Study reveals common causes of corruption in South Africa

24 April 2011 | Angeline Albert

A number of South Africa’s public sector buyers have accepted kickbacks in exchange for rigging tenders, according to a report highlighting levels of corruption.

The study by the Public Service Commission (PSC) focused on the most common types of corruption in the country’s national and provincial governments based on 7,766 incidences reported on the National Anti-Corruption Hotline between September 2004 and June 2010.

Having identified 11 types of corruption during this period, the PSC found 720 cases of “procurement irregularities” in the two public bodies, nine national departments and three provincial governments that were selected at random for scrutiny.

Procurement irregularities chiefly involved officials awarding government tenders without following policies and procedures. There were also, however, examples of buyers awarding contracts to friends and family or rigging tenders in exchange for kickbacks. In other instances purchasing officials had disclosed classified information to contractors or service providers, or a contractor or supplier had falsified standards certificates or paid bribes. Sometimes tender specifications were ignored or altered to the advantage of a particular bidder.

Problems the report identified included:
• A lack of ‘declaration of interest’ procedures or policies for accepting gifts,
• Failure to enforce internal disciplinary measures against purchasing staff,
• A lack of prosecutions of companies involved in corrupt practices,
• No mechanism to blacklist offenders found to be involved in fraud.

The commission said internal controls in the areas of procurement and financial management should be strengthened. It recommended that departments periodically conduct surprise procurement audits of selected projects to identify weaknesses and malpractices in purchasing processes.