The State of Corruption in the Philippines

corruption grease money

Corruption in the Philippines- A Hopeless Case

I could still very much remember the day in the early part of January 2001 when we, graduate students pursuing Master in Public Management major in Local and Regional Administration, were having a study session at the National College of Public Administration and Governance (NCPAG) of the University of the Philippines Diliman. We were then discussing the merits and demerits of then President Joseph Estrada’s impeachment trial for bribery, graft and corruption, betrayal of public trust and culpable violation of the Constitution that started last December 7, 2000. I could not help but be intrigued with the arguments of one of my classmates who posited that the Philippines is a “hopeless case” in the fight against corruption. Moreover, he argued that whoever sits as President of the country, corruption will not die down as it is entrenched in the Filipino psyche and that the only means for the country to progress is to literally “kill all the adult Filipinos and let one among the present-day innocent grade school children led the country in the march towards prosperity.”

While everyone in the room find his “kill-all” idea absurd but we understood our classmate for bringing up such argument out of sheer frustration as one of the distinguished professors of the UP-NCPAG, whose essays on Philippine public administration we closely followed and accepted as gospel truth, was himself tainted in that presidential scandal in his capacity as one of President Estrada’s most trusted advisers.

President Estrada was not given the chance to receive the verdict of the Philippine Senate, which was converted into an Impeachment Court, as he was ousted by the second people power revolt and left Malacañang Palace, the seat of presidential power, on January 20, 2001.

Corruption- What Is It?

Corruption, according to the Transparency International, is the abuse of entrusted power for private gain. Simply put, it is a form of dishonest or unethical conduct by a person entrusted with a position of authority, often to acquire personal benefit. It can be classified as grand, petty and political, depending on the amounts of money lost and the sector where it occurs.

corruption grease money

Grease Money or “lagay” in the drawer of a government official and employee in exchange for favor in some government transaction- a typical form of corruption in the Philippines.

There are 8 types of corruption frequently practiced in the Philippines namely: tax evasion, ghost projects and payrolls, evasion of public bidding in awarding of contracts, passing of contracts, nepotism and favoritism, extortion, protection money and bribery.

1. Tax Evasion

This is very rampant, particularly in the private sector due to the refusal of those engaged in private businesses to honestly declare their annual income and to pay the corresponding taxes to the government.

2. Ghost Projects and Payrolls

This is done by high officials of the government whereby non-existing projects are financed by the government while non-existing personnel or pensioners are being paid salaries and allowances. This practice is rampant in government agencies involved in formulation and implementation of programs and projects particularly in infrastructure and in the granting of salaries, allowances and pension benefits.

3. Evasion of Public Bidding in the Awarding of Contracts

Government offices, particularly bids and awards committees forego the awarding of contracts through public bidding, or award these contracts to favored business enterprises or contractors. Sometimes, members of bids and awards committees are very subjective of awarding the contract to those who can provide them with personal benefits.

To legally evade public bidding, purchasing government agencies would embark on a “piece-meal purchasing strategy” whereby small amount of supplies and materials will be bought in a continuous process. In which case, internal agreements between the buyer and the supplier is done whereby a certain percentage of the price value will be given to the buyer which sometimes result to overpricing and the purchase of sub-standard supplies and materials.

4. The practice of passing contracts from one contractor to another

In the construction of infrastructure projects, contractors have that practice of passing the work from one contractor to another and in the process certain percentage of the project value is retained by each contractor and sub-contractors resulting to the use of substandard materials or even unfinished projects.

5. Nepotism and Favoritism

Government officials particularly those occupying high positions tend to cause the appointment or employment of relatives and close friends to government positions even if they are not qualified or eligible to discharge the functions of that office. This is one of the root causes of inefficiency and the overflowing of government employees in the bureaucracy.

6. Extortion

This is done by government officials against their clients by demanding money, valuable items, or services from ordinary citizens who transact business with them or with their office. This is rampant in agencies issuing clearances and other documents, those involved in the recruitment of personnel, or those performing services that directly favor ordinary citizens.

