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The ANC’s labour alliance partner Cosatu has drawn a line in the sand about Government corruption. It’s insisting President Jacob Zuma deals with graft in a more “consistent and brutal” manner if he wants the labour federation’s support to run for a second presidential term. Zuma has promised to deal with the “money sickness” gripping the ANC. But if he does much more than just tinker with a system where party, State and personal interests are so intimately linked, he’s likely to lose much more than just Cosatu’s political support.
The Auditor General’s office estimates that at least six of 10 public servants hold private business interests. Almost 60% of national Members of Parliament have shares in companies and 45% hold directorships in private companies. When it comes to the Cabinet, around 42% of Zuma’s senior Ministers have outside business interests. And, until now, there have been no sanctions against ministers who have private companies that win State contracts.
The same goes for provincial government politicians. On average, between 33% and 50% of provincial public representatives (MPLs) have outside business interests, including directorships.
The scope of all those interests is tricky to track, because systems to ensure politicians and senior officials fully declare them is regularly shown to be inadequate. Such interests usually also extend to family members, which need not be declared. For example, Zuma’s own family has gained sizeable business interests since he became ANC president in 2007. That begs obvious questions about what role the Zuma name played in securing those, which do business with the State and which dealings have crossed ethical, if not legal, lines?
“That’s the point. If you’re a minister you can’t allow your wife, your brother or your cousin to do work with Government. Even if there’s nothing untoward in your business dealings with Government, people will always think you’re benefiting because of your surname,” Cosatu secretary general Zwelinzima Vavi told Finweek.
He adds: “If you want to be a public representative you have got to choose between that job and being a business person. You can’t be both. If you’re a business person and you become a public representative it needs to be obligatory that you put your business interests in a blind trust. The reality is the temptation is just too great if you’re in a position of power not to advance your own business interests.”
While ANC and Government leaders never address those specific details, they regularly use public platforms to lament how too many people join the ANC for potential business opportunities.
While the latest African Peer Review Mechanism report (see box) homes in on the lack of progress SA has made fighting corruption and questions why Government has done nothing to protect whistleblowers, Council for the Advancement of the South African Constitution (CASAC) chairman Sipho Pityana says patronage and corruption are now “so pervasive and rampant” the country is on the verge of being deemed a “dysfunctional state”.
dysfunctional state
Estimates are that 20% of total annual State tender value – around R180bn – is lost due to graft and/or mismanagement. The problem is getting the ANC very bad rap, especially at local government level, where Auditor General Terence Nombembe uncovered more than R4bn in irregular spending last year against R2,4bn the previous year. The latest AG reports also reveal how municipalities awarded contracts worth a total R207m to bureaucrats and municipal employees, including councillors and mayors.
ANC leaders are keen to point out Zuma has taken “unprecedented” action against corruption this year. Technically, he has. Aside from the fact he’s asked the Special Investigating Unit (SIU) to investigate every single municipality in North West province, this year he’s referred 18 proclamations (to investigate various Government departments) to the SIU. That’s the most the SIU has ever been given in its 15 years of existence. These inquiries involve tender irregularity worth around R10bn and conflicts of interest of about R5bn. They include the “worst 20” of Government’s 10 000 subsidised housing projects, half of which were flagged to be “problematic in some way”.
The SIU has also been asked to probe the entire procurement chain in the Department of Public Works. So far it’s found R35m was paid to entities in which officials have undeclared business interests. It’s also found the SA Police Force’s procurement process for building or renovating 33 police stations worth R330m was deeply flawed.
WILL ZUMA FIGHT CORRUPTION?
Zuma is feeling the heat from those who stand to be exposed by this action. Vavi says people “hate Zuma already” but, he argues, Zuma can only benefit politically from getting more “consistent and brutal”. “If he does that he’ll go to that conference (the ANC 2012 elective conference) a massive hero because people in the ANC are really gatvol about corruption.”
Can Zuma afford to take this risk? Public Affairs Research Institute director Ivor Chipkin suspects if Zuma does go the whole hog to fight corruption, he’ll need to root out the personal and private networks hijacking State procedure and policy. Doing that would mean stepping on enough powerful toes to ensure his political career ended.
