Introduction
Corruption is at the heart of an urgent socio-political and economic crisis in contemporary South Africa. The Zondo Commission1 has been headline news since its commencement in August 2018. Meanwhile, sceptical observers question just how effective such commissions are. Will the inquiry ask the right questions? What will happen once the report is published? Will anyone be punished? Ongoing discussions on talk radio shows cite the failure of previous commissions to yield meaningful punitive action. The lack of significant prosecutions is also cited as weakening South Africa’s international reputation. The country is only just starting to uncover the true extent of the damage to the economy and, in particular, to state-owned enterprises (SOEs). Therefore, it is useful to ask: what, if anything, will come out of the current investigations? Putting in place robust procedures and policies has typically been the response when corruption or fraud2 has been uncovered, but is this response sufficient or even appropriate if the people in the system are not also committed to the prevention of corruption? Whereas internal disciplinary processes had been properly and effectively used to address instances of individuals’ fraudulent activities, my interviews indicated that where wider systems of corruption had been involved, those same processes were ignored or circumvented.
Procurement plays a major part in the discourse of corruption. Procurement-related stories have become more likely to make news headlines, whether or not they can be linked to corruption. Throughout South Africa, there is a strong, animated and persistent discourse around corruption. While the period relating to Jacob Zuma’s presidency from 2009 until 2018 represents a key phase, I do not presume that this period indicates the start of the corruption crisis. Van Vuuren (2018, 2) observes that ‘corruption and economic crime in the post-apartheid period … did not start to manifest the day that the Mandela administration was inaugurated.’ One investigative researcher I interviewed further asserted that systems of corruption in South Africa’s apartheid-era governing structures were so deeply ingrained that they continued into the new democratic era.
In this article, I consider the role that the practice of procurement and ways of working play in this discourse, ultimately undermining otherwise robust procurement policies. Unfortunately, when procurement takes centre stage, it is often in terms of its failure to deliver good-value products and services. As I outline below, procurement undertakes a co-ordinating role within an organisation, translating operational and budgetary requirements into specifications and overseeing the conduct of tenders. These form the basis of contracts and payment processes that procurement should help to put in place. The management of these processes is one aspect of its governance and process compliance role. In the current literature, most reforms centre on policies and regulations. Effective policies are intended to safeguard an organisation’s revenue stream. For public enterprises, this can have a much greater impact, contributing to effective service delivery while making the most of limited resources. I would argue that such policies also rely on effective, commercially aware practices in order to be fully effective. Done well, procurement will rarely grab the attention of executive management, but poor procurement (with or without corrupt motives) has wide-reaching effects.
South Africa: corruption in context
South Africa’s association with corruption is not unique in the world, but its history and politics are. Unlike most other states in Africa, a period of colonial rule was followed by government by a minority settler community, introducing apartheid policies formally in 1948. Despite the imposition of formal economic sanctions by the United Nations (UN) in 1976, South Africa’s government was able to operate effectively for many years. Van Vuuren (2018) argues that the system that supported this indicated significant levels of corruption. Furthermore, I believe that the way that apartheid’s structures were implemented has resulted in overtly process-driven, regimented behaviours in many organisations, public and private. Procedural compliance has become a strong feature within South Africa’s bureaucratic structures, and yet it has ultimately failed to prioritise and adequately support effective service delivery in the case of SOEs.
Over the years, several judicial commissions have been convened to investigate corruption in arms dealing, public enterprises and, more recently, the phenomenon of state capture. This revolves primarily around Jacob Zuma and the Gupta family, collectively dubbed ‘the Zuptas’ in popular culture. The three Gupta brothers – Ajay, Atul and Rajesh – relocated to South Africa from their native Indian state of Uttar Pradesh and set up in computing. Gupta-owned enterprises later gained control of major suppliers to SOEs, while the brothers have been accused of influencing senior political appointments (Martin and Solomon 2016; Dassah 2014).
