Deputy Speaker, the Auditor-General issued a report to Parliament in August 2008, which indicated that senior managers failed to declare their interests and that the majority of government employees did not have approval to perform remunerative work outside their employment in government.
The report of the Auditor-General highlighted, amongst other things, six key findings. The first is a lack of approval to perform remunerative work. Of the 2 319 government officials that had an interest in companies that did business with government departments, only 75 had permission. The business conducted with government by these employee-related entities for the 2005-06 and 2006-07 financial years amounted to R615 million.
The second finding highlighted excessive business with employee-related entities. In certain instances, employees of the departments had approval to perform other remunerative work, but did excessive business with government which could have had an impact on their ability to effectively perform their respective duties. The Auditor-General further found that 19 employees did business with national and provincial departments to the tune of R68 million.
With regard to the third finding, there was also the issue of collusive tendering processes. The Auditor-General also identified a total of 11 employees involved in collusive tendering and their activities amounted to R1,6 million.
Regarding the fourth finding, the report also dealt with conflicts of interest. Employees were involved in procurement processes in the departments and the entities in which they had an interest. These employees were appointed to deliver goods and services for government and their conflict-of-interest transactions amounted to R14,2 million.
In respect of the fifth finding, there was also a lack of declaration as well as misrepresentation in the standard bidding documents. Fifty-nine government employees with transactions amounting to R172 million were found to have misrepresented the disclosure in the tender documents by not declaring that they were related to companies and close corporations doing business with government.
The sixth finding was regarding deviation from the supply-chain management processes in the awarding of tenders and quotations.
When read in line with the findings of the Public Service Commission's Report on financial disclosures by members of the senior management service for the 2007-08 financial year, the findings of the Auditor-General are an indication of a profound challenge of a conflict of interest in the Public Service.
The Public Service Commission, PSC, found that 210 senior management members did not disclose their interests in some companies or close corporations. Furthermore, the PSC reported that only 48% of the disclosure forms were submitted by senior management members to the PSC before the prescribed dates.
Whilst there are clear guidelines in terms of the Public Service regulations, Treasury regulations, the Public Finance Management Act and other applicable legislation regarding the prevention and the management of conflicts of interest, the following challenges remain significant in resolving this matter.
One, there is lack of compliance with legislation relating to financial disclosures; two, there is no proper monitoring of the legislation relating to financial disclosures, procurement, collusion among public servants and other practices that have led to the findings outlined by the Auditor- General; three, there are attitudinal reasons that mostly lead to a lack of compliance by senior management.
In line with the aforementioned provisions, we recommend that: One, national and provincial departments ensure that they develop effective monitoring and evaluation policies that will respond to any breaches in policy and deal with such cases immediately; two, in an event that some employees are found guilty, the respective national and provincial accounting officers must ensure that they recover the money acquired through these fraudulent means; three, the accounting officers of the relevant departments must take disciplinary action against designated employees who do not declare their interests in companies or CCs that did business with national departments; and, four, national departments that had employees performing remunerative work without approval investigate these instances and that the relevant accounting officers take immediate and appropriate disciplinary action against those that are found guilty of performing remunerative work without approval. I thank you.
Madam Deputy Chairperson of the House, the government programme of action till 2014, as derived from the ANC election manifesto, rightly identifies the intensification of the fight against crime and corruption as one of the key priorities. It is important to note, therefore, that the first report of Scopa, the Standing Committee on Public Accounts, to come before this House this session dealt with the shortcomings within the SA Police Service in their fight against crime. The second report of Scopa dealt with corruption within the Public Service generally.
Equally important to note is that both reports are based on performance, as opposed to compliance audits, which speak directly to the quality, the depth and the nature of service delivery to the public.
Too often we tend to delink oversight over the public purse from the day-to- day performance issues that impact on the interaction of ordinary South Africans within the Public Service.
In the 1992 "Ready to Govern" policy document of the ANC, the ANC commented on the Public Service thus: "The civil service should be impartial in its functioning and be accountable both to Parliament and to the broad community it serves."