Paul Hoffman SC, of the Institute for Accountability in South Africa (IASA), says Zuma also runs the risk of letting his own skeletons out of the closet – possibly those related to the arms deal charges he never faced. Hoffman says the arms deal not only unleashed a sense of impunity for a protected few fingered (Zuma included) but also sent a clear message to the corrupt in Government that “if you’re in the in-faction you can be as corrupt as you like. As a result, Government is paying lip service to fighting this.”
Government certainly has been tardy about doing what the ANC leadership undertook to do at Polokwane: fight corruption. For example, the conference agreed to implement a law regulating a post-tenure cooling-off period for politicians and officials who leave public office to go and work for companies that have benefited from Government contracts. That hasn’t happened and isn’t on the cards.
“Why has nothing happened about that? Why is there dithering on matters that are straightforward to address?” asks Vavi.
National Treasury is working to overhaul the State tender system and has, so far, centralised all such tenders worth more than R500m so its officials can oversee them. However, the system still has very basic loopholes Government could quickly and easily fix (see box).
Nothing has been done to heed proposals from the ANC Youth League in Mpumalanga to pass a law that prohibits all state employees from having interests in entities that do business with the State. Those calls stem from several murders of ANC politicians and officials in the province that have been linked to State tenders.
THE CASE OF JOHN BLOCK
Two tender cases worth more than R400m in total against ANC Northern Cape chairman and provincial minister John Block are a good example of how the State is an easy pass to access cash. In the first (R112m) case against Block, Ithala bank chief and KwaZulu-Natal political heavyweight Sipho Shabalala and businessman Gaston Savoi involves a deal where Savoi sold water purification and oxygen machines to provincial departments at massively inflated prices. That’s easily done without breaking any law (see box).
In the second case (R300m) Block is on the rack for his alleged involvement in crooked State security contracts awarded to Global Crown Trading. He appears to be connected to Global Crown Trading through an intricate business network that makes it difficult to pinpoint wrongdoing, let alone prove it, especially in instances where businesses don’t give officials or politicians immediate payment for favours. Instead, a promise is made to give a particular official/politician significant benefit in the form of shares, payments or position in the future, possibly when they’ve left public life.
When it comes to anti-graft agencies investigating cases such as Block’s, they’d also have to wade into the sensitive areas that involve the unintended consequences of policies such as black economic empowerment and the much-defended ANC policy of cadre deployment.
“Politics at local government level especially has become increasingly about getting your faction into a position of power and influence. People don’t believe good conduct is how you stay in office. It’s about who you know and for some getting on a list is do or die,” says Hennie van Vuuren, head of corruption and governance at the Institute of Security Studies, who adds that corruption has become much more than trading in brown envelopes. “It’s about trading in influence and what that can deliver.”
SA’S ANTI-CORRUPTION LAWS
Ivor Chipkin says that’s complicated by the fact that SA’s anti-corruption laws are ambiguous and make it difficult to prove and prosecute corruption. In other words, there’s a major gap between what’s currently illegal and what’s unethical.
But Government insists it’s clamping down on corruption. It parades the Municipal Systems Amendment Bill as proof it’s serious about limiting political influence, especially over State tender processes at municipal level. While acting Co-operative Governance Minister Nathi Mthethwa says there are “shockingly high levels of inappropriate political interference” in municipal government, he’s confident the Bill will limit that. It will do so by prohibiting politicians from holding senior management jobs in municipal administrations. It also bans officials found guilty of misconduct from being employed in any other local government position for a period of 10 years.
However, Vavi questions why the bans on politicians holding senior management positions and on guilty officials finding future work are limited to local government. He says they should extend to all organs of State if Government is serious about dealing with corruption.
The South African Municipal Workers’ Union has objected to the prohibitions the Bill seeks to impose, saying they infringe individual political rights and, as a result, Zuma appears to be paralysed and has not signed the Bill into law.
