Grease

This is the culture that P-Noy the corruption buster is up against:

A private individual doing business with a government agency wanted one of his documents photocopied. He offered a clerk P5,000 to facilitate the job. The new head of the agency, who got wind of the offer, told the businessman that for P5,000, he could buy his own basic photocopying machine.

Last March about 50 governors received two ambulances each – Proton vans made in China – for their respective provinces, courtesy of the Philippine Charity Sweepstakes Office (PCSO).

Nothing wrong with that at first glance; which province cannot use an ambulance?

What was wrong was that the rules required the PCSO to shoulder only 60 percent of the cost of an ambulance; the recipient local government must shoulder the balance of 40 percent. That sharing scheme is the same for all, including the poorest provinces, which are most in need of ambulances and health care services.

Those 50 lucky recipients got two ambulances each without putting up the 40 percent. You can be sure none of the governors was a known supporter at the time of opposition presidential frontrunner Benigno Aquino III.

Sources in the Department of the Interior and Local Government are also looking into the possibility that franchise operators of the small town lottery (STL) are using the game as a front for the still more popular jueteng.

The DILG is helping the PCSO trace certain items and expenditures listed as donations to local politicians or their constituents.

There were fund releases, for example, amounting to over P870,000 each – exactly the same amounts down to the last centavo – ostensibly for various types of surgeries under the names of different individuals. There were also donations listed under the same name for various types of surgeries undergone in succession every month.

There could be a legitimate explanation for all those expenditures, but it will have to wait, because there was no official audit of the PCSO – an agency that earns about P2 billion a month from the lotto, STL and sweepstakes – by the Commission on Audit last year.

The government is still reviewing why the PCSO is regularly spending P78 million for TV shows promoting the office, when the lotto, sweepstakes and STL hardly need promotion in this land of bettors.

A storeroom in the PCSO yielded about half a million pieces of medical kits, in individual and family sizes, all bearing the image of then President Gloria Macapagal-Arroyo. The items, which might have been bought simply to give business to someone’s crony during the campaign period, are still usable and will be distributed to the needy. If you’re a businessman trying to bag that kind of contract with the government, will you also offer a clerk P5,000 to facilitate your papers?

Similar stories are circulating and deals are being unearthed in other offices. The new government has started looking into a $180-million deal, signed last January, for a Belgian firm to dredge the heavily silted Laguna de Bay. Experts have said that dredging, which will work to reduce flooding from the Pasig River and spillways, will not stop the lake from overflowing into the Metro Manila/Southern Tagalog floodplain during heavy rains. A department officer-in-charge refused to endorse the dredging deal and was promptly replaced; the replacement knew what was good for him and approved the contract.

The culture of corruption has spawned its own lingo. Grease money, without which the wheels of governance in this country turn exceedingly slow, is called padulas. “Kaliwaan tayo” is the polite suggestion to fork over the padulas, which is really nothing more than a shakedown, take it or leave it.

Businessmen, regardless of the size of their operations, should want an end to this culture, where they have to factor in corruption as an unavoidable production cost. But businessmen, like politicians, do what they can to compete and survive. If that’s the way we do business in this country, businessmen pay up and simply pass on the cost of padulas to consumers.

Crooks can survive and still keep the new bosses happy. A Customs collector, for example, can fulfill his quota and even add a bit for name recall when promotion time comes around. Anything beyond the quota he can keep as his bonus.

Several entrepreneurs, believing that they were victims of unfair valuation, were overheard grousing recently that they tried to haggle for a lower padulas when they were asked to fork over P1 million. They were told that if they didn’t like the P1 million, they would be assessed P2 million. Who can say no to savings of P1 million?

Can P-Noy end this system and make a dent against corruption?

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The problem is so frustrating that some new appointees have wondered aloud if systematizing corruption would be better. Put a “tong-pats” cap of say 30 percent and that’s it, from the bossing all the way down to the clerk who will carry documents to the photocopying machine.

When I mentioned this to some foreigners, the surprising reaction was that it might work, since it would bring a degree of predictability to the business environment in this country.

Foreign investors and diplomats have often pointed out that corruption is a problem almost everywhere in Asia. Their bigger headache in the Philippines is the unpredictability of the results of corruption. In other countries, their grease money gets the expected results. Not so in this country, where a substantial investment could be lost years after a deal has been signed and a project is ready for operation.

One of the biggest challenges facing the new Aquino administration is regaining investor confidence. Part of that task involves guaranteeing predictability even when kaliwaan is involved.

Because P-Noy has vowed to lead by example, the public’s minimum expectation is that there will be fewer corruption scandals involving Cabinet members, their relatives and friends.

Corruption in the lower levels of the bureaucracy could prove harder to eradicate. For poorly paid government workers, grease money can be irresistible.

A solution is to improve the system to cut red tape and plug opportunities for padulas. At Customs, for example, all shipment documents can be scanned from the moment the goods leave the port of origin until arrival at the destination and release, with copies given to auditors (not internal ones) who will conduct random checks for discrepancies.

Tax declarations of certain government personnel can be scrutinized, and bank secrecy laws can be eased.

There are ways of compelling transparency and honest governance. The new administration can surprise us with results.