7. “Tong” or Protection Money

This is a form of bribery which is done by citizens performing illegal activities and operations. They deliver huge amount of money to government officials particularly to those in-charge of enforcing the law in exchange for unhampered illegal operation. The law enforcement officer who receives the money will be duty-bound to protect the citizen concerned together with his illegal activities from other law enforcement authorities. This is practiced mostly by gambling lords and those engaged in business without the necessary permits as well as by the drug lords to ensure that their illegal drug business becomes a flourishing enterprise.

8. The “Lagay” system or Bribery

The “lagay” system or the act of citizens to bribe government officials occupying sensitive positions in government is perpetuated due to bureaucratic red tape. Too much paper requirements, long and arduous processing of documents, ineffective and inefficient personnel management and the absence of professionalism in the public service force ordinary citizens to employ extraordinary and illegal methods for the immediate processing and issuance of required personal documents. The most frequently employed method is offering a considerable amount of money to a government official who can facilitate the issuance of the desired documents in agencies issuing licenses, permits, clearances, and those agencies deputized to make decisions on particular issues.

The same is true with the awarding of contracts for infrastructure projects, wherein, the contractor has to “promise to pay” to the agency officials and staff, a certain percentage of the contract amount upon billing. But the worst part of it is the fact that the contractor has to “pay in advance” to the political leadership- that is the Barangay Captain, Mayor, Governor, Congressman, Senator up to the President- the cut right after the awarding of contract. In effect, not less than 40% of the contract price is lost to corruption leaving the Filipino citizenry with no choice but to make use of the completed projects funded with only a maximum of 60% of the project cost.

Another method in this category is the employment of “fixers” whereby people will pay certain individuals who may or may not be government employees to process or obtain personal requirements for them.

Why Corruption Thrived in the Philippines?

Corruption is as old as history itself. In the Philippines, it started historically during the Spanish colonial period when the archipelago was part of the kingdom of the Spanish Monarch. Public office, like everything else within the colony, was treated as a property of the King which he can dispose of as he liked. Government offices or positions were awarded based on patronage or auctioned off to the highest bidder. Government was an instrument mainly for enslaving the conquered subjects for the benefit of the King and his Spanish subjects.

The American colonial period saw the formal introduction of Philippine civil service and professionalism in government, which may be responsible for the lesser incidents of corruption in the country during that period. Nevertheless, it is from the Americans that the Filipinos learned pork-barrel politics.

Beginning at the end of the World War II until the present, corruption again flourished as Filipino politicians scrambled for a share of war damage payments, kickbacks in the financial aids and grants that flooded the Country for infrastructure during the period of rehabilitation, and opportunities for bribes and exactions created by the imposition of import and foreign exchange controls, issuance of mining and logging permits and preferential access to government loans and pork-barrel funds. Moreover, local and national government agency heads distributed government positions and profitable sectors of economy among their relatives, friends and cronies, and amassed substantial amount in ill-gotten wealth.

What Are The Measures Employed To Control Graft and Corruption?

The government employs legal measures and anti-corruption bodies to combat the problem of graft and corruption.


The 1987 Philippine Constitution

Article XI of the 1987 Philippine Constitution, titled “Accountability of Public Officers”, states in Section 1 that “public office is a public trust. Public officers and employees must at all times be accountable to the people, serve them with utmost responsibility, integrity, loyalty and efficiency, act with patriotism and justice, and lead modest lives.”

Section II of the same article states that the President, Vice-President, members of the Constitutional Commissions and the Ombudsman may be removed from office on impeachment for bribery and graft and corruption.

Republic Act No. 3019 also known as the Anti-Graft and Corrupt Practices Act of 1960

This law enumerates all corrupt practices of any public officer, declares them unlawful and provides the corresponding penalties of imprisonment (between 6-15 years) perpetual disqualification from public office, and confiscation or forfeiture of unexplained wealth in favor of the government.