Party political funding
While politicians’ trading accusations about corruption to discredit political opponents is fast turning into a national sport, there’s one area where politics is wide open to shady influence but no politician speaks about: party political funding. There’s no law regulating private donations to political parties, which means companies and individuals are able to make donations in secret. While that opens up opportunities for influence to be bought – and makes politicians answerable to donors, not voters – all SA’s political parties have actively resisted legal challenges to make the process more transparent.
For example, in the case against Block, Savoi has admitted to paying a R3,6m donation to the ANC. That dovetails with what several businesses described to Finweek as pressure to donate money as a pre-requisite for getting contracts and access to influential people. While the ANC is very defensive of an organisation such as its Progressive Business Forum – which regularly holds functions where it calls on invited business leaders to donate to party coffers – the question is what do businesses get in return? Where does the line between what’s ethically acceptable and what’s not begin and end and who monitors that?
A letter Hessequa municipality ANC mayor Christopher Taute wrote to a local businessman (on a municipal letter head) earlier this year gets to the nub of it. He wrote: “As you currently have contracts with our municipality, which were made possible by this ANC-run council, I would like to make a friendly request that you contribute a donation to the ANC for the election campaign in order to continue building on your good relations with this ANC-run council.”
The ANC says Taute’s letter was an “error in judgment”. Although the party initially said it wouldn’t take action against him, the Public Protector has officially found Taute guilty of misconduct. While the ANC hadn’t responded to that finding at the time of writing, party officials at the ANC’s Luthuli House privately confirmed there’s significant conflict in the ANC about where the boundary between business and politics lies and what constitutes a conflict of interest.
While ethical issues are complicated by unintended consequences of political strategies, such as black economic empowerment, Van Vuuren says: “The practice of using your connections to get business from Government is not only widespread, but people who benefit aren’t clandestine mafia types who make a career of corruption. They’re largely upstanding citizens who pay taxes and go to church, mosque or shul – possibly even people who don’t see anything wrong in what they’re doing.”
Nevertheless, Vavi says there’s growing frustration with what’s perceived to be the ANC’s confusing standards and statements about questions of politically connected individuals and their business interests. That extends to the conspicuous consumption politicians – including Cabinet Ministers – enjoy at taxpayers’ expense.
BRING THEM TO BOOK
Idasa’s Judith February agrees and has echoed the union’s call for Zuma to fire and make examples of ministers such as Co-operative Governance Minister Sicelo Shiceka, who’s accused of spending lavishly – more than R1m since appointed to Cabinet – by flouting official travel and accommodation privileges. Eight weeks after the allegations surfaced Zuma has yet to comment. He’s also ignoring Vavi’s calls to suspend Block.
In an unprecedented move, Parliament’s Ethics Committee – headed by veteran ANC MP Ben Turok – has asked Public Protector Thuli Madonsela to investigate Shiceka’s expenditure. That makes him the first minister since 1994 to be referred to the Public Protector for such investigations. But the real test will be what Zuma will do if Madonsela’s findings – due to be released after Finweek goes to press this week – go against Shiceka?
All eyes will also be on Zuma if Madonsela’s final investigation into police chief Bheki Cele finds him guilty of misconduct for his involvement in two lease agreements amounting to R1,5bn. While Madonsela’s initial report implicated Cele, the reality is if there are criminal charges to press against him, Madonsela and the SIU can only refer the case to the NPA or to Cele’s own department, the Police. It will be a stern test indeed for anti-graft agency the Hawks, which for now falls under the police.
The Constitutional Court has confirmed the Hawks, which replaced the disbanded Scorpions, aren’t sufficiently independent and therefore are open to political interference. While MPs have 15 months left to change that, the jury is still out about the new incarnation. Will it meet the requirements of international treatise SA has signed and, even if it does, will it be truly independent?
Regardless, the lack of a truly independent agency means the ANC’s succession battle will play itself out over a period where individuals fingered for corruption have the perfect opportunity to cry foul and to claim they’re victims of some political/succession battle plot.
