How Mobile Phones Eliminated Corruption: The Jhang Model

A “silent revolution” on corruption, as Aremeyaw Anas calls it, may now be underway in Ghana, following his recent revelations of corrupt practices at Ghana's main ship port at Tema. About a dozen officials of Customs, Excise and Preventive Service (CEPS) will lose their jobs, and face the law. Several more will be reassigned away from Tema ship port. These are encouraging steps, but pretty far from what will be needed to stem corrupt practices everywhere in Ghana so the country can create a better, business-friendly economy.

The good thing is that, the “Anas tapes” has rekindled the debate on corruption (including its causes and costs) and there have been loads of suggestions on how to nip it in the bud. Most are not new, and all point to a committed leadership. Others (e.g., the think-tank IMANI) advocate a reduction in taxes and duties at the shipping ports so individuals and businesses will have less incentive to substitute bribery for their tax obligations. I like this idea; supported by the Laffer curve (named after Art Laffer) which demonstrates that, beyond a certain tax rate, government tax revenues actually falls with higher taxes, both due to the disincentive to work (at a higher tax rate) and tax avoidance. The idea is applied in Switzerland, where tax rates are low and there is almost 100 percent compliance rate. However, alone, lower taxes will not eliminate corruption in Ghana, at least not in the short to medium term.

If Ghana's leaders really want to reduce, and hopefully eliminate corruption, it will help to learn from success stories elsewhere. The 'Jhang' model is particularly instructive: it is simple, cheap and transparent – the basic requirements for a sustainable anti-corruption strategy. More importantly, the main actors in this model are the people, those who stand to benefit the most from a corruption-free society, with help from their mobile phones. The strategy, a brainchild of Mr. Zubair Bhatti, involves an audit (phone calls) to ascertain customer feedback, and whether or not they were made to pay a bribe for a service.

Jhang District in the province of Punjab, Pakistan, has a population of 3.5 million, and was ranked amongst the most corrupt in Pakistan, in particular its Land Transactions and Registration office in the city of Jhang, the capital. Take a moment to think of the land registrar in Accra, and how a piece of property can be sold to multiple buyers at the same time. Or think of what it takes to obtain a driver's license at the Driver and Vehicle Licensing Authority (DVLA). A similar story ran in Jhang. Just about every visit to the Lands Department (e.g., to register a piece of land; buy/sell a piece of land; or transfer that land to a child) required a huge bribe.

Then Mr. Bhatti became a District Coordination Officer (DCO), and was given oversight of the Lands Department in Jhang city. He designed a system where staff at the Lands Office took down every client's phone number, promising that he would personally call them at the end of each day to find out if they paid more than the due taxes, or were forced to “grease some palms,” or whether they had been unsatisfied with the service. (In actuality, Mr. Bhatti only called about 5 percent of the clients, selected randomly). A typical phone call to a client includes the following questions: “How much did you pay as tax today?”; “Were you asked to pay a bribe?” “Did you complete your transactions today?” or “Were you satisfied with the service offered to you today?” – a set of basic customer feedback questions. Each call lasts only a few minutes and likely to costs less than 50 Ghana pesewas of air-time. (Mr. Bhatti discussed the strategy at TEDx-Lahore: http://www.youtube.com/watch?v=ZiB5-JGNArM ; with subtiles)

When Mr. Bhatt brought the first charges against a staff member who had asked for a bribe, the others realized that he was serious. A couple more “pink slips” followed and something miraculous happened. Clients reported of a sudden improvement in services; no bribe was asked or taken; clients were welcomed with smiles, to their surprise. Corruption had almost disappeared in days. Even the World Bank became a fan, and last month the bank decided to fund an expansion of the 'Jhang' model across the entire province of Punjab.

The neat thing about the Jhang (Zubiar Bhatti) model is that (1) it works and it is cheap; (2) it involves a proactive government – instead of waiting for evidence of corruption, the government is out there seeking the evidence; and (3) the results are immediate.

To be sure, the strategy of phone-call audits will only be effective in checking low-to-middle level corruption (e.g., Tema ports, vehicle registration at the DVLA, or applying for a passport). But it is conceivable that if low-level corruption is successfully eliminated (through this strategy or equivalent), employees will have the courage and moral authority to expose the high level crimes within the same organization. Secondly, it is possible that both the supply-side (e.g., the diasporan eager to clear goods from Tema port or the driver license applicant) and the demand-side (the government official) of corruption will collude on bribes to render a phone audit ineffective. That will be sad though. But then, a government would have done its part. The rest will depend on us, the people, and on how badly we want to rid Ghana of this cancer, so we and our children can live better lives.

Edward Kutsoati a Lecturer at Department of Economics, Tufts University and an associate of IMANI and AfricanLiberty.org