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Why Ethics Regulations Continue to Fail SA

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Why Ethics Regulations Continue to Fail SA

2nd September 2009

By: ISS, Institute for Security Studies

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Endless media accounts of conflicts of interest situations among public officials reveal two broad failures of South Africa's integrity management system. First, in the unregulated grey zones numerous opportunities for unethical conduct remain. Second, where regulations do exist they are often ineffective.

In the first instance, important examples include the revolving door between government and business where public officials are recruited into the private sector, taking up lucrative jobs with the same corporate interests who had business pending before them when they served in government.

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South African law is yet to recognize that the rapid movement of public officials threatens the integrity of government in two ways: public officials may be influenced in their official actions by the promise of a job with a company seeking a contract or attempting to shape public policy.

Alternatively, former public officials have extraordinary access to lawmakers and can use their government connections to benefit themselves or their business interests after they leave office.

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‘Cooling off period' laws attempt to prevent these abuses by restricting private appointments for a period of one year usually. Yet, they are absent in South Africa. Another grey area involves the interconnectedness of the incumbent ANC party in government and black economic empowerment businesses that tender for public contracts. These examples highlight the need for tighter regulations, yet there is little political will to tackle these areas head on.

So why is it that these conflict prone situations remain unregulated? A fundamental reason relates to the general confusion about the nature of conflicts of interest, or more specifically, what constitutes a conflict. This ambiguity plays itself out in two opposing trends. The first trend is seen with great regularity in media reports, where conflicts of interest are confused or equated with actual corrupt or unethical behaviour. In reality, conflicts of interest should be understood as a situation, not an action. Public officials may find themselves in a conflict situation without actually behaving corruptly. In other words, a conflict of interest does not refer to actual wrongdoing, but rather to the potential to engage in wrongdoing. Of course, the litmus test is whether the individual removes him or herself from the conflict situation. An official may or may not allow the interest that conflicts with the public interest to wrongly affect his or her conduct. But when reported in the media, however well-intentioned, it is misinformed or sensationalized; the result can be detrimental to the fight against corruption.

Over time, the public may even become dismissive of conflicts of interest regulations as way to combat corruption. Responsible reporting is mindful of the differences between non-compliance on the one hand, and a genuine conflict of interest on the other. Similarly, when a potential conflict arises and comes to the public's attention it is an encouraging sign that ethics mechanisms are working. After all, conflicts of interest are a naturally occurring phenomena, and an inevitable consequence of the fact that people occupy more than one social role. Attention should rather focus on those individuals who knowingly decline to remove themselves from a dubious conflict situation.

The other trend is found among politicians, who tend to adopt a narrow interpretation of what constitutes conflicts of interest. Of course, there is general agreement that bribes, kickbacks and extortion all involve a conflict of interest. Yet, the mere abuse of influence, such as nepotism, favoritism and misuse of state or public property, also constitute a conflict of interest but those who hold positions of power are less accepting of these aspects.

 

These tensions highlight a critical issue - that South Africa's public body remains somewhat unsure about what constitutes a conflict of interest situation in public life. The ensuing confusion continues to hold up regulatory efforts, and ultimately, the fight against corruption in the public sector. Until we reach a broad consensus about what should constitute minimum standards of ethical conduct for public officials, a number of activities that are ethically dubious will remain quite legal and those in power will dismiss sensationalist reporting for being precisely that.

Where regulations exist, they are often ineffectual, due, in part, to lax monitoring and oversight. Take financial disclosure as an example. Non-compliance by public officials, across legislatures, executive institutions and the civil service is a serious problem because there are few incentives for public officials to submit their records on time.

First, public officials know that their forms are rarely, if ever, scrutinized by an overseer, and are thus unlikely to be missed. The most meaningful incentive however is driven by concern on the part of the public official that s/he faces disciplinary measures for non-compliance. However, in reality, this rarely occurs. Serial offenders are not being dealt with harshly despite the range of penalties that exists. Registrars and Integrity Commissioners lament their inability to enforce penalties, which is usually the responsibility of senior political figures such as Speakers of Parliament, or Ethics Committee members.

The Public Service Commission recently reported, with dismay, a 48% compliance rate among senior managers in the public service in 2008, moving thereafter to recommend charging non-complying members with misconduct. The real concern here is not of non-compliance per se. Rather, that various ethics regimes across government are unable, or unwilling, to employ punitive measures to chastise those who, with apparent ease, dismiss their duty to remain publically accountable. This makes a mockery of the entire disclosure mechanism, which becomes a hollow exercise.

Beyond this, there is a far more fundamental issue that seriously undermines existing ethics and disclosure regulations. The practice of monitoring and oversight to detect potential conflicts of interest is difficult because the very mechanism that oversight relies on, that of public access to information contained in disclosure records, is notoriously hard to realize.

Take the case of parliaments. Rudimentary monitoring ensures compliance is met. But effective oversight requires more rigorous monitoring to identify and flag potential conflicts or irregularities in disclosure documents and powers to institute investigative proceedings. The South African case falls short in this regard. There is little comprehensive or proactive monitoring of elected officials disclosure forms. Instead, oversight relies largely on the principle of public access to the information. Scrutiny of the forms by citizens or another public official is deemed sufficient. Only once a complaint is lodged are registrars entitled to request an investigation. Without an official complaint, there is little justifiable reason or incentive for registrars to check member's interests, even when they suspect wrongdoing. Registrars are not expected to actively investigate whether conflicts exist among their members through scrutiny of disclosure forms. Disclosures are taken at face value as correct until someone suggests otherwise.

While the media and journalists play a vital role in holding elected members accountable, they face the same ‘access to information' constraints as that of the public. There are large-scale differences across government institutions in the ability of citizens to access disclosure records. It seems that mandating public disclosure by law is no guarantee that the public can access this information. Often, requests for information are met with suspicion or resistance. Even when access is granted, records are not always up to date. Secret disclosure does little for accountability and the detection of conflicts of interest. A far greater commitment on the part of government to transparency and access is necessary if the credibility of the disclosure regime is to be enhanced.

Finally, even where regulations exist they occasionally provide loopholes. The current situation of gift-giving to elected officials is a case in point. Although regulations require public disclosure of gifts above a certain value it imposes no limits or threshold on the value of accepted gifts. So, while it may well be ethically dubious for elected officials to accept a Mercedes Benz from a private entity it remains perfectly legal. Surely the acceptance of expensive, luxury gifts, however innocent or well intentioned, should be off-limits precisely because it puts unfair pressures on our public officials and raises unnecessary questions about the integrity of that individual.

Where to from here? South Africans should push for national debates on ethical conduct in public life, by asking the following questions. What can citizens expect from their elected and non-elected officials? What constitutes ethical and fair conduct? Despite the tug and pull of conflicting interests, should the elusive ‘public interest' always prevail? Over and beyond the enrichment of their loved ones, or themselves, public officials can also step up to the cause by revisiting and revising existing ethics regulations.

Written by: Collette Schulz-Herzenberg, Senior Researcher in the Conflicts of Interest project, Institute for Security Studies (ISS) Corruption & Governance Programme in Cape Town

 

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