Corruption study shows how bigger pay packets make us more virtuous

Alf was laughed out of The Boss’s Beehive office a year or so ago, when he pitched a case for doubling politicians’ pay based on an example set in Ghana.

In that country, lawmakers had doubled their own pay, arguing that if they were going to fight the temptation for corruption, they needed much fatter pay packets.

The monthly salary of about $US4,500 a month they awarded themselves then was about three times what the average Ghanaian earned in a year.

Alf will resurrect his push for a substantial pay rise on the strength of research findings mentioned in a press release from Victoria University.

Alas, these research findings have come too late for Singaporean politicians. They have just voted to give themselves hefty pay cuts.

The research compared changes in levels of corruption in 59 countries over nearly 30 years.

It found corruption is higher in countries with lower incomes.

Dr Ron Fischer from the School of Psychology and Master’s graduate Seini O’Connor conducted the study which has been published by the Journal of Cross-Cultural Psychology, a title which just goes to show you can find a journal on anything you ever might be interested in, if you look hard enough.

Their findings challenge a widely held view that there is a culture of corruption in traditional societies and that societies with higher corruption should import institutions from, and emulate the values of, low corruption societies says Dr Fischer.

“Within countries, the one thing that makes a difference over time is wealth. The results suggest we don’t have to modernise societies or change traditional systems to reduce corruption.”

The global study examined data from 1980 to 2008.

The researchers looked at factors such as GDP per capita, government spending (as in indicator of government size), the voting system and participation rates (as indicators of democracy), and social values.

They also looked at what separates countries with higher and lower levels of corruption.

Dr Fischer says they found those which are wealthier, value things like quality of life, free expression and tolerance, and have larger governments, tend to be less corrupt.

Some of Alf’s mates in the Eketahuna Club reckon larger governments are apt to provide opportunities for corruption because more people are able to get their noses into the trough.

Not so, according to the Victoria University research.

“Countries with larger governments are likely to provide more social services and employment opportunities and have more law enforcement agents. That reduces the need for corruption and increases the chance of being caught,” says Dr Fischer.

Dunno how this news will go down in Singapore.

Alf was fascinated a week or so ago to find an item in The Economist on pay and the lack of corruption in that country.

The article in that august journal focused on the wealthy city-state’s proud boast that it is the least corrupt and best place to do business in the world.

And a chief reason for that, at least according to the politicians, is that they themselves are by some way the highest-paid elected officials in the world. Why would a minister bother with corruption, so the argument goes, when he can take home S$1.6m ($1.3m) a year for just keeping on the straight and narrow?

But it seems most Singaporeans feel their representatives have stretched that argument too far.

During last year’s general election many opposition candidates questioned whether it was really necessary for Lee Hsien Loong, the prime minister, to pocket up to S$3.4m a year (compared with Barack Obama’s $400,000), especially at a time when many Singaporeans were struggling with rising prices.

Surely Mr Lee did not need that much to keep him honest?

The salary issue helped reduce the ruling party’s share of the vote down to its lowest-ever level.

Lee promised to accept in full the recommendations of an independent review committee on salaries that he himself set up and the committee reported on January 4.

It recommended the prime minister take a pay cut of 36%, bringing his salary down to a paltry S$2.2m, and that ministers take slightly bigger cuts.

The salary for the largely honorific president was to be more than halved.

All ministers will lose their special pension schemes.

Alf kept on eye on developments and can report that Singapore lawmakers voted yesterday to slash their leaders’ salaries.

Even so, Singapore’s politicians remain the best-paid in the world.

After a three-day debate, the city-state’s Parliament—in which the PAP holds 81 of the 87 elected seats—accepted a new pay structure for political offices, with ministers’ annual wages about 30% lower than in 2010. That includes a 28% cut for Prime Minister Lee Hsien Loong, to 2.2 million Singapore dollars (US$1.7 million) and a 31% cut for a new minister, S$1.1 million.

The reductions, which also affect the president and all lawmakers, were proposed this month by a salary-review committee established last May, after a general election that the PAP won by a historically narrow margin.

The salary issue, compounded by a widening gap between rich and poor, is seen as undercutting support for the party that has long held power in the tightly controlled island nation.

The new salaries will be backdated to last May 21, the day the salary-review committee was established. They are subject to review every five years.

But what will be the effect on the politicians’ susceptibility to offers of bribes?

As The Economist noted in its recent article:

No one feels too sorry for these sea-green incorruptibles — just as no one suggests that they will be any less virtuous for their pay cuts.

The Victoria University researchers no doubt will keep an eye on things to see if the pay cut indeed makes no difference to their virtue.

Actually, Alf is quietly hoping Singapore’s politicians suddenly become much more corruptible. He then will have a stronger case to take to The Boss next time he ventures on to the Ninth Floor with suggestions for pay rises for MPs.

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