Executive Order No. 292 or the Administrative Code of 1987

This order reiterates the provisions embodies in Section 1, Article XI of the 1987 Constitution. It also gives the President the power to institute proceedings to recover properties unlawfully acquired by public officials and employees.

Republic Act No. 6713 also known as the Code of Conduct and Ethical Standards for Public Officials and Employees of 1989

This act promotes a high standard of ethics and requires all government personnel to make an accurate statement of assets and liabilities, disclose net worth and financial connections. It also requires new public officials to divest ownership in any private enterprise within 30 days from assumption of office to avoid conflict of interest.

Republic Act No. 6770 also known as the Ombudsman Act of 1989

This provides the functional and structural organization of the Office of the Ombudsman which will be discussed later on.

Republic Act No. 7055 also known as An Act Strengthening Civilian Supremacy over the Military

This law creates two avenues for trying erring members of the Armed Forces of the Philippines and other members subject to military laws. Crimes penalized by the Revised Penal Code and other special penal laws and local government ordinances shall be tried in civil courts. Military courts shall take cognizance of service-oriented crimes only.

Republic Act No. 7080 also known as the Act Defining and Penalizing the Crime of Plunder

This act penalizes any public officer who by himself or in connivance with members of his family, relatives by affinity or consanguinity, business associates, accumulates or acquires ill-gotten wealth, through a combination of series of event criminal acts, an aggregate amount to total value of at least fifty million pesos (P50,000,000).

Republic Act No. 8249 also known as the Act Further Defining the Jurisdiction of the Sandiganbayan

This classifies the Sandiganbayan as a special court and places it at par with the Court of Appeals.

Presidential Decree No. 46 declares it unlawful for government personnel to receive gifts and for private persons to give gifts on any occasion including Christmas, regardless of whether the gift is for past or future favors. It also prohibits entertaining public officials and their relatives.

Presidential Decree No. 677 requires the Statement of Assets and Liabilities to be submitted every year.

Presidential Decree No. 749 grants immunity from prosecution to givers of bribes and other gifts and to their accomplices in bribery charges if they testify against the public officials or private persons guilty of those offenses.


The 1987 Philippine Constitution has created constitutional bodies to deal on graft and corruption and to effectively implement the provisions of public accountability. These bodies are granted fiscal authority to ensure their independence and their actions are appealable only to the Supreme Court. These constitutional bodies are:

a) The Office of the Ombudsman (OMB)

The Office of the Ombudsman investigates and acts on complaints filed against public officials and employees, and serves as the “people’s watchdog” of the government. The Ombudsman and his deputies (Overall Deputy Ombudsman, Deputy Ombudsman for the Military, One Deputy Ombudsman each for Luzon, Visayas and Mindanao) are the “protectors of the people”. This office:

i) oversees the general and specific performance of official functions so that laws are properly administered;

ii) ensures the steady and efficient delivery of public services;

iii) initiates the refinement of public procedures and practices; and

iv) imposes administrative sanctions on erring government officials and employees, and prosecute them for penal violations.

b) The Civil Service Commission (CSC)

The CSC is the central personnel agency of the government which is mandated to establish a career service and promote moral, efficiency, integrity, responsiveness, progressiveness, and courtesy in the civil service. It shall also strengthen the merit and rewards system, human resource development, and public accountability. It has jurisdiction over administrative cases including graft and corruption brought before it on appeal.

c) The Commission on Audit (COA)

The COA is the watchdog of the financial operations of the government. It is empowered to examine, audit, and settle all accounts pertaining to the revenue and receipts of, and expenditures or uses of funds and property under the custody of government agencies and instrumentalities. It shall promulgate accounting and auditing rules and regulations for the prevention and disallowance of irregular, unnecessary, excessive, extravagant, or unconscionable expenditures, or use of government funds and properties.

d) The Sandiganbayan

The Sandiganbayan is the anti-graft court of the Philippines. It has jurisdiction over civil and criminal cases involving graft and corrupt practices and such other offenses committed by public officers and employees. It is in charge of maintaining morality, integrity and efficiency in the public service.


