Challenging the percentage system : tackling systematic corruption through improved transparency and accountability in India : paper presented at the IRC symposium ‘ Pumps, Pipes and Promises: Costs, Finances and Accountability for Sustainable WASH Servic

Almost every service in India has an unofficial price, whether it is getting a job as a school teacher, bagging a government contract as an NGO or escaping a traffic fine. An important distinction, however, is between ad hoc and institutionalized payments. Although few reliable estimates exist, the latter – which also goes by the name of the ‘percentage’ system - is a much bigger drain on the national exchequer. Its organized chains of fund flow characterizes both political and the bureaucratic systems and affects all sectors, including water and sanitation. Several innovative approaches to improve transparency and accountability have been taken by local civil society organizations and donor-supported projects, including community contracting, village Social Audit Committees, public hearings, supported by government measures, such as the Right to Information. The benefits of reducing corruption are likely to be huge, but much stronger initiatives from within the political, legal and executive branches of government are needed for successful reform of the ‘system’. In the meanwhile, civil society organizations and external support agencies must learn from and build on successful initiatives, and institutionalize such measures wherever possible. [authors abstract]