SA needs general anti-corruption body – Hoffman

Corruption “in high places” could be countered by an effective general anticorruption body, South African Institute of Accountability director Paul Hoffman said on Wednesday.

He stated that such a body would have to be entrenched with – as laid down by the Constitutional Courts statement in businessman Hugh Glenister’s 2011 seminal judgment – specialisation, training, independence, proper resourcing and security of tenure.

“South Africa has no such thing [a generalised anticorruption body]. The Hawks are a pale shadow of the Scorpions, and the Scorpions were vulnerable to closure because they lacked security of tenure,” Hoffman said.

Speaking at a Free Market Foundation media briefing on lessons in “unconstitutional procurement”, he referred to Eskom’s questionable procurement tactics regarding its awarding of a R20-million contract to Hitachi Power Africa (HPA) for the supply of boilers for its new coal-fired power station Medupi, in Limpopo.

HPA is 25% owned by the ruling African National Congress’ (ANC’s) investment arm, Chancellor House, and 70% by Hitachi Power Europe. It was estimated that Chancellor House would incur R5.8-billion in dividends over the contract period, which would then go into the ANC’s purse.

Hoffman said that it this was not creating an even playing field for all political parties, as the ANC’s main opposition, the Democratic Alliance, was rumoured to have a budget of between R100-million and R120-million for the next national election, while the ANC was making billions in just one deal.

“Such deals are unconstitutional and does not allow for fair elections in South Africa, essentially all taxpayers are funding the ANC,” he highlighted.

Another high-profile case was the government’s continuous guarantees and bailouts of national carrier South African Airways (SAA), despite its inability to generate returns and repay expensive loans. The assistance given to SAA reached R11-billion in October last year when the government announced another guarantee of R5-billion.

“Local commercial competitors do not have the benefit of so generous a shareholder. The guarantee will cost the shareholder, and therefore the taxpayer, dearly when it is called up as it surely will be,” Hoffman stated, adding that the government was contravening Section 217 of the Constitution, which prescribed that procurement in the public sector must be done in accordance with a system that is fair, equitable, transparent and cost-effective.