The impact of state capture in SOE procurement operations has had the effect of diverting resources such that funding was not used (and is no longer available) for the improvement of living conditions in previously neglected areas, leading to public protests and unrest about poor service delivery (eNCA 2019); income inequalities have been further exaggerated, constituting a mechanism of elite class formation (see von Holdt 2019); lack of economic growth has impeded transformation and development; and it has undermined the country’s political legitimacy, resulting in alienation of the polity (see Elliott 1997). I would further argue that it has undermined the professional perception of procurement, an aspect that can have further repercussions in the quality of personnel attracted into the profession. My position is that procurement needs to attract innovative gatekeepers focussed on how best to support its stakeholders. While the gatekeeper role is essential, it is not enough to provide an effective procurement service. Procurement must also make a significant contribution to managing the organisation’s supply chain performance, risks and costs (see Kelman 2005). Instead, procurement in South Africa needs to break free of process-orientated, hierarchical, authoritarian ways of working and become a trusted, critical partner to the organisation’s operations and its supply chain, while navigating the policies rather than being driven by them.
My research involved a mixture of fieldwork and archival research using primary and secondary sources: newspaper articles and transcripts, affidavits and evidentiary documents and videos submitted to the Zondo Commission. Meanwhile, Twitter and WhatsApp group discussions, radio and news stories provided additional background. Archival research formed the foundation, detailing existing policies and procedures governing public procurement and giving insight into specific policy failures. I conducted 12 semi-structured, face-to-face interviews during March and April 2019 with respondents based in Gauteng and Eastern Cape, and one in London. I used an exploratory research design and open-ended questions that allowed participants to provide narrative responses, encouraging a more conversational discussion. Except for one that took place in a mall café in Johannesburg, interviews were conducted at the interviewee’s office. A list of example questions was sent to each participant prior to the meeting, along with a standard consent form.
On the whole, those I spoke to were keen to discuss anti-corruption failures, the impression being that they were in no way implicated themselves, particularly those still working within procurement. While I developed a line of questioning similar to the approach used by Hellman, Jones, and Kaufmann (2003, 755), wording sensitive questions to avoid implicating the interviewee, it was rarely necessary as it was most often the interviewees who introduced the subject first. This further supported my experience of corruption as discourse observed by Gupta (2006).
Within a critical realist philosophical framework, I acknowledge that some approaches I have encountered while working for other organisations will carry a bias towards a normative Euro-American way of working. In South Africa, this proved similar to my participants’ experiences and formed part of the discussion. Given the limited number of interview subjects and locations, I do not consider the sample or their experiences to be entirely representative of South Africa’s procurement operations. However, feedback from procurement professionals at a series of follow-up workshops I held in August 2019 confirmed that the attitudes and experiences I have outlined are typical of their experiences of the profession in South Africa’s public and private organisations.
My approach to reform places greater emphasis on the way that procurement is practised and its policies enacted. However, another aspect I had not originally considered arose in several interviews, concerning the motivation and morality of those undertaking corrupt acts. Linking corruption to a degradation of society lacks authenticity based on the levels of public outrage and lack of acceptance. I therefore considered Ekeh’s (1975, 92) theory of two publics, which proposes that the influence of colonialism on Africans’ consciousness was to bifurcate the public sphere of the state. Morality from the private sphere tends to be transferred to the primordial public, but not into the civic public sphere, which he defines as ‘amoral and lack[ing in] the generalised moral imperatives operative in the private realm and in the primordial public’. Although many professionals consider the new Constitution of South Africa to be part of their primordial public, there are others whose morality more closely aligns with one of a bifurcated view of publics. Where the latter is the case, they are most likely to place SOEs in the civic public space and to consider the exploitation of such entities reasonable.
Defining corruption in South Africa
Understanding what is perceived as corruption is a challenge. One journalist outlined a case where the consulting firm Bain developed a close relationship with the South African Revenue Service (SARS) Commissioner, Tom Moyane (Skiti 2018). Prior to Moyane’s appointment, Bain’s senior executives met Moyane several times and allegedly discussed future bid opportunities. While this might arguably be considered networking, it carries an air of impropriety. Is the patron–client relationship to be considered more suspicious than the ‘Old Boys’ Network’? Therefore, for Gupta, it is within the context of expected behaviours that corruption is defined:
Expectations of ‘right’ behaviour, standards of accountability, and norms of conduct for state officials, in other words, come from social groups as well as from ‘the state’. Sometimes these standards and norms converge; more often, they do not. Thus, there are always divergent and conflicting assessments of whether a particular course of action is ‘corrupt’. (Gupta 2006, 225)
In a slightly different vein, Ekeh’s (1975) thesis helps explain the apparent ease with which certain corrupt activities may be practised by otherwise upstanding members of society in Africa. This chimes well with Chabal and Daloz’s (1999, 99) observations of the complexity of considering corruption in sub-Saharan Africa:
there is in Africa a marked reluctance to abide by the abstract and universalist norms of the legal-bureaucratic order that are the foundations of Western polities. The legitimacy of the formal rules of conduct which characterise the modern state has hitherto failed to supersede that of the informal compacts derived from ethnic, factional, or nepotistic ties of solidarity.
