10 th NYC GLOBAL PARTNERS SUMMIT: PUBLIC INTEGRITY: ANTI-CORRUPTION STRATEGIES, ECONOMIC DEVELOPMENT AND GOOD GOVERNANC

1. 10th NYC GLOBAL PARTNERS SUMMIT: PUBLIC INTEGRITY: ANTI-CORRUPTION STRATEGIES, ECONOMIC DEVELOPMENT AND GOOD GOVERNANCE WORKSHOP C: CASE STUDIES FROM THE INTEGRITY FRONT PUBLIC PROTECTOR OF THE REPUBLIC OF SOUTH AFRICA Adv Thuli N Madonsela 7 JUNE 2012

2. “The public sector, like all of society and the world, is a mixed bag of humanity. This mixed bag contains persons of little virtue and persons of virtue. The reality is such that the public sector is no more and no less unethical than the rest of society. But because the public sector is constituted of people and institutions that hold public trust... (it) must and does make that extra effort to maintain the integrity of its internal operations. “ Report on proceedings of the THIRD ANTI-CORRUPTION SUMMIT

3. Outline of Presentation • Introduction • Place of Public Protector in Socio-legal Context (4-5) • Powers, Functions and Approach(6-13) • Legal and Policy Framework Informing Local Government Investigations(14-16) • Typical Integrity Violations in Local Government Investigations(17-19) • 5 Case Studies(20-25) • Lessons Learned(26) • Conclusion(27-8) `

4. Nation’s Resounding No To Corruption in Twitter Case • A young model recently found out the nation does not take corruption lightly or consider it funny. • This followed her twitter in which she bragged about bribing a traffic officer saying:“Just got out of a R2 500 fine for going 140 in a 60 zone. R30! (Less than 3 dollars) Bwahahahaha. I LOVE JMPD” • Within hours, she had retracted the twit following the public outrage that ensued. She claimed her twit had been a joke. • Corruption, Watch a recently established anti-corruption civil society agency led the moral backlash than followed. `

5. The Public Protector is Part of a Broader National Integrity Framework • The Public Protector South is national Ombudsman like institution , established under section 181 of the Constitution, which forms part of the national integrity framework. • Part of a network of oversight and accountability bodies that include the Auditor-General, Public Service Commission, the Judiciary, Financial Intelligence Centre, Legislature, media and society. • Important role in enforcing Democratic values of good governance, and the Rule of Law And quality of life. • A civil law innovation in a common law legal system, its enforcement powers are non-judicial. • Swedish origins (202 years)with national resonance with traditional institutions such as the Venda Makhadzi (see cover page).

6. Constitutional Mandate • Established under chapter 9 of the Constitution, the Public Protector has the power under section 182 of the Constitution to strengthen and support constitutional democracy by: • investigating any conduct in state affairs, or in the public administration in any sphere of government, that is alleged or suspected to be improper or to result in any impropriety or prejudice; • to report on that conduct; and • to take appropriate remedial action. • Mandate covers all organs of state at national, provincial and local levels, including local government and extends to state owned enterprises, statutory bodies and public institutions. Court decisions are excluded. • Section 182(4) enjoins the Public Protector to be accessible to all persons and communities • Supreme Court Judge rank with stringent appointment and impeachment procedures, which include an open Parliamentary process culminating in presidential appointment for a 7 year fixed term following a 60% majority vote in Parliament and impeachment similar to judiciary. • Nationals and non-nationals may approach. No need for direct prejudice/injustice>

7. Six(6) Key Mandate Areas The Constitution anticipates mandate expansion through legislation, and legislation passed since establishment 15 years ago has resulted in the Public Protector being a multiple mandate agency with the following 6 key mandate areas: • Maladministration and appropriate resolution of dispute the Public Protector Act 23 of 1994(PPA). The maladministration jurisdiction transcends the classical public complaints investigation and includes investigating without a complaint and redressing public wrongs(Core); • Enforcement of Executive ethics under by the Executive Members' Ethics Act of 1998(EMEA) and the Executive Ethics Code (Exclusive): • Anti-corruption as conferred by the Prevention and Combating of Corrupt Activities Act 12 of 2004 (PCCAA) read with the PPA(Shared); • Whistle-blower protection under the Protected Disclosures Act 26 of 2000. (Shared with the Auditor General and to be named others; • Regulation of information under the Promotion of Access to Information Act 2 of 2000;(PAIA) and • Review of decisions of the Home Builders Registration Council under the Housing Protection Measures Act 95 of 1998.

8. Other Mandate Areas Transversal investigative powers acknowledged in sector specific legislation, including the following: • Promotion of Equality and Prevention of Unfair Discrimination Act 4 of 2000; • National Energy Act 40 of 2004; • Special Investigation Units and Special Tribunals Act 74 of 1996; • National Environmental Management Act 108 of 1999; • Gauteng Petitions Act. Non-investigative functions conferred by legislation such as: • Public Finance Management Act 1 of 1999; • Lotteries Act 57 of 1997; • National archives and Record Service Act 43 of 1996; and • Electoral Commission Act 51 of 1996.