LOOPHOLES IN STATE BUREAUCRACY
Value for lots of money…
OBVIOUS LOOPHOLES in State bureaucracy beg questions about why Government hasn’t been proactive about them. For example, the State’s three-quote system makes it easy for suppliers to get Government to pay hugely inflated prices for procured goods. When officials procure goods or services for the State, they have to choose suppliers from the existing database. They must randomly select three and choose the best quote from those.
But the supplier selected won’t necessarily offer optimal value for money. Why? Officials might randomly draw three very expensive, less skilled suppliers from the list. The supplier on the database who offers the cheapest and best service can’t be used repeatedly and may not be used as a benchmark. Suppliers have to be rotated so all suppliers on the database are given a turn. While this system also opens up the possibility for collusion among suppliers on the list, many try to get themselves on as many Government procurement lists as possible, knowing that – even with inflated prices – they’ll eventually be chosen.
Another conspicuous systemic weakness is the power the Public Finance Management Act (PMFA) concentrates in accounting officers. While the accounting officer has the power to control and influence all parts of the value chain, he also chooses which outside company is employed to conduct forensic investigations requested by the Auditor General. The firm the accounting officer selects to do the job obviously wants more work from Government. While that may change their findings and recommendations, accounting officers can also easily ignore recommendations for further investigations, criminal charges or disciplinary action.
While such systemic gaps are regularly flagged by Parliament’s public accounts committee, and while the committee also regularly objects to the lack of action departments take against officials who flout the very strict provisions of the PMFA, the question is simple: Why is Government not taking swifter action with regard to these issues? The PMFA is 13 years old.
POLITICISATION OF STATE
SA under the cosh
THE AFRICAN UNION’S African Peer Review Mechanism (APRM) has flagged corruption in South Africa as a major concern, saying it’s being fuelled by a State that’s increasingly politicised. The APRM report, which is part of a voluntary self-monitoring mechanism for members of the AU, targets Government’s questionable and politicised appointments that not only scupper investigations into corruption but fuel it and prohibit transparency.
The report focuses on the relationship between party and State and uses the National Youth Development Agency (NYDA) as an example of such politicisation of State organs. It says the NYDA’s management is top-heavy with members of the ANC Youth League and has ANCYL members on its board.
“During 2010 two instances strongly suggested an undue alignment of the NYDA with the ANCYL,” states the report, which also highlights how 62 of 63 members of the NYDA’s provincial advisory boards were linked to the ANCYL and regarded as supporters of its president, Julius Malema. The report adds: “Indeed, it was alleged the NYDA had bent the rules for nomination to allow candidates who had missed the nomination deadline to be considered and had overturned decisions of the selection panel.”
CORRUPTION-BUSTING UNITS
Mixed blessing
PARLIAMENT’S CHALLENGE is to find a way to allow anti-graft investigators and prosecutors to work without having to fear some form of career sanction: for “upsetting” someone, somewhere, in an undefined organisational system. The Constitutional Court ruling in favour of businessman Hugh Glenister demands Parliament resolves that and reconstitutes the Directorate of Priority Crimes Investigation – the Scorpions – by September next year.
That work will coincide with what’s certain to be a politically charged period leading up to the ANC’s elective conference at year-end 2012. Nevertheless, the late Professor Kader Asmal – who resigned as an MP in protest against the disbanding of the Scorpions – argued there are three likely locations for the anti-corruption unit: the National Prosecuting Authority, the Office of the Public Protector and a stand-alone unit accountable to citizens via representatives in Parliament and to the courts.
While there’s a political problem in locating the unit in the NPA – because its head, Menzi Simelane, is a political appointee – organisations such as the Institute for Accountability in Southern Africa are calling for an all new anti-corruption commission. Such a Chapter 9 institution would be led by a judge or retired judge and would be similar to the relatively successful all-in-one model used in Hong Kong and Mauritius.