Von Holdt (2019, 14) argues that the mechanism behind some of the state capture level of corruption in South Africa has ‘contributed to the emergence of new elites located in a convergence of political power and economic muscle’. Essentially portraying corruption as a project of elite class formation, his condemnation is consistent with the perception of corrupt action outlined by Chabal and Daloz (1999, 100): ‘Condemnation is reserved for those individuals or groups … who are seen to appropriate “public” resources purely out of greed and with little regard for those who would count on benefiting from such graft.’
The role of procurement
Defining procurement requires the consideration of far fewer nuances than corruption, although there are differences in the way that procurement is practised by different organisations. Neupane, Soar, and Vaidya (2014, 22) provides a definition: The ‘processes whereby … organizations acquire goods and services, works, and other activities from third parties’.
In this article, I define procurement as encompassing both purchasing and supply chain management functions. Because procurement is a support function, some organisations position it within operations, and many academics write with a focus towards operations management journals. However, procurement is often also positioned in a gatekeeper role within finance. Matrix reporting models can be used effectively to combine a functional reporting line and an accountability reporting line. My approach considers both aspects essential to the effectiveness of procurement: the organisation needs commercial support (negotiation of equitable contract terms), operations understanding (service and delivery focus), risk management (finance and contractual) and compliance (legal) to come together. Procurement is the function where these elements should be combined and co-ordinated.
Anti-corruption in procurement policies
When looking at modes of corruption, Klitgaard (1988) is often cited, using the following equation:
Countering corruption using this model involves reducing or eliminating monopolies, lowering discretion and increasing accountability. However, Kelman (1990, 1994, 2005) argues repeatedly that too much regulation in public procurement in the US is counterproductive to its efficiency. His assumption is that procurement professionals will respond to discretion with integrity, presumably relying on a Foucauldian panopticon syndrome of self-policing. The mechanism for limitation, he concludes, could be better achieved by the use of decision-making panels, aimed at delivering decisions by consensus and an insistence on comprehensive documentation of the process (Kelman 2005, 91). But is this realistic in a situation where corruption is pervasive? Or where consequence management is perceived as weak? Or where accepted ways of working mean that officials follow instructions from those in authority without question?Is there anything that can reasonably be done if corruption has pervaded many levels of an organisation? Olver’s (2017) approach in the case of Nelson Mandela Bay (NMB) municipality was to replace the highest officials. From there, he attempted to impose cultural change and top-down reform. The end of Jacob Zuma’s presidency is considered by many an opportunity for President Cyril Ramaphosa to staunch the grand corruption that has emerged over the past decade in South Africa. However, the outlook is generally considered precarious. Olver (Ibid.) cites the strong influence of factions within the ANC that frustrated his reformation efforts in NMB. This article considers how policy and legislative reforms need to be supplemented by practice-level improvements in procurement.
Public procurement policy development in South Africa
In South Africa’s public procurement entities, robust policies and procedures have often been ineffective in preventing corruption and moreover tended to focus procurement on policing the organisation at a process level rather than facilitating its operational success. I consider that the level at which these policies work can be subverted if not also supported by more collaborative, less authoritarian working practices and by practitioners empowered to question their superiors openly.
Following the first democratic elections in 1994, the African National Congress (ANC) recognised the importance of maintaining global financial stability while implementing its reforms. The development of the Public Finance Management Act (PFMA) was therefore considered a high priority, its aim being to establish financial controls that reflected the ideals of the constitution. The PFMA was confirmed in 1999 and a Preferential Public Procurement Framework Act (PPPFA) was formalised soon after, in 2000. The ANC government had by that time decided to move away from the centralised procurement model directed by the state tender board (STB) to a decentralised model that put municipal governments in charge of regional procurement.
