How to check it?

Prof. S. Sabir A. Jaffery
Jan 03 - 09, 2005



Corruption, like malignant cells, has penetrated deep through the fibers of our society. It has grown massive in size and multidimensional in nature. Its manifestations are widespread. Any attempt to illustrate them would be a futile exercise since the majority of the populace is already seized of them. There would hardly be a person who, directly or indirectly, in one way or the other, would not have fallen prey to them.

There may be several reasons for our gradual but continuous ruin. But, the basic derangement that is the root cause of all our failings, which underlines all our shortcomings, and which counters all the corrective measures, is corruption.

Moreover, the gene of corruption is the financial corruption. It is the mother figure that nurtures all other species of corruption. Obviously, therefore, if financial swindlings alone are contained, all other channels of misdoings and misgivings are likely to, if not fully dry up, at least flow at low ebb.

Nationwide awakening is needed on this issue. Lately, people at the helm of affairs seem to have turned on the alert. NAB's seminars on corruption vividly indicate government's concern to disseminate the devastation this menace has in its fold. It is high time that any body, who may have any thing in his quiver to hit right at its roots, should come forward with his prescription.

Once we reach the conclusion that corruption is the basis of all other evils, the question that arises next is, how to check it? It is a million dollar question that remains unanswered, despite superabundant rhetoric. What is more alarming is the common belief that the situation is, or at least seems to be, incorrigible. The disease has since been diagnosed. Great many amulets have been proposed. Several consultant physicians, both indigenous and hired from IMF health clinic, assumed in rotation charge of the 'patient', each claiming his prescription to be the panacea, devolving on himself the Kar-e Masihai, and claiming to bring the dead to life. Yet the relief is not forthcoming. On the contrary, we are heading fast toward a total collapse. Why is it so? What is that which is instrumental to such an undying devastation? The sooner an answer to this question is found, the better it would be for our financial health, thereby leading to an overall convalescence.

The most widely proclaimed line of action for eradicating corruption is to strengthen the accountability process. The proposition, although sounds expedient, is not an unmixed blessing. Punitive actions, no doubt, have their own impact. However, they cannot be the substitute of preventive measures.

Corruption is an attitude of life. It is a behaviour of human being. It has, therefore, to be dealt with in consonance with the human nature that prefers material possessions and physical comfort to moral values. In order to win over this nature of mankind, it is immensely desirable that emphasis should be shifted from punishing the corrupt to preventing the corruption.

This does not, however, mean that corrupts should be allowed to go scot-free. It rather suggests that priority should be given to creating the conditions in which resorting to corruption becomes, if not impossible, at least difficult. Simultaneously, systematic and consistent efforts should be made to strengthen the moral fiber of the society to operate as a deterrent against all sorts of misdoings. Impartial, judicious, transparent, and brazen-handed accountability culture should also coexist, although to be looked upon as a last resort. This, of-course, refers to future. Accountability for crimes already committed should be fast and meaningful.

It may be argued here that severe punishment operates as deterrent against crime. This is not an unmixed truth. The Consent or Acceptance Theory of Managerial Authority presents limitations to this phenomenon. One may possess formal authority, which is meaningless unless it can be effectively exercised. And an authority can only be exercised effectively if those on whom it is exercised accept it. It is, therefore, the attitude of the individual convict that determines the impact of punishment. Habitual criminals don't care even for life terms. Capital punishment also fails to tame the hardened outlaws.

There are also the ethnic and emotional repercussions, instantaneous reactions, and ancestral traditions that at times stimulate crimes. Suicidal bombing, KaroKari honour killing Vani Girls trade-off blasphemous retaliations, ethnic killings and different kinds of terrorist activities are the examples to quote.

Moreover, punishments often convert the casual wrongdoers into hard-liners. Again, wide-ranging and indiscriminate punishments create an atmosphere of fear and apprehension, which tends to vitiate initiative and decision making capability.

Lastly, punishment for one offence can be averted by committing another. As an Urdu verse reads:

Leke rishwat phansgaya hai deke rishwat choot ja

(if entangled by taking bribe, get off by offering the bribe)

What, therefore, we actually ought to ensure is that the crimes which have not been committed shall not be committed. This needs a socio-cultural set up that has built-in checks to discourage wrong doings.


The first and the most effective step in this direction is to enforce complete documentation of financial transactions in all walks of life. Ours is a cash-ridden society. Most of our day-to-day financial transactions are settled in cash. This, on the one hand, facilitates embezzlement, and, on the other hand, makes it difficult to lay hand on the culprit for want of adequate proof. The underlying temptation encourages swindlers and borderline wrongdoers to adopt wrongdoings as a permanent way of life. Hence, tax evasion, bribe, commission, kick back, misappropriation, fraud, embezzlement, and all sorts of financial swindlings flourish in a cash-nurtured society. We have to dispense with this culture if we want to have financial discipline in our ranks.

