 2016, a total of 1,792 public civil servants across 26 institutions were provided ethics training. The European Commission continued to sponsor ethics leadership training for Turkish civil society groups in 2017.
Political party finances are regulated by Law 2820. Parties that achieve 3% or more of the val id votes during the general election receive state aid, and those overcoming the 10% threshold receive higher sums proportionate to the share of votes received. Parties’ accounts are reviewed annually by the Constitutional Court, although this process is not timely. In recent years, the court found that the main parties had received or spent money unlawfully.
In general, corruption remains widespread, and unfair and biased bureaucratic treatment is common. Especially at the local level, corruption remains a systemic problem. While municipalities controlled by opposition parties are closely monitored by law-enforcement authorities and government inspectors, municipalities controlled by the AKP are shielded from close scrutiny. The Turkish Court of Accounts reported several improper transactions in the 2016 annual accounts of several metropolitan municipalities, including Ankara, İstanbul, Gaziantep, Bursa, Ş.Urfa and Kocaeli. However, these reports have not been discussed by the parliament. Though the reports were published in the media and online, publicly exposing hidden budget expenditures, housing-procurement abuses and tax compromises. Instead of prosecuting the corrupt officials, President Erdoğan simply removed them from office.
A 2014 omnibus law amended various aspects of Turkish public-procurement legislation, introducing restrictive measures that make the previously optional domestic price advantage of up to 15% compulsory for “medium and high-technology industrial products.” The law authorizes the Ministry of Science, Industry and Technology to determine the list of items for which a domestic price advantage will be compulsory; this gives considerable discretion to the administration.
During the review period, corruption has deepened due to the rentier economy, the government’s authoritarian tendencies, weakened parliamentary oversight, dysfunctional public administration and financial audit institutions, and impunity. Moreover, the gold trader Reza Zarrab’s testimonies in the U.S. indicate that Zarrab bribed former AKP ministers with millions of U.S. dollars between 2011 and 2013. On 17 December 2015, the Bribery and Corruption Investigation decided not to prosecute four ministers and their relatives. In January 2015, due to the AKP’s parliamentary majority, the Turkish parliament voted not to put the ministers on trial. Though these cases can be reopened in future. The main opposition party leader stated that the President Erdoğan’s family members transferred millions of U.S. dollars to a company in the Isle of Man (a tax haven) in 2011 and 2012. In a counter attack, the Minister of Interior removed the mayor of Ataşehir, a town in İstanbul, from office following allegations of corruption.

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