A Super-Scorpions unit needed to oversee state deals and corruption

by | Nov 23, 2020 | General | 0 comments

12 November 2020 – 16:34 Petrus Marais, Lloyed Rakgoale, Karam Singh and Caroline James

Against the backdrop of a looming global recession and the aftershocks of the Covid-19 pandemic, addressing corruption and the misappropriation of state resources in SA remains as important as ever.

The cabinet and the ANC have proposed measures to deal with this scourge, ranging from prosecution to requiring officials to step down from public office if charged. While it is encouraging to hear more robust anti-corruption rhetoric from the senior leaders in the government and the ANC, many initiatives and proposals remain mere statements of intent.

There are three areas of reform that need urgent attention to tackle corruption: changing the public procurement system, re-establishing SA’s investigative and prosecution capability, and using civil law and administrative sanctions to fight corruption.

It has become clear that the existing public procurement system simply cannot regulate transparent, fair, efficient and sustainable public procurement in SA as required by the constitution. Public-procurement processes are lengthy, involving open tenders and many decision-makers. A shortage of capacity in procuring entities, a fragmented legal framework, the desire to pursue other social goals such as BEE, political interference and a lack of transparency continue to plague the system.ADVERTISING

Fortunately, there is recognition of these failings and processes are under way to revamp SA’s public procurement system. Parliament published the draft Public Procurement Bill this year, and called for public comments. While it is encouraging that the bill consolidates and standardises the existing legal framework, the bill has key weaknesses.

There is a clear need for a succinct and independent review process of tender advertisements, awards and implementations, and the bill attempts to create this. However, it establishes a procurement regulator but places this office within Treasury, which jeopardises its independence.

Challenging tender awards remains difficult. A long review process is set out in the bill, but to ensure accessibility the process should be simplified to ensure dissatisfied bidders can quickly and cheaply challenge the award of a tender they believe to be irregular. A process for monetary compensation to bidders unlawfully deprived of tenders, paid as a fine by the procuring entity, should also be included.

At present the bill does not make a commitment to transparency, and various provisions limit access to information on tenders to public bodies. The opaque nature of the existing procurement system also results in a heavy reliance on whistle-blowers with inside information on irregular tenders bringing the wrongdoing to light, who require better protection.

One final element that can indirectly prevent procurement corruption is to make beneficial ownership information publicly accessible. There should be a requirement in law that beneficial ownership information be collected and readily published on a central register.

One of the key components in the fight against corruption is the re-establishment of investigative and prosecutorial capability commensurate to the corruption challenge. There is precedent for having prosecutor-led investigations in SA, namely the controversially disbanded Directorate of Special Operations (known as the Scorpions), yet today we find ourselves with a deeply flawed structure. State investigation and prosecution skills have been hollowed out and the Directorate for Priority Crime Investigations (the Hawks) lacks the skills to investigate highly complex corruption cases.

In addition, the lack of a formalised investigative unit within the National Prosecuting Authority (NPA) itself hampers its ability to contribute meaningfully to a multipronged approach to anticorruption. Although the current investigating directorate, under Hermione Cronje, is a welcome addition to the NPA’s arsenal, its focus on only a small portion of corruption cases limits its effectiveness.

The Fusion Centre, established during the Covid-19 pandemic, has proved to be a successful model for interagency, interdepartmental and interpersonal co-operation, but does not now have the necessary legislative protection or permanence. This multi-stakeholder approach would need to be formalised through legislative amendments.

Such “workarounds” of the existing structures speak to the fact that the structures in their current forms and silos are not optimal and that there needs to be a move towards establishing a carefully constructed single, multifaceted investigative and prosecutorial capability to deal with corruption, including incorporating prevention and detection strategies under such an entity.

After a commission of inquiry appointed to investigate the mandate and location of the Scorpions, judge Sisi Khampepe made it clear that it was both rational and constitutional to have an investigative unit within the NPA. It is our assessment that a successful investigative directorate and prosecution authority needs to be a single unit with leadership with security of tenure protections; a specialised unit with sufficient, properly trained staff with security of tenure; a unit with the ability to contract specialist expertise; and a unit that is independent of executive influence, control or interference.

What is clear is that as part of the systemic reforms proposed there is a need for a guarantee of real independence. Whatever end state we arrive at — whether it be a different NPA or a new anti-corruption agency — it must have greater independence guarantees than those that exist. The authority for such propositions should always be the constitution. 

Given the magnitude of existing corruption, law enforcement efforts need to incorporate the full complement of SA’s criminal, civil and administrative legal framework to ensure accountability. While criminal prosecutions remain an important aim, they are lengthy, resource-intensive and costly.

The benefit of using criminal and civil processes to ensure accountability and the recovery of assets is demonstrated in the achievements of the Special Investigating Unit’s (SIU) Special Tribunal. To strengthen the SIU and immunise it from potential political interference, we suggest incorporating it into an all-purpose, independent anticorruption agency with constitutional status that would enable it to initiate investigations without the need for presidential proclamations.

Second, a permanent Special Tribunal should be established to enable the continued prosecution of civil matters and extend the tribunal’s powers to include the power to impose punitive, administrative penalties that will have the effect of a civil judgment.

Although the SA legal framework does not empower law enforcement agencies to punish individuals and firms that engage in malpractices and maladministration by imposing administrative penalties, administrative fines do have the potential to deter individuals or firms from engaging in illegal conduct/activities. We only need look to the successes of the SA Revenue Service and Competition Tribunal for evidence of this.

Thus, in the interest of expediency to deal with the large number of pending and unresolved corruption cases, the ability to impose administrative sanctions should be considered for the Special Tribunal.

By seizing the opportunity to reform these key governance structures SA will be able to take firm action to address corruption and hold to account those responsible of depriving millions of South Africans of their constitutional and human rights.

• Marais and Rakgoale are with FTI Consulting, and Singh and James with Corruption Watch.

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