Five pillars and National Treasury’s oversight of SOE procurement
In the absence of a formal public procurement act3 that specifies how procurement should be conducted under the rules of the constitution, National Treasury (NT) has documented a set of General Procurement Guidelines. These guidelines are built on five pillars: value for money; open and effective competition; ethics and fair dealing; accountability and reporting; and equity. The pillars indicate that South Africa’s theoretical approach to procurement has robust foundations, noting nuances and defining each of the pillars in reasonable and succinct terms. This framework implements the key elements required to regulate and manage public procurement. How does this operate in practice and what are some modes of failure to which it might be vulnerable?
While NT has powers of enforcement under various parliamentary acts, its procurement department issues instructions for improvements and other actions to various state entities. NT’s acting Chief Procurement Officer (CPO), Ndleleni Willie Mathebula, considers there to be a balancing act in the way that NT operates. In his testimony at the Zondo Commission, he positioned this as a question: ‘Are instructions on their own enough to address some of these things unless you address the behaviour – the behaviour of the people that [are] dealing with procurement to make sure that they live up to what the Constitution is saying[?]’ (Mathebula 2018). The implication is that there is scope for NT to apply some discretion in its oversight of SOE procurement. However, can NT influence a contract that is considered critical to the country’s ability to function? One example is the supply of fuel to the state-owned power producer, Eskom. In most cases, Eskom should be able to rely on its forecasts, but in emergencies, additional contracts may be required. NT’s options in this case will be severely restricted, and in practice, it may not be possible to apply remedies such as cancelling the contract.
Furthermore, while the PFMA provides for emergencies, it can also become easy for SOEs in critical positions to claim emergency status in order to avoid deeper levels of scrutiny or bypass approval stages that are otherwise perceived as time consuming. The effect of this is not always corrupt practice, but it does lessen the organisation’s perception of how relevant the guidelines are. While NT is empowered to make recommendations to SOEs regarding process improvements, no process exists to track what action is actually taken. Indeed, current practices indicate that many of its recommendations are never implemented. Even if they are implemented, no feedback mechanism exists to allow NT to assess the impact of its recommendations. This has been noted in several Zondo Commission testimonies, where reports by audit teams have repeatedly identified the same issues. There is, therefore, little or no accountability for addressing the findings of audit reports or NT’s recommendations.
Treatment of deviations
SOEs need to apply to NT for a PFMA deviation in certain circumstances, where a contract is above R10 million or where a significant contract amendment is required. NT’s role is to carry out a final review and indicate approval (or the need for further information) or rejection. Oversight of high-value contract amendments arose in response to the problem of scope creep. This happens when, due to amendments over time, the contract value increases disproportionately. Instances of scope creep can be legitimate or, conversely, can be used by suppliers to increase costs following contract award. Scope creep can indicate corruption but might equally be the result of errors in the specification. The aim of NT is clear: it acts as an additional checkpoint to reduce the likelihood of corruption within the process. However, significant levels of scrutiny require appropriate levels of resources in terms of both capacity and competence in order to operate effectively. Mathebula notes that over time, the additional level of scrutiny required by NT was nominally accepted,
but there were unintended consequences and I think this is quite important. In defence[, …] instead of deviations being an exception from the norm, deviations became the norm. So, orders of state instead [of] complying with [the regulations] saw a room to use deviations to circumvent the system and this is where the challenge is [sic]. (Mathebula 2018, 44)
Addressing PFMA shortfalls
Contract management is one of the aspects the public procurement act, as drafted, aims to address. Poor contract management can be manipulated in a number of ways. For example, unchallenged contract extensions can result in disproportionate price inflation, anti-competitive practices, lack of scrutiny around contract variations and scope creep. Ultimately, the true vulnerability lies in the people implementing the policies. The importance of competence is recognised by NT, as evidenced by the introduction of a minimum competency framework for financial and supply chain management positions in 2007. According to NT's 2017 competency report, in supply chain management, just 59% of senior managers and 37% of department heads achieved minimum competence standards. Therefore, do procurement officials have the skills to negotiate and implement robust contracts? How is their performance measured and incentivised? Current research fails to address these questions in a significant way, and yet it has been the actions of the people involved in implementing the policies that have made the systems most vulnerable to corruption.
