Pursuing Reforms thru Integrity DEvelopment thru Integrity Development

Pursuing Reforms thru Integrity DEvelopment thru Integrity Development Review DR. DAVID J. LOZADA, JR Assistant Secretary of Health A project of the Office of the Ombudsman in collaboration with the Department of Budget and Management, Civil Service Commission, Commission on Audit, DAP - Cf. G 1 DAP - Cf. G and the Development Academy of the Philippines

AGENCIES COVERED (1 st cycle) Office of the Ombudsman (Central Office including OSP) Department of Education (Central Office, NCR, Region I, Region VIII) Civil Service Commission (self-administered survey) Department of Budget and Management (CVA Project of DAP-WB)) DAP - Cf. G 2

AGENCIES COVERED (2 nd cycle) Department of Public Works and Highways Philippine National Police Bureau of Internal Revenue Bureau of Customs Land Transportation Office DAP - Cf. G 3

“Corruption is not primarily a problem of bad people, but of bad systems. ” -- Robert Klitgaard DAP - Cf. G 4

Fighting Corruption in Several Fronts Prevention Prosecution Promotion of corruption intolerance Partnerships “An ounce of prevention is worth a pound of cure. ” DAP - Cf. G 5

WHAT IS IDR Integrity development review is a preventive measure against corruption. It entails a systematic assessment of the agency’s corruption resistance mechanisms and its vulnerabilities to corruption. DAP - Cf. G 6

OBJECTIVE OF IDR v Assist the management and leadership of the agency to: v v v Assess the level of integrity development within the agency Identify the agency’s vulnerability to corruption Assess the adequacy of agency’s controls to detect and prevent corruption Prepare a more focused Corruption Prevention and Integrity Development Plan Establish benchmarks by which performance and results of anti-corruption programs can be monitored DAP - Cf. G 7

Concept of Integrity Review CRR of ICAC NSW/HK CVA of US-OMB/DAP Corruption Resistance Review Corruption Vulnerability Assessment Integrity Development Review DAP - Cf. G 8

Integrity Development Review Framework Individual Human Resource Development Organizational Procurement Management • Leadership • Code of Ethics • Gifts and Benefits Policy Corruption Risk Management Environment DAP - Cf. G Performance Management Financial Management Whistleblowing, Internal Reporting & Investigation Managing Interface with External Environment DAP - Cf. G 9

Integrity Development Assessment areas Leadership Code of conduct Gifts and benefits Recruitment & promotion Performance management Procurement Financial management DAP - Cf. G Internal reporting Corruption risk management Managing interface with stakeholders 10

IDA Levels of Achievement 5 – Evaluation of effectiveness 4 – Integration 3 – Enforcement 2 – Adaptation/deployment 1 – Minimum standards 0 – Anecdotal, no systematic approach DAP - Cf. G 11

1. Leadership The role of senior leaders in promoting integrity in the organization is very important. Senior leaders and officials are key in setting values and directions, promoting, practicing, and rewarding performance, and using these to proactively address ethical and accountability requirements. Corruption prevention and integrity is primary responsibility of senior leaders and managers. DAP - Cf. G 12

1. Leadership Objective: To assess how senior leaders lead the organization towards integrity building Outcome: Increased management accountability for corruption prevention DAP - Cf. G 13

Leadership Rating 5 4 Levels of achievement Senior leadership organization reviewed Practices/performance of senior leaders evaluated 3 Senior leaders have specific responsibilities for prevention and detection of corruption 2 Senior leaders take proactive steps to discourage staff from engaging in corrupt practices 1 Senior leaders set values, directions and performance expectations; articulate importance of ethical conduct DAP - Cf. G 14

2. Code of Conduct A Code of Conduct sets out the standards of behavior expected of staff. It defines the desirable behavior for all types of work in the agency. An effective code relies not only on appropriate form and content but also on its continued promotion and enforcement. DAP - Cf. G 15

2. Code of Conduct Objective: To determine the existence, employment, and enforcement of a Code of Conduct that will address potential unethical behavior & conflicts of interest in an agency’s operations and interaction with stakeholders. Outcome: Strengthened commitment to public service and primacy of public interest DAP - Cf. G 16

Code of Conduct Rating 5 4 3 2 1 Levels of achievement Code regularly reviewed for effectiveness Agency’s code of conduct integrated in key agency systems/mission critical functions There are sanctions/rewards for noncompliance/compliance Code is adopted to agency’s operations Has a general code of conduct based on RA 6713 DAP - Cf. G 17

3. Gifts and Benefits Policy Gifts and benefits are offered innocently or as bribes. The acceptance of gifts or benefits can create a sense of obligation that may compromise the receiver’s honesty and impartiality. Hence, agencies must set policies to deal with gift giving. DAP - Cf. G 18

