The rules governing conflicts of interest, financial disclosure and performance agreements in the public service are there to ensure that senior managers are accountable and clean. If these and other rules are not enforced the way is open for unscrupulous officials to abuse the public trust for personal gain. Recent reports by the Public Service Commission (PSC) and the Auditor-General (AG) have found that many senior managers are disregarding these prescripts with impunity.
 

On the 8^th of July, the Select Committee on Public Accounts (SCOPA) considered a 2008 report by the AG which found that 2270 senior managers in provincial departments had an interest in companies doing work with government. `The majority did not have approval to perform other remunerated work.’ Between 1 April 2005 and 31 January 2007, the value of these interests was R540 million, with Limpopo alone accounting for R269 million.    

SCOPA wanted to know from provincial directors-general what action had been taken against officials who had broken the rules. Across the board, the top provincial officials could not provide satisfactory answers. Admittedly, provincial DGs are not the accounting officers of provincial departments, but most seemed ill-prepared and none could convince SCOPA that any action at all had been taken. SCOPA concluded that the provinces had only learned of the problems through the AG’s report, and monitoring systems were either `ineffective or non-existent.’

Senior managers must disclose their financial interests to the PSC annually, but many fail to do so. The PSC report for 2009 shows that the number of disclosure forms it received declined from 85% in 2006/07 to 80% in 2007/08 (with only 74% of national departments complying). The PSC concluded that accounting officers are not taking disclosure seriously and executive authorities are not exercising proper oversight. 

Non-compliance with performance management prescripts is another worrying trend: In 2008/09 only 73% of heads of department had submitted signed performance agreements to the PSC. In 2006/07 only 19 heads of national departments out of the 27 who qualified (70%) and 36 of the 73 provincial heads who qualified (49%) underwent performance evaluation by their executive authority. The PSC poses the question of how these heads of department `can be expected to ensure that the rest of the staff in their departments are held accountable for their performance’. The report concludes that ` performance management as an accountability mechanism continues to receive inadequate attention, and no sanctions are imposed in cases of non-compliance.’

In his budget vote, the Minister for Public Service and Administration, Richard Baloyi, did not respond to these problems directly, but promised to undertake `an assessment on the state of implementation of policies’ and report back `by the end of the current financial year’. A pedestrian response considering that the PSC has raised these problems in past reports. Indeed, the chairperson of SCOPA suggested to the Minister’s own department and other national departments present that they ought to be more worried by the findings in the AG’s report than they appeared to be. The audio transcript of that meeting is replete with evidence of the committee’s frustration that these problems are not being tackled decisively.

     

The most disturbing thing about these findings is not even the levels of non-compliance, but rather government’s inability to enforce its own rules and the culture of laxity and impunity that has taken root. 
              

SCOPA decided it would call in the accounting officers of national departments named in the AG report. That hearing should be synchronised with equivalent hearings in the provincial SCOPAs to ensure an all of government response to the problem. DGs who fail to submit their own financial disclosures or sign performance contracts on time should account publicly for their failure, and the PSC must publish the names of public servants with unauthorised business interests.
 

A PSC commissioner suggested legislation to prohibit outside remunerated work altogether. At least there ought to be a public register of civil servants with business interests similar to the register for MPs. Discussing the PSC’s annual report in a plenary session of Parliament would also raise the level of debate about the quality of our public management, and expose executive authorities that are not performing their oversight functions to stronger public scrutiny.
 

The DPSA must fix the problems with the definition of outside remunerated work in the Public Service Act (which apparently does not include directorships or share-holding), as well as the gaps in the standard disclosure form all managers must sign (which apparently does not require disclosure of outside business interest). The prescript should also apply to all public servants, not just senior managers. Finally, is it realistic to expect these small provincial legislatures to police accountability in so many departments? Perhaps the Act should be amended to restore the provincial DG to the role of accounting officer for the province.  
 