Policies are not the problem
How, therefore, should procurement consider control measures that address the failure of existing anti-corruption policies? I consider the Klitgaard (1988) model overly simplistic and difficult to apply with any degree of authenticity. Instead, ‘it is important to stress that not all analytical interpretations of corruption provide equally convincing accounts of what is happening today [in Africa]’ (Chabal and Daloz 1999, 97). Similarly, although several interviews indicated personnel and competence issues, it is also not generally convincing to take on ‘those approaches which stress either the absence of professionalism or the scarcity of resources in Africa … ’ (Ibid.)
Throughout my research, common elements emerged that run counter to a best-practice environment: poor consequence management (lack of accountability); lack of commercial understanding; being too process-driven and hierarchical; and poor contract management and planning. Another aspect many of my interviewees raised forms an interesting observation, which I have considered in terms of its relationship to Ekeh’s theory of two publics. My interviewees expressed such actions as indicative of people who had a ‘right to prosper’ or a ‘sense of entitlement’, feeling that they were owed a higher standard of living by the state, which, during the apartheid struggle years, had deprived them of such.
What’s the point of compliance?
When I came to research anti-corruption practices in South Africa, the acceptance of gifts and corporate hospitality was soundly rejected by all those I interviewed within procurement. However, there is clearly a culture of ‘kickbacks’ in South Africa that is far more prevalent than anything I experienced working in Europe, where occasional corporate hospitality and small tokens were generally considered part of supplier relationship management. One South African engineering services provider stated that they would be expected on a regular basis to pay out ‘cool drink money’ to the procurement people to avoid complications when it came to finalising contracts. Another supplier told of how their own practice of not engaging in low-level kickbacks had lost them several contracts, to the extent that they now refuse to work with certain government agencies or bid for associated contracts. These experiences were confirmed by consultant auditors and a former member of the Scorpions (the predecessor to the Hawks, South Africa’s anti-corruption unit).
My first interviewee confirmed my impression that South Africa’s bureaucratic structures and policy frameworks are robust. In her experience, ‘the policies are documented, they are implemented, the systems are there to support them and they are understood … . They are just ignored or actively circumvented.’ Several interviewees talked about the quality of frameworks South Africa had developed with a sense of pride, although one supply chain manager also expressed her frustration at having to keep track of NT’s policy updates and changes. She also embodies the mentality that may be considered typical of South African bureaucracy: that, while processes are to be considered, the hierarchy within the organisation makes it important to follow the instructions of one’s superiors. Expressing her frustration at not achieving a ‘clean audit’ status from the Auditor-General, the supply chain manager cited how difficult she found it to maintain compliance – due significantly to the actions of senior officials. In expressing regret at the regression of organisations in the Eastern Cape, the Auditor-General observes that ‘the audit outcomes regressed in 2017–18 as a result of the slow pace of addressing the root causes of the findings raised by this office every year’ (AGSA 2018). The comments relating specifically to supply chain management across the country are of greater concern in this context, as he observes that ‘uncompetitive and unfair procurement processes and inadequate contract management were common’ (Ibid.).
The lack of remedial action to address audit findings is symptomatic of an issue raised by all interviewees: poor consequence management. One interviewee attributed this to an atmosphere of complacency in layers of upper management that he considers evident in both public and private procurement: audit findings were simply not considered important. Another example was noted by other interviewees in senior management and board-level positions, who were concerned by the way in which declarations of interest had been treated: the paperwork was done but there was rarely any follow-up to ensure that action was taken to avoid undue influence. The declaration, having been recorded, would rarely result in appropriate remedies or significant follow-up action. The overall impression is that authority and seniority also conferred rectitude. This was all too apparent at Eskom, where board members issued direct instructions to employees that required them to override whatever controls were in place. Head of Finance Snehal Nagar (Testimony 05.03.2019) stated that while he didn’t have the background for or understanding of an instruction from the board to pay a supplier without a relevant contract, ‘I think not doing this is … insubordination.’ He later outlined an example of a department head who exited the organisation following a challenge to an instruction that came out of another board meeting:
Now that whole process of not following an instruction … is ugly … and when you follow that you’re on your own from an Eskom perspective, there’s no support behind you there … . [H]ere you’re sitting with a transaction [and although] I don’t understand the context, I’m making sure that from a transactional/governance point of view we are covered … . (Ibid.)
