The high-profile case of Phajo Nidup, accused of embezzling around Nu 1 billion is historic case of a massive fraudulent practice in the country. The verdicts, while punishing the accused and also junior and mid-level officials who accepted bribes, have fallen short in holding the top leadership at these organizations responsible. In cases of such massive institutional failures, there should be specific legal and moral accountabilities imposed on the Board of Directors, Chief Executive Officers, Thrompon (Mayor), and other senior executives who derive substantial privileges and decision-making powers under their leadership and should have instituted better measures to prevent such massive fraud as this is not the first time our banks have failed. Punitive actions, such as hefty fines, dismissals, or even criminal prosecution, must be taken against those at the helm who failed to implement robust governance mechanisms to detect and prevent such large-scale corruption and financial misconduct. The less fortunate like farmers and unemployed youth have almost no access to financial services such as loans, Banks have been generous to those rich and who have wealth and properties.

Another important aspect the nation must look at from the economic perspective. Studies have shown that corruption relates to the economic status and compensation provided to civil servants, especially those in lower-income brackets. When public officers struggle to make ends meet due to meagre salaries that fail to keep up with rising living costs, the temptation to supplement their incomes through illicit means increases substantially.

This can be deduced from countries like Denmark, Norway, and Singapore, which rank among the least corrupt globally because their government employees in these countries are countries with highly competitive pay packages and comprehensive benefits for their civil servants. We often look at Singapore as an example. Singaporean civil servants, besides highly competitive salaries averaging $42,049 annually, have generous leave entitlements promoting work-life balance schemes. These include vacation, medical, marriage, maternity/paternity, and childcare leave and allowances for children, subsidy in medical expenses. There are also flexible work schedules, performance-linked bonuses, and unique perks like the Singapore Civil Service Card enabling exclusive discounts across the island.  Further, they also have huge retirement-saving benefits.  Such incentivized system reduces economic motivations for corrupt conduct. In Bhutan, with mass exodus of civil servants in recent times, work-life balance has become almost impossible particularly where majority of civil servants are assigned with multitasking.  Studies have shown that when legal income sufficiently meets economic needs, the lure of exploiting positions for graft diminishes. Contrarily, “nations with low civil servant pay and benefits, and living costs face persistent corruption issues”.

To address these twin issues of lack of accountability and inadequate civil service compensation, Bhutan’s legislature should establish an independent ombudsman with the authority to investigate wrongdoing and impose strict penalties across all levels of government including top decision makers. This ombudsman must have prosecutorial powers and the ability to enforce punishments ranging from fines and dismissals to criminal charges against corrupt officials, irrespective of their rank or status.  Further, we must avoid enforcing training bonds or mandatory service obligations as such coercive measures have been shown to backfire and breed resentment, contributing to brain drain and talent loss contributing to a higher of attrition rate.

To emulate Singapore’s success, Bhutan must hold corrupt top leaders equally accountable, treat civil servants fairly, establish an independent ombudsman, and provide competitive public sector compensation to dissuade from corrupt conduct.


Sonam Tshering

Lawyer, Thimphu

Disclaimer: The views expressed in this article are author’s own.