In cases where documentation becomes unavoidable, a small part of the money involved is declared, while the remaining major part changes hands surreptitiously. The most glaring example is that of undervalued registration of sale deeds of immovable properties. This is how the vendor evades wealth tax, the vendee saves the duty on the amount paid beneath the table, and the functionaries of the sub-registrar's office get their share of butter and honey. The only loser is the public exchequer.

These transactions take place right under the nose of the people at the helm of the affairs, inflicting on the exchequer a loss of millions of rupees every day in the wake of the persistently deficit budgets, smashing the national economy year after year. All concerned have turned deaf ears towards such a massive monetary swindling, as it serves their vested interests, notwithstanding the cost the nation has to pay for it.

This is one example to symbolize the pecuniary corruption while there are many more, which like the termite are eating up the roots of our national economy.

In September 2002, when it had already become exceedingly overdue, the Government of Sindh issued The Stamp (Sindh Third Amendment) Ordinance 2002, whereby stamp duty on all sorts of conveyance deeds regarding movable and immovable properties was reduced from 5% to 3%. Further, registration fee was also slashed down from 1.5% to 1%. Although belated, it was a step in the right direction that should have encouraged documentation of these transactions for the full amount of the deal.


Overbearing rhetoric, tall claims, and ill-conceived, half-baked, or impracticable measures, or the measures pursued with low or no commitment, lead to nowhere. Money, time, and energy spent on them go down the drain. These rather add one more layer of frustration to the morale of an already dejected nation.

What is needed is just one bold step to turn the corner. It should be self-contained and self-controlled, that is to say, a one-time action that needs no monitoring or follow up for being continuously operative. A three-in-one step as stated thereunder shows adequate potential to take up the glove with success.

Financial transactions in cash in excess of the prescribed limit should be declared illegal through an Act of Parliament. Violation of this law should be treated as an offence attracting exemplary punishment.

No debt or financial obligation, public or private, for amount exceeding the prescribed amount should be recognized by law as paid or settled, unless it is paid through approved banking channels. In other words, currency notes should not remain legal tender for exchange of goods and services and settlement of debts beyond the specified amount.



Currency notes of the denomination of Rs.500 and Rs.1,000 should be demonetized, and their value credited into bank accounts of the owners, without requiring them to declare the source of acquisition. The decision to issue currency notes of the denomination of Rs.5,000 should be revoked forthwith.

The cash-free culture that would emerge as a result of this three-fold step will be self-maintainable. No person on earth will be willing to acquire or possess the money, which he will not be able to use. Money is a means, not an end. When it ceases to serve the end, it becomes non grata. Thus, there will be no violation of this law, and, therefore, no monitoring or supervision by any government agency or functionary will be needed to ensure its unhampered implementation.

In the recent past, government had made an attempt to pay by cheque salaries to its employees of specified grades. However, a short while later, the practice was abandoned. Such decisions are the test of the nerves of the decision makers. Obviously, rulers toiling under their own weaknesses could not withstand the resultant pressure from interested quarters. Again, under yet another decision, any payment of Rs.50,000 or more, other than by crossed cheques, bank drafts, or payment orders, would not qualify for tax credit, adjustment or deduction, or refund or draw back, or zero rating of tax. These measures denote a half-hearted beginning of a really good job, whereas what is desirable is a full-blown action in one go for the nation as a whole, leaving no room for its sabotage by vested interests.

To achieve this objective, developing of banking habits and popularizing of cheque currency are prerequisites. As a positive step in this direction, a few years ago, the government withdrew excise duty and withholding tax on cheques, payment orders, and other modes of remittance. Surprisingly, banks in the name of "cheque book issuing charges" reimposed this financial burden on the accountholders. To start with, the rate of service charges was kept the same as it was of the government excise duty, i.e. Rs.2 per cheque leaf, probably to camouflage this ill intended manipulation. Later the rate was raised to Rs.62 for 25-leafs chequebook, and now certain banks are charging @ Rs.3/- per cheque leaf. This is unprecedented and unjust, and should be withdrawn forthwith.

Adding fuel to the fire, banks with the collaboration of the State Bank of Pakistan, arbitrarily penalized the accounts maintaining less than Rs.5,000 credit balance with Rs.50/- per month service charges. Even a shortage of Re.1/- even for one day would attract the penalty for the whole month. No body cared to know that how many Pakistanis were there who could deposit Rs.5,000 with a bank and forget it for all time to come, keeping in view that to have a bank account is no more a luxury. One is at a loss to understand why the SBP surrendered to the banks' unlimited hunger for profit. Last year, banks earned profit in millions and billions. What was the rationale behind adding mole to the mountain at the cost of small accountholders? Further, there is no check on banks' freely and excessively violating the conditions imposed by the SBP as a pre-requisite to this unwanted practice.

In the wake of these two most ill-conceived decisions issuance of Rs.5,000 currency note and levying service charges on accounts with balances less than Rs.5,000 it will be hoping against the hope that any serious attempt is intended to be made to discourage financial corruption.