One interviewee considered that a high administrative burden for procurement teams had led to many compliance-related tasks being treated perfunctorily. The importance of being seen to be policy-compliant (albeit in many ways superficially so) took precedence over procurement’s effectiveness. At the same time, though, other interviewees expressed the feeling that policy compliance was considered a nuisance by many in public organisations. In an environment where consequence management is poor, there is little incentive to implement improvements, reforms and remedial actions. In the extreme, responsibility for ethics and principles is allocated to those with higher authority.
Conversely, one organisation has introduced an internal procurement performance measure to address non-compliance. They record and track trends in non-compliant and irregular spending. The follow-up action depends on the justification provided, but they also see it as an opportunity to engage with the department or individuals responsible. Procurement is ideally placed to implement, enforce and monitor remedial action. Repeated infringements require much greater engagement with internal stakeholders. Consequence management is evidenced not only in punitive action but in increased accountability and improved service delivery. It requires procurement to focus less on following specific processes and more on being an effective support function to the organisation and providing a service that brings value to the organisation by managing its supply chain performance, risk and cost.
Competence, capacity and power: a people problem?
This focus on value does not just apply to procurement’s role in improving accountability. If procurement is to be effective, it needs to be a partner to the organisation’s effective delivery according to its objectives. While it is an oversimplification to state that many of the problems encountered can be traced back to the people involved, the human factor cannot be ignored, and how procurement is perceived by the rest of the organisation is where this aspect of the role is most apparent. It is not unusual for a procurement department to be considered merely a transactional, process-driven function, and historically, the role of procurement evolved out of the purchasing function’s transactional roles. These older purchasing-based practices meant that even modern procurement departments employed working practices that did not foster an environment where seniority could easily be questioned.
The role of contract management is often led by the operations function of an organisation, but procurement and operations need to work together in order to develop effective contracts. Negotiating in teams is often cited as one anti-corruption reform, being one aspect of reducing the monopoly of the function while increasing the transparency of the process. This can be particularly effective when the negotiating team consists of those from different business functions with differing accountabilities. However, the power dynamic should also be considered: when suppliers bring their senior executives and legal support to negotiate contract terms, junior procurement officials may be out of their depth and more likely to capitulate to seniority – whether internal or external.
The aspects of reform that need to be addressed here should focus on the ways in which value in the contract is achieved by procurement. It needs to exert its influence throughout the procurement cycle, particularly by becoming involved in the contract management. In my interviews, no procurement practitioners or senior managers were able to give examples of their involvement in the ongoing management of a contract. Although the function is often titled ‘supply chain management’, there is little or no evidence of even basic performance management of suppliers. This further contributes to another oft-mentioned failing: procurement planning.
When procurement is not involved in the overall contract management, it becomes removed from the contract review process. Procurement is then unable to ensure that any lessons learned during the performance of the current contract are built into the next. The tendency may be either to allow for the contract specification to ‘roll over’ or to become overly dependent on the operations team to develop a specification. In the case of one boiler maintenance contract at Eskom, the supplier, Carab, influenced senior operations managers into developing specifications that were specific to that supplier, thus severely restricting competitive options. Procurement then failed to address the resulting contract issues (Mail & Guardian, 22 March 2019). This points either to extreme incompetence or pervasive corruption.
However, it is also not straightforward, when considering all the mechanisms that may come into play. One interviewee outlined how he considers that anti-corruption systems can also be used to subvert standard processes. For example, when close to awarding the contract, a concern raised via the whistle-blowing process prompts an investigation, requiring the tender process to be put on hold. Of necessity, the incumbent gets extended because the service is considered critical to operations. During the Zondo Commission proceedings, allegations of conflict of interest were raised against one of the prosecuting advocates. In that case, Judge Zondo allowed proceedings to continue while investigations took place, ensuring that there was no conflict in doing so. This could be an option (possibly using NT’s deviation process) in cases where the contract award is not in favour of the incumbent, further discouraging abuse of the whistle-blowing process.