This report has its roots in the report issued by the Auditor-General to Parliament in January 2006, regarding, one, approval for government employees to perform other remunerative work; and, two, disclosure of financial interests by Ministers, Deputy Ministers and senior managers.
We all know that the report indicated that designated employees had failed to declare their interests and that the majority of government employees did not have approval to perform remunerative work outside their employment in government, as required by the relevant legislation and regulations. This then gave rise to a performance audit being concluded both nationally and provincially.
I shall briefly sketch out the main findings of the Auditor-General, whilst my colleague will delve deeper into some of the issues uncovered in the audit, suffice to say that it is not a pretty picture. We would be failing in our duty and responsibilities to the public if we were to shy away from raising these issues.
During the audit process, specific emphasis was placed on the performance of remunerative work; the declaration of registrable interests; the declaration of interests and standard bidding documents; deviation from supply-chain management; noncompliance with certain Treasury regulations and non-performance in terms of value-added tax legislation.
Scopa then heard and considered evidence on two occasions, from the directors-general of different departments, such as National Treasury; the Department of Public Service and Administration; the Department of Arts and Culture; the Department of Communications; the Department of Correctional Services - I'm happy the Minister is here - the Department of Labour; the Department of Police, the Department of Trade and Industry; and the list goes on.
Let me then sketch and point out the current situation as it stands. The regulatory framework used currently is applicable to all members of senior management services. That is where the crux of the problem lies. We don't understand why it excludes all the members below the senior levels, that is below directors. That is where we think the bulk of the problem is, because directors-general will not tender for something while their subordinates will do the same. We have uncovered particularly in the Department of Correctional Services.
The chapter reads: Unless it is otherwise provided for in his or her condition of employment, every officer and employee shall place the whole office or her time at the disposal of the state. The question is: If a person is allowed, as is the case in the current situation, to have work because he is below the threshold of senior management, when is he going to have the time to devote all his time and dedication to do the work for the state? We are of the view that this is supposed to be corrected.
The results, therefore, of our deliberations is the resolution now before this House, which my Scopa colleagues will deliberate on. However, I wish to focus on a worrying development with far-reaching implications for every parliamentary committee. It transpired as a result of our public hearings.
The parliamentary system of government is premised on the idea that public representatives, as representatives of the electorate, perform oversight of the work of the executive and the Public Service. In this regard, the Deputy President, while delivering his keynote address at our Apac - Association of Public Accounts Committees - conference, captured the nature of this engagement when he said: Our Constitution specifically requires the legislatures to provide for active mechanisms of oversight and to ensure that executive organs of state in the national and provincial spheres of government are accountable to legislatures.
That is what we are saying: Ministers, you are accountable to Parliament. That is what the Constitution is saying. The Constitution is specific about the type of society it wants to create and the values of accountability, of responsiveness and of having an open society.
As an oversight mechanism, public accounts committees have a great responsibility and must contribute to legislatures fulfilling their mandate of overseeing executive actions, with special focus on financial management and administration.
The Auditor-General has raised the bar. We are going to carry out performance audits. We have to engage, one way or another. The legislative framework will then force us to carry out oversight, where we will have to call in the Ministers. This is what the current performance audit, done by the Auditor-General, is saying currently, unless stated otherwise.
Our democratic system of government is critically dependent on transparency and accountability. The main responsibility for this is in the hands of the South African legislatures. When legislatures oversee and scrutinise the actions of the executive, they have to enforce accountability on the part of government. The Constitution prescribes that members of the executive, as Madam Pandor has said, are collectively and individually accountable and must regularly provide comprehensive reports regarding matters related to the performance of functions under their control.
Therefore, the need for strong parliamentary oversight and scrutiny guidelines are an essential part of promoting good governance and combating corruption, and this is an internationally accepted fact.
