Government News Analysis Reforms

Serious surgery required

Registering a Property

Corruption, that long untreated cancer anchored deep in the Philippine economy, persists in holding the country back. It’s not as if there’s a lack of resources – both natural and human, the archipelago has them in abundance; it’s wealth in each would put most countries in the immediate region of Southeast Asia to shame.

But all that is more than offset by still staggering levels of corruption in parts of the public sector – the ‘free bank’ for so long enjoyed by unscrupulous and disreputable public servants at all levels is still operating its bootleg businesses.

President Rodrigo Duterte is making some in-roads into this serious legacy problem – he’s fired government officials; even ones he appointed himself. He’s also made it crystal clear to all government employees that graft, fraud and other forms of corruption won’t be tolerated and that he’ll come down hard on anyone found looting the people’s purse.

Unfortunately, there’s no silver bullet for this disease – nor is there for its close cousins and constant companions, bureaucratic red tape and incompetent staff. In the Philippines these problems have become so deep rooted over time that they’re part of the entire functioning structure. Serious surgery is required to remove them, a piece at a time. The question is, where to start?

Well, one place might be in sorting out the irregularities and shady areas of property registration in the Philippines – a lucrative, scam-laden area that’s been a traditional earner for the corrupt, a resort for pedantic pen-pushers and a rest home for the aimless. The following paragraph, taken from he 2015 Investment Climate Statement of the US State Department’s Office of Investment Affairs, roundly encapsulates the flavour and the extent of the problem.

“The Philippines recognizes and protects property rights, but the laws are weakly implemented.  Multiple agencies are involved in property administration, which results in overlapping procedures for land valuation and titling processes.  Property registration is tedious and costly.  Record management is weak due to a lack of funds and [lack of] trained personnel.  Corruption is also prevalent among land administration personnel and the court system is slow to resolve land disputes. The Philippines ranked 112 out of 189 economies in terms of ease of property registration in the World Bank’s 2016 Ease of Doing Business report”.

Well, things in this area haven’t improved. In fact they’ve got worse. These are the results for ‘Registering a Property’ in the World Bank’s 2018 Doing Business report. For the purpose of our analysis here, we’ve extracted the results of the 10 Association of Southeast Asian Nations (Asean) states out of 190 countries researched world wide.

Singapore, 19th; Malaysia, 42nd; Vietnam, 63rd; Laos, 65th; Thailand, 68th; Indonesia, 106th; Philippines, 114th; Cambodia, 123rd; Myanmar, 134th; Brunei, 136th. A lacklustre seventh for the Philippines in a category where it should be able to get within two places of the front.

The big problem is lack of transparency. In 2013, Transparency International reported that 20% of users of land services globally claimed to have paid a bribe for services such as registering a land title or obtaining updated property ownership information.

Add to that other forms of corruption, such as land-record fraud, alteration; land-document forgery; multiple ownership/titles for the same plot of land; pay-to-play arrangements by which officials become virtual brokers for acquiring, disposing and developing land – everyone knows of stories like that in the Philippines – and the scope for corruption becomes graphically apparent.

In the Philippines, the Land Registration Authority (LRA) and the Register of Deeds, which facilitates the registration and transfer of property titles, are responsible for land administration. The LRA is charged with safeguarding the integrity of land registration. But without transparency in the system, trying to preempt every scam in the system is like trying to catch rain in a colander.

In May, the Regional Trial Court in Quezon City found an LRA employee guilty of graft and bribery, fining him PHP100,000, sentencing him to between six and 11 years in prison and banning him from holding a public office for life. He’d demanded payment of PHP300,000 to expedite an order to title a property in La Union.

And so, back at the report we turn to the indicator, ‘Quality of Land Administration’ – a component of registering a property. And here’s what we find in the Asean scores: Singapore, 29.0; Malaysia, 27.5; Brunei, 18.0; Thailand, 18.0; Vietnam, 14; Philippines; 12.5; Indonesia, 11.3; Laos, 10.5; Cambodia, 7.5; Myanmar, 5.5.

And now, the number of ‘Procedures’ involved in registering a property across Asean. Laos, 4; Indonesia, 5; Thailand, 5; Vietnam, 5; Myanmar, 6; Singapore, 6; Brunei, 7; Cambodia, 7; Malaysia, 8; Philippines, 9.

Both those are extremely poor results for a strong emerging economy – though in terms of the ‘Time (days)’ it takes to satisfy those procedures, the Philippines does better. Thus, Singapore, 4.5; Thailand, 7; Malaysia, 13; Indonesia, 27.6; Philippines, 35; Laos, 53; Cambodia, 56; Vietnam, 57.9; Myanmar, 85; Brunei, 289.7.

With a strong political will, a determined approach and a major infusion of transparency at every level of the land-administration system, all this could be sorted out and the Philippines could emerge as clean as anywhere in the region. At the same time, some one needs to take a flamethrower to the morass of red tape that’s throttling efficiency. But what’s also required is a new work culture – possibly starting with ineffectual department workers either being retrained to serve the public or being put on the bus home.

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