3. Gifts and Benefits Policy Objective: To ensure accountability and enhance transparency of officials/staff by properly reporting the offer and receipt of gifts and benefits Outcome: Increase transparency and accountability DAP - Cf. G 19

Gifts and Benefits Rating 5 Levels of achievement Gifts and benefits and reported bribes regularly reviewed 4 Gifts received by agency or staff documented in register 3 Policies on acceptance of gifts consistently enforced with managers having clear tasks 2 Policies on acceptance of gifts made known to clients, suppliers 1 Agency has a written policy on acceptance of gifts and offer of bribes DAP - Cf. G 20

4. Human Resource Management The recruitment process provides the agency an opportunity to screen incoming employees for likelihood of corrupt behavior and conflicts of interest. The promotion system provides opportunity to sanction corrupt behavior and reward people who comply with agency’s integrity standards. DAP - Cf. G 21

4. Human Resource Management Objective: To prevent entry of corrupt and unqualified applicants and ensure promotion based on merit and adherence to standards Outcome: Increased proportion of new recruits and promotions based on merit. DAP - Cf. G 22

Human Resource Management Rating Levels of achievement 5 Outcomes of personnel recruitment, selection and promotion regularly reviewed to enhance integrity of the process 4 PSB decisions are randomly checked; deviations documented 3 Meetings and decisions of PSB planned and documented 2 Guidelines communicated to all employees 1 Agency’s recruitment and selection process follows CSC guidelines DAP - Cf. G 23

5. Performance Management Performance management aims to align agency and individual interests and ensures that agency goals are met. Performance monitoring can increase the likelihood of spotting unproductive activities of employees and providing incentives for ethical behavior. Efficient and effective units or agencies do not only save time and resources, but are more resistant to corruption. DAP - Cf. G 24

5. Performance Management Objective: To increase monitoring and encourage employees to take personal responsibility for maintaining high standards of behavior and work targets Outcome: More efficient service delivery; reduced corruption incidence DAP - Cf. G 25

Performance Management Rating 5 Levels of achievement Performance management system regularly reviewed for effectiveness 4 Staff performance rating are consistent with the attainment of unit’s targets and level of performance 3 Organizational and individual performance regularly accounted for 2 Agency has a performance management and evaluation system in place 1 Performance targets and work plans at the unit DAP - Cf. Gbased on agency goals 26 and individual level DAP are

6. Procurement Management The procurement system covers the process of planning, bidding, selection, delivery and inspection of goods and services. A poorly managed procurement system opens risks of corruption and wastage of resources due to poor quality of goods and overpricing. DAP - Cf. G 27

6. Procurement Management Objective: To strengthen the procurement process and manage agency’s resources better Outcome: Transparent and clean procurement process; enhanced value for money of procured items DAP - Cf. G 28

Procurement Management Rating 5 Levels of achievement BAC decisions and other procurement outcomes are regularly audited. 4 Sanctions and penalties are applied for nonperforming suppliers 3 BAC meetings and decisions documented; performance of suppliers and contractors against obligations monitored 2 Guidelines are disseminated to every unit and relevant personnel are trained 1 Agency’s procurement system has adopted DAP - Cf. G 29 R. A. 9184

7. Financial Management Financial transactions are generally vulnerable to corruption. Issuing and receiving payments represent significant temptation for opportunistic and potentially corrupt individuals. Profligate use of financial resources can happen due to loose controls, arbitrary setting of budgets and misallocation. DAP - Cf. G 30

7. Financial Management Objective: To determine the existence and effectiveness of controls to prevent fraud and misuse of agency’s finances Outcome: Enhanced financial accountability DAP - Cf. G 31

Financial Management Rating 5 4 3 2 1 Levels of achievement Financial controls are reviewed for effectiveness in preventing fraud. Financial reports made public Budgeting and accounting guidelines strictly enforced Guidelines on financial management disseminated to every unit; training for relevant personnel conducted. Agency has adopted the New Government Accounting System. DAP - Cf. G 32

8. Whistleblowing, Internal Reporting and Investigation Whistleblowing should be encouraged in every agency because it is the fastest way of detecting corruption yet the most difficult to do. An effective protected disclosure and a good witness protection should be established within the agencies. DAP - Cf. G 33

8. Whistleblowing, Internal Reporting and Investigation Objective: To foster a conducive environment for internal reporting & investigation of suspected corruption in the agency. Outcome: High motivation of employees to report corrupt behavior that they observe. DAP - Cf. G 34

Whistleblowing, Internal Reporting and Investigation Rating 5 Levels of achievement System for internal reporting and investigation is reviewed for effectiveness in preventing corruption. 4 Sanctions imposed one erring personnel 3 Investigations are conducted and complaints are resolved completely 2 Employees are oriented on the procedures; relevant personnel receive training 1 Agency has a written policy on internal reporting and investigation DAP - Cf. G 35

