Corruption is possible when we draft laws badly. It is not enough to pass draconian laws or order inquiries to identify and punish corrupt individuals. That is slamming the door on a few horses, while many more may continue to escape. That is the easy part.

The hard, and much more intellectually demanding, task is creating a rule-based, open and competitive public sector in which corrupt decisions are impossible.

Laws which do not lay down transparent and easily understood rules, and which leave decisions which can make people rich to the discretion of ministers or senior public officers create the conditions in which corruption is possible.

This sort of loose or bad drafting can happen for the best of reasons. We decide we want to promote urban development, exports, housing, industrial investment or the like. We want to be "selective". We do not want to hand out money or privileges to all and sundry. We also want quick decisions. So we define the eligibility criteria for a tax break, a loan, a rezoning, a loan guarantee, a grant, or a passport in a very vague or general way, leaving the decisions to be made "having reviewed all the circumstances", or "in the public interest", or something vague like that.

Once the ultimate deciding criterion is this vague, it is impossible on the face of it to see whether a particular decision is suspect or not. Even the introduction of absolute transparency into the process will not proof the decision against corruptibility.

With vague criteria, there will be no definitive ground for saying that a particular decision ought not have been taken, or any prima facie evidence of breach of duty.

IN A list of measures advocated by the World Bank in a recent publication on good government, the following recommendations are made on how to cut out corruption.

"Clarify and streamline laws in ways that reduce official discretion;

make rules more transparent;

introduce market-based schemes that limit the discretion of regulators;

adopt administrative reforms that introduce competitive pressures into government."

The World Bank argues strongly for the maximum separation of powers, and the creation of veto points that can check arbitrary decisions. This means more than just having the courts review government decisions. It means opening up closed sectors of the economy to competition, so as to remove the cosy conditions in which cartels can operate. Competition is the enemy of corruption.

The Freedom of Information Act is a big step in that direction as far as openness is concerned. But we need a complete audit of all our tax incentives and grant schemes to remove all unnecessary discretion and occasions when the criteria for the exercise of discretion are vague. We need to create open markets where favouritism will be impossible.

We also need to update our anticorruption legislation. Through the ethics legislation of 1995, payments or gifts to some public officials must now be disclosed. Their personal financial interests must be disclosed. But this covers only very senior officials, and does not encompass everybody who can make important discretionary decisions.

It does not require any declaration of a decision-maker's level of indebtedness, which is a factor that opens individuals to corruptibility. A tax compliance certificate will not in itself reveal whether an individual is vulnerable because of personal debts.

AND this legislation only covers disclosure. The fundamental criminal offence of corruption is still dealt with in Ireland, after 75 years of independence, by British legislation of 1889 and 1916.

To be fair, this British legislation is still in force in Britain too. They have not gone any further than us in reforming it.

This anti-corruption legislation has a number of defects. It does not impose any special obligation on those who know or suspect corrupt decision-making to report it to anyone. Not only is there no immunity for whistle-blowers, there is no formal obligation placed on senior people to blow the whistle.

It covers bribes, but it does not criminalise the use of threats or deception to get a public official to make a decision in a particular direction.

The definition of "public bodies" covered is out of date. For instance, it refers to them as bodies which administer money "raised by rates". We need a modern definition of public bodies, like the one in the Freedom of Information Act, in our law against corruption.

It only covers bribery of Irish public officials. It is not an offence at all for someone in Ireland to bribe a foreign official. It should be. Bribes paid to foreign officials may even be tax-deductible under Irish law!

There is a doubt as to whether it covers votes or decisions taken by TDs in the Dail itself. These may be exempt from the corruption law by virtue of parliamentary privilege.

There are no special powers available to those investigating corruption, of the kind that are available to those investigating tax evasion or company fraud.

The result of the weakness of our anti-corruption law is that we find out about potentially corrupt activities only by accident or as a result of other events. But the corruption itself is no accident. As long as monopolistic State services are operated in a discretionary way without clear rules, accountability and open competition, we are leaving the door open to corruption.

John Bruton is the leader of Fine Gael