We cannot understand why the government has not yet introduced legislation to deal with this shameful situation

Committee report

Current legislation is "inadequate... uncoordinated and piecemeal", an International Development committee report out on Wednesday says.

International Development Secretary Clare Short has already said she regrets the weakness of current legislation and admitted it is damaging the UK's reputation.

But the Conservatives are accusing the government of "continuing to sit on their hands while corruption abounds".

Among the committee's findings was confusion over tax relief on money gained through bribes and corrupt payments.

The report recommends the Inland Revenue and Treasury act to clarify the situation.

Clare Short: 'Current law weak'

And it condemns a "lack of coherence, focus and determination across Whitehall" in tackling the problem.

The UK signed the Organisation for Economic Cooperation and Development (OECD) Convention on Combating Bribery of Foreign Public Officials in 1997.

It called for member states to make it a criminal offence for domestic companies to bribe public officials overseas.

But the committee heard that "those bribing overseas seem to have a rather comfortable regime in this country" and that the convention had no "direct and immediate impact on UK law".

'Shameful situation'

"New legislation is urgently needed to meet our international obligations but, incredibly, has yet to be introduced," the report says.

"We cannot understand why the government has not yet introduced legislation to deal with this shameful situation."

It went on: "It is entirely unsatisfactory that confusion remains over the issue of tax deductibility of bribes.

"The Inland Revenue and the Treasury should take steps to clarify the situation and should make explicit that no form of bribery or corrupt payment, anywhere, can receive tax relief."

The Labour-dominated committee also recommends that the Department for International Development set up a hotline for reporting corrupt practices and a list of debarred companies.

'Labour rhetoric'

Giving evidence to the committee in February, Clare Short said: "The view we are taking on the OECD Convention is damaging our reputation and I really regret it, because our commitment to have new legislation means that we are going to do the right thing.

"So why do we not do it more elegantly and say we know our existing law is too weak?"

Shadow international development secretary Gary Streeter said the report showed the government's "soft stance on bribery and corruption is undermining the entire British aid effort".

"Labour's rhetoric on good governance has been badly damaged by their abject failure to pass legislation to combat bribery," the MP added.

In January the OECD criticised the UK for the low number of company directors prosecuted for bribery overseas.