Corruption in the Nigerian Economy

ASTRACT
The paper has critically examined the harshness of corruption on the Nigerian economy and the support of civil servants in reduces its incidence. The ‘monster’ is the cause for the nation’s economy development impediment. Related literature of renowned scholars, white paper of the Dangin Commission (2000) of Plateau State and personal opinions of civil servants were major sources of data used for this paper. Again, we employed a survey instrument-questionnaire for collecting primary data and percentages were used for testing our hypothesis. According to our investigations, corruption in civil service is caused by Staff negligence and/or negligence of management and the more culpable persons are experienced public servants on level 10 and above, also political appointees. The best strategy of curbing corruption in Nigeria, as opined by respondents and supported by our hypothesis, is those saddled with the responsibility of fighting corruption must live above board and avoid creating bad precedent. Again, the Auditor-General and his/her subordinates should engage in a regular periodic inspection.

1.1 BACKGROUND OF THE STUDY
With the current global recession, the economies of most developing countries have been thrown into very serious problems. Stocks in the capital market in Nigeria, America and United Kingdom among others are experiencing the bearish market situations. Besides, Nigeria has other factors that have battered our economy seriously: these are no other things than the monster-corruption and the persistent political crisis. Measures such as the War Against Indiscipline (WAI), the Independent Corrupt Practices Commission (ICPC) and Economic & Financial Crime Commission (EFCC) have been employed and adopted by past regimes and administrations to curb the underhand practices but all proved abortive, while the economy recession is on the increase: how long should this continue.
According to a statement in one of the Daily Times of 1999, it says, “Decade after decade, children are born to see and learn of this enemy of development. Why should we allow this to continue, we need to joint hands on this criminal behaviour in other to protect present and future generations of our great country”.
Corruption has really been the bane of this country; all hands must be on deck. Nigeria was grouped as the 2nd position and the 6th position of the world most corrupt countries. The sequence of the positions above shows little improvement which is not significant for stopping the worry of patriotic Nigerians on the matter. The instinct for corruption normally begins with ungratefulness and greediness. As stated by Malick, 1994:68; “The origin of corruption is that it is influenced by the quest for more material wealth”.
According to Bureau for Public Procurement (BPP: 2008), Nigeria losses 60 kobo to underhand practices out of every N1 (100 kobo) spent by government. The wealth of this nation is being looted by the few privileged individuals known as civil servants and politicians who are busy acquiring their ill-gotten wealth by inflating contract, diverting public assets into personal property and etcetera. Corruption has really ruined our economy in different ways.
According to Akara (1994:12), Corruption, in all its ramifications in any society is the symptom of the moral indiscipline and moral decadent that can only be arrested and the society regenerated, if and only if that society itself becomes aware and conscious of its dangerous descent into the abyss of self-extinction.
Corruption has really affected the public sector and has spilled to other sectors of the economy such as private sector businesses and households. In view of the yearly reports of the Nigeria Deposit Insurance Corporation (NDIC) and the various white papers issued in Plateau State-Nigeria, year-in-year-out, many people are initiated into the different forms of these sharp practices. A recent revelation made by the Plateau State Commission of Enquiry into Financial Activities of government for 1999 – 2007, the State Board of Internal Revenue generated about N24 billion (approximately $210 million) but less than 25% of the revenue was account for, more than 75% of the revenue is allegedly embezzled.
The issue of corruption in the public sector is perpetrated in a syndicate where both civil servants and political appointees are involved.
A study on why corruption flourishes in the public sector might be expected to provide a useful insight into the strategies to be adopted to minimize this evil. It is also expected that the existing government will learn from the experiences of past leaders, who have failed in their efforts to curb the menace of this underhand practices by given leap service for implementation of measures the country has put in place to help in reducing the cases and magnitude of corruption in the public sector and indeed the country as a whole.

1.2 STATEMENT OF THE PROBLEM
Though, the public sector is the machinery of government in achieving meaningful development in the area of infrastructures, education, health and etcetera, the failure to achieve any of these developmental goals is due to an array of problems. Of these problems, the issue of corruption is one that has eating into the fabrics of our economy and the need to manage its scourge is imperative.
The efforts of the Independent Corruption Practices Commission (ICPC) and the Economic & Financial Crime Commission (EFCC) have done little in curbing this monster as cases and magnitudes of corruption is still significant compared to the poverty level in this country. According to 2006 NDIC annual report (2008), billions of Naira are lost to fraudsters and other dubious people annually. In the survey conducted between 1999/2000 by CPAR, an average of $10 billion is lost to corruption (BPP: 2008). This cannot be allowed to continue, never! The magnitude of this problem and its implications for the Nigeria economy have inspired the writing of this paper with a view to having all hands on deck in fighting this evil in Nigeria.

1.3 OBJECTIVES OF THE ARTICLE
The aim of this paper is to assess the views of civil servants about the effort of government against corruption in the Public Sector in Nigeria and to proffer suggested approaches on how to minimise it.
To achieve this singular objective, the following secondary objectives have been specified:
i) To review existing literatures on the subject matter;
ii) To identify the causes of corruption perpetrated in the Public Sector;
iii) To determine the negative effect of corruption in the Public Sector;
iv) To ascertain the major perpetrators of corruption in the public sector.
v) To recommend strategies for curbing and reducing the incidence of corruption in the economic system of Nigeria.
1.4 RESEARCH QUESTIONS
In the light of the foregoing, the following questions may be asked:
i) What are the ways of defrauding the public sector?
ii) What are the major causes of corruption in the public sector?
iii) What are the effects of corruption in the public sector?
iv) How can the problems of corruption be managed in our public offices?
v) What are the best ways of mitigating the effects of corruption in Nigeria?
vi) Who are the major contributors to corruption in Nigeria?
vii) Who are the most culpable people involved in corruption.
These questions form the problem that prompted the writing of this paper and the need to provide workable answers to them constitutes its justification.
1.5 HYPOTHESIS
To achieve some of the objectives of this paper, the following hypothesis is formulated:
Ho: That civil servants being the most culpable persons in corruption in Nigeria are not in support of the fight against the “Monster”;
HI: That civil servants being the most culpable persons in corruption in Nigeria are in support of the fight against the “Monster”.
This hypothesis will be tested with percentages of collective opinions of civil servants as obtained from the field.

1.5 SCOPE AND SIGNIFICANCE OF THE STUDY
This paper is relevant to what the Obasanjo’s government started which the Yar’adua’s administration is trying to sustain, specifically on their efforts to wipe out all forms of corruption in Nigeria. The settings up of the Anti-Corruption Act’2000, Anti-Money Laundry Act’2004 and the Economic and Financial Crime Commission (EFCC) in 2004 are all proofs that the Nigerian government is really fighting corruption, and requires support from all patriotic Nigerians to join hands against this evil that is pervading the society.

