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INTERVIEW: Brazil needs to tackle "instilled" graft in public sector - watchdog

Source: Thomson Reuters Foundation - Fri, 4 Feb 2011 19:50 GMT
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BOGOTA (TrustLaw) - Brazil’s ineffectual justice system, along with difficulties accessing public information and general indifference, is hampering the fight against graft in South America’s largest economy, the head of a Brazilian anti-corruption watchdog has said.

Gil Castelo, founder and head of Open Accounts, a leading non-governmental organisation that monitors government spending, says these three issues need to be tackled to stem widespread graft in the public sector and ensure state funds are better spent.

“The problems of impunity and ineffectiveness of the Brazilian justice system destabilises anti-corruption attempts,” he said.

“It’s important to foment society’s participation in the surveillance of public accounts. However, public participation depends on transparency and access to information. With transparency, social control is enlarged and this enhances the quality and legality of public spending,” Castelo told TrustLaw.

Corruption costs Brazil, one of the world’s fastest-growing emerging economies, roughly $25 billion a year, representing 1.4 to 2.3 percent of the gross national product, according to a study published last year by the Sao Paulo Federation of Industries based on 2008 figures.

Founded in 2005, the award-winning Open Accounts has been at the forefront of the fight against exposing public-sector graft.

Its headline-grabbing investigations have been used by Brazil’s public prosecutors and auditing authorities to help prosecute public officials, including Brasilia’s governor, José Roberto Arruda, who was jailed last year.

The organisation also works closely with local journalists to denounce the misuse of state funds. It helped expose Brazil’s expenses scandal involving dozens of lawmakers that led to the resignation of a government minister.

More recently, Open Accounts put the spotlight on the lack of money invested by the Brazilian authorities in disaster prevention, following the flash floods and mudslides last month that killed over 665 people. In some cases, the groups say, local authorities have been diverting funds allocated to disaster management for other purposes.


Over the years, Brazilians have become weary of corruption scandals and few trust their elected officials. From alleged vote-buying in Congress to accusations of fraud in tendering major infrastructure contracts under former president Lula da Silva, corruption scandals often dominate headlines.

Ninety percent of Brazilians view corruption as a ‘serious’ or ‘very serious’ issue, according to recent research by the Federal University of Minas Gerais.

However, few of them are willing to, or know how to, hold elected officials to account.

“Brazilian society, unfortunately, is still passive,” said Castelo. “In view of the military dictatorship, followed by a period of very high inflation, Brazilian society lost a sense of the value of our currency and also of the value of our voice in the fight against corruption.”

One way of fighting corruption, he said, is to promote the right to access to public information, especially at the local level.

“Transparency of public accounts is still not at the level we desire. In state companies, for instance, it is still very limited,” said the former public official.

For anti-corruption watchdogs and the local media, getting hold of sensitive documents detailing possible corrupt practices among elected officials is fraught with difficulties.

Open Accounts is investigating claims of misuse of government fishing subsidies overseen by the labour ministry, worth $713 million a year.

“We’re certain that there are thousands of citizens who have never ever fished but do receive the benefit,” said Castelo. “However, the list of the beneficiaries is being considered confidential, which seems absurd to us.”

 “We will have to go to the courts in order to obtain such a list.” 

The newly elected government of President Dilma Rousseff has declared lifting 25 million Brazilians out of extreme poverty a priority.

But the government will also need to make combating graft a priority as Brazil gains prominence as a global economic powerhouse and actor on the international stage.  

“President Dilma´s main challenge will be that of confronting the de facto corruption that is instilled in the Brazilian public sector,” said Castelo. He said several politicians linked to graft scandals during the last government still hold elected posts.

Brazil was ranked 69th out of 180 countries in Transparency International’s 2010 index of perceived levels of public sector corruption, 48 places below Chile, South America’s other leading economy. The lower the position, the worse the perceived corruption.


Corruption in Brazil, like in other Latin American countries, is often more prevalent at the local government level, during election campaigns and in government infrastructure programmes.

“Historically in Brazil, deviations from good practice occur in infrastructure works, such as highways and sanitation,” said Castelo.

Corruption at local level was particularly rife where powerful family dynasties still yield power and the press enjoys less freedom.

 “It is greater in states and municipalities because there is less transparency of public accounts. In addition, local institutions and the press are usually also less independent,” said Castelo.

“Although this may sound incredible, in some states and several Brazilian cities, there still exists ‘coronelismo’ or the rule of coronels, which means that a family has enormous influence over constituted powers.”

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