The rules governing “conflicts of interest” in the public service seem straight forward enough. Three of these rules are the following: Public servants who want to do outside remunerative work must get prior approval from their political head. Every year, senior managers must disclose their financial interests to the Public Service Commission. Accounting officers must take reasonable steps to put down control systems to ensure that designated officials comply with these rules and to discipline those that don’t. 
 

The problem is the system doesn’t work. That much is clear from a 2008 report of the Auditor-General on the extent to which public servants comply with these prescripts, which revealed almost complete disregard for the law. The truly astounding finding is not the extent of non-compliance, but Government’s inability to put in place even the most basic systems to enforce and oversee compliance with the law.  
 

To apply these three rules in practice will require a department to establish a basic system of administration – that is a set of management controls and practices, tools such as standard disclosure forms clearly stipulating what must be disclosed by whom by when, systems for keeping track of compliance, and so forth. With proper systems in place, any accounting officer called to answer before SCOPA should be able to walk into the committee armed with facts and figures on what was done to implement the rules, the number of transgressions, what action was taken, emerging trends etc. 
 

On the 8^th of July, SCOPA wanted facts and figures from certain national and all provincial Directors-General about what had been done to address the problems of non-compliance the Auditor-General had identified almost a year ago. 
 

Across the board, the most senior public servants in our country were unable to convince the committee that anything at all had been done or that even the most basic management controls were in place to police the system. With few exceptions, their testimony provided no additional information or insights to SCOPA that was not already provided by the Auditor-General’s report.  
 

The committee members responded to the testimony with a storm of criticism. The audio transcript is filled with references to `arrogant officials,’ `dereliction of duty,’ `wasting the committee’s time,’ `officials folding their arms’ in the face of problems and `fancy footwork.’ At one point the chairperson wanted to know whether national departments shouldn’t perhaps `be more worried’ by the findings than they appeared to be. One of the most telling comments was, `the committee wants someone to do something.’
 

Why did this situation happen at all - What is wrong with our system of public accountability? And more importantly how do we fix the problems? There seem to be at least five problems, some big, some not so big, some of the Directors-General own making, others not.
 

Problem one was that SCOPA asked direct questions and few of the provincial Directors-General were well enough prepared to provide straight answers. Many started talking about what the province intends to do in future and were smartly re-directed to what it had in fact done. Few if any had statistical or factual information with them. Poorly prepared officials are not in a position to answer for their conduct. This fact alone undermines accountability and amounts to disrespect of Parliament. Aside from that it is incomprehensible why anyone would walk into SCOPA especially without being armed to the teeth with facts and figures, if only to save themselves the humiliation of being taken to task in public for not being adequately prepared.
 

The DG’s present were not the accounting officers of the departments affected by the transgressions. Consequently, the national DG’s deferred to the provincial DG’s who pointed to the provincial heads of departments, who were not present. While appreciating the decentralized system of accountability, the chairperson pointed out that the national departments administer the laws concerned and therefore have the responsibility to bring problems and trends to the committee’s attention. None of the national DG’s presented a global picture of problems and trends. Similarly, provincial Directors-General are responsible for coordinating the implementation of policy in the provinces, and should be in a position to provide a provincial perspective. Nevertheless, there is clearly a need to define exactly what these oversight accountabilities entail at every level of government.  

The conflict of interest laws are not being enforced        

The rules and sanctions are there, but according to SCOPA - they are not being enforced. SCOPA could arrive at this conclusion because the provinces were unable to place information before SCOPA showing that (a) they had detected problems of non-compliance independently of the AG report and (b) the province had taken disciplinary action. Further, they testified that in many cases, executive authorities (Ministers and MECs) were aware of the transgressions but have not taken action, pointing to a lack of political will to deal with the problems.
 

Here there are four problems. First, it is uncertain whether directorships comprise remunerated work. Secondly, the national department was aware of this problem since 2003 but has yet to fix it. Thirdly, the existing prescripts do not include shareholding in companies or apply to middle management. Fourthly, the disclosure form doesn’t require managers to disclose outside remuneration. SCOPA seemed incredulous that these basic flaws in the system existed at all, let alone that it has taken so long to close the gaps in the legislation.
 

Culture of impunity