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SA: KZN Premier Senzo Mchunu on fraud and corruption in government

Senzo Mchunu
Senzo Mchunu

17th October 2014

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KwaZulu-Natal Premier Senzo Mchunu has warned that fraud and corruption has a potential to collapse government if nothing was done to root out this scourge from government and society as a whole. He was speaking in a meeting attended by Heads of Departments, Chief Financial Official and Supply Chain Managers at Cedara outside Pietermaritzburg. He convened this meeting to allow HODs and CFOs to account for the failure of their respective departments to achieve clean audits.

“Fraud and corruption are a cancer which, if not arrested has potential to irreparably harm the standing of our province and its reputation amongst its citizens, making our people lose faith in the future of our democratic country. Fighting corruption is about the restoration of the integrity government. We need act urgently because fraud and corruption have a potential to cause a massive drain on resources, undermines service delivery and causes our democracy to flounder.”

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“We have invited journalists to this meeting so that they can report publicly about this matter. Unlike the apartheid government which did not speak openly about apartheid. Accountability to the general public was nonexistent. Importantly, the debate on corruption was suppressed because those at the helm of the corrupt and brutal apartheid system used public resources not only for self-enrichment but to crush those who were regarded as a threat.”

“There was neither a will on the part of the apartheid government to deal with this scourge nor resources allocated to eradicate corruption and maladministration in the public service. Ours is a government that is declaring war openly against corruption and we invite the public to join us in the fight.”

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“This government is clearly different from the apartheid regime. Transparency and accountability are at the core of good governance and it is for this reason that issues of good governance are on top of the agenda.”

“We have “Mpimpa and Sukuma Sakhe” hotlines created for the public to report cases of fraud and administration. We have appointed the Ombudsperson whose role is to deal with complaints related to poor service rendered by government.”

“We have established the Integrity Management Unit whose responsibility is to promote and encourage ethical behavior in the public service under the campaign “I DO RIGHT” even when nobody is watching. The Integrity Unit working with Provincial Treasury have investigated the following cases:

    In the 2012/13 year alone, 708 civil servants were reported to the police for fraud and corruption. The total number of money involved in this fraud and corruption is more than R30 million ( R30 832 552)
    546 of these civil servants were convicted and sentenced to varying terms of imprisonment.
    In the first quarter of 2014 (April to June), 274 public servants were subjected to disciplinary hearings for grant related fraud and 78 for fraud and theft. The hearings are continuing.

“The supply chain management uni is an area that is open to corrupt practices such as bribery and fraud. Gaps to prevent decay need to be closed.

"All contracts which are awarded to those who do business with government, mostly the private sector, should pass the scrupulous test of value for money through a fair and transparent competitive process.”

"Criminality in the awarding of tenders must land those involved in prison. It should be emphasized that bribery and fraud in the awarding of tenders involves both state employees and the private suppliers."

"Therefore, we need the co-operation of the private sector in order to turn around the situation. The private sector must assist by not offering bribers to the state employees involved in procurement processes. We expect you to respond and give us reasons around the performance of your departments. In cannot be correct that nobody is held accountable for failing to achieve clean audit."

“In his report which he presented to me, the Audit General highlights areas that are contributing to weak audit outcomes. There are few key areas that require an immediate response from all of you today.”

“Some of these include ineffective contract management and internal controls.  Supply chain management systems that are not fair, equitable, and transparent and in turn promote irregular practices. In some instances, such weaknesses result in tenders and contracts being awarded to relatives, friends or to civil servants.”

“The statutory responsibility of accounting officers is to maintain effective systems of internal controls. I expect you to set the tone regarding the importance of internal controls and expected standards of conducts from employees.”

“If we want to develop a good image for this government, the day-to-day implementation of effective risk management processes should not be delegated to junior staff. It is your responsibility as Chief Financial Officers.”

“You are responsible for the ongoing monitoring of procurement activities to ascertain whether all components of internal controls are functioning and effective.”

“Human Resource management and Leadership is one area which requires your immediate attention. Finance Departments and Supply Chain Management Units need to employ competent people who possess sound financial management skills.”

“Information Technology Financial management is also crucial in ensuring effective internal control systems. Weaknesses in the IT system must be eradicated as it is the cause of poor financial reporting in many departments and municipalities. As Chief Financial Officers you need be at the forefront of the development of effective Financial and Information management systems for your departments. If you fail to do that government will lose millions of rands through fraudulent transactions.”

“During the previous term of office, government lost more than R179 million as a result of cybercrime. One case involved an employee whose password and username was used to access BAS and PERSAL System. About 19 criminal cases were registered with the SAPS.”

These are the issues that you must focus on throughout this conference.

 

Issued by the Presidency

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