What the Deputy President said in his statement with regard to public accounts committees is applicable to all parliamentary bodies. It therefore pains me that during one of our interactions with an official from Arts and Culture that there was a high level of ill discipline, as the official came to Parliament and literally lied. We cannot accept that.
We want to send out a strong message to the officials that lying to Parliament is a crime. I'm happy to report to this House that the COO, Chief Operating Officer, concerned, of Arts and Culture, has since been suspended and we will follow up this matter with keen interest. [Applause.]
We are saying that this Public Service does not have a place for people who do not take their work seriously. We will follow this matter to the letter. I thank you. [Applause.]
Madam House Chairperson, hon members, conflicts of interest can extend beyond simply the term of one's employment. The original arms deal joint investigation report of 2001 - eight years ago - states that Parliament should take urgent steps to ensure that high-ranking officials and Ministers are not allowed to be involved in contracts that are concluded with the state for a reasonable period after leaving office. Now is the time to take this recommendation and the 2006 concerns of the Auditor-General seriously and implement them.
Measures to combat conflicts of interest are urgently needed but cannot stop at the level of senior officials. They must also include Ministers, their spouses and families. In Scopa's report before the House, it is recommended that the Public Service Commission, Cipro - Companies and Intellectual Property Registration Office - and the National Treasury databases should be integrated for available information. As far as Cipro is concerned, there is the looming Valor IT tender scandal. There are also serious flaws in the system that allows criminals to commit tax fraud. Furthermore, the National Intelligence Agency, Nia, has since 16 January of this year failed to do a security clearance on a chief information officer, as is required. Die Departement van Handel en Nywerheid het slegs riglyne vir die aanstelling van persone met 'n kriminele rekord, wat nou eers in die proses is om in beleid vervat te word. Maar alles is blykbaar onder beheer, want die Nasionale Intelligensie-agentskap gaan hierdie voornemende werknemers se rekords verifier. Indien 'n mens na die Cipro-geval kyk, gaan Handel en Nywerheid vir 'n lang tyd vakante poste h. (Translation of Afrikaans paragraph follows.)
[The Department of Trade and Industry only has guide-lines for the appointment of persons with a criminal record, which is only now in the process of being formulated into policy. But apparently everything is under control, because the National Intelligence Agency is going to verify the records of these prospective employees. When one looks at the Cipro case, the Department of Trade and Industry is going to have vacant posts for a long time.]
To keep criminals out of public office, Nia will play a crucial role. The right person needs to be in charge of the agency. Since the latest appointment, the DA has made its view very clear on this matter. With all the shaking and shuffling on the highest level, I will not be surprised if we soon sing the national anthem to the tune of "Shake, shake, shake your booty". Even the Treasury admits that they employed people with criminal records, although they stressed the point that this was not related to the type of work that was being performed. But, yet again, criminal records have to be verified by Nia. Hoe gaan die NIA al die personeel wat aangestel moet word of reeds werksaam is se kriminele status verifier? Soos ons almal weet, het die agb President baie sterk standpunt ingeneem teen korrupsie, of hoe? Op 'n vraag aan die Presidensie deur die agb Leier van die Opposisie aangaande die meer as R9 miljoen se rekenaartoerusting, kantoortoerusting en ander masjinerie waarvoor geen stawende dokumentasie beskikbaar was vir die Ouditeur- generaal se oudit nie, antwoord die Presidensie soos volg: (Translation of Afrikaans paragraph follows.)
[How is the NIA going to verify the criminal status of all members of staff who have to be appointed or who are already employed? As we all know, the hon President has taken a very strong view against corruption, isn't that so? To a question directed at the Presidency by the hon Leader of the Opposition regarding the more than R9 million worth of computer equipment, office equipment and other machinery, for which no supporting documentation were available for auditing by the Auditor-General, the Presidency responded as follows:]
Some of the records for assets procured prior to the year 2007-08 could not be obtained because there were no proper records kept. The officials that were responsible for the safekeeping of asset documents have left the Presidency. No action was taken against any officials as they are no longer working for the Presidency.
There you have it. The buck stops with the Presidency.
Met so 'n voorbeeld wat gestel word, is dit geen wonder dat ons 'n probleem in die Staatsdiens het nie. Dankie. [Applous.] [With such an example that has been set, it is no wonder that we have a problem in the Public Service. Thank you. [Applause.]]
House Chair and hon members, elected and appointed government officials who betray the people they serve through unethical, illegal and greedy pursuance of personal interests, gain or private success should be punished by double measures.
Those who steer public money into their own pockets commit a serious crime against the jobless and poor people who instead could have participated in the economy. We know that more than R615 million from 2005 to 2007 landed in private pockets. Some 30 officials gave themselves undue tenders in excess of R30 million. The fat cats became fatter.
High ethics are key to a corrupt-free society. But some people have no regard for the law or standards. This is more than misconduct or neglect of duty, but a violation. They get unfair advantages, compromise independence, and misuse positions, state facilities, time, employees and inside information for their gains. They stop at nothing and even engage in political influence or collusion. They treat our hard-earned tax money as their cash cow for the milking. They even regulate their own ventures.
As a rule, government employees should avoid conflicts of personal interest and public duty, whether nonprofitable or profitable. They must evade every appearance of conflicts of interest. To do paid private work while working for government is simply wrong. The report before the House is a shame for our country and an indictment of this government. It says that even Ministers, since 2006, did not declare their interests or get permission. Millions of rand went into the pockets of already paid officials.
Cope calls on all to root out corruption or undue enrichment and not condone it by inaction. How can we fight corruption when little happens to those who "Tata machance" and "Tata mamillion"? The Minister of Finance, in fact, said, and I quote: "Take strong action against those who feed selfishly off the state." Cope says we must be alert and blow the whistle.
We must raise the levels of Public Service professionalism and the ethics for conducting business on or off duty. We must embark on a fresh campaign of integrity, clean governance, clean hands and clean conscience and report all deviations. All officials must comply. All employees guilty of this must be shown the door. I thank you. [Applause.]
Chairperson, the hon colleagues who spoke before me have indicated that the first report was tabled by the Auditor-General in 2006 and that we had a new report that we considered in July 2008. We all know what the report indicated. It indicated that senior managers failed to declare their interests and so did certain Ministers.
Now the question to ask hon members is whether it is the duty of the Auditor-General to find these things out. Well, the answer, my friends, is not blowing in the wind. The answer lies with the fact that directors- general or heads of departments have failed in executing their own responsibilities to ensure that senior managers within their departments complete declarations of interests and everything else that is necessary. It also lies in the inability of the Department of Public Service and Administration and the Public Service Commission to have the same understanding of what remunerative work means. We hope that by the time we discuss this later on, they will know exactly what remunerative work means.
The sterling work of the Office of the Auditor-General has helped to identify many areas which need to be tightened up to ensure that there are continued investigations as to whether or not some of the transactions in which government employees who did business with government departments were fraudulent.
Members of Parliament have to disclose their interests, and this is a public document. Why should government officials' interests not be declared publicly as well? They sit on procurement committees; we don't. In municipalities, you find that the officials look at tenders, but don't have to declare their interests.
When it comes to moonlighting - and the SAPS and the Health Ministers are not here - you find that many members of the SAPS and nurses are moonlighting. They work for government, for pension and everything else, but they go and work for private hospitals and security companies in the evenings. When are we going to put a stop to moonlighting?
We also need to ensure that those who are employed in state-owned enterprises declare their interests publicly. This is because state-owned enterprises seem to be becoming a cash cow for many people who either worked in government or have knowledge of what is happening in government. Thank you. [Time expired.] [Applause.]
House Chair, Ministers, Deputy Ministers and colleagues, it is generally accepted that our Constitution guarantees the right for all citizens to make their livelihoods, so long as they do so legally. That constitutional imperative is not what is under consideration in this case. Essentially, what we are discussing today is the phenomenon of serving two masters simultaneously. Rightly or wrongly, the current