Corruption in Real Estate construction sector
In 2014, Bangladesh has been ranked as the 14th most corrupt country in the world. The country’s corruption has caused many negative effects, including the death and injury of more than a thousand people in the Rana Plaza accident last April 2013. This is not the first construction accident in Bangladesh. The construction sector is one of the areas which corruption can easily pervade with the presence of bribes, political backing, and non-disclosure of project plans and the bidding process.
Many buildings and structures in Bangladesh have been reported of not having met the requirements provided in the building codes. Days before Rana Plaza’s collapse, cracks in the building has been detected compelling authorities such as the Bangladesh Garment Manufacturers and Exporters Association to issue a notice advising the building owners to close the building and suspend its operation. However, the warning remained unheeded forcing employees to report to work despite the danger. Also, some floors of the building were illegally constructed.
It is worth pondering about whether the Rana Plaza collapse and other similar incidents are to be considered “accidents” when such incidents could have been prevented. The poor quality of structures in Bangladesh is a reflection of the country’s corruption not only in politics but also in the personal sector. More than a few public communications projects has been halted or delayed due to corruption in the planning and construction stages of these projects. The most controversial of these projects is the six-kilometer Padma Bridge in Dhaka, which was delayed due to World Bank and Asian Development Bank’s decision to suspend the loan granted to the Bangladeshi government because of corruption allegations.
How Corruption Occurs in construction sector?
The most common corruption practice in the construction sector is manipulation done at the bidding. In the bidding, many contractors give their proposals for a certain project. Usually those with the most practical and affordable proposals are granted the project, however, there are certain instances that the criteria for the selection is not disclosed. This is where bribery takes place when some contractors pay a huge sum to the authority in charge of the project or a politician just to be awarded the project. There are also some cases, especially in public infrastructure projects, when politicians use their influence to have the project awarded to a contractor who is either family or friend in exchange of a share in the payment given for the project.
After the bidding, some contractors change the materials provided in the proposal with materials that are substandard and cheaper to allow them to have more kickbacks from the project. Sometimes, the contractors are in collusion with politicians in this scheme. This results in structures with poor quality and faces the risk of collapsing.
To curb corruption in the construction sector, there should be transparency in the project budget proposals, bidding process, planning and design, and implementation. Strict compliance with the building codes shall be enforced to ensure the quality of the structure. There should also be a regular monthly inspection of the structures during its construction stage and after every two years after it has been erected.