Public service corruption costs almost R1bn

There has been a leap in the cost of financial mismanagement and corruption in the public service, the watchdog Public Service Commission (PSC) has reported.

Briefing Parliament’s public service and administration portfolio committee, commission director general Richard Levin told MPs he hoped this would not soon hit R1 billion a year.

Although the trend in the actual number of reported cases of financial misconduct – for the five years from 2006/07 to 2010/11 – showed a decline, the cost had rocketed.

“What’s significant is the value; the value has gone up dramatically, from R130.6 million (in 2006/07), to ... R932.3m in 2010/11.

“We’re moving towards a billion (rand). We don’t have 2011/12 (figures) yet, but – and obviously we’re hoping it won’t – will it hit the billion mark?”

There were 1 035 reported cases of financial misconduct in 2010/11, but Levin said this was underreported.

“But certainly ... there’s an escalation in the value of financial misconduct. The figures speak to it.”

Levin said a “fundamental problem” within the public service was the number of senior managers who had other business interests.

“That’s something we need ... to take very seriously; whether we should continue to countenance this situation whereby senior managers in the public service ... through a process of disclosure ... are actually allowed to have business interests that aspire to do business with government.

“That is a fundamental problem. We need to look at it quite seriously.”

While there were arguments on why this should be allowed, in terms of the Constitution and Bill of Rights, the implications of allowing it needed to be understood from an ethical, corruption, and performance standpoint.

“Because, if I’m running four businesses, can I really do justice to my full-time job as a senior manager in the public service, if I’m running all those businesses on the side? Will I have the necessary time to do my job properly?”

The PSC, which is constitutionally mandated to monitor the public service, believed senior public service managers should not be permitted to have such business interests.

“Can we permit a senior manager to have a business interest that seeks to do business with the state? Our view is that it’s wrong.”

Levin said the commission was also concerned about the number of departments, national and provincial, which had not submitted financial disclosure forms this year, listing senior managers’ business interests, if any.

“We are concerned. There are 31 departments that did not submit financial disclosure forms to the PSC by May 31 (for 2011/12). Seventeen were at national level, and 14 were at provincial level.”

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