9. Institutions Within Jurisdiction The Public Protector’s oversight jurisdiction covers more than 1000 organs of state and government agencies operating at all three levels of government, including local government. Public institutions and bodies performing a public function are also included.

10. Investigation/ Intervention Triggers

11. Approach to Investigations? • To pronged approach which seeks to verify and remedy maladministration and injustice at hand while acting as a catalyst for change to entrench good governance thus ensuring that organs of state habitually get things right the first time. Promptness and rigor balanced. • Options include case resolution or investigation, latter may be simple, complex and/or systemic. Integrity matters are investigated. •  Standard Approach to an Investigation:

12. Approach to Investigations?(cont) • What happened? • Proof on a balance of probabilities achieved through document and explanation requests and interviews or hearings. Forensic investigation and expert opinions, where appropriate. • What Should have happened (Proper)? • Legal and regulatory framework used as benchmarks for standard that should have been complied with • Constitutional provisions (NB entitlements and ethical ethical governance provisions), legislation(including Public regulations and Public Service and Treasury Directives/Guides), policies and other prescripts. • Sector and international good practice

13. Approach to Investigations?(cont) • Is there a discrepancy between the two? • Proper conduct test transcends lawfulness • Gap evaluated to ascertain if constitutes maladministration, unethical conduct or corruption. • Room for genuine mistakes. • Prejudice suffered assessed/quantified. • What is the remedy • In service failure civil remedies underpinned by quest to place complainant or victim of maladministration as close as possible to where s/he would have been but for wrongful state action • In integrity violations disciplinary directives to appropriate authorities and criminal referrals to NPA in terms of section 6 of PPA. Commitment to claw back abused state funds.

14. Transversal Integrity Framework Informing Local Government Investigations • Properness, maladministration or integrity violations in local government tested against: • Transversally applicable provisions of the Constitution such as fundamental rights (Bill of Rights, etc) founding values in section 1, principles of public administration in section 195, procurement regulation under section 217 and fiscal prudence guidelines. • Transversal legislation and directives including- • Preferential Procurement Policy Framework Act • Promotion of Access to Information Act • Promotion of Administrative Justice Act • the Protected Disclosures Act • the Prevention and Combating of Corrupt Activities Act

15. Specific Integrity Framework Informing Local Government Investigations • Municipal Finance Management Act, 2003 • The Constitution – sections 53, 152, 195 Chapt 3 & 7 • Local Government: Municipal Structures Act, 1998 • Local Government: Municipal Systems Act, 2000 • Local Government: Municipal Demarcation Act, 1998 • Codes of Conduct for Councillors and Municipal Employees

16. Specific Integrity Framework Informing Local Government Investigations • Codes of Conduct for Municipal Councillors and Staff Members prescribed by Municipal Systems Act • The Code of Conduct for Councillors similar to EMEA Code covers, among others integrity issues, such as councillors : • To perform the functions of office in good faith, honestly and a transparent manner; and at all times act in the best interest of the municipality and in such a way that the credibility and integrity of the municipality are not compromised. • To disclose personal or private business interests. • Not allowed to benefit from any contract awarded by the municipality. • National Anticorruption Strategy also informs investigations • and relevant international instruments, including UN Convention Against Corruption and OECD Convention on Combating Bribery of Foreign Public Officials in International Business, taken into account.

17. Typical Integrity Violations Investigated in Local Government • Over 1000 cases investigated each year with over 180 cases relating to allegations of unethical conduct, financial mismanagement, abuse of power or corruption in Municipalities under PPA, PCCAA and PDA. • Key issues involve corruption, abuse of power and abuse of resources in procurement management, allocation of social housing, licencing and traffic regulation, employment opportunities, including Extended Public Work Programmes(EPWP), theft of electricity and municipal billing malpractices as well as enforcement of by-laws Specific allegations typically involve: • Bribery: promise, offering or giving of a benefit that improperly affects the actions or decisions of a public official. • Fraud: actions or behaviour by a public official, other person or entity that deceive others into providing a benefit that would not normally accrue to the public official, other persons or entity. The South African government has invested over ZAR60bn (7,1bn USD) of public funds into the provision of an estimated 2,8m subsidised housing units for low-income beneficiaries. A large number of the cases reported involve the fraudulent allocation of these subsidised houses

18. Typical Integrity Violations Investigated in Local Government c) Abuse of power public officials using entrusted power or authority to improperly benefit another public official, person or entity • Conflict of interest: financial or other private interest or undertaking that could directly or indirectly compromise the performance of a public servant’s duties • Corruption: Entrusted power used for own benefit or gratification, bearing in mind that corruption is a bilateral integrity violation. Irregularities in relation to tender and procurement related matters: *Auditor General SA Consolidated Local Government audit outcomes -2009/10

19. Typical Integrity Violations Investigated in Local Government e) Favouritism: the provision of services or resources according to personal affiliations of a public official. f) Nepotism: public officials ensuring that family members are appointed to public service positions or that family members benefit form procurement processes

20. Case Study 1: Touting for Donations • The conduct of mayor of a district municipality was investigated following allegations that he had used the municipality’s letter head to write a letter to municipal contract holders requesting donations to his party. It was specifically alleged that the letter had pointed out that his party being in office had resulted in their current contracts and that should it be returned to office, contract opportunities would continue. • The conduct was found to be unlawful improper and a violation of the code of ethics. • Remedial action involved a directive to the municipal council to take disciplinary action and educate councillors about the code.

