Bain 'disappointed and surprised' after UK govt punishment for its role at SARS

accreditation
0:00
play article
Subscribers can listen to this article
Lord Peter Hain leaves a weekly cabinet meeting in London, England.
Lord Peter Hain leaves a weekly cabinet meeting in London, England.
Cate Gillon/Getty Images/File
  • Bain & Co. has been banned from UK govt work for three years over the role it played in facilitating the capture of the SA Revenue Service.
  • The ban sets an important precedent for the handling of companies found to have assisted with corruption overseas, according to lawmaker Peter Hain. 
  • Hain has long called for repercussions for the firm and other international businesses that were implicated in state capture.
  • Get the biggest business stories emailed to you every weekday, or go to the Fin24 front page.


A UK government ban on Bain & Co. from competing for state contracts sets an important precedent for the handling of companies found to have assisted with corruption overseas, according to lawmaker Peter Hain.  

The global consultancy was this year found by a South African judicial commission to have had links with corruption in the country under the presidency of Jacob Zuma, specifically in work restructuring the national tax agency. 

Labour peer and veteran anti-apartheid campaigner Hain has long called for repercussions for the firm and other international businesses that were implicated in the practice known locally as state capture, which the government estimates cost the country R500 billion.

"This is an important precedent which I welcome because when this was going on and Bain in South Africa was doing all this nefarious business and earning big fees in the process, then it was away from global scrutiny," Hain, who grew up in South Africa, told Bloomberg Radio. "I don’t think that public contracts should be handed out in a country like Britain to any company that has behaved in that unlawful way."

Bain was barred from bidding for British government contracts for three years for being "guilty of grave professional misconduct which renders its integrity questionable", Minister for Government Efficiency Jacob Rees-Mogg told Bain’s UK Managing Partner, James Hadley, according to a letter reported by the Financial Times and confirmed by Bloomberg. 

Bain said the firm is "disappointed and surprised" and would be responding to express concern about the decision-making process before considering other options.  

The global company said in 2018 its work for the South African Revenue Service amounted to "serious failure" and paid back fees, but has since denied wilfully facilitating or being party to corruption.

Other international firms have returned earnings for their links to graft in South Africa, notably McKinsey & Co., another global consultancy, and Swiss industrials firm ABB, German IT services firm SAP SE. and auditor KPMG LLP are two others to have been embroiled in scandals in the country during the Zuma era.

Hain urged US President Joe Biden and UK Prime Minister Boris Johnson in February to suspend Bain’s operating licenxes after the judicial commission’s report, which Bain said mischaracterised what took place. Athol Williams, a former partner at Bain who turned whistleblower, said the UK government’s decision shows the findings were taken seriously - more so than South African President Cyril Ramaphosa’s administration.

"I think this should embarrasses the South African government because the South African government has had this information for years," Williams said in an interview Wednesday with Johannesburg-based broadcaster eNCA.

- With assistance from Caroline Hepker, Rene Vollgraaff and Lizzy Burden.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
17.98
-0.8%
Rand - Pound
19.89
-2.4%
Rand - Euro
17.61
-1.4%
Rand - Aus dollar
11.68
-0.4%
Rand - Yen
0.12
-0.6%
Gold
1,661.34
+0.1%
Silver
18.78
-0.6%
Palladium
2,218.50
+3.1%
Platinum
870.00
+0.4%
Brent Crude
89.32
+3.4%
Top 40
56,921
-0.9%
All Share
63,264
-0.9%
Resource 10
59,793
+3.3%
Industrial 25
76,769
-2.2%
Financial 15
13,707
-2.8%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders