Combating corruption in Turkey

In February 2010, the ruling Justice and Development Party (AK Party) government approved a strategy to strengthen measures to combat corruption and boost transparency in governance. The Prime Ministry Inspection Board, the chief watchdog agency over the government, has drafted what it called a strategic action plan to implement the Cabinet’s strategy. The roadmap with 18 specific actions by relevant authorities to combat corruption was tied to a time frame to make sure recommendations in the plan are achieved under deadline pressure. All looked very good on paper, yet suggestions were implemented only halfway through and deadlines lapsed on many measures.

For example, the plan talked about reforming election campaign finance laws and the financing of political parties in 24 months. It still has not been taken up despite the passage of three years. Another proposed measure for reviewing and revising the law regulating asset and financial disclosure for public employees has not been completed in the projected timeframe of 18 months. The declaration of assets by public employees is not as robust as one would like to see, and the disclosure statements often lacked quality and comprehensiveness.

Sometimes, corruption investigations have been hampered by invoking the state secrecy clause or trade secret provisions in relevant laws when in fact the letter as well as the sprit of the law intended something else. The prime minister’s watchdog agency proposed legislative changes to address that loophole. The draft law on state secrets and how to relax the strict provisions for greater public good was brought onto Parliament’s agenda in the last legislative session. Although the draft has some shortcomings, it nevertheless is an improvement on existing laws. But the draft was never taken up for a debate in Parliament because the relevant commission controlled and chaired by the AK Party was intentionally absent to block the movement on the draft.

The action plan suggested the completion of the amendment to the law on the Court of Accounts. This was done in 2011, bringing the law in line with European Union standards and was hailed by Turkish President Abdullah Gül as a major breakthrough. Yet in less than a year, the government rushed to submit revisions to neuter this recently adopted law in a last-minute motion in Parliament. The government was able to push the changes through Parliament using the majority it has in the legislature. The stripped-down law prevented the Court of Accounts from submitting auditing reports on government agencies for 2013 budget deliberations for the first time in the history of the Turkish Republic. It was only after the Constitutional Court that intervened in cancelling the government-endorsed changes that the Court of Accounts was able to finish auditing reports.

The action plan to combat corruption also envisages a review of the law on public procurement in 18 months with a view to strengthening transparency and accountability. Unfortunately the government has not only expanded the number of listed items that are exempt from the review of the public watchdog procurement agency with a series of amendments but also sharply reduced the sentences for public bid rigging schemes, practically giving those who made a profit at the expense of taxpayers’ get-out-of-jail-free cards.

I want to focus on something else that did not attract much of a debate in Turkey or in the EU, if any at all, but is crucial for transparency. In fact the prime minister’s watchdog agency elaborated on that in detail, but no action was taken on suggestions. The strategic action plan urged the government to review and change Law No. 2531, which prohibits former state employees from taking a job in the private sector that may create a conflict of interest with their previous positions in government

This “conflict of interest” law was adopted in 1981 right after the military coup, which provided greater leeway for former generals to be hired by companies involved in military contracts and tenders while barring other public employees from going into the private sector in similar conflict of interest situations. The exceptions for former generals under a military regime are hardly a surprise. But there were good suggestion for others. The Prime Ministry Inspection Board suggested that this law needed to be reviewed and revised to strengthen transparency rules. It contracted officials from the Finance, Justice and Defense ministries to come up with suggestions in 18 months. As far as I know, this work was never completed.

On a downbeat note, there are serious question marks as to how effectively the existing law has been implemented as well. The law stipulates that former government employees cannot work in companies that may have direct interest in obtaining contracts and favors from agencies these employees worked for. The reasoning is obvious because private companies have a vested interest in employing former government employees who are not only familiar with the facts of particular matters but also possess the expertise and enjoy networking on how to acquire contracts in government service. Hence the law requires a three-year cooling-off period during which a former government employee cannot be hired directly or indirectly by a company that has business interests in the employee’s area of responsibility in the last two years of a career as a government worker.

There are serious loopholes in this law. For one, the law does not prohibit ex-employees’ spouses or immediate relatives from being hired by these companies. Instead of hiring former government employees, sometimes companies just put spouses or siblings on the payroll to circumvent the ban. This loophole is even valid when the government worker is still on the job. Ideally spouses of government employees should face restrictions under the conflict of interest law if that employee participates in a matter that is also of concern for the company that hired his or her spouse.

Another shortcoming is that the law does not cover all state agencies. More worryingly, the monitoring and regulatory agencies in banking, energy and other critical economic fields are not covered because there was no such concept when the law was adopted in 1981 and the Turkish economy was largely dominated by state economic enterprises. In fact, when an opposition member queried the government last year to find out how many in the government violated the conflict of interest law, the Banking Regulatory and Supervision Agency (BDDK) said its employees are outside the scope of the law that covers only agencies that are operating under general or specially authorized budgets as listed. Regulatory agencies are described as neither and were added to the Turkish law later on as a completely different category.

Although the BDDK claims that similar provisions aimed to prevent a conflict of interest were included to its own law with the requirement of a two-year cooling-off period, I’m not sure that piecemeal approach in the government works. The fact that almost all regulatory agencies have not reported a single case for the conflict of interest that runs afoul of Law No. 2531 so far raises the issue of credibility concerning the existing system. Either we are too perfect, or cracks are wide open in the law. For example, in June of last year, Şakir Ercan Gül, the head of the Savings Deposit Insurance Fund (TMSF), reported to Parliament that that his agency had no record of jobs its former employees might have gotten. He also said there has been no complaint whatsoever with regard to the conflict of interest law.

Likewise, head of Capital Markets Board (SPK) Vedat Akgiray said the SPK does not collect information on former employees, adding that he has no knowledge on any case that violates the conflict of interest law. In July 2012 in response to a parliamentary query, the Energy Market Regulatory Agency (EPDK) said there had been no investigation done into former employees under the existing law. Finance Minister Mehmet Şimşek reported to Parliament last year that he has no information or evidence indicating that whether former employees of the Finance Ministry have ever been involved in an area covered under the jurisdiction of the Public Procurement Agency (KİK).

Similarly, Food, Agriculture and Animal Husbandry Minister Mehdi Eker also reported in June 2012 that there was no single judicial case launched against a former employee of the Tobacco and Alcohol Market Regulatory Agency (TAPDK). The only case reported as violating the conflict of interest law so far was disclosed last year by Minister of Industry Nihat Ergün, who said a probe was launched into a former employee who worked in the government’s Sugar Agency (Şeker Kurumu) as secretary-general until 2008 and was later hired by Konya Sugar Industry and Trade Co. (Şeker Sanayi ve Ticaret Şirketi). However, the probe, triggered by a complaint, was suspended due to a lack of evidence, and the possible disciplinary punishment was rendered ineffective because the person in question had already left the public position.

In any case, even if a former government employee was caught with hard evidence of creating a conflict of interest between public and private industries, there is no deterrence in the law. The violators of this law are subject to prison terms of six months to two years. It is not a serious offense considering that jail terms under three years have often been suspended, commuted or turned into probation since the third and fourth judicial reform packages were adopted in Parliament.

The AK Party came to power with a successful campaign of anti-corruption as a vote-mobilization strategy against the background of corrupt mainstream political parties a decade ago. That campaign may be a harbinger of its demise if the AK Party keeps bending over backwards on its determination to let corrupt politicians and bureaucrats act with impunity.

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