What non-NCR managers say about corruption

This week, SWS had gigs in Cagayan de Oro City (CDO) and Davao City, as part of the roadshow of the National Competitiveness Council (NCC) for regional competitiveness, by sharing the SWS Survey of Enterprises on Corruption directly with people from government, business and academia in seven sample areas.  Earlier gigs were in the cities of Makati (for the National Capital Region or NCR) and Tagaytay (for Cavite-Laguna-Batangas or CLB).  The CDO presentation showed data combined with Iligan City (abbreviated CDO-I).  The roadshow goes next to the cities of Cebu, Iloilo and Angeles.

This is the survey wrongly reported by media as “perception of graft surges,” when its original SWS title was “The fight against public sector corruption has MIXED FINDINGS” (caps in original—MM). In my piece “Survey reporting 101” (Opinion, 1/18/14), I pointed out that though the national percentage of enterprises seeing “a lot” of corruption in the public sector did rise from 43 in 2012 to 56 in 2013, the 2012 figure was the record lowest in 11 surveys over 2000-2013, and the 2013 figure was the next-lowest of that period.

In the NCC roadshow, we bring out the numbers for each area. For instance, the overall 56 percent that see “a lot” of public sector corruption is the average of 69 in NCR, 33 in Angeles, 46 in CLB, 55 in Cebu, 54 in Iloilo, 54 in CDO-I, and 45 in Davao. Note that all the numbers outside NCR are below the overall 56. NCR carries a big weight in the averaging since it has 351 of the 951 enterprises that were sampled.

Rating the city governments in fighting corruption. The roadshow also emphasizes items directly pertinent to the cities.  One such item is the businessmen’s rating of their city governments’ sincerity in fighting corruption. In 2013, the net sincerity score (the percentage calling them sincere minus the percentage calling them insincere), for the entire sample, of city governments was +23, which SWS calls “moderate” (between +10 and +29).

However, the “moderate” classification happened because the NCR grade was only net -5 (called “neutral” since it’s between +9 and -9), while the other six areas gave their city governments much higher grades, of +30 in Angeles, +35 in CLB, +41 in Iloilo, +33 in Cebu, +30 in CDO-I, and as much as +67 in Davao.  The Davao grade is Very Good (+50 to +69); the other five non-NCR grades are Good (+30 to +49).  Thus city governments outside the NCR are much better regarded by businessmen than those in  NCR.

Being asked for a bribe to get a local government permit.  In 2013, the total frequency of solicitations for bribes from businessmen hit a record low ever since the time these questions were asked in 2003.  In relation to getting a local permit in particular, the solicitations dropped from 31 percent in 2012 to 25 percent in 2013.

Among areas, the 2013 solicitations were highest in NCR (31 percent), followed by Cebu (29), Angeles (28), Davao (25), CDO-I (21), Iloilo (19), and CLB (10).  Thus, being asked for a bribe to facilitate a local permit was three times as common in NCR as it was in CLB.

Private sector integrity. Like the year before, the 2013 survey saw flatness in corruption as well as in honest business practices in the private sector over time.  These are disappointing contrasts to the clear improvements in the public sector.

Only 88 percent of the managers said that most/almost all companies in their own sector of business demand receipts for all their payments. I say “only,” because such a practice is the duty of all, and not just of most, companies. By area, the percentages were 91 in NCR, 90 in both Cebu and Davao, 89 in Iloilo, 86 in CDO-I, 85 in Angeles, and 78 in CLB.

Only four out of five (81 percent) said that most/almost all companies in their own sector of business pay the correct wages. By area, the percentages were 88 in NCR, 86 in Angeles, 83 in Davao, 76 in both CLB and Iloilo, 71 in Cebu, and 66 in CDO-I.

Only 79 percent said that most/almost all companies in their own sector of business issue receipts for all their revenues. By area, the percentages were 87 in Cebu, 84 in NCR, 79 in both Angeles and Davao, 78  in Iloilo, 73 in CLB, and 66 in CDO-I.

Less than two-thirds (64 percent) said that most/almost all companies in their own sector of business pay taxes honestly.  By area, the percentages were 71 in Angeles, 67 in CLB, 66 in  NCR, 64 in both Cebu and Iloilo, 61 in Davao, and 53 in CDO-I.

Only 63 percent said that most/almost all companies in their own sector of business keep only one set of accounts.  By area, the percentages were 68 in NCR, 67 in Cebu, 61 in Davao, 60 in CLB, 59 in Angeles, 58 in Iloilo, and 55 in CDO-I.

This shows that businesses in NCR have the highest compliance with three out of the five practices.  On the other hand, businesses in CDO-I have the lowest compliance with four out of the five.

The business climate. Managers in Davao have the highest satisfaction (86 percent), among the seven areas, with what their city governments is doing to promote a good business climate.  Next come managers in Iloilo (83 percent), Angeles (81), CLB (74), Cebu (70), CDO-I (57), and NCR (52).

Business expectations for the coming two years have never been as favorable as they are now, ever since the surveys started in 2000.  The percentages in 2013 among those calling their business prospects either good or excellent are 86 in Iloilo, 84 in Angeles, 80 in both CLB and Cebu, 78 in Davao, 70 in NCR, and 69 in CDO-I.

The businessmen’s experiences in, attitudes towards and perceptions of corruption have many interesting differences from place to place in the country.  Thus the expansion across geographical areas has added much value to the survey.

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