However, concentrating all anti-graft investigation and prosecution in a single agency isn’t an unmitigated blessing. An agency such as that runs the risk of becoming the central focus of the powerful and privileged it’s investigating. In other words, ensuring two or more anti-corruption agencies have capacity and independence means there isn’t just one “enemy”. But no matter how an independent corruption-busting unit is structured it has to be fortified by an independent judiciary and backed by the political will to fight all graft.
The Auditor General’s office estimates that at least six of 10 public servants hold private business interests. Almost 60% of national Members of Parliament have shares in companies and 45% hold directorships in private companies. When it comes to the Cabinet, around 42% of Zuma’s senior Ministers have outside business interests. And, until now, there have been no sanctions against ministers who have private companies that win State contracts.
The same goes for provincial government politicians. On average, between 33% and 50% of provincial public representatives (MPLs) have outside business interests, including directorships.
The scope of all those interests is tricky to track, because systems to ensure politicians and senior officials fully declare them is regularly shown to be inadequate. Such interests usually also extend to family members, which need not be declared. For example, Zuma’s own family has gained sizeable business interests since he became ANC president in 2007. That begs obvious questions about what role the Zuma name played in securing those, which do business with the State and which dealings have crossed ethical, if not legal, lines?
“That’s the point. If you’re a minister you can’t allow your wife, your brother or your cousin to do work with Government. Even if there’s nothing untoward in your business dealings with Government, people will always think you’re benefiting because of your surname,” Cosatu secretary general Zwelinzima Vavi told Finweek.
He adds: “If you want to be a public representative you have got to choose between that job and being a business person. You can’t be both. If you’re a business person and you become a public representative it needs to be obligatory that you put your business interests in a blind trust. The reality is the temptation is just too great if you’re in a position of power not to advance your own business interests.”
While ANC and Government leaders never address those specific details, they regularly use public platforms to lament how too many people join the ANC for potential business opportunities.
While the latest African Peer Review Mechanism report (see box) homes in on the lack of progress SA has made fighting corruption and questions why Government has done nothing to protect whistleblowers, Council for the Advancement of the South African Constitution (CASAC) chairman Sipho Pityana says patronage and corruption are now “so pervasive and rampant” the country is on the verge of being deemed a “dysfunctional state”.
dysfunctional state
Estimates are that 20% of total annual State tender value – around R180bn – is lost due to graft and/or mismanagement. The problem is getting the ANC very bad rap, especially at local government level, where Auditor General Terence Nombembe uncovered more than R4bn in irregular spending last year against R2,4bn the previous year. The latest AG reports also reveal how municipalities awarded contracts worth a total R207m to bureaucrats and municipal employees, including councillors and mayors.
ANC leaders are keen to point out Zuma has taken “unprecedented” action against corruption this year. Technically, he has. Aside from the fact he’s asked the Special Investigating Unit (SIU) to investigate every single municipality in North West province, this year he’s referred 18 proclamations (to investigate various Government departments) to the SIU. That’s the most the SIU has ever been given in its 15 years of existence. These inquiries involve tender irregularity worth around R10bn and conflicts of interest of about R5bn. They include the “worst 20” of Government’s 10 000 subsidised housing projects, half of which were flagged to be “problematic in some way”.
The SIU has also been asked to probe the entire procurement chain in the Department of Public Works. So far it’s found R35m was paid to entities in which officials have undeclared business interests. It’s also found the SA Police Force’s procurement process for building or renovating 33 police stations worth R330m was deeply flawed.
WILL ZUMA FIGHT CORRUPTION?
Zuma is feeling the heat from those who stand to be exposed by this action. Vavi says people “hate Zuma already” but, he argues, Zuma can only benefit politically from getting more “consistent and brutal”. “If he does that he’ll go to that conference (the ANC 2012 elective conference) a massive hero because people in the ANC are really gatvol about corruption.”
Can Zuma afford to take this risk? Public Affairs Research Institute director Ivor Chipkin suspects if Zuma does go the whole hog to fight corruption, he’ll need to root out the personal and private networks hijacking State procedure and policy. Doing that would mean stepping on enough powerful toes to ensure his political career ended.