However, the efficacy of whistle-blowing processes themselves were questioned by another interviewee. Her frustration was that, in putting a whistle-blowing process in place, the competence and training of those in the first line of data gathering had not been given adequate consideration. Operatives were recruited with basic data recording skills, rather than investigative skills or forensic backgrounds. As such, there would often be insufficient information for an investigation to proceed, while the anonymous nature of the process also meant that there could be no follow-up with the whistle-blower.
The common thread here is that there is a tendency for those employed within procurement to approach the role with more of a focus on process compliance than on supporting the organisation’s overall goals and objectives. One senior finance manager noted that the introduction of the contract amendment threshold for SOEs effectively eroded the integrity of the regulatory systems in place. Heads of procurement impacted by this could have approached NT to arrange a more appropriate and efficient form of engagement and manage the workload more effectively for both parties. However, the engagement with NT was treated as ‘over-the-wall’, with silo operating mentalities applying equally to the SOEs and NT. NT may be responsible for issuing improvement points to other procurement teams, but it should also be receptive to and actively seek the SOEs’ feedback.
These practice-level reforms are intended to supplement and support the wider policies and regulations. There is another factor that can undermine all of this, and it stems from an executive level.
‘We didn’t come out of exile to be poor’
This phrase was cited by two interviewees as the justification put forward by some of those accused of profiting from the state. The actual quote, in a story in The Economist (2010) – ‘I didn’t join the struggle to be poor’ – is attributed to Smuts Ngonyama, ANC spokesman, from 2007. The story goes on to outline a number of misdeeds on the part of SOEs and other official bodies, quoting Gwede Mantashe (then the ANC’s secretary-general) as saying, ‘Too many “comrades” regarded election to public office simply as a chance to get rich’ (Ibid.).
Von Holdt (2019, 14) considers corruption and state capture to have been a deliberate system of class formation for a new political elite:
the appropriation of finance through inflated tenders and fraudulent contracts, and its recirculation through Gupta and Zuma linked companies and back into political patronage networks, contributed to the emergence of new elites located in a convergence of political power and economic muscle.
A number of my interviewees felt that this viewpoint had validity, and one agreed that it had been successful. Another interviewee outlined how justifications used were often part of a technical game: ‘But I’m stealing from [the state airline] SAA. SAA only services the elite so the poor aren’t [suffering]’ (S. Skiti, interview, 2019). Positioned thus, I note the parallel with Appiah’s (1992, 8) story of subjective justice in Ghana mentioned earlier.
Although Ekeh’s theory of the ‘civic public’ was not recognised by my interviewees, it does align closely with what has taken place. The idea of the civic public having a different or amoral basis may not feel authentic to those being interviewed, but I am acutely aware that their epistemological grounding (similar to my own) is one that most closely aligns with a ‘sole public’ system of morality. This is common in South Africa, as the idea of the state, particularly the constitution, is one that is held dear by many South Africans (Comaroff and Comaroff 2006, 25). The idea of a civic public is far less recognisable to them than might be the case elsewhere in sub-Saharan Africa. However, it cannot be denied that corruption has taken place on a grand scale in South Africa. The morality behind that may never be entirely or adequately explained, but even taking Ekeh’s two publics as the basis, it is also not straightforward, as there are both similarities and some marked differences. It is possible that many SOEs retained an aura more aligned to the apartheid state and therefore continue to be viewed as an element of the enduring civic public.
Talking about Eskom, one interviewee was emphatic: ‘We’re sticklers of attention; we’re sticklers of protocol [sic] … looking at the case of what you’re seeing at the moment, it was really intentional.’ Whereas she and others refer to a general erosion of morality in society, I consider this too simplistic an explanation. Surely, if that were the case, there would be no public outcry? After all, as Rose-Ackerman (1999, 177) points out, ‘corruption can be routine and commonplace without being viewed as acceptable by the population that bears its costs.’ Furthermore, I am wary that, without the theory of the two publics, ‘to fly in this way in the face of the evidence that corruption is both more common and less normatively clear-cut impairs our understanding of what we observe empirically in post-colonial Africa, regardless of ideological, normative or analytical preconceptions’ (Chabal and Daloz 1999, 98).
