Modiselle at the Fraud Awareness Campaign
13 October 2006
"It's your budget, become a Player"
Launch Mmabatho Convention Centre, 13 October 2006 at 10h00
Honoured guests,
Ladies and gentlemen,
Corruption manifests in many forms. All of these forms DEVIATE from many
generic and fundamental values of society, faiths, as well as morals and other
codes of behaviour that govern individuals and groups, in various pursuits of
life, whether they act alone or in relation to one another. Many of these codes
have been refined into a set of descriptions and prescripts of behaviour known
as ethics.
As we know, ethics are the standards of conduct that distinguish between
right and wrong, good and bad, virtue and vice, justice and injustice. Some
ethical standards i.e. morals are highly general and apply within the context
of various institutional or organisational codes of conduct or familiar roles
such as medical ethics, etc.
Corruption has become an acceptable evil in governments all over the world.
Commentators and investigators of corruption say the scourge is of such
magnitude that it cannot be uprooted altogether, but can only be "controlled"
to "acceptable limits," like a chronic disease! "Astonishing...isn't it? Sadly,
we must concede that corruption is one of the major problems facing our
society. It's like a parasite that erodes stability and trust and it damages
the ethos of our democratic government. Its effects can seriously constrain
development of our economy and grossly compromise our efforts to halve poverty
and unemployment by 2014.
Government's Role
To address the specific problems of corruption in our country, the South
African Government in 1997 initiated a National Anti-Corruption Campaign and
expressed its commitment to fight fraud and corruption in the Public Service.
From this, a National Public Service Anti-Corruption Strategy was developed to
prevent and combat corruption through a variety of supportive actions.
As one of those actions, the Public Finance Management Act (PFMA) was
enacted, together with the accompanying Treasury Regulations. These documents
prescribe that "fraud prevention plans" be developed to limit the risk of
fraud, while creating awareness and promoting ethical business conduct. One
needs to realise that a professional, well-planned and detailed fraud awareness
and preventative strategy can only be developed with extensive research and by
taking the National Public Service Anti-Corruption Strategy (NPSAS) and all
other relevant information and facts into cognisance. Our Fraud Prevention
Framework is founded upon the dimensions of fraud risk assessments, fraud
policies and response plans, fraud prevention controls (documents, systems,
policies and procedures), training, education and essentially the awareness
factor.
The National Government has gone to so much trouble to fight crime, fraud
and corruption and various bodies such as the National Anti-corruption Forum
which was launched in Langa, Cape Town as far back as June 2001. This forum's
objectives were to establish national consensus through the co-ordination of
sectoral anti-corruption strategies, to advise government on the implementation
of strategies to combat corruption and to share information and best practice
on sectoral anti-corruption work, so that members can advise one another on the
improvement of anti-corruption strategies. Apart from this, a special
investigations unit was established, which managed the execution of special
investigations with relation to the core functions of the Commission.
Then the National Prosecuting Authority (NPA) of South Africa was
established which included the National Prosecuting Services (NPS), the
Directorate: Special Operations (DSO), the Witness Protection Programme, the
Asset Forfeiture Unit (AFU), and specialised units such as the Sexual Offences
and Community Affairs Unit and the Specialised Commercial Crime Unit. This was
over and above the Office of the National Director of Public Prosecutions
(NDPP) which forms the head office of the Prosecuting Authority.
These are just a few of the many initiatives which the National Government
came up with in their fight against fraud and corruption. I must hasten to add
that progressive structural changes have been made since. In spite of all these
efforts, crime and corruption carries on unabated.
Let me share a few examples with you:
So-Called Soft Issues
In the workplace, all officials have access to official telephones. If every
one of the 66 761 officials just make an estimated two private calls at a cost
of just 50c per call, per day, this amounts +- R16 million per year. Another
example to amplify the point; if most of our officials are generally
unproductive, surfing the internet, taking long coffee breaks and lunches,
sitting around doing nothing, gallivanting at Mega City during working hours,
for an average time of just 60 minutes per day, this amount to +- R24 million
per annum.
If you just isolate these two examples from the many examples out there, we
are effectively losing more that R40 million annually, meant to address the
very important issues of poverty alleviation and job creation in this country.
What are we doing? We could build more than 600 Reconstruction and Development
Programme (RDP) houses for the homeless for instance, or put this money towards
addressing the promises made by the Honourable President.
These examples only depict the impact of wasteful practices in our
provincial government. Just think of the amounts of money that is lost if one
assumes the same bad habits exist at National level, in all of the other
provincial governments and at Local Government level in all of our
municipalities. These losses could in fact run in to hundreds of millions or
even billions of Rand annually.