Other government agencies in the fight against corruption are the following:

a) The Department of Justice (DOJ)

The DOJ conducts preliminary investigations on complaints of a criminal nature against public officials that are filed with the Department, subject to the approval of the OMB if the offense investigated was committed by the public official in relation to his office. The DOJ also prosecutes in these cases if the public officials involved belong to ranks lower than salary grade 27.

b) The National Bureau of Investigation (NBI) and the Philippine National Police (PNP)

These law enforcement agencies conduct fact-finding investigations on graft cases. They conduct entrapment operations which, if successful, results in the arrest and filing of criminal complaint against the perpetrators in the courts. It may issue subpoena and serve warrants of arrest issued by the courts. The NBI agent or policeman who conducted the investigation also acts as witness for the prosecution during journal preliminary investigation and the prosecution of the case by the Ombudsman.

c) The Presidential Commission on Good Government (PCGG)

This was created primarily to go after ill-gotten wealth. It is also tasked to adopt safeguards to ensure that corruption shall not be repeated and institute measures to prevent the occurrence of corruption.

d) The Presidential Commission against Graft and Corruption

This was created under Executive Order No. 151 by then President Ramos to investigate graft and corruption cases in the executive department. It has jurisdiction over corruption cases if the crime involves:

i) Appointees with rank of or higher than Assistant Regional Director;

ii) At least one million pesos;

iii) An offense that may threaten grievous harm to national interest; and

iv) Cases specifically assigned by the President.

e) The Inter-Agency Anti-Graft Coordinating Council

The council coordinates the government anti-corruption efforts. It is composed of the Commission on Audit, the Civil Service Commission, the Ombudsman, the Department of Justice, the National Bureau of Investigation and the Presidential Commission against Graft and Corruption.

What Are the Impediments to the Anti-Corruption Drive of the Government through the Years?

Despite the existence of these graft and corruption counter measures, this menace remains a major problem of the Philippine government. This can be attributed to the following factors:

a. Specific culture of Filipinos is enhancing the proliferation of graft and corruption. The strong family ties justify giving benefits to unqualified recipients which are very evident in employment and awarding of contracts. This societal phenomenon is adversely affecting professionalism, efficiency and effectiveness in the government service as well as in the construction of public infrastructure and procurement of government supplies and materials that are sometimes substandard and overpriced.

b. The Filipino culture of gift giving justifies bribery and extortion thereby making it hard for law enforcement and anti-corruption agencies to arrest the problem. This social practice renders inutile the law prohibiting gift giving thereby further enhancing this corrupt practice.

c. Agencies deputized to fight graft and corruptions are not well funded by the government. There is also lack of recognition, merits, awards and rewards given by the government for the efforts of anti-corruption bodies. Personnel of these agencies mandated to go against corrupt public officials are vulnerable to bribery because of lack of financial support, integrity and professionalism. Measures have to be introduced in the recruitment of anti-corruption personnel to ensure that they possess morality, honesty, integrity and dedication to duty.

d. Transparency is not religiously observed particularly in government transactions. The public is denied access to activities of government officials. The people are not informed, in detail, of the share of each executive department, the legislature and the judiciary, in the national budget and how these departments spend their financial requirements.

e. Effective monitoring of government programs and projects as well as expenditures is not being seriously undertaken by those tasked to monitor them. They are also vulnerable to bribery and do not actually conduct thorough inspection but merely rely on information gathered.

f. The statement of assets and liabilities, which is an effective mechanism to curb graft and corruption, is religiously submitted yearly by all public officials. However, no agency of government is deputized to examine the veracity of the data entered in those statements. Most public officials with unexplained wealth can successfully hide the same by paying accountants to make accurate and official statements for them.

g. Other anti-corruption provisions may work against getting good people in government. One example is the requirement of divestment, currently, the only approach to the possible conflict of interest that will be encountered by the entry of well- qualified people in the government. The current divestment procedure may be too harsh since it could effectively mean that no top industrialist should be a Secretary of Trade and industry, and no top banker may be Central Bank Governor. That would be closing to the government a valuable human resource. Besides, the appointing power must put a person where his expertise is. Others would circumvent the law by divesting themselves with their direct link to a business enterprise by transferring their interests to trusted relatives or friends but in reality, they still remain in control of the enterprise.

