The first report of the Zondo commission does more than identify culprits for criminal prosecution. It goes a long way in confirming, and providing further detail about what was argued in the 2017 “Betrayal of the Promise” report published by the State Capacity Research Group . It also lays out an ambitious project of government reform.
Part 1 of the Zondo report shows how corruption in SA is the result of incestuous relationships between political, administrative and economic powers in the management of the state apparatus. While the report resembles the verdict in a criminal case in the way it marshals evidence of crimes and names those responsible, the recommendations also offer an anti-corruption agenda with comprehensive and ambitious proposals.
Notwithstanding the evidence of the crimes committed, the policy recommendations made by the commission must be subject to public scrutiny and debate.
The recommendations can be organised into three groups: the trial and conviction of individuals responsible for wrongdoing; improvements in the political system, such as the introduction of changes in the financing of political parties; and addressing the weaknesses of the public procurement system, correctly identified as being at the heart of so much corruption and government failure.
Here we would like to consider the commission’s proposals regarding public procurement. We understand that what has been published so far may be supplemented in the final report with further detail. There is, nonetheless, a substantive proposal from Zondo in part 1 of the report.
The contractor, the infamous Edwin Sodi, hired to upgrade the municipal dam where the hippos were in residence, made a mess of things and the water level dropped. The hippos moved out
While SA’s political culture is such that questions of administration are usually treated with a yawn, buying goods and services constitutes a large part of what the government actually does. In fact 14% of the national budget was spent on goods and services in 2021 — more than the cost of public debt. Even a modest improvement in this area could have transformational effects in our daily lives. There are so many examples, but two will suffice.
Farmers, workers and residents in the Tzaneen area have recently been harassed by hippos that have moved into farm dams. Why? The contractor, the infamous Edwin Sodi, hired to upgrade the municipal dam where the hippos were in residence made a mess of things and the water level dropped. The hippos moved out.
As the pandemic spread and hospitalisations and deaths spiralled, the government relaxed regulations for the procurement of protective gear for hospitals and so forth. An emergency necessitated emergency procurement. Yet the result, as the auditor-general reported, was a grotesque frenzy of price gouging, fraud and the general manipulation of processes. In this case, supply chain management was a matter of life and death.
Public procurement is about the everyday functioning of government. This is why it is so important that the current system is reformed. How should this be done?
The state capture commission has recommended that a new anti-corruption agency be created to deal specifically with public procurement. It would increase transparency in public tenders, see to the formation of a body of professionals specialised in public procurement and introduce new codes of conduct to strengthen integrity management among public servants. These proposals, however, are insufficient and would still fall short in closing the loopholes that allow manipulation and looting.
In public enterprises, especially those implicated in state capture but across the government, procurement has come to a standstill, and with it the work of the government. In this environment even decent people are often too scared to make decisions at all. Procurement reform must not just reduce the risk of corruption from happening; it must also make procurement possible, easy and effective.
SA needs a professional and effective public service whose operational excellence is the main source of corruption prevention. This will not be achieved by reforming the public procurement system alone, much less by creating a new anti-corruption agency.
The current public procurement system is already overly fragmented and regulated by numerous legal regimes. The introduction of a new agency with the exclusive mission of combating corruption in public procurement will be yet another arrangement to further complicate the public procurement system and the anti-corruption system. Both are handicapped by the lack of strategic co-ordination, of human and financial resources, of capacity to conduct sophisticated analysis and of institutional support.
Better than a new agency, it would be useful to strengthen the regulatory function exercised by the office of the chief procurement officer, making it an autonomous agency responsible for giving directives and implementing guidelines for public procurement throughout the country.
A supply chain manager should be a prized position, attracting highly skilled and senior candidates who are appropriately rewarded. After all, these officials must be able to tell the difference between a scam and an innovation, write specifications and evaluate the technical standards of bids. In the banks these are highly paid roles. In the government these fundamental tasks are left to junior officials for whom a procurement job is a career dead-end.
How many guards do you need, what qualifications should they have, how should they be resourced? None of these are simple questions
It is the extreme shortage of people with technical knowledge of products and services that means certain kinds of actions must be centralised, or at least regionalised. As a thought experiment, imagine that you are an official in the department of transport who has to write the specifications for hiring security guards. How many guards do you need, what qualifications should they have, how should they be resourced? None of these are simple questions in fact. Get the answers wrong and you end up without train stations at all.
A centralising approach also presents risks, of course — institutions with generic mandates are more attractive prey to abuse of power and traditional cases of dismantling the public service. This is why it is crucial today to reform the process by which heads of institutions are selected and managed. For the civil service to live, cadre deployment must die. This is why we suggested in a report published last year the introduction of a senior civil service system such as that adopted by the US, the UK, Australia, Chile and Portugal.
The Zondo commission has correctly put its finger on public procurement as urgently needing reform. The system is the lifeblood of the government. It is the lifeblood of SA’s shadow state too — the nexus where business and politics feed off each other. The commission’s proposal has put the issue of public procurement firmly on the agenda but needs further consideration for stronger safeguards. We must seize the moment — not least for the sake of the hippos.
* Chipkin and Leite work at the think-tank Government and Public Policy. GAPP has launched a civilian commission to develop detailed plans on procurement reform.
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