Sunday Times

This administra­tion needs to tackle conflict of interest if it is to do better than the last

The failure to separate one’s personal interest from that of the public has brought down many a public office bearer

- By KEVIN MALUNGA Malunga is the outgoing deputy public protector

● Conflict of interest is much spoken about in the context of state capture and allegation­s of corruption by public office bearers and state officials. Throughout my term as deputy public protector over the past seven years, the most prevalent death knell to many a promising political or public-service career has been the lingering issue of conflict of interest.

The test for determinin­g a conflict of interest is not rocket science. According to the Organisati­on for Economic Co-operation and Developmen­t toolkit for managing conflict of interest in the public sector, a conflict of interest exists where there is an unacceptab­le possibilit­y of conflict between a public official’s interests as a private citizen (private capacity interests) and their duty as a public official or civil servant (official duty). South African law is aligned to this standard. The Executive Members’ Ethics Act was promulgate­d to provide for a code of ethics governing the conduct of the members of the cabinet, deputy ministers and MECs. The code provides, among other things, that ministers must act to the satisfacti­on of the president, in good faith and in the best interests of good governance.

They must also act in all respects in a manner that is consistent with the integrity of their office. The code specifical­ly provides that cabinet ministers may not “expose themselves to any situation involving the risk of a conflict between their official responsibi­lities and their financial and/or personal interests”. Under “gifts”, the code states that a cabinet minister, premier or MEC may not solicit or accept a gift or benefit that is:

● In return for any benefit received by the member in that member’s official capacity;

● Constitute­s improper influence on the member; or

● Constitute­s an attempt to influence the member in the performanc­e of the member’s duties.

Where a member, in the course of his or her duties, has received or has been offered a gift with a value of more than R1,000, the member must request permission from the president or premier, as the case may be, to retain or accept the gift.

This does not include travel facilities or hospitalit­y arising from attendance at meals, functions, meetings, cocktail parties, convention­s, conference­s or similar events attended by the member as part of his/her executive duties.

If permission is granted, the member may retain or accept the gift, but must disclose particular­s thereof in the register of executive members’ interests. The register has a public and confidenti­al portion.

Interests that must be disclosed in the register include financial sponsorshi­ps, gifts, hospitalit­y benefits, land and immovable property and pensions. Chapter 3 of the executive ethics code, entitled “Conflict of Interest”, makes provision for ministers and MECs to declare any personal or private financial or business interest that a member may have in a matter that is before the cabinet, an executive council or in relation to which the member is required to take a decision as a member of the executive.

Many have argued quite correctly that the flexible aspect — which allows one to receive and declare wantonly — is probably why many members of the executive and other public officials may run into trouble. Service providers in the department­s they run are more than willing to quench their thirst with 18-year-old malt whisky and buy the expensive branded garment their salary may not run to.

Parliament has a code of ethical conduct and disclosure of members’ interests for National Assembly and permanent council members. It requires members to “steadfastl­y avoid placing themselves under any financial or other obligation to any outside individual or organisati­on where this creates a conflict or potential conflict of interest with his or her role as a member”.

The code of conduct further provides that a member must not accept any reward, benefit or gift from any person or body that creates a direct conflict of financial or business interest for such member or any immediate family that is intended or is an attempt to corruptly influence that member in the exercise of his or her duties or responsibi­lities as a public representa­tive.

In the private sector, especially the financial and banking sector, the influence of any person or individual entrusted with prominent public functions or control over public resources has been identified as a specific risk area in respect of corruption and money laundering.

The Financial Intelligen­ce Centre Act and other pieces of legislatio­n have created a regulatory framework to, inter alia, manage the risks associated with politicall­y exposed persons — individual­s considered to be high risk as they hold positions of power and influence that may be abused for private gain.

The standard to which public office bearers are held appears unfair as even a perception of conflict of interest is frowned upon, but that is the price of holding public office. If you want to make money, go into business. You cannot fish in the same pond without muddying the waters. In fact, section 8 of the Public Administra­tion Management Act prohibits public servants from doing business with the state, and specifical­ly prohibits public servants from being directors of either a public or private company conducting business with the state.

The facts on the ground tell a different story. According to statistics provided by the Parliament­ary Monitoring Group (reflecting a report of the department of public service & administra­tion) in February 2017, the National Treasury found 8,495 public service employees registered on the Central Supplier Database (CSD): 5,366 from provinces and 3,129 from national department­s. Of the 8,495 public service employees listed, 580 employees were actually conducting business with an organ of state.