Is the Philippine Corruption Condition Really a Hopeless Case?

On January 20, 2016, exactly 15 years after President Estrada’s ouster, I was seriously contemplating on the Philippines’ “hopeless case” scenario being painted by my UP-NCPAG classmate. Truly, the hope that was initially embraced by the Filipino people with the assumption of then Vice-President Gloria Macapagal-Arroyo to the presidency turned to hype as her 9-year presidential term (2001 to 2010) was generally perceived to be the most corrupt  since the time of President Marcos.

Subsequently, President Benigno Semion S. Aquino ascended to the presidency in 2010 on the campaign promise of “Daang Matuwid” (Straight Path). Admittedly, President Aquino bowed out of office with unblemished record in terms of corruption in his personal capacity and was generally popular at home and abroad. In fact, during the opening day of my one-month training in Japan last July-August, 2014, our Japanese lecturer heaped so much praise to President Aquino for building a business-friendly climate in the Philippines. Nevertheless, the Aquino Presidency was also blamed for the failure to curb the rising corruption in government agencies from the local up to the cabinet level, the soaring drug menace and the increasing criminality.

It was at this backdrop of the Philippine socio-political landscape that President Rodrigo Roa Duterte, the fiery Mayor from Davao City in Mindanao, was swept to power in the May, 2016 presidential elections with the campaign promise of a “bloody war” against corruption, illegal drugs and criminality. While a number of persons, Filipinos and foreigners alike, will disagree with me but 16 million Filipino voters, and even those who did not vote for him, saw President Rodrigo Roa Duterte’s assumption to the presidency as a ray of hope as well as the light shining at the end of the darkest tunnel of corruption-laden governance that mainly caused the rise of the illegal drugs trade and criminality in the country.

Corruption in the Philippines- Final Thoughts

Corruption corrodes the fabric of society. It undermines people’s trust in political and economic systems, institutions and leaders. It can cost people their freedom, health, money – and sometimes their lives. No wonder, illegal drugs trade with its resultant criminality had skyrocketed as the people in power were corrupted to condone, instead of stopping, the menace.

The magnitude of corruption in the Philippines is so prevalent that it is next to impossible to eradicate it. Applying the corruption issue to a viral systemic plant disease affecting all the plant parts, a pessimist like my UP-NCPAG classmate sees no other solution but to uproot the entire plant.

However, for an optimist like me who has been in the civil service for the past 29 years, hence, a component part of a disease-inflicted plant so to speak, there is still a way to eradicate corruption in the Philippines. For one, not all of those involved in corruption are willing participants to the crime as they are just compelled by circumstances to go along with the system for fear of getting the ire of the powers-that-be for being “un-cooperative.’

Truly, a piece-meal approach treating a specific plant part of a systemic disease-afflicted plant would surely not hold water. With this in mind, a systemic control measure -from the soil to the roots, stem, trunk, leaves, flowers and fruits needs to be done to save the plant from destruction. Applying into the Philippine condition, a comprehensive anti-corruption drive involving the Filipino people taking the role of the soil; the political leaders as roots; the agency heads as stem; the department heads as trunks; the plain staff as leaves and; the citizenry as flowers and fruits needs to be implemented by the government. And, an anti-corruption initiative of this magnitude can only prosper if and when the President of the Republic of the Philippines commits to a “clean government” like what President Rodrigo Roa Duterte had repeatedly said since his first State of the Nation Address.

For this, we are crossing our fingers with profound prayers that President Rodrigo Roa Duterte shall succeed in eliminating corruption. After all, I fully subscribe to his statement that: “After the eradication of corruption, illegal drugs trade and criminality in this country, everything else- local and foreign direct investments, job generation and its accompanying economic prosperity- shall follow suit.”


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