9. Corruption Risk Management Corruption is often deeply embedded in an agency’s systems & procedures, making it difficult to fully define the dynamics contributing to corruption. Thus, strategy for curbing corruption should be well defined and targeted. Risk assessment is an important management tool in detecting and preventing corruption. DAP - Cf. G 36

9. Corruption Risk Management Objective: To directly address and eliminate corruption risks Outcome: Reduced corruption cases within the agency DAP - Cf. G 37

Corruption Risk Management Rating 5 4 3 2 1 Levels of achievement Corruption risk management plan is regularly reviewed to enhance integrity measures. Corruption prevention plan supported in the corporate/management plans Agency has a plan/strategy to address identified risks Agency proactively undertakes risk assessment Agency recognizes the role of internal audit in preventing/detecting corruption DAP - Cf. G 38

10. Interface with External Environment Several corruption incidences with an agency involves an external party. Agencies should effectively manage their external environment to contain corruption. DAP - Cf. G 39

10. Interface with External Environment Objective: To establish effective parameters for external relations and foster good client relations. Outcome: Improved public perception on performance of the agency DAP - Cf. G 40

Interface with External Environment Rating 5 Levels of achievement System of managing interface with external environment reviewed 4 Complaints analyzed to identify possible incidence of corruption 3 Agency has mechanism to check published rules, procedures, standards are followed 2 Agency proactively disseminates information to the public 1 Agency has a policy on disclosure of information DAP - Cf. G 41

Survey of Employees DAP - Cf. G 42

Survey of Employees: Agenda Leadership Code of conduct Gifts and benefits Recruitment & promotion Performance management Procurement Financial management Internal reporting & investigation DAP - Cf. G Corruption risk management Managing interface with stakeholders Organizational culture Types of corruption Perceptions/ Attitudes on corruption incidence DAP - Cf. G 43

Net Satisfaction Rating from Likert Scale = % Strongly Agree + % Somewhat Agree – % Somewhat Disagree - % Strongly Disagree Net Rating + 50 or higher + 20 to + 49 + 1 to + 19 0 -1 to -19 -20 to -49 -50 or lower DAP - Cf. G Interpretation Highly positive Moderately positive Slightly positive, % undecided substantial Split opinion Slightly negative, % undecided substantial Moderately negative Extremely negative DAP - Cf. G 44

Corruption Vulnerability Assessment v Examine high risk functions, programs and activities v Assess probability that corruption could occur v Assess adequacy of existing controls and if controls are operating v Identify measures to address residual risks DAP - Cf. G 45

Project Components v Training of Assessors v Guided Assessment of 5 agencies v Presentation of Findings to the Advisory Group v Development of Agency. Specific Corruption Prevention Plan DAP - Cf. G 46

Composition of Assessment Teams DAP - Cf. G l OMB l PAGC l DBM l COA l DAP l CSC l Dep. Ed l Internal Assessors Note: CSO assessors may be included DAP - Cf. G 47

General Set of Activities Step 1. Program Communication and Assessor Preparation Step 2. Guided IDA Self-Assessment Step 3. Survey of Employees Step 4. Indicators Research Step 5. Corruption Vulnerability Assessment Step 6. Analysis and Validation Project Duration: 8 months DAP - Cf. G Step 7. Management Presentation Step 8. Development of Corruption Prevention Plan DAP - Cf. G 48

INTEGRITY DEVELOPMENT ASSESMENT Dimension Status/Remarks 1. Leadership DOH-Champion-Sec FTD, DOH-IDC 2. Code of Conduct For finalization of the revised DOH Code of Conduct 3. Gifts and Benefits Policy For EXECOM approval of draft DO 4. Human Resource Management DO no. 2005 -0006, Feb 21, 2005(recruitment & selection of Appointees 1 st & 2 nd level in CO) 5. Performance Management DM no. 2005 -0034, Feb 21, 2005(Integration of client rating in employees PES) 6. Procurement Management RA 9184 fully implemented, Tripartite CODE of Conduct in Public Procurement-on going meeting with OMB 7. Financial Management E-NGAS training completed, software and hardware (to be provided by EU) 8. Whistle blowing, Internal Reporting and Investigation C/O Atty. de. Veyra 9. Corruption Risk Management Baseline Info to be used - the DOH Agency analysis framework made by the OMB 10. Interface with External Environment NGO-partners(NAMFREL/TAN), publication of blacklisted suppliers DOH website DAP - Cf. G 49

Notes: You may use this presentation. Just acknowledge source. Some pictures were downloaded from the internet. For additional information, contact DAP at cfg@dap. edu. ph DAP - Cf. G 50