So-Called Hard Issues
Then you have the supply-chain management environment, where we are dealing
with a minefield of opportunity to defraud Government and ultimately the poor.
You have contractors who bribe decision makers in the public sector to award
them contracts; they inflate their prices unrealistically in order to make
excessive profits; or they even quote unrealistically low prices, knowing that
they will never be able to do the job according to specifications.
They then compensate for the low quotes with the so-called cost-increases,
bankruptcy ploys and low-quality work and sub standard materials. Contractors
even form front companies with public servants! Then you have suppliers who
deliver products and services that do not comply with the agreed
specifications, or they would falsify the quality or standards certificates.
These suppliers also engage in duplication and/or over-invoicing or submitting
claims for services not rendered. Then there are the issues of collusion to fix
prices, interfering with the work of evaluators, ignoring quality or safety
standards and misrepresentation or dubious claims about the services or
products.
Then there are the issues of general unethical behaviour by some of the
business sector where agents do not disclose to consumers how much commission
goes to the agent as part of the deal, often pressurising ignorant consumers
into serious debt. You also find that managers of companies award themselves
large bonuses and benefit packages that they do not deserve and in the process
deprive the company's other stakeholders of their full benefit. Issues such as
creative accounting to falsify the apparent value of shares in the company and
the methods whereby powerful companies stall to settle accounts with suppliers,
gaining interest on money in their bank accounts are just a few examples.
These few examples, of big time embezzlement by some corrupt individuals run
into billions of Rand annually, which otherwise were meant to address our
strategic objectives as articulated by our President as follows:
* eradicate the bucket system by 2007
* every citizen would have access to fresh running water by 2008
* every citizen would have access to proper sanitation by 2010
* every citizen would have access to electricity by 2012
* halve poverty and unemployment by 2014.
Against this background, it cannot be overemphasised, that when people
charged with providing poverty alleviation and rural development, brazenly
steal funds meant for the poor, there is more that enough reason for outrage!
In an attempt to solve the above challenges or for that matter any challenge of
this magnitude, we surely have to go back to our roots. So, in absence of
another similar national or provincial exercise, the North West Provincial
Treasury launched the biggest fraud awareness campaign to date, during it's
2006/07 budget speech with the theme, "It's your budget; become a player!"
The philosophy of this campaign has been derived from the traditional tools
of African legal philosophy as illustrated in a story published in Lovedale
Press, 1970. The story relates to a dispute between twin brothers, about who
should be the successor to their father, Vuyisile. (The interesting story can
be read in the Fraud Awareness booklet, which was distributed to you).
However, the following observations can be made based on the said story and
more so about the African folklore:
* matters of law engaged the whole community and were not the domain of a
few legal experts
* legal solutions were also sought in historical analogies and precedents, like
Western law, but legal rules were applied in a flexible fashion
* many other factors as well as the fact that, the community regarded everyone
as equally worthy of concern and that everyone was capable of influencing
important decisions regardless of age, gender or status.
Our Fraud Awareness Campaign "It's YOUR budget, become a player" is founded
on these historic principles. The campaign is an attempt to get every citizen
in the province to do their bit to ensure that all the budgeted funds are spent
where intended in terms of the budget statement and that none of the funds
should vanish due to poor or maladministration, wasteful practices, fraud,
theft and corruption by any stakeholder.
This department and all "players" are endeavouring to embed corporate
citizenship in the North West. While specific qualities will always underpin
the values of good citizenship, we are committed to responding to the shifting
demands of this role. Our motto is based on the well-known phrase, "Prevention
is better than cure."
Because this province is committed to high legal, ethical and moral
standards, and because all employees are expected to share this commitment, we
had no choice but to initiate something fresh in absence of another similar
exercise and in line with the well known indigenousness proverb, "Until the
lions have their storytellers, tales of the hunt will always glorify the
hunter." What makes this approach fresh and unique is the fact that we're
trying to move away from the reactive approach of whistle blowing and
prosecuting in an attempt to become more pro-active.
A corporate citizen or "player" does not engage in corrupt shameful
behaviour. If we, as the community see an individual for example misusing a
government asset such as a vehicle, we need to become "a player" or a corporate
citizen and confront that individual. That person might ignore the first person
to approach him or her, but when the tenth member of the community approaches
the same perpetrator, at the same shopping mall, he or she would surely think
twice before misusing that vehicle so blatantly again.
