Reports on state capture are a reminder of how tender rip-offs can damage the state. Citizens cannot afford to sit back when similar scams occur at local level.
The corruption allegations contained in the Betrayal of the Promise: How the Nation is Being Stolen, report is backed by several of the nation’s most esteemed universities. Read alongside the SA Council of Churches and the Public Affairs Research Institute’s own work on the same topic and bearing in mind the former public protector’s investigative findings, there can be little doubt that this degree of endemic corruption plunges the South African state into deep crisis. The capture of key institutions like the Treasury all but extinguishes the last flicker of hope.
The tentacles of state capture now extend so far and wide that it is hard to imagine how even those non-captured elements of the Hawks or the special investigations unit will dismantle this network of sleaze.
The chairman of parliament’s standing committee on public accounts (Scopa), Themba Godi, recently conceded that the government’s anti-corruption task team lacks political leadership.
The authors of Betrayal of the Promise, outline the potential impact of tender fraud given the scale of procurement growth in SA. “Over the last 20 years the value of goods and services that the government purchases, largely from the private sector, has grown to between R400- and R500-billion a year.” For 2014/15 the auditor general found R46.4-billion of this was irregular expenditure.
Tender-rigging and subverted state procurement procedures have clearly done major damage to the public service capabilities of Eskom, Transnet, the police, mineral resources ministry and virtually every other state-owned enterprise. In comparison, dodgy tenders at local government level may seem insignificant in rand terms.
However, a far more immediate community service impact is felt when local government procurement is corrupted.
But tender rigging is not simply about stealing from the public purse. There are longer-term impacts on state institutions. Because the supply chain management process must be subverted, the perpetrators of tender fraud must undermine key parts of the corporate and financial governance structure. This may entail weeding out key professionals or leadership that has demonstrated strong independence and integrity.
Meddling with key procurement structures through improper appointments, political interference and the sidelining of key technical audit staff is also used to achieve the same objective.
Regulatory frameworks are manipulated, often in the name of legislative compliance, to disqualify or sideline certain bidders. The new politically connected elite, many believe, has stolen not just vast swathes of the state but the “radical” discourse of transformation.
Some community activist groups are not buying the new transformation spin. But instead of resorting to blunt protest, they are invoking a more tactical approach to the problem. These groups track and report suspect municipal business deals and outsourcing arrangements.
Modest as they may be, these small citizen-driven initiatives may yet prove to be an effective counter measure to the local manifestation of state capture.
- Glenn Hollands is a local government consultant and plays a minor support role in citizen-based initiatives to improve local governance and accountability.