Meanwhile, callers on talk radio call-in shows often cited their frustration at the level of ‘eating’ going on. This term is used throughout sub-Saharan Africa as exemplified in a Zakes Mda play, The mother of all eating. The play’s title refers to the protagonist’s own view of himself: ‘The Man’, who proudly details his skill in corruption and associated career success while others languish – in part due to their own lack of complicity in various systems of corruption.
Conclusion
Trying to avoid a Western system of morality is difficult in South Africa as it tends to be pervasive throughout society and particularly in the mainstream media. Still, its limitations have also been recognised by interviewees who expressed a deeper connection to so-called traditional practices. The lack of accountability was often cited as a failure in effective consequence management and, at the extreme, certain people involved acted with impunity. While this criticism might arguably be considered one rooted in a Westernised system of morality, one consultant auditor interviewee pointed out that South Africa’s implementation of the Roman–Dutch legal system has been criticised when compared to the justice practised by Indlu Yenkosi,4 the traditional courts. His perception is that justice in the European system is both slower and less effective than traditional African justice, which would not consider corrupt practices acceptable where the actions are taken for the benefit of the individual. The unspoken assumption is that the traditional court would apply its judgement fairly and, importantly, swiftly. There is, however, no easy way to test how those courts would react in these situations or whether their judgement might be different when presiding over corruption where a group (for example, the ANC as a political party) or an entire community might be the beneficiary.
In an environment where processes are perceived as not working well, circumventing or manipulating the system can become the acceptable way of working. When procurement focuses on its processes rather than the organisation’s objectives, it can compound such perceptions further. At this point, petty corruption can easily be accepted as a new norm, enabling creative officials to benefit while retaining the veneer of compliance. Chabal and Daloz (1999, 106) make an important distinction: that ultimately, ‘corruption is not a hallmark of authoritarianism: nor is it (as we are now well aware) incompatible with democratic systems.’ In a commercial setting, I would argue that this also applies to regulatory systems. Corruption will thrive where it is ‘instrumentally profitable in the … circumstances’ (Ibid.). Working more collaboratively, procurement can enable creativity and add value within its gatekeeper role. Fewer workarounds are then required, enabling more effective levels of compliance in the future. As such, process compliance should be an outcome rather than the objective.
President Cyril Ramaphosa’s efforts at transparency and reform are not without precedence, which is probably why so many people also express their lack of confidence in the formal judicial processes. Similarly, when former President Jacob Zuma set up an inter-ministerial task team chaired by Collins Chabane and oversaw the changes that brought public procurement procedures under NT’s purview (The Economist 2010), there was little confidence that any serious prosecutions would result. This remains an unspoken reservation behind many expressions of hope in the new leadership.5 While Zakes Mda’s play The mother of all eating (2002) is clearly satirical, many opinions expressed by my interviewees are summarised by the protagonist’s observation of how things work: anti-corruption supporters quickly get weeded out for fear that they will expose the corruption of their seniors. While it clearly over-simplifies matters for dramatic licence, in his monologues the protagonist is able to express thoughts he knows are widely considered to be unacceptable.
For now, Ramaphosa has an opportunity to implement truly effective anti-corruption measures, but I would argue that no new policy measures are required. Rose-Ackerman (1999) considers that there is a role for the international community to play in reinforcing the need for reforms, but Skiti (interview, 2019) remained wary. In South Africa’s case, the years of isolation during apartheid have left some people with the opinion that the country can ‘go it alone’. But he also points out the flaw in such thinking, as it ignores how connected geopolitics has become.
In South Africa’s politics, opposition parties have often found it difficult to hold the ruling party to account and, in the view of certain ANC stalwarts, the bulk of the work needs to be done by the party itself. The same applies to procurement and its leadership. Good procurement may not be openly rewarded, but poor procurement affects the efficiency of the entire operation. Working as an isolated, hierarchical, process-based function has made procurement far too vulnerable to corruption. Effective procurement leadership therefore seeks to build relationships with stakeholders throughout the organisation for procurement to become a trusted partner and be considered an important element in driving value through improved management of the supply chain.