Responding to Anas, Institutionally

Once again, ace investigative journalist Anas Aremeyaw Anas has shone a light on
another sordid corner of the state's creaky institutional superstructure.

And once again we respond with the same reckless hysteria with which we greeted
his 2010 exposé of cocoa smuggling along the country's western border: Fire
them! Prosecute them! Jail them and throw away the keys!


Most of these calls were of course heeded by the government, which even
increased troop presence along the borders ostensibly to curb cocoa smuggling.
But the practice continues. The smugglers simply weigh the potential benefits
against the cost and then take the necessary risks – like any savvy business
person would do. It may be illegal but it’s certainly not irrational.

The public's response to the latest exposé of corruption at the Tema Port has
been no different, with one commentator even suggesting that the corrupt
officials be executed.

But we've been there before, haven't we.

Over the years, we have fired and jailed and even executed, including three
former heads of state in 1979, and yet public sector corruption remains --
doggedly.


Not even the 'glorious 31st December revolution' of 1981 - which followed the
bloody 'house cleaning' of 1979 - could minimize it, much less eliminate it.

Proof of that came in 1999, when the queen of England visited Ghanaand President
Rawlings asked for her help in fighting corruption in his government – exactly
20 years after he presided over the execution of his three predecessors amidst
mass dismissal and incarceration of lower-level public officials who were
considered corrupt.

In the 12 years since then, Ghanaians have watched somewhat helplessly as
officials in high places dip their hands in the public kitty at will and
bureaucratic corruption, such as exposed by Anas, gradually eats away at public
confidence in the state. The jailing of some public officials for “causing
financial loss to the state” in 2001 was only highlight of a cosmetic attempt at
fighting corruption which, not surprisingly, barely deterred others from
stealing from the state later. Corruption, we were later reminded, was as old
as Adam.

While Anas deserves commendation for his enterprising work, the inconvenient
truth is that there is nothing substantially new in his latest revelations. As
far back as September 6, 2007, Ghanaweb ran a GNA story titled, '40,000 vehicles
escape payment of customs duty'.

In that story, an investigator hired by the Ministry of Finance expressed
concern about the “huge loss of revenue to the state [through] tax evasion, and
said the leakage was coming from some officials of the CEPS and the Driver and
Vehicle Licensing Authority (DVLA)”


The similarity of that story to Anas’s warrants extensive quotation here:

“The investigator said some officials of the CEPS and the VELD used the paid
duties of vehicles of already registered vehicles to register new ones.
In that instance, the officials collect data from the Ghana Community Networks
computer monitoring system for vehicles whose customs duties had already been
paid to satisfy the duty payment requirement for registering new vehicles.
In some cases, payment for a bicycle, motorbikes and fishing nets had been used
for vehicles that would have attracted higher duties when in reality nothing was
paid for them.”
The story speaks of a four-member committee established by the then finance
minister to “investigate allegations of operational malpractices at CEPS to
establish administrative actions against culpable personnel and identify
management weaknesses in dealing expeditiously with disciplinary matters.”

The committee, we were told, was “reviewing the systems, procedures, processes,
rules and regulations of CEPS in relation to its auction procedures to recommend
specific actions or alternatives of disposing of seized goods. The committee
would also examine the role of clearing agents, auctioneers and other related
matters.”

At about the same time, a study commissioned by the ministry found that
government was losing about GH¢3 billion (the cedi was roughly equivalent to the
US dollar then) in tax exemptions to a range of beneficiaries, including
diplomatic missions, NGOs and so-called foreign investors, at least one of which
used its exemption to import chicken eggs.

It is clear from the foregoing that corruption is an institutional not a
personality problem, transcending revolutions and governments. In the case of
the ports, cumbersome procedures, along with an irrational and prohibitive
tariff regime, only succeed in making criminals of otherwise decent and honest
citizens.


When a person buys a car abroad for US$2,000.00 and has to pay more than
US$3,000.00 in duties and other taxes through an inscrutable bureaucratic maze,
the temptation to beat the system becomes rational, even human, if not
defensible.

“Only fools like me pay duties,” said a New York-based Ghanaian lawyer familiar
with the madness at our ports. “The commercial importers don’t pay anything.
They would not make any profit if they did”.

Some defend higher tariffs in the name of revenue for development. But common
sense tells us that beyond a certain threshold, higher tax rates actually yield
less, not more, revenue through evasion or a decline in the underlying economic
activity.


Nor is it true that we need higher tariffs to protect and grow local industry.
What local industry actually needs are reliable electricity, affordable credit,
good infrastructure, a skilled and productive labor force, a competent
government, and of course efficient port services. Higher tariffs impede
development by raising the cost of doing business, suppressing industrial
growth, and of course suppressing job creation.


The illogic of punitive tariffs applies equally to cocoa taxes. So long as
government insists on paying farmers below-market prices, the rational incentive
to beat the system through smuggling will persist, damn the consequences.


The best response then to corruption is not the heavy-handedness, even the
draconian measures, of the past, or the emotional responses of the present, but
a continuous, credible, and transparent process of institutional regeneration
and policy recalibration, taking cognizance of changed circumstances and the
need to do things differently at different times for better results.


The evidence suggests that some efforts were made in this regard in the past,
but the fact that the rot persists at the ports and other corners of the
bureaucracy indicates that either not enough was done, or the wrong solutions
were applied, or some combination of these and other factors. Something
certainly went wrong somewhere.

Forceful, purposely and decisive leadership may well make the difference this
time around. Let’s give it a try.

Credit: Nii Moi Thompson