21. Case Study 1: “Glimmer of Hope” • Service delivery failure investigated in response to violent public protest, included allegations of systemic maladministration in procurement, financial and asset management, abuse of state resources and corruption. • Findings following a systemic investigation and corrective intervention confirmed maladministration, abuse power and of state resources. • Specific findings included councilor unethical conduct involving theft illegal electricity connection and theft of credit notes. • Remedial action included disciplinary action and referral to the police for criminal investigation an d prosecution.

22. CASE STUDIES : 2 WHISTLE-BLOWER BLOWS BANKING PIPELINE • A Whistle-blower (bank employee) who noted anomalous bank deposits with amounts immediately cleared used the Protected Disclosure Act (PDA)to telephone the Public Protector to report suspected fraud. • An investigation (involving the Auditor General) confirmed that a municipal syndicate was involved in siphoning municipal funds into a private account. • Matter referred for criminal prosecution combined with disciplinary action. The participants are currently being prosecuted and an asset forfeiture process is under way.

23. Case Studies: 4. IT CAN’T BE RIGHT:REMEDYING SELF INTEREST IN MIDVAAL • A systemic investigation was conducted into allegations of tender irregularities, unethical conduct by a councilor(personal use of Council resources) and dept collection practices underpinned by selective collections, conflict of interest and asset disposal prejudicial to the municipality and members of the public, mostly poor people, who donated their property to settle their municipal debts. • Key finding related to impropriety of procurement of the municipality’s (virtually) sole legal provider (Chairperson of party in control of municipality), whose role included legal advisor, attorney, dept collector and a further finding that the service provider’s conduct constituted a conflict of interest as his company bought property donated to the municipality through him at next to nothing, without transferring such property to the municipality as required. • Corruption investigation by SIU continues and referral to law society made.

24. Case Studies: 5 Against the Rules • Alleged irregularities, including corrupt practices in Procurement of offices for police headquarters for national and one of the provinces. • Procurement irregularities confirmed in Public Protector’s findings. General findings included improper demand management, overpricing. Conduct of accounting officer found to be unlawful, improper and constituting maladministration. • Remedial action included disciplinary action and review of contract with a view to cancellation.

25. Case Studies: 6 Identity Theft • Often a service failure investigation reveals corruption, fraud or some other form of conduct failure as the main causal factor • While investigating the South African Social Security Agency’s denial of child benefits to a mother, it turned out that she was a victim of identify fraud and a syndicate involved in corrupt practices. The scam was an organized crime operation involving a combination of identity theft transcending four organs of state and a private supermarket. • Remedial action included disciplinary action and referral for criminal investigation. Recovery of funds also forms part of the package.

26. Workload Tackled Through Collaboration with Local Ombudsman Offices and Integrity Structures • Over 26 000 cases processed per year comprising 20 000 received and about six thousand carried over from previous year. • Population of about 50 million people spread over a vast country with 47 district municipalities and 6 metropolitan districts making up 53 districts serviced by 20 offices of the Public Protector backed by toll free line and mobile office outreach services. Staff compliment of over 300 persons. • Local Ombudsman structures encouraged to be first port of call for complaints. • Integrity and complaints structures for municipal police included. • Collaborative work with fellow integrity institutions such as the Auditor General, Hawks, SIU and PSC employed where deemed appropriate.

27. Conclusion • Local government is at frontline of public service delivery and essential for fulfillment of constitutionally promised quality of life for all people, particularly through delivery on socio-economic rights and Millennium Development Goals(MDGs); • Maladministration and corruption key factors derailing service delivery thus delaying fulfillment of constitutional dream, which includes redressing apartheid imbalances, gender inequalities and other inequalities; with peace undermined hence public protests; • Public Protector’s impact due to sound constitutional foundations, comprehensive legal framework and rule of law ethos, including independence of the judiciary and constitutionally entrenched public accountability; • Integrity efforts form part of national anti-corruption strategy • Role of civil society facilitated by an active media enjoying constitutionally entrenched right to freedom of expression, incorporating freedom of the media has been • Good governance and anticorruption movements, including annual national Good Governance Week. • Institutionalization of principles of accountability, integrity and responsiveness in public service anchored in stewardship service ethos.

28. “ Let it never be said by future generations that indifference, cynicism or selfishness made us fail to live up to the ideals of humanism which the Nobel Prize encapsulates…..” President Nelson Mandela. Nobel Peace Prize acceptance speech.

29. THANK YOU www. pprotect.org