Paul Hoffman SC, of the Institute for Accountability in South Africa (IASA), says Zuma also runs the risk of letting his own skeletons out of the closet – possibly those related to the arms deal charges he never faced. Hoffman says the arms deal not only unleashed a sense of impunity for a protected few fingered (Zuma included) but also sent a clear message to the corrupt in Government that “if you’re in the in-faction you can be as corrupt as you like. As a result, Government is paying lip service to fighting this.”
Government certainly has been tardy about doing what the ANC leadership undertook to do at Polokwane: fight corruption. For example, the conference agreed to implement a law regulating a post-tenure cooling-off period for politicians and officials who leave public office to go and work for companies that have benefited from Government contracts. That hasn’t happened and isn’t on the cards.
“Why has nothing happened about that? Why is there dithering on matters that are straightforward to address?” asks Vavi.
National Treasury is working to overhaul the State tender system and has, so far, centralised all such tenders worth more than R500m so its officials can oversee them. However, the system still has very basic loopholes Government could quickly and easily fix (see box).
Nothing has been done to heed proposals from the ANC Youth League in Mpumalanga to pass a law that prohibits all state employees from having interests in entities that do business with the State. Those calls stem from several murders of ANC politicians and officials in the province that have been linked to State tenders.
THE CASE OF JOHN BLOCK
Two tender cases worth more than R400m in total against ANC Northern Cape chairman and provincial minister John Block are a good example of how the State is an easy pass to access cash. In the first (R112m) case against Block, Ithala bank chief and KwaZulu-Natal political heavyweight Sipho Shabalala and businessman Gaston Savoi involves a deal where Savoi sold water purification and oxygen machines to provincial departments at massively inflated prices. That’s easily done without breaking any law (see box).
In the second case (R300m) Block is on the rack for his alleged involvement in crooked State security contracts awarded to Global Crown Trading. He appears to be connected to Global Crown Trading through an intricate business network that makes it difficult to pinpoint wrongdoing, let alone prove it, especially in instances where businesses don’t give officials or politicians immediate payment for favours. Instead, a promise is made to give a particular official/politician significant benefit in the form of shares, payments or position in the future, possibly when they’ve left public life.
When it comes to anti-graft agencies investigating cases such as Block’s, they’d also have to wade into the sensitive areas that involve the unintended consequences of policies such as black economic empowerment and the much-defended ANC policy of cadre deployment.
“Politics at local government level especially has become increasingly about getting your faction into a position of power and influence. People don’t believe good conduct is how you stay in office. It’s about who you know and for some getting on a list is do or die,” says Hennie van Vuuren, head of corruption and governance at the Institute of Security Studies, who adds that corruption has become much more than trading in brown envelopes. “It’s about trading in influence and what that can deliver.”
SA’S ANTI-CORRUPTION LAWS
Ivor Chipkin says that’s complicated by the fact that SA’s anti-corruption laws are ambiguous and make it difficult to prove and prosecute corruption. In other words, there’s a major gap between what’s currently illegal and what’s unethical.
But Government insists it’s clamping down on corruption. It parades the Municipal Systems Amendment Bill as proof it’s serious about limiting political influence, especially over State tender processes at municipal level. While acting Co-operative Governance Minister Nathi Mthethwa says there are “shockingly high levels of inappropriate political interference” in municipal government, he’s confident the Bill will limit that. It will do so by prohibiting politicians from holding senior management jobs in municipal administrations. It also bans officials found guilty of misconduct from being employed in any other local government position for a period of 10 years.
However, Vavi questions why the bans on politicians holding senior management positions and on guilty officials finding future work are limited to local government. He says they should extend to all organs of State if Government is serious about dealing with corruption.
The South African Municipal Workers’ Union has objected to the prohibitions the Bill seeks to impose, saying they infringe individual political rights and, as a result, Zuma appears to be paralysed and has not signed the Bill into law.
Party political funding
While politicians’ trading accusations about corruption to discredit political opponents is fast turning into a national sport, there’s one area where politics is wide open to shady influence but no politician speaks about: party political funding. There’s no law regulating private donations to political parties, which means companies and individuals are able to make donations in secret. While that opens up opportunities for influence to be bought – and makes politicians answerable to donors, not voters – all SA’s political parties have actively resisted legal challenges to make the process more transparent.