One more obstacle in the way of the popularity of cheques was the lack of effective legal cover against their dishonour. Although, under The Banking Companies (Recovery of Advances) Act, 1997 and the Recovery of Loans Ordinance XXLVI promulgated in 2001, it has been made a criminal offence to issue a cheque that would not be honoured, the acceptability of cheques in day-to-day settlement of financial transactions is still non-existent. The reason is our time-consuming and cumbersome legal procedure that ends in "justice delayed is justice denied".

Yet another excuse usually put forth against augmenting the use of cheques is the low literacy rate in Pakistan. How strange! Instead of making any serious efforts to raise the literacy level, we use it as pretence for our sluggishness. Surprisingly enough, with the same level of illiteracy, we don't mind switching over to credit cards and ATMs, which indeed is a function one step ahead of cheque culture.

Further, illiterate villagers taking agriculture loans or making Hajj deposits utilize banking services quite freely. Moreover, our bankers have never been deficient in handling the accounts of illiterate persons, pardah nasheen ladies, or disabled accountholders. Training material of our banks and code of banking practices are quite self-sufficient to manage these categories of accounts, and our bank officials are well versed with the practical snags and legal requirements of handling such accounts.

A reference here to the ever increasing cost of living coupled with the government's apathy will not be out of place. The continuous prices escalation has made it increasingly difficult for the common man to make his both ends meet within his legitimate income, which compels him to resort to illegal means of acquiring money. Notwithstanding our tall claims for poverty alleviation, we have, on the one hand, slashed down the purchasing power of masses by such ill-conceived actions as substantially cutting down the rates of profit of savings schemes, and, on the other hand, pushed the prices beyond the reach of common man by measures such as fortnightly increase in the prices of petrol and petroleum products. This Hippocratic attitude of the government cannot be defended with any stretch of arguments.


Corruption has two faces: one, the wrongdoing, i.e. commission, two, the wrongful undoing, i.e. omission. The former means: "to have done what should not have been done". It is visible by nature. The latter signifies: "not to have done what should have been done". It is by nature invisible, and therefore tends to be more disastrous.

The commissioning part of corruption can be identified with reasonable precision. Hence, it can be prevented, controlled, and brought within the ambit of law. We had so far been discussing this aspect of corruption. The other facet of corruption, i.e. omission, is outrageous for the reason that the law finds itself helpless in attacking it.

The inaction, dereliction, or delayed action ends in greater devastation, as its effect is not quantifiable, and its impact cannot be measured. It may take as great a toll as loss of half of the country and may still remain unidentified. It cannot be controlled or countered by law or by administrative orders. You can stop a man from doing a thing, but you cannot always make him do a thing, if he is not willing to do that.


1. Excessive security of job has been mainly responsible for inefficiency. This must be done away with. Each employee, from top to bottom, has to justify his or her being in the job every day. This, in other words, means that powers of hire and fire should vest in the management. There may be instances when this power is exploited or misused. To check and control excesses of management, Services Tribunals should be mandated to award summary judgments within the maximum specified time.

2. Trade unions have done immense harm to industry. These should be abolished. The jurisdiction of Services Tribunals may be extended to take all out care of the employees.

3. Seniority should be assigned the same sanctity in all the organizations as it normally enjoys in the judiciary. All prestigious placements/postings and promotions should be based on seniority. Reasons of suppression should be advised in writing to aggrieved person. Corruption in banks increased manifold after the politicians and bureaucrats placed their cronies at the helm of affairs at the cost of seniority, mercilessly killing the merit.

4. Punishments and rewards should be prompt and transparent. Undue interference and meddling from any quarter should be curbed with iron hand, as it kills initiative and power of decision-making.

5. All sorts of perks for all categories of staff, irrespective of grade and rank, must go. Transport provided to an executive due to the nature of his job should be used strictly for official purposes only. Family members should not be allowed to use or share the official car with the executive. However, salaries should be rationalized to match the cost of living. These should be raised twice a year: once, effective from the first day of the financial year of the organization as normal grade increment; next, from the mid of the year, at the prevalent rate of inflation.

More than once the government banned the purchase of cars of higher than the prescribed horsepower for its functionaries. What was the outcome of these orders is no more a secret. Why should we then resort to such actions which can be reversed any time? What is actually needed is the basic revision of Service Rules, eliminating the very provisions of perks and allowances, so that the future governments may not be able to reverse the decision simply by administrative orders, without getting through the parliament.

6. Some other causes of inefficiency and corruption in government offices are: lengthy and cumbersome procedures, misuse of discretionary and centralized powers, and undue secrecy of government business. Services of professional bodies may be utilized to ameliorate and simplify procedures, which may be widely publicized so that people should know what they are exactly required to do. Thus, extortion of money from them would become, if not impracticable, at least difficult.

7. Prize Bonds schemes are speculative that create easy money, leading to dubious practices. All such schemes, which are prone to speculation, gambling, games of chance, such as, Bank of Punjab's Crorepati scheme, should be withdrawn forthwith.