The campaign will start small but every cent saved will convert into
millions in the near future and provide a better life for all. However, the
most difficult part of such a campaign is to ensure that the message reaches
every person in the province. The Fraud Awareness and Preventative Framework as
well as the Regulatory Framework are booklets, compiled by the Provincial
Treasury with the assistance of certain skilled individuals from the Office of
the Auditor General, PWC, KPMG and Gobodo to name but a few. These documents
are intended to create awareness at all levels of society, educating us all in
the relevant controls, procedures and Acts and helping us to realise the
importance of protecting our slice of the cake for the greater good of many,
rather than watching it being consumed by a greedy few.
Coming up with an awareness initiative is one thing, but our next biggest
challenge is to find ways to get people interested to educate themselves and to
understand more about fraud and corruption and how this impacts negatively on
their lives. We then came up with the idea of using a game, in both pamphlet
form as well as electronic format. The game is a self-test questionnaire, which
has a soccer theme and should work well with the people of South Africa, as it
also helps to ignite world cup 2010 fever. When you play the game, it would
randomly select a few questions and answers and based on the answers you pick,
the game would then tell you which role you play in the community at
present.
We say that all people can generally be categorised into four main groups
being: the spectators; the critics; the manipulators; and the "players" or
corporate citizens:
* most people are mere spectators as our cartoon character Lizz, who just
turns a blind eye, and does not want to get involved.
* Then, you will find the next group of people being the critics who would,
just like our cartoon character Humphrey, criticises everything around them
(especially the ANC led government) without offering any solutions.
* Unfortunately, we have among us quite a few "on-the-take Jakes," our cartoon
version of a little jackal, who are the cause of these problems! Jake is a
manipulator who looks for weaknesses in systems and procedures and then
manipulates them for his or her own benefit.
* Luckily, we are not all bad and there are a handful of individuals, like our
cartoon character Kelebogile, who wants to make a difference. These people
build solid bridges between how things are right now, and how they should be.
These individuals are the so-called "players" or corporate citizens.
Our main goal with this initiative is ultimately to get at least fifty
percent of all people in this province to become corporate citizens or
"players" as we say. Once you have played the game and you know who you are
right now, you can do something about it by reading more about the subject in
our awareness guides and by getting involved. Our next big challenge is how to
ensure that every person in the province gets in contact with our campaign.
We realised that the only way to achieve this goal is to get a partnership
going with the most prominent business people in the province. If we could
achieve a strong public and private partnership that could jointly fund the
tools that we require to spread the message to the most isolated areas of the
community, we believe that this initiative would ultimately be successful. We
also realised that if we wanted to keep our corporate citizens or "players"
interested in a campaign of this nature, regular feedback of some sort would be
required. People quickly lose interest in an initiative where they cannot see
the progress made as a result of their efforts.
So, we gave the Finance Website a face lift and added a link, which takes
you to the homepage of this particular campaign. On this page, you will find
links to the available documentation as well as a link where the public can
interact with the department regarding the campaign by sending E-Mails, SMSs
and even photographs of potential misuse or wasteful practices by perpetrators.
Our communications directorate would monitor all interaction received from the
public, just to make sure that it does not contain any offensive material and
that it would be suitable for people of all ages, etc.
Information that seems to depict wasteful or illegal practices would be
forwarded to the Department of the Premier for further investigation and
feedback. The public would receive general monthly feedback on the website,
regarding the progress made with cases reported, cases under investigation and
cases completed. What makes it interesting is the fact that the public would
for the first time be able to read about other people's experiences relating to
this campaign and therefore all corporate citizens would in fact assist in
creating general awareness. The public would also be updated on all new
developments relating to this campaign in the media and on this webpage.
There will also be a recycling initiative which will be driven by the
Department of Education at all secondary schools in the province, to create
awareness amongst our youth. We must bear in mind that most of our grade twelve
learners of this year become economically active next year, and it is of great
importance that these young people entrench consciousness in becoming corporate
citizens before entering the mainstream economy.
We will also initiate a potential new source of provincial revenue by
acquiring television and Digital Video Disc (DVD) equipment, which would be
used in all our revenue offices such as hospitals and motor vehicle licence
offices, to sensitise the public on the importance of this campaign and how to
become corporate citizens. The same equipment could be used for marketing
services rendered by some of our bigger suppliers, which could in turn render
additional revenue for the province to increase service delivery to our
communities.
In conclusion, we call on the people of the North West to join us in the
struggle against fraud and corruption. The cancer at the heart of this
imbroglio, and the loopholes that corrupt people exploit to enrich themselves
at the expense of the poor, must be excised.
The robbing of the poor must stop!
Thank You
Issued by: Department of Finance, North West Provincial Government
13 October 2006
Source: North West Department of Finance (http://www.nwpg.gov.za)
