Oct 20, 2017 Last Updated 8:27 AM, Oct 20, 2017

RAPIDLY rising reports of corruption in Australia and New Zealand are reflected in drops on the world’s leading corruption index.

“For countries that like to win at everything they do, Australia and New Zealand had some disappointing news late in 2014, with both dropping one ranking in Transparency International’s Corruption Perceptions Index rankings of the least corrupt public sectors,” says Suzanne Snively, Chair of the New Zealand chapter of Transparency International.

New Zealand is now ranked second while Australia is 11th, dropping out of the Top 10.

“This drop is a wake-up call for your organisation,” Snively is quoted as saying in the Deloitte survey, released in March.

So how big is the problem now? Again, the Deloitte survey is short on detail when it comes to actual costs of corruption in New Zealand and Australia.

However, a rough idea can be gained from existing estimates.

The Deloitte survey quotes a 2008 report from the World Economic Forum, the International Chamber of Commerce, the United Nations Global Compact and Transparency International that the global cost of corruption is estimated to equal more than 5 per cent of global GDP (US$2.6 trillion), with over US$1 trillion paid in bribes each year.

If the Australian economy of $1.5 trillion suffers the same level of corruption as global estimates, costs there would be US$78 billion.

Similarly, the New Zealand economy of $185 billion would see corruption costs of US$9.2 billion. To put that in perspective, Australia currently spends around US$4 billion on aid, with New Zealand aid equalling US$500 million.

From a global context, corruption costs are 13 times of global aid targets to halve world poverty.

In other words, money lost to corruption could end world poverty six times over.

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by Jason Brown

 

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