2.0 REVIEW OF LITERATURE
2.1 Definitions of Corruption: Anti-Corruption Law of the Federal Republic of Nigeria 2000 defined ‘Corruption’ “to include all forms of bribery, fraud and other related offences”. A corrupt practice takes place when one in a fiduciary position acts in a manner prejudicial to the cause of his employer because of the receipt of a benefit or consideration from a third party who is ultimately the beneficiary of the action taken, (Ijewere, 1999).
According to Osisioma (1999), corrupt practices tend to produce an illegal transfer of resources, and in the transfer exercise, the actors engage in an unproductive use of their labour and resources.
Obasanjo (1994) defines corruption as the misuse of public power for private and personal benefit which is distinguishable from other crimes by the fact that it is usually carried out in utmost secrecy and the act itself may not be immediately perceptible.
In its tactical meaning, corruption is an act or course of deception deliberately practiced to gain unlawful or unfair advantage; deception directed to the detriment of the public.
2.2 FORMS OF CORRUPTION AND WAYS OF DEFRAUDING GOVERNMENT.
Corruption is perpetrated in the civil service in various forms. The two major forms are petty corruption and grand corruption. The common ones have been identified and classified as follows:
a) Inflating of contract prices;
b) Diversion of government property to personal property;
c) Collection of bribes or gratification;
d) Teaming and Lading;
e) Irregularities;
Many measures have been introduced, especially at the individual Ministry, Boards and Parastatals to minimize this menacing problem without much success, (Danging Commission,2000).
2.3 CAUSES OF CORRUPTION IN THE PUBLIC SECTOR.
The common causes of corruption as identified by different Authors and Newspapers are summarized below:
i) Poor Administration – This is in terms of inadequate supervision, and inadequate control is the most significant causes of corruption. For instance, when a junior staff is inadequately supervised, those with fraudulent tendencies may get the wrong impression that there working environment and/or circumstances is safe for the perpetration of corruption, (Ishola, 1997:25).
ii) Negligence – Staff negligence and/or negligence of management is the commonest and most susceptible factor which corrupters look forward to in government establishments and they usually capitalize on it. For instance, lack of regular bank reconciliation, stocktaking, verification of prices in the market and issuing of cheques without proper blocking of the unused space could be manipulated by the perpetrators, (Babatunde, 1987:16).
iii) Poor Salaries and Conditions of Service – When civil servants are unable to meet their personal, psychological and social needs because of poor salaries and conditions of service, they may be tempted to collect bribe, inflate contract price, inflate prices of goods/items purchased directly, embezzle money or fraudulently convert some of the government assets into their own use. This temptation becomes harder to resist particularly for civil servants who work with cash or in other sensitive areas, (Dandago, 1997:16).
iv) Opportunity and Low Chance of Detection – A poor or inadequate internal control or inefficiency of existing control could induce corruption. A poor or inefficient control system could also be a tempting source to a rather previously honest staff, (Williams, 2000:24).
2.4 THEORIES OF CORRUPTION
Attempts have been made to weave the aforementioned factors into comprehensive theories of corruption and criminal behaviour. Theories of corruption are terse and controversial, Babatunde (1987) has propounded that the motivation to fraudulent behavior derives from the number of causes. These could be pathological, greed, the desire to be with the Jones; extreme; want often characterized as dire need; cultural demands or the cultivation of tastes too expensive for the legitimate income of the individual. Criminal motivation, with particular reference to corruption is said to be pathological when the state of mind of the criminal disposes and impels him to engage in corrupt practices, even though he is not in dire need of the resources. A case in point is a kleptomaniac who has a pathological desire to steal for the sake of stealing.
Osisioma (1999) opined that the main cause of corruption in the public sector is traceable to the general dishonesty in the society. Since there is corruption in all facets of the Nigerian life, management of finances should pay attention to some of the factors that causes corruption in the public sector.

2.5 THE EFFECTS OF CORRUPTION IN PUBLIC SECTOR
The perceived effects on the government, and the desire to find the means of curbing such adverse effects normally prompts studies on corruption in the Public Sector. Attempts have therefore been made by many writers to identify the effects of corruption in the Public Sector and the economy in general.
All authors/writers agreed that corruption leads to huge loss of resources, which belong to the government, and members of the general public. This loss results in reduced levels of resources available, which could hamper the development of the economy and could force enterprises to liquidation if the frequency and scale of corruption are high.
Other effects of corruption in the public sector, which will consequently affect the society, include the loss of confidence in Nigeria by international investors and therefore a setback for the effort aimed by the Obasanjo’s administration to create enabling environment for international investors to invest. In addition, the distraction of government’s attention, increase in operating costs, and the wastage of time and resources on minimizing corruption are other effects of corruption, (BUGAIN; 1994:91).

2.6 THE MEASURES FOR CONTROLLING CORRUPTION:
In view of the gravity of the effects of corruption on public sector, government has employed many measures aimed at controlling corruption. However, corruption has continued on an upward trend despite these measures and this has called their effectiveness into question. According to Jat (1998:129), the most threatening aspect, however, is that the control of an identified specie of Fraud (corruption) seems to give birth to another that is invariably more sophisticated and complex indicating the negative use of human ingenuity and endowment.
A number of authors: Obasanjo, Osisioma, and Malick among others, have identified some administrative control systems that can be devised by government to prevent corruption. Administrative control system has been defined as “the whole system of controls, financial and otherwise, established by the government in other to carry on the business of government in an orderly manner, safe-guard its assets and secure as far as possible the accuracy and reliability of the records”. (Millichamp, 1990:79)
Internal administrative control system was classified into two major groups: internal checks and internal audit. Internal checks are the operational controls which are built into the public sector system to simplify the processing of policies in order to secure prompt services to the populace, to help in minimizing clerical errors and to act as insurance against collusion.
Internal audit or inspection involves the review of administrative activities and records undertaken within the civil service by specifically assigned staffs. The roles of the inspectorate division and the state Audit department are to serve as watch-dogs on public funds, to ensure that there is no improper application of these funds, to ensure that expenditure and revenue are duly authorized and accounted for, to periodically inspect account books in order to ensure that transactions are properly recorded and books are regularly balance, to investigate mal-practices like frauds, inflated contracts, forgeries, embezzlement and theft of government money or properties.
However, existing systems of control can be classified into two: Prevention and Detection.
Those aimed at prevention and those aimed at detection. Measure aimed at preventing corruption include; dual control, operational manual, graduated limits of authority, reporting system, establishment of inspectorate units, general personnel policies, referencing on presentation of documents of value, segregation of duties, verification of all approval for payment and purchases and close watch on the life-style of staff.
Others are prompt treatment of files and the movement of files by messengers.
Measures aimed at detecting corrupt practices include: contract verification, market survey, checking of cashiers, bank reconciliation, periodical submission of statement of accounts, periodic stock-taking of all items in the store.
In addition to management and internal control measures, the authors suggested means of controlling corruption in the public sector, which are the statutory requirements of an external auditor and the examination of government books of accounts by the state audit department as an inspectors’ authority.
Sanusi attributed the ineffectiveness of these to weakness in staff policy and control, operational procedures, and the attitude of government. In contrast, some other writers such as Obasanjo, Malick, Osisioma (2000) have argued that the causes of corruption in the public sector is not that of lack of administrative control systems but that of moral weakness of man’s mind owing to his acquisitive instincts.

3.0 DATA PRESENTATION AND ANALYSIS
To substantiate our research questions earlier mentioned, data collected from Plateau State civil service, the Dangin Commission Report (2000) and responses from our field survey is hereby presented in tabular form with proper analysis below. This will be presented using percentages as a parameter.
3.1 PRESENTATION AND ANALYSIS PRIMARY DATA
Table 1 shows the Responses of respondents from the Field Survey
QUESTIONS No. 0F RESPONSE %
1. Which of the following ways do you thing civil servants are using mostly to defraud the government? Tick one, please:
i. Contract price and purchase price inflation….
ii. Collection of bribes or gratification………
iii. Diversion of government property to personal property……………………
iv. Teaming and Lading……………………
v. Robbery and Burglary…………………….
TOTAL

13
16

6
3
2
40

32.5
40

15
7.5
5
100
1. Which of these are the major causes of corruption in the public sector? Tick one, please:
i. Poor Administration
ii. Staff negligence and/or negligence of management
iii. Poor Salaries and Conditions of Service
iv. Opportunity and Low Chance of Detection
i. TOTAL

11

12
7
8
40

27.5

30
17.5
20
100
2. Which of the following form of corruptions do you thing has the more negative effect on the Nigerian economy?
ii. Grand corruption: that is, corruption involving N100,000 and above
iii. Petty corruption: that is, corruption involving less N100,000
i. TOTAL

22

18
40

55

45
100
3. Suggest ways in which problems of corruption can best be managed in our public offices by ticking one of the following?
ii. Sound internal control system
iii. Internal check and internal audit
iv. Periodic inspections by the Auditor-General
v. Instituting an EFCC outlet in every government ministry
vi. Instant dismissal of dubious and suspected corrupt officials
TOTAL

6
8
12

5
9
40

15
20
30

12.5

22.5
100
4. Who amongst these are the most culpable people involved in corruption?
i. Level 01- 06 employees
ii. Level 07 – 12 officers
iii. Level 13 – 16 officers
iv. Level 17 and all political appointees
TOTAL

5
10
12
13
40

12.5
25
30
32.5
100

From the above analyses, 40% of the respondents opined that the most common ways that civil servants used for defrauding the government is through bribery and gratification. For the causes of corruption in Nigeria, 30% of the respondents indicated that staff negligence and/or negligence of management is the major cause. However, most civil servants have opined that grand corruption has more negative effects that petty corruption. This finding is 55% against 45%. Again, 30% and 22.5% of the respondents have indicated that the best ways to manage corruption are Periodic inspections by the Auditor-General and Instant dismissal of dubious and suspected corrupt officials, respectively. Lastly, the survey has revealed that the most culpable persons are civil servants on level 17 and all political appointees, followed by civil servants on level 13 – 16.

Table 2 is a Likert Questions Table containing a list of suggested strategies for curbing corruption in which 150 respondents (Civil Servants) indicated their agreement or otherwise and to what extent.
Note. Questions 1–5 were answered on a 5-point Likert-type scale ranging from 0 (strongly agree) to 4 (strongly disagree).

Question 0 1 2 3 4
1. Employer should verify the integrity of new employees from their referees
32
34
8
46
30
2. Any identified fraudulent person should be instantly dismissed and made to face the full wrath of the law
55
39
13
23
20
3. The fight against corruption should commence right from homes and schools
41
48
9
20
32
4. Those saddled with the responsibility of fighting corruption should try and live above board and avoid creating bad precedents

72

56

2

8

12
5. All civil servants and political appointees should declare their assets on assumption of duty
52
50
16
22
10

From table 2, 48% of the respondents strongly agreed that those saddled with the responsibility of fighting corruption should try and live above board and avoid creating precedence. This is followed with the opinions of 37% of the respondents who strongly agreed that any identified fraudulent person should be instantly dismissed and made to face the full wrath of the law while 35% also agreed on strong terms that all civil servants and political appointees should declare their assets on assumption of duty. However, 32% of the respondents merely agreed that the fight against corruption should commence right from homes and schools while majority disagree that employer of labour (government) should verify the integrity of new employees from their referees as a strategy for curbing corruption.

TEST OF HYPOTHESIS
The responses from the field survey in table 2 above are used to test the hypothesis that says “That civil servants being the most culpable persons in corruption in Nigeria are not in support of the fight against the monster”

Question 0 1 Total (0&2) 2 3 4 Total Grand
(3&4) Total
1 32 34 66 8 46 30 76 142
2 55 39 94 13 23 20 43 137
3 41 48 89 9 20 32 52 141
4 72 56 128 2 8 12 20 148
5 52 50 102 16 22 10 32 134
479 223 702
To accept the null hypothesis, the percentage of disagreed responses must be greater than 50% otherwise reject it and accept the alternative hypothesis.
Percentage of agreed responses = 479 x 100 = 68%
702 1

Percentage of disagreed responses = 223 x 100 = 32%
702 1

Hence, we reject Ho that says, “Civil Servants being the most culpable persons in corruption in Nigeria are not in support of the fight against the “Monster” and accept HI that says, “Civil Servants being the most culpable persons in corruption in Nigeria are in support of the fight against the “Monster”.

4.0 SUMMARY, CONCLUSION AND RECOMMENDATION
Based on the study, the paper can be summarized with the findings that factors such as: Contract price and purchase price inflation, Collection of bribes or gratification and diversion of government property to personal property are most common ways in which civil servants used in defrauding the government.
For causes of corruption in Nigeria, Staff negligence and/or negligence of management, Poor Administration, and Poor Salaries and Conditions of Service got the highest votes in that order.
It has been opined that the best ways for managing corruption in our various public offices include Periodic inspections by the Auditor-General, Instant dismissal of dubious and suspected corrupt officials will serve as deterrence against future occurrence in addition to internal check and internal audit. All civil servants are culpable to corruption but the most of them all are directors and political appointees.
In conclusion, corruption is a menace that is found in all the fabrics of the Nigerian society and the Auditor – General and all his employees should do their work honestly and diligently too now corruption is spreading like wild fire in Nigeria inspite of government stringent policies that have been instituted.
In conclusion, since civil servants who are even the most culpable persons in corruption in Nigeria are in support of the fight against it, government should not relent in its fight against corruption as there seems to be light at the end of the tunnel.
Hence, this paper recommends the following measures for minimizing corruption in Nigeria:
i. Accounting officers/Chief Executive Officers should live above board and avoid creating precedence.
ii. All identified fraudulent person should be instantly dismissed and made
to face the full wrath of the law.
iii. All civil servants and political appointees should declare their assets on assumption of duty.
iv. The fight against corruption should commence right from homes and schools.

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