"The moment when something which has been kept hidden, becomes exposed"

Issue No 003
23 May 2003
 ~ ~ ~ ~ ~ ~ ~ ~ ~
 Editorial

 News Headlines

 Research & Reform

 Top SADC Story

 Profile

 Announcements
 
About ISS

 Subscribe

 UnSubscribe

 Contact Us

Disclose your assests

The temptation to tell half of the truth is often quite irresistable. In a country where we have a limited number of investigative journalists and modest law enforcement capacity to dig out instances of conflict of interests, undeclared assets and corruption in the public tender process, we have to rely on an ethic of service delivery amongst our public officials to stop the creep of corruption. The Department of Public Service and Administration correctly brands this form of responsive government as ‘Batho Pele’. However, too often it’s a corrupt official (or businessperson for that matter) who jump the queue and places themselves first.

The Gauteng Transport Departments Paul Mmakola appears to be a case in point (see Provincial Admin. Section) Charged with corruption and overspending totaling over R34 million, he is also appeared to have appointed friends as departmental procurement contractors. He presumably failed to disclose his relationship with the contractors to his seniors. In similar vein we have witnessed disquieting allegations against Min. Moisua Lekota (see National Govt. section). He failed to disclose his assets in Free State businesses in accordance with Executive Members Ethics Act. Prior to joining cabinet, Lekota was Premier of the Free State province. Even if there is no basis for a corrupt relationship having transpired, the Minister Lekota needs to account for this apparent oversight. A relatively light slap on the wrist of a R11 485 (one weeks salary) fine by the Parliamentary Ethics committee, announced on 22 May, may not suffice. The political establishment should know the rules by now, after all it was this government which helped craft what many regard as a model legal framework to combat corruption. (See Crime & Justice section for details of a draft Bill that could create an asset register for this countries judiciary.) Failure to adhere to the principles of disclosure sets a bad precedent for the likes of Mr. Mmakola who then believe they too can get away with it. Public scorn, increased capacity for investigative journalists and enforcement agencies together with improved whistleblowing facilities and ethics training in the public sector are a potentially powerful mix of measures to ensure that public officials feel compelled to reveal – all - their assets.

PUBLIC SERVICE

National Administration: A shadow falls on Lekota

The constitution of South Africa draws the distinction between public and private interests of serving Cabinet Ministers, as they are required to be absolutely transparent about their own private business interests. The Executive Members Ethics Act and the Ministerial handbook require all ministers to disclose all their shares and directorships. Against the background of a legislative framework to ensure public trust in government administration Minister of Defence Mosiuoa Lekota joins the likes of former African National Congress Women’s League president Winnie Madikizela-Mandela and ANC chief whip Tony Yengeni for failure of private interest disclosures. Minister Lekota, who is national chairperson of the ANC, never disclosed that he is a director of the Landzicht Winery in the Free State, and its holding company GWK Corporation. GWK-Landzicht is a regular supplier of wines for all Free State provincial government functions and closely linked with the Free State Province Department of Tourism, Environmental and Economic Affairs in business interests. The Minister also has undisclosed shares in BZL Petroleum, a distributing company of Caltex, which distributes diesel products to farmers and businesses within its 60% market share in the Free State.
Full article in the Mail & Guardian: archive.mg.co.za...

National Administration: State edits arms report to parliament

“It is now clear that the final report on the R60bn arms deal, given to Parliament after an investigation by SA’s auditor-general, public protector and prosecutions chief, was heavily edited. This has emerged in draft reports, released last week, which threaten to reopen the arms deal scandal and could undermine efforts by government to escape more political damage from the affair. The final, sanitised version of the report omitted findings on gifts received by key players during the arms procurement process, as well as ‘inaccuracies’ in a defence department presentation to Parliament’s select committee on public accounts (SCOPA)…”
Full article in Business Day: www.bday.co.za...

Provincial Administration: Zero Tolerance for Corruption in Gauteng Transport

The Gauteng Transport Department’s administration director, Paul Mmakola, has been suspended pending an investigation into allegations of overspending and corruption amounting to some R34-million in last year’s 2001-2002 financial year. Mmakola is also accused of nepotism by appointing relations and friends as procurement contractors in the Department’s tendering processes. This probe into maladministration sets an important precedence for consistency as the Department is currently investigating an R5-million function for the province’s licensing officials at a Sun City resort in the Northwest.
Full article at SABC: www.sabcnews.com...

Local Government: Samwu accuses council officials of corruption

The South African Municipal Worker’s Union (Samwu) accuses Johannesburg council officials of corruption. The allegations involve irregularities in the appointment of personnel in Soweto and Dobsonville. The Union alleges that more than eight employees in the Soweto-Dobsonville area were irregularly appointed without having been interviewed. In a dossier in Sowetan Sunday World possession the Union alleges that a number of its members have implicated senior council officers in wrongdoing and improper social behaviour.
The full article appeared in the 11 May edition of the Sowetan Sunday World ...

INDUSTRIES

Public Procurement: Challenging the tender tango

“It takes two to tango, and that is axiomatic of tender corruption. Briber and bribed entwined in conspiracy, a furtive shuffle ahead, and the rest of the floor is left standing. It doesn’t matter if our couple weren’t the best dancers; they were the sneakest and made off with the prize. Public sector procurement is worth R180-billion a year. It is one of the main drivers of black economic empowerment thanks to policies that, transparently, add weight to bids by empowered companies. Unfortunately, as many a Mail & Guardian expose has shown, government and parastatal procurement is also a big driver of corruption. The stakes are high and unscrupulous players will seek hidden ‘weight’ by soliciting of offering kickbacks or pending influence. When it pays to challenge corruption, it becomes very expensive to tolerate corruption, and corruption will be the ultimate loser. Tolerating corruption assists in the derailing of South Africa’s developmental agenda.
Full article in the Mail & Guardian: archive.mg.co.za...

Africa’s Oil Interests: Oiling poor governance to sustain poverty

An underlying assumption of Nepad’s Peer Review is that aid and investment will flow to African countries practicing good governance. In reality, mixed with contradictions, it seems aid and investment flows to the personal enrichment of bureaucrats and politicians to the detriment of their populace they were elected to serve trustworthily. Dianna Games reports in Business Day that a US multinational Oil Company, Halliburton, paid a $2,4m bribe to a Nigerian government official in return for tax breaks related to the company’s operations in that country. Bribes amounting to $500m paid into the private US bank account of Equatorial Guinea’s president by oil companies Exxon Mobil, Amerada Hess and other multinationals for similar privileges are currently under investigation. Oil companies are feeding off the poor and corrupt governance of the countries in which they operate, using whatever means necessary to protect investments in unstable states.
Full article in Business Day: www.bday.co.za...

SOCIAL JUSTICE

Skills Development: Government acts on skills authorities

The Treasury has raised serious concerns about the extent of maladministration bedevilling the Sector Education and Training Authorities (Setas) responsible for providing training for workers, the unemployed and those working in the small business sector. The Setas receive an annual budget of R3-billion from a tax levy imposed on all companies in South Africa. The Treasury’s raising of the alarm came as an increasing number of the training agencies were dogged by serious management problems. A number of senior officials attached to Setas have allegedly been fired on internal charges of fraud and corruption. The Tourism and Hospitality Education and Training Authority (Theta), a component of Setas, Deputy CEO, Vincent Hays was fired after an internal inquiry found him guilty of corruption and embezzlement. He irregularly increased his own salary, gave his wife an official salary and granted leave to independent contractors without the authority of the board. Another component of SETAS, the Secondary Agriculture Sector Education and Training Authority (Setasa), CEO Gerald Leith allegedly failed to disclose his interest in a Pretoria-based company he irregularly awarded contracts to. Apart from these the Mail & Guardian reports that the Seta fails to accomplish its mandate of empowerment and education by not utilizing their budget effectively, and not identifying skills shortages efficiently enough.
Full article at iafrica.com: allafrica.com...

Social Services: Pensioners defrauded

An employee of the government employee pension fund, Nathan Graaf, appeared on charges of corruption and fraud in the Pretoria Commercial Crimes Court after being arrested by members of the SAPS Serious Economic Offences Unit. Graaf allegedly sold confidential information of pension fund members to outside companies, who with the knowledge of the beneficiary payout information would facilitate the payment of benefits to beneficiaries. The scheme defrauded hundreds of unsuspecting pensioners of their pension payouts. Investigations into Graaf were initiated by the Treasury.
Full article at IOL: www.iol.co.za...

Social Development: Officials charged with defrauding government

Four former Eastern Cape social development department employees appeared in various courts earlier this month on charges of defrauding the department of almost R400, 000. The anti-corruption and fraud operation by the Joint Anti-corruption Task Team attached the vehicle and Bisho home of a man who defrauded the department of about R43, 000. Another employee involved in pension fraud amounting to R50, 000 was served with restraining orders, his house attached and his savings account had been frozen. All the suspects were employed by the social development department between 1994 and 1996.
Full article in Business Day: www.bday.co.za...

CRIME AND JUSTICE

Justice : Judges may be forced to declare assets

Parliament’s justice committee is poised to create a register in which the judges will have to declare both their financial and business interests, similar to that which is in force for MP’s. The justice committee is at present deliberating on the Judicial Officers Amendment Bill that seek to create mechanisms to maintain oversight of judicial conduct and ethics. The new clause added to the Bill says the committee must make provision for ‘the disclosure by judges of their financial interests as determined by the committee and the keeping of a register of such financial interests’. When warned that there would be costs associated with the creation of an office to administer the register, chairperson of the committee Johnny de Lange said: “if we are serious about the accountability of the judiciary than there are going to be costs.”
Full article in Business Day: www.bday.co.za...

Reform: Eastern Cape Interim Management Team on track

Public Service and Administration Minister, Geraldine Fraser-Moleketi, announced that the Interim Management Team (IMT) appointed to root out corruption in the Eastern cape public service has done a good job thus far. Responding to questions in the National Assembly on the progress made in helping the Eastern Cape Provincial Administration dealing with maladministration and breakdown in service delivery. The Minister mentioned the numerous arrests made on the basis of the work done by the task team. Part of the team’s mandate and work included looking at the plans and programmes of the province and to help ensure that identified and ongoing projects were fast tracked in order to deal with backlogs in service delivery in the province. A final report of the IMT is expected within the December 2003 – January 2004 period.
Full article at allafrica.com: allafrica.com...

Reform: Health Department launches anti-corruption campaign

The national health department is displaying its commitment to rooting out corruption and fraud in the public health sector by launching an anti-corruption and fraud campaign, as part of efforts to improve efficiency within the public service. Health minister Manto Tshabalala-Msimang announced that the campaign is set to focus on the loss of documents and information, violation of procurement procedures, misuse of state-owned property for private purposes and excessive use of consultants. It will also focus on alleged irregularities within the department’s human resources division based on claims of unfair employment procedures such as nepotism. The campaign seeks to end theft of information through the use of technology as well as payment of salaries to non-existent employees and fraudulent overtime claims. It will also look at the alleged use of official time for private purposes by government officials. The minister indicated that 75 cases relating to fraud, corruption, nepotism, irregularities and unethical behaviour in the department had been reported since 2001. Anyone wishing to report fraud and corruption can do so on 0800 20 1414
Full article at IOL: www.iol.co.za...

Public Service Commission

The Public Service Commissions (PSC) main role mandated by the SA Constitution is one of effective oversight and monitoring of the public service. The Commission has various functions in fighting corruption including risk assessment, anti-corruption investigations, awareness raising, advocacy and prevention.

The PSC is bound by the Constitution to report at least once a year to the National Assembly; and, in respect of its activities in a province, to the legislature of the province. The PSC must at all times retain its independent and impartial status. Such interaction must in no way affect it’s reporting to the National Assembly or the various Provincial Legislatures.

In the year 2000, the PSC conceptualised and developed six Key Performance Areas (KPAs). The two KPAs, summarised below, have formed the basis for the implementation of the PSC’s business plans and charted its future operations:

1. Professional Ethics and Risk Management

Developing effective tools for addressing corruption.



Auditing the performance of various agencies and departments, eliminating duplication and coordinating functions.



Monitoring and raising awareness of conflict of interest issues among managers.

2. Anti-Corruption Investigations

Identifying and eliminating weak management systems and inadequate internal controls.



Addressing lack of coherent strategy within government.



Redefining the PSC’s role with regard to corruption in line with its Constitutional mandate.



Strengthening proper investigative capacity within the PSC.

The PSC, which has both national and provincial offices is also responsible to assist the cross-sectoral National Anti-Corruption Forum (NACF) with its activities. Attempts have been made to revive this body in 2003. The PSC has made some valuable recommendations to parliament over the last year regarding public service anti-corruption strategies. These include reports on anti-corruption hotlines, blacklisting of bribe-paying companies and risk management. Copies of these reports can be found on the PSC website.
For more information please consult the PSC website: www.psc.gov.za...

(Please forward us details of forthcoming books, conferences, seminars or events that could be considered for inclusion.)

Public Service Accountability Monitor (PSAM) launches new Website

PSAM called on the Eastern Cape government this week to work together with it in an effort to keep the public better informed of their performance in managing public resources and dealing with misconduct. The PSAM appealed to the provincial administration and the national government’s Joint Management Team to use the PSAM‘s new accountability monitoring website for this purpose. PSAM director, Colm Allan, said that it was vital for government to communicate its achievements and successes to the public in order to counteract over six years worth of negative reportage about government misconduct, corruption and maladministration in the province.

The updated website reveals startling information collected in PSAM's Eastern Cape case monitoring database. Members of the public, provincial Legislature and Legislature oversight bodies are encouraged to make use of the website which will be updated regularly.
For more information visit: www.psam.org.za...

The Institute for Security Studies (ISS) is an applied policy non-profit research organisation with a focus on human security issues on the African continent.

This e-briefing is produced by the SA Anti-Corruption Strategies component which is located within the ISS Organised Crime and Corruption programme in Cape Town and funded by the Danish Development Agency (DANIDA) through the Embassy of Denmark.

Editorial Team:
Hennie van Vuuren (Senior Researcher: Anti-Corruption Strategies)
Paul Arendse (Research Intern)
Pilisa Gaushe (Manager: ISS Corruption Resource Centre)


For more about ISS please visit our website at: www.issafrica.org...
To contact us, or if you should have any comments, please email: umqoled@iss.org.za