“Water
is a resource without substitute. It is paramount to our health, our food
security, our energy future and our ecosystem. But corruption plagues water
management and use in all these areas,” said Huguette Labelle, Chair of
Transparency International.
The
report, the first of its kind to explore the impact and scope of corruption in
different segments of the water sector, identifies a range of problems, from
petty bribery in water delivery to procurement-related looting of irrigation
and hydropower funds; from covering up industrial pollution to manipulation of
water management and allocation policies.
“Corruption’s
impact on water is a fundamental governance problem, yet it is not
sufficiently addressed in the many global policy initiatives for environmental
sustainability, development, and food and energy security. This must
change,” added Labelle.
The
water crisis is undeniable and the corruption challenge it faces is urgent.
More than 1 billion people worldwide have no guaranteed access to water and
more than 2 billion are without adequate sanitation, which has devastating
consequences for development and poverty reduction.
“Climate
change requires the world to come up with what is likely to be the most
far-reaching and complex global governance framework ever devised. Without
addressing the corruption risks, especially as they relate to water, such
plans stand on shaky ground”, said Labelle. The report demonstrates
corruption’s potential to obstruct effective enforcement of water-sharing
pacts and resettlement arrangements, both key to confronting the fallout from
climate change.
Irrigated
land helps produce 40 per cent of the world’s food, but corruption in
irrigation is rampant. Addressing this risk is fundamental to increasing food
production and tackling the global food crisis. “Massive new investments in
irrigation have been announced worldwide to help counter the food crisis, yet
water shortage means food shortage and if corruption in irrigation is not also
addressed, these efforts will fall short,” stated Labelle.
For
the Philippines, which has allocated close to US$1 billion for irrigation and
related agricultural improvements, the report presents case evidence of how
corruption has hindered the building and performance of irrigation dams. In
India, a country at the centre of the crisis, corruption is estimated to add
at least 25 per cent to irrigation contracts and the proceeds help maintain a
corrupt system of political handouts and compromised oversight. In the end,
investment costs rise, systems are rendered inefficient and small farmers are
left especially vulnerable to water shortage.
When
corruption occurs, the cost of connecting a household to a water network
increases by up to 30 per cent, raising the price tag for achieving the
Millennium Development Goals for water and sanitation by a staggering US$48
billion, according to expert estimates in the report.
Corruption
in drinking water and sanitation emerges at every point along the water
delivery chain; from policy design and budgeting to building, maintaining and
operating water networks. It drains investment from the sector, increases
prices and decreases water supplies. One result is that poor households in
Jakarta, Lima, Nairobi or Manila spend more on water than residents of New
York City, London or Rome.
Industrialised
countries are not immune. Corruption has plagued the tendering of water
contracts in cities like Grenoble, Milan, New Orleans and Atlanta. Likewise,
cases of bid-rigging and price-fixing in water infrastructure provision have
surfaced in Sweden, while in Chicago water budgets fell victim to misuse for
political campaigning.
Corruption
in water resources management undermines the sustainability of water supplies,
fuels highly unequal water sharing which can incite political conflict and
fosters the degradation of vital ecosystems. In China, for example, corruption
has weakened the enforcement of environmental regulations, abetting the
pollution of aquifers in 90 percent of cities and making over 75 per cent of
urban rivers unsuitable for drinking or fishing.
Corruption
in hydropower inflates the cost of dams and related projects. It also makes
re-settlement more challenging by preying on compensation funds and
initiatives meant to aid displaced people. The stakes are high: hydropower
accounts for one-sixth of the world’s electricity production and investment
volumes are projected to reach US$60 billion annually over the next 20 years.
Corrupt
conditions in water persist because their greatest impact is exacted on those
with the least chance of redress, disproportionately affecting women, the poor
and those with no voice at all: future generations and the environment.
Nonetheless,
as the Global Corruption Report shows, taking action against corruption
in the water sector is both timely and feasible. Key recommendations of the
report include:
-
Establish
transparency and participation as guiding principles for all aspects of
water governance: From transparent budgeting and participatory
policy-making to public mapping of water pollution, public audits of
projects and access to contract terms and performance reports, transparency
and participation strengthen integrity in water governance, but need to be
adopted globally.
-
Strengthen
regulatory oversight: Government and the public sector continue to
play the most prominent role in water governance and should establish
effective regulatory oversight, whether for the environment, water and
sanitation, agriculture or energy. Institutional reform and
capacity-building are essential to bring oversight in water up to the
standards already achieved in other sectors
-
Ensure
fair competition and accountable implementation of water projects: All
stakeholders have a role to play. Contracts should incorporate
anti-corruption measures. Governments and contractors can enter into
agreements for fair public procurement. Lenders and donors must strengthen
anti-bribery provisions in their due diligence requirements.
Transparency
International, along with the International Water and Sanitation Centre,
the Stockholm International
Water Institute, the Swedish
Water House and the Water
and Sanitation Program-Africa founded the Water
Integrity Network (WIN) in 2006. Today WIN is a growing network of
organisations and individuals that fights corruption in all parts of the water
sector. The Global Corruption Report 2008 benefited from expert and
financial support from WIN.
###
Transparency
International is the civil society organisation leading the fight against
corruption.
GCR
2008 Executive Summary download
GCR 2008 Full report download
Media
Contacts:
In
New York
Gypsy Guillén Kaiser
Tel. +49 176 10121661
ggkaiser@transparency.org
In
Berlin
Jesse Garcia
Tel.+49 30 343820667
jgarcia@transparency.org