For example, in the case against Block, Savoi has admitted to paying a R3,6m donation to the ANC. That dovetails with what several businesses described to Finweek as pressure to donate money as a pre-requisite for getting contracts and access to influential people. While the ANC is very defensive of an organisation such as its Progressive Business Forum – which regularly holds functions where it calls on invited business leaders to donate to party coffers – the question is what do businesses get in return? Where does the line between what’s ethically acceptable and what’s not begin and end and who monitors that?
A letter Hessequa municipality ANC mayor Christopher Taute wrote to a local businessman (on a municipal letter head) earlier this year gets to the nub of it. He wrote: “As you currently have contracts with our municipality, which were made possible by this ANC-run council, I would like to make a friendly request that you contribute a donation to the ANC for the election campaign in order to continue building on your good relations with this ANC-run council.”
The ANC says Taute’s letter was an “error in judgment”. Although the party initially said it wouldn’t take action against him, the Public Protector has officially found Taute guilty of misconduct. While the ANC hadn’t responded to that finding at the time of writing, party officials at the ANC’s Luthuli House privately confirmed there’s significant conflict in the ANC about where the boundary between business and politics lies and what constitutes a conflict of interest.
While ethical issues are complicated by unintended consequences of political strategies, such as black economic empowerment, Van Vuuren says: “The practice of using your connections to get business from Government is not only widespread, but people who benefit aren’t clandestine mafia types who make a career of corruption. They’re largely upstanding citizens who pay taxes and go to church, mosque or shul – possibly even people who don’t see anything wrong in what they’re doing.”
Nevertheless, Vavi says there’s growing frustration with what’s perceived to be the ANC’s confusing standards and statements about questions of politically connected individuals and their business interests. That extends to the conspicuous consumption politicians – including Cabinet Ministers – enjoy at taxpayers’ expense.
BRING THEM TO BOOK
Idasa’s Judith February agrees and has echoed the union’s call for Zuma to fire and make examples of ministers such as Co-operative Governance Minister Sicelo Shiceka, who’s accused of spending lavishly – more than R1m since appointed to Cabinet – by flouting official travel and accommodation privileges. Eight weeks after the allegations surfaced Zuma has yet to comment. He’s also ignoring Vavi’s calls to suspend Block.
In an unprecedented move, Parliament’s Ethics Committee – headed by veteran ANC MP Ben Turok – has asked Public Protector Thuli Madonsela to investigate Shiceka’s expenditure. That makes him the first minister since 1994 to be referred to the Public Protector for such investigations. But the real test will be what Zuma will do if Madonsela’s findings – due to be released after Finweek goes to press this week – go against Shiceka?
All eyes will also be on Zuma if Madonsela’s final investigation into police chief Bheki Cele finds him guilty of misconduct for his involvement in two lease agreements amounting to R1,5bn. While Madonsela’s initial report implicated Cele, the reality is if there are criminal charges to press against him, Madonsela and the SIU can only refer the case to the NPA or to Cele’s own department, the Police. It will be a stern test indeed for anti-graft agency the Hawks, which for now falls under the police.
The Constitutional Court has confirmed the Hawks, which replaced the disbanded Scorpions, aren’t sufficiently independent and therefore are open to political interference. While MPs have 15 months left to change that, the jury is still out about the new incarnation. Will it meet the requirements of international treatise SA has signed and, even if it does, will it be truly independent?
Regardless, the lack of a truly independent agency means the ANC’s succession battle will play itself out over a period where individuals fingered for corruption have the perfect opportunity to cry foul and to claim they’re victims of some political/succession battle plot.
LOOPHOLES IN STATE BUREAUCRACY
Value for lots of money…
OBVIOUS LOOPHOLES in State bureaucracy beg questions about why Government hasn’t been proactive about them. For example, the State’s three-quote system makes it easy for suppliers to get Government to pay hugely inflated prices for procured goods. When officials procure goods or services for the State, they have to choose suppliers from the existing database. They must randomly select three and choose the best quote from those.
But the supplier selected won’t necessarily offer optimal value for money. Why? Officials might randomly draw three very expensive, less skilled suppliers from the list. The supplier on the database who offers the cheapest and best service can’t be used repeatedly and may not be used as a benchmark. Suppliers have to be rotated so all suppliers on the database are given a turn. While this system also opens up the possibility for collusion among suppliers on the list, many try to get themselves on as many Government procurement lists as possible, knowing that – even with inflated prices – they’ll eventually be chosen.
Another conspicuous systemic weakness is the power the Public Finance Management Act (PMFA) concentrates in accounting officers. While the accounting officer has the power to control and influence all parts of the value chain, he also chooses which outside company is employed to conduct forensic investigations requested by the Auditor General. The firm the accounting officer selects to do the job obviously wants more work from Government. While that may change their findings and recommendations, accounting officers can also easily ignore recommendations for further investigations, criminal charges or disciplinary action.
While such systemic gaps are regularly flagged by Parliament’s public accounts committee, and while the committee also regularly objects to the lack of action departments take against officials who flout the very strict provisions of the PMFA, the question is simple: Why is Government not taking swifter action with regard to these issues? The PMFA is 13 years old.
POLITICISATION OF STATE
SA under the cosh
THE AFRICAN UNION’S African Peer Review Mechanism (APRM) has flagged corruption in South Africa as a major concern, saying it’s being fuelled by a State that’s increasingly politicised. The APRM report, which is part of a voluntary self-monitoring mechanism for members of the AU, targets Government’s questionable and politicised appointments that not only scupper investigations into corruption but fuel it and prohibit transparency.
The report focuses on the relationship between party and State and uses the National Youth Development Agency (NYDA) as an example of such politicisation of State organs. It says the NYDA’s management is top-heavy with members of the ANC Youth League and has ANCYL members on its board.
“During 2010 two instances strongly suggested an undue alignment of the NYDA with the ANCYL,” states the report, which also highlights how 62 of 63 members of the NYDA’s provincial advisory boards were linked to the ANCYL and regarded as supporters of its president, Julius Malema. The report adds: “Indeed, it was alleged the NYDA had bent the rules for nomination to allow candidates who had missed the nomination deadline to be considered and had overturned decisions of the selection panel.”
CORRUPTION-BUSTING UNITS
Mixed blessing
PARLIAMENT’S CHALLENGE is to find a way to allow anti-graft investigators and prosecutors to work without having to fear some form of career sanction: for “upsetting” someone, somewhere, in an undefined organisational system. The Constitutional Court ruling in favour of businessman Hugh Glenister demands Parliament resolves that and reconstitutes the Directorate of Priority Crimes Investigation – the Scorpions – by September next year.
That work will coincide with what’s certain to be a politically charged period leading up to the ANC’s elective conference at year-end 2012. Nevertheless, the late Professor Kader Asmal – who resigned as an MP in protest against the disbanding of the Scorpions – argued there are three likely locations for the anti-corruption unit: the National Prosecuting Authority, the Office of the Public Protector and a stand-alone unit accountable to citizens via representatives in Parliament and to the courts.
While there’s a political problem in locating the unit in the NPA – because its head, Menzi Simelane, is a political appointee – organisations such as the Institute for Accountability in Southern Africa are calling for an all new anti-corruption commission. Such a Chapter 9 institution would be led by a judge or retired judge and would be similar to the relatively successful all-in-one model used in Hong Kong and Mauritius.
However, concentrating all anti-graft investigation and prosecution in a single agency isn’t an unmitigated blessing. An agency such as that runs the risk of becoming the central focus of the powerful and privileged it’s investigating. In other words, ensuring two or more anti-corruption agencies have capacity and independence means there isn’t just one “enemy”. But no matter how an independent corruption-busting unit is structured it has to be fortified by an independent judiciary and backed by the political will to fight all graft.
