Helping regional partners root out corruption

Corruption is a universal problem. No country is immune from it, including our own. That is why the strategy elsewhere affirms the urgent need for a National Integrity Commission in Australia.

Nevertheless, structural factors make corruption more or less prevalent globally. Closed institutions often lack the transparency or checks and balances to prevent it. And certain economic conditions, such as a dependence on aid or resource extraction, can increase the incentives and opportunities for elites to engage in rent-seeking. For many states in the region, the presence of these factors makes corruption an endemic challenge.

This should be of great concern to Australia, as it is to the many advocates, journalists, and civil society organisations that lead the fight against corruption regionally. For them, corruption is not just a moral affront, but an active threat to human security. It is a parasitic force that drives inequality, slows growth, and siphons away the benefits that would otherwise accrue to citizens.

It is crucial, then, that Australia re-invigorates efforts to help the region root out corruption. In parallel with anti-corruption action at home, we will work at a regional level to:

Champion independent media and civil society organisations. Local advocates and journalists are passionate and effective champions of anti-corruption regionally. To support their work in exposing and holding corruption to account, Australia will increase the share of development assistance we direct towards civil society groups regionally.

Provide technical assistance to ASEAN's Southeast Asia Parties Against Corruption (SEA-PAC). It is critical that Australia sees corruption as a problem we solve with, not for, the region. One-way, top-down efforts will be disregarded as patronising, and thus are likely to close off cooperation and harm relations in general. Australia will therefore aim instead to boost and support regionally led anti-corruption efforts, such as SEA-PAC. We will offer to provide useful technical assistance, at arm's length from government, on legal, investigative, and enforcement issues.

Link Australia's planned National Integrity Commission with regional counterparts. Australia will aim to see the new National Integrity Commission build up an international work program, analogous to that of the AEC. As an independent and apolitical partner, the Commission would be a trusted provider of peer-to-peer capacity-building in the anti-corruption space.

Promote fiscal transparency and accountability. Australia will continue to encourage and support our partners in improving public financial management, including through capacity-building initiatives.

Continue to embed effective governance standards and monitoring and evaluation mechanisms in our development programs. Given corruption is endemic in many places, it is unrealistic to make our aid conditional on its absence. Doing so would see little aid delivered and citizens effectively punished for the crimes of elites. Instead, then, our aim should be to design and deliver aid in ways that minimise opportunities for corruption. We will do so, first, by continuing to ensure that our development programs are designed around transparent governance structures and effective monitoring and evaluation mechanisms.

Localise the disbursement of development assistance. Centrally directed aid can also inadvertently fuel corruption, as elites extract revenue along its way to community recipients. To reduce such opportunities for cronyism or rent-seeking, Australia will aim to increase the share of development assistance we provide at the grass-roots level.

Reduce reliance on contractors. A structural dependence on contracted aid delivery can fuel corruption too, in this case in the form of commercial pay-to-play schemes. To avoid this, Australia will work to ensure that government agencies re-assume primary responsibility for the delivery of development assistance.

Apply targeted sanctions as necessary. In cases of grave or persistent corruption, Australia will make full use of its new Magnitsky-style sanctions regime.

Progress the roll-out of the Blue Dot Network. The BDN, which Australia is working to realise with Japan and US under the Trilateral Infrastructure Partnership, aims to create a trusted rating system for regional infrastructure projects. While its main aim is to catalyse greater private investment in regional infrastructure, it would also contribute to reducing corruption. That is, by directing foreign investment towards projects with strong governance, the BDN would effectively reward infrastructure developers for improving transparency and accountability. Of the anti-corruption levers that could be brought to bear, this has the distinct virtue of being seen as a positive incentive, not a coercive or patronising measure.