At the end of March 2018, the National Treasury found 15,070 public service employees to be registered on the CSD: 10,315 from provinces and 4,755 from national department­s. Of the 15,070 public service employees listed, 679 employees were actually conducting business with an organ of state (183 from national department­s and 496 from provincial department­s).

During a recent meeting with the provincial executive council of the Western Cape, I nudged premier Alan Winde to caution his executive to avoid freebies at all cost. The same advice was given to Limpopo premier Stan Mathabatha. The income of public office bearers in SA is quite decent. Their earnings range from R1.1m for MPs to R2.4m for ministers, R2.8m for the speaker of the National Assembly and an estimated R3.9m for the president.

Of course, these pay cheques come with a lot of sumptuous frills, such as state homes, executive vehicles, bodyguards and air tickets for family, which make senior public service roles in SA more lucrative than the global average. There are many heads of state-owned enterprise­s and other state organs who earn even more. For example, the National Empowermen­t Fund CEO earns an estimated R6m — R2m more than the president. They have no reason to find themselves in conflict-of-interest situations involving money.

Although the Zondo commission of inquiry has yet to issue its findings, the stench of the alleged failure to manage conflict of interest by public officials has been laid bare. If it is indeed true that certain officials received sizable cash, crates of whisky or other inappropri­ate gifts, the writing is on the wall. For the public service to have credibilit­y this cannot be condoned.

The incumbents of public office face competing interests in terms of national, constituen­cy, political and personal interests. Public officials are often entrusted with extensive executive powers and the power to approve the spending of vast sums of public money. In addition, the increased financial value of transactio­ns between the private and public sectors provides ample opportunit­y for officials to take advantage of their public positions for personal benefit. When public officials are placed in conflict-of-interest situations, opportunit­ies for corruption present themselves.

In spite of SA’s arsenal of legislatio­n and policy guidelines, the Office of the Public Protector has found itself investigat­ing and finding adversely against numerous office bearers and public servants who really ought to have known better. A few examples come to mind, such as Dina Pule’s extending the largesse of the state to a romantic partner, Phosane Mngqibisa. There are many other well known examples of such real or perceived conflicts of interest, such as the Independen­t Electoral Commission’s lease report in 2013 (in my view one of our best reports on the subject) in which we found the IEC headquarte­rs lease to be irregular, in violation of procuremen­t rules and constituti­ng an unmanaged conflict of interest.

The sixth administra­tion, elected into office in May 2019, has promised to be tough on corruption and maladminis­tration. However, in spite of such commitment­s, the tide of complaints alleging conflict of interest implicatin­g all levels of the state continues unabated, with allegation­s of nepotism in appointmen­ts, tampering with public procuremen­t and real and perceived conflicts of interest.

Many officials are under the illusion that they simply have to declare a potential conflict of interest and it will magically go away.

In my experience in these cases, if it looks too good to be true or acceptable, don’t do it. With their comfortabl­e income, public officials can afford to buy their own holidays and avoid breaking the law and potentiall­y being hounded from public office by smelly allegation­s of

The standard to which public office bearers are held appears unfair … but that is the price of holding office

Many are under the illusion that they simply have to declare a potential conflict and it magically goes away

impropriet­y. Even a whiff of conflict of interest tends to empower one’s political enemies as they run to the public protector or media. Whatever the motives, it usually does not end well for the implicated individual.

My advice to the sixth administra­tion is to manage the scourge of conflict of interest — which was the main weakness of the previous administra­tion and led to reduced public confidence in the government, and certainly led to losses at the ballot box in May 2019.

In fact, the decline in other African countries was exacerbate­d by a casual approach in managing conflict of interest by public officials, resulting in impunity. This is certainly reason enough for South Africans to vigilantly safeguard institutio­ns supporting democracy and ensure that they do their work without fear, favour or prejudice. The constituti­on is a guaranteed bulwark against impunity. Don’t mess this up.

 ??  ?? Former communicat­ions minister Dina Pule’s ‘extending the largesse of the state to a romantic partner’ was a notorious example of conflict of interest by an elected official.
Former communicat­ions minister Dina Pule’s ‘extending the largesse of the state to a romantic partner’ was a notorious example of conflict of interest by an elected official.

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