Grand Projects – Grand Corruption?
An excerpt from the Global Corruption Report 2008, published by Transparency International
In nature, water always flows downstream. In the geography of power
relations, clean water tends to flow to the rich and powerful, while
waste water tends to flow to the poor. An important reason for this
anomaly is corruption, which has contributed to a political economy
that favors large, capital-intensive projects over small-scale
approaches.
In recent years, institutions such as the UNDP and the UN Millennium
Project have advocated for a reassessment of large-scale infrastructure
in the water sector and a stronger focus on decentralized projects and
efficiency improvements in order better to meet the needs of poor
people. The Water Supply and Sanitation Collaborative Council warned in
March 2004:
“From India to Bolivia, Kenya to Nepal can be found the ruins of
now-defunct water and sanitation programmes that have never yielded
more than a fraction of the benefits expected. (…) Increasing the funds
available for further largescale, delivery-oriented infrastructure will
achieve very little without a re-think of how and for whom such funds
are to be spent.”
Nonetheless, decentralized approaches and efficiency improvements
continue to be neglected in water sector development. The UNDP stated
in its 2006 Human Development Report:
“While many governments extol the virtues of small-holder farming, most
concentrate scarce public investment on relatively large-scale,
capital-intensive commercial farming areas. That approach may be bad
for long-run growth and for poverty reduction. (…) Micro-irrigation may
be expanding rapidly, but it still covers only about 1% of the worlds
irrigated area.”
In Pakistan, World Bank evaluations found that water conservation
measures could save more water than new dams. In spite of this, the
country’s water bureaucracy suffered from a “build-neglect-rebuild”
syndrome and prioritized new investments over the maintenance of the
existing infrastructure.
Maximizing the opportunities for corruption is one of the key factors
that create a bias towards large, greenfield investment projects in the
water sector:
- Large, new investment projects award more political prestige and afford more centralized bureaucratic control than decentralized schemes and efficiency improvements where control and resource flows are more dispersed.
- Foreign financing can typically be attracted for investment projects, but not for infrastructure maintenance.
- Corruption tends to favour large-scale, capital-intensive projects because they are more likely to involve and benefit actors with deep pockets.
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In addition, bribes paid as part of large international projects
can often be siphoned off to foreign bank accounts, which corrupt
officials may consider safer than bribes for local projects which tend
to remain within the local economy.
In sum, corruption is an important factor that influences how vested
interests capture government decisions on the type and size of
infrastructure projects. The World Commission on Dams noted in its 2000
report: “Decision-makers may be inclined to favor large infrastructure
as they provide opportunities for personal enrichment not afforded by
smaller or more diffuse alternatives.”
However, it is important to note that local investment projects are by
no means free of corruption. Dipak Gyawali, a former Minister for Water
Resources in Nepal, points out that “corruption affects all projects,
small, medium and large”, and government-sponsored projects as well as
projects implemented by non-governmental organizations. Shekhar Singh,
convenor of India’s National Campaign for People’s Right to Information
and a former advisor to the country’s Planning Commission, explains
that in order to maintain power, a government apparatus will tend to
offer spoils to bureaucrats and power brokers at the local, regional
and central level. Typically, budgets therefore contain a fine balance
of pork barrel investments at all levels of government.
Labour-intensive self-help initiatives and the maintenance of existing
infrastructure are most likely to be neglected in systems captured by
corruption. These are precisely the types of approaches that have the
largest potential to reduce poverty. Ultimately, the poor which are
denied basic services pay the highest price for corruption in the water
sector.
Transparency and public participation in the planning process for water
sector projects, including the assessment of available options at an
early stage, are needed to counter the influence of corruption. After
stopping the large Arun III dam in 1995, civil society activists in
Nepal worked with local engineers, government officials and
entrepreneurs to promote a series of small hydropower projects. These
projects generated electricity at lower cost and for more rural
communities than Arun III could have done.