Ukraine relaunches online earnings system to prevent corruption, some skeptical

Ukraine on Thursday launched an online income declaration system meant to combat corruption among state officials that it hopes will unlock funds from the IMF, but its developer and watchdogs said insufficient political will could undermine the project.

A first attempt in mid-August to launch the system, which will make the revenue and property holdings of state officials open to public scrutiny, failed after snagging on security concerns, drawing dismay from anti-corruption campaigners.

Patchy progress on reforms has held up payments of the International Monetary Fund’s $17.5 billion loan programme since last October, but Ukraine’s leadership hope the relaunch of the e-declaration programme will unlock the next tranche – worth around $1 billion.

“The system has been working since midnight. There have been no malfunctions so far,” a spokeswoman for the National Agency for the Prevention of Corruption (NAPC) said.

Yuriy Novikov, the director of Miranda, the company that designed the e-declaration software, said there were no technical reasons why the system should fail this time, responding to accusations that badly designed software contributed to the failed launch in August.

A “fairly large” group of officials do not want the system to succeed, Novikov told Reuters.

Transparency International Ukraine welcomed the launch, but said there was a danger the programme could prove ineffective.

“We hope that the president (Petro Poroshenko) … will not allow the e-declaration system to be discredited by the introduction of amendments to anti-graft legislation,” TI Ukraine senior analyst Oleksandr Kalitenko told Reuters.

Meanwhile, the head of the non-governmental Anti-Corruption Action Center, Vitaliy Shabunin, said lawmakers from across the political spectrum had already worked out a way for officials to avoid being held liable for illegally earned wealth under the e-declaration system.

“They have not stopped attempts to squash criminal responsibility for these crimes,” he said in a blog post on news site Ukrainska Pravda.

Both the president and Prime Minister Volodmyr Groysman have repeatedly praised the system as a vital tool in the fight against corruption.

The IMF has not said when its board will meet to discuss its review of the bailout program. A board decision is needed to unlock the next tranche of loans.

Ukraine’s hopes for a visa-free regime with the European Union also hinge on the success of its efforts to eliminate graft. ($1 = 26.5500 hryvnias).

Source: Reuters | Thursday September 1, 2016
http://www.reuters.com/article/ukraine-crisis-corruption-idUSL8N1BD0UJ