A professor from the Jawaharlal Nehru University recently commissioned a study which found that until the 1980s the biggest scam that had surfaced in the public was Bofors, involving what seems today a measly figure of Rs 64 crore. The next decade, i.e. 1991-2001, saw 26 scams that involved losses to the exchequer exceeding Rs 1000 crore. And then, the student had to give up his study after accumulating a list of at least 150 scams, each exceeding Rs 1000 crore, for just the period 2005-08. This exponential growth of corruption in India after ending the license-permit raj and introducing the LPG (liberalization, privatization, globalization) policies in the hope of reducing corruption is no mere coincidence.

Corruption in India has grown to alarming proportions because of policies that have created enormous incentives for its proliferation, coupled with the lack of an effective institution that can investigate and prosecute the corrupt. Under the garb of liberalization and privatization, India has adopted policies by which natural resources and public assets (mineral resources, oil and gas, land, spectrum, and so on) have been privatized without transparency or a process of public auctioning. Almost overnight, hundreds of memorandums of understanding (MoUs) have been signed by governments with private corporations, leasing out large tracts of land rich in mineral resources, forests and water. These allow the corporations to take away and sell the resources by paying the government a royalty, usually less than one per cent of the value of the resources.

The Karnataka Lokayukta, Justice Santosh Hegde, recently pointed out in a report on mining in Karnataka that the profit margins in such ventures often exceed 90 per cent. This leaves huge scope for bribe giving and creates incentives for corruption. The same thing happened when A. Raja, without going through a public auction, gave away spectrum to companies at a fraction of its market price. Private monopolies in water and electricity distribution, airport development, and so on, have been created, where huge and unconscionable levels of profit can be made by corrupting the regulator and allowing private monopolies to charge predatory prices. Tens of thousands of hectares have been given away to corporations for commercialization in the guise of airport development, construction of highways, creation of Special Economic Zones and so on, at what appear throwaway prices.

 

Apart from creating huge incentives for corruption, such policies have also resulted in the involuntary displacement of lakhs of poor people, leaving them on the brink of starvation, even forcing some to join the Maoists. The beneficiaries have stripped the land of natural resources (a good deal of which is exported) and destroyed the environment. Most ominously, such deals have resulted in the creation of monster corporations that are so powerful and influential that they have come to influence and virtually control all institutions of power, as we see from the Niira Radia tapes.

While adopting policies that create huge incentives for corruption, we have not set up effective institutions to check corruption, investigate and prosecute the corrupt and bring them to justice. The Central Bureau of Investigation (CBI) continues to be under the administrative control of the government, which is seen as the fountainhead of corruption. Thus, action is rarely taken by the CBI to effectively investigate high-level corruption, except in the rare instances when the court forces its hand. Often we see the CBI itself behaving in a corrupt manner, with no other institution to investigate that.

The Central Vigilance Commission (CVC), mandated to supervise the CBI, has failed to act, since its own appointment process is riddled with conflict of interest. The Prime Minister, the Home Minister and the Leader of the Opposition want to avoid their own accountability and are thus interested in having weak and pliable individuals to man the institution expected to supervise the CBI. Moreover, both the CVC and the CBI have to seek the government’s prior sanction to investigate and prosecute wrongdoers; such sanction is usually denied when it comes to high-level corruption. The CVC depends on vigilance officers in various government departments who are often middle-level officers from the same departments and thus cannot be expected to exercise vigilance over their bosses who write their confidential reports. The judiciary, which must try and convict the offenders, too has become dysfunctional and is afflicted with corruption due to a lack of accountability of the higher judiciary.

 

The draft Jan Lokpal bill seeks to create an institution that will largely be independent of those it seeks to police, and have effective powers to investigate and prosecute all public servants (including ministers, MPs, bureaucrats, judges and so on) and others found guilty of corrupting them. Since corruption involves misconduct and gives rise to grievances, the draft also proposes that the Lokpal will supervise the machinery (the vigilance department) to pursue disciplinary proceedings against government servants as well as the machinery to redress grievances. Thus, both misconduct by government servants and grievances will come under the ambit of an independent authority rather than the government, whose machinery has become ineffective due to conflict of interest. It is further proposed that if the Lokpal finds that a contract is being awarded for corrupt considerations, it can stop the contract process. It cannot otherwise interfere with government decisions or policy.

 

It is often alleged that this would create a super-cop with enormous powers and no accountability. There is a misconception that the proposed Lokpal will also have judicial powers; there is no such provision in the bill. The need of the hour is to have an effective cop who can investigate and prosecute the high and mighty without interdiction from the very people who need to be prosecuted.

The bill seeks to make the Lokpal accountable. First, the Lokpal is mandated to work transparently so that everything related to its functioning is known to the people (without compromising the investigation itself). Exemptions from disclosure provided in the Right to Information Act could be included. Second, the Lokpal’s orders will be subject to review in the High Courts and the Supreme Court. Last, any of the 11 members of the Lokpal could be removed for misconduct by a five-member bench of the Supreme Court, whereas all the officers under its supervision will be accountable to independent complaint authorities that will be set up in each district.

In order to maintain the independence of the Lokpal, it was decided following many consultations that the selection committee should consist of the PM, the Leader of Opposition, two Supreme Court judges, tow High Court judges, the CAG, the CEC and the three previous Chairpersons of the Lokpal. This broad-based committee was envisaged so as to avoid a conflict of interest observed in the appointment procedure for the CVC, which has often resulted in weak and pliable individuals being appointed.

 

It has been said that putting the function of redress of grievances on the plate of the Lokpal would make its work unmanageable. However, it is important to remember that the Lokpal will function only as an appellate body for grievances, which will have first to be sent to the grievance redressal officer attached to each office of each public authority. Further, only those grievances arising out of a violation of the citizen’s charter, which is mandated to be made for every public authority by the UNCAC (United Nations Charter Against Corruption) will be considered .

Thus, the Lokpal will only cover grievances arising from duties which should have been fulfilled by the public authority in a time-bound manner, but were neglected due to some extraneous consideration, usually the expectation of a bribe. This mechanism will also help strengthen our existing public machinery because the grievance redressal officer will be the one held responsible and on whom a fine can be imposed for the improper functioning of his/her office.

Another significant aspect of the Jan Lokpal bill is the fact that it also addresses corruption arising from the dealings between the state authorities and private corporations, specially with respect to transfer of national resources like land, water, minerals, and so on, by:

a) mandating that any transfer of natural resources must take place in a completely transparent manner through public auctions, unless it is not possible, in which case reasons must be recorded in writing;

b) directing that no government servant can wilfully take up a job/consultancy with a private corporation for benefit if he/she has dealt with their file in an official capacity while serving in government; and

c) directing that if any private entity is convicted under the Prevention of Corruption Act for abetting an act of corruption (i.e. for bribing a public official), then the company concerned and any other sister-company will be blacklisted for any government transaction in future.

In addition, the very definition of ‘act of corruption’ also includes ‘obtaining any benefit from any public servant in violation of any laws or rules’, which would include any license, contract or largesse which has been obtained by any private corporation in violation of laws and procedures laid down by any competent authority.

 

One must not, however, be under any illusion that the Lokpal law by itself will solve the problem of corruption. Unless we tackle and change the policies that create enormous incentives for corruption, and monster corporations that have become too powerful for any institution to control, the fight will remain incomplete. The judiciary too is in need of comprehensive reforms. But setting up an independent, credible and empowered Lokpal is a first step, a necessary, though not a sufficient, condition to effectively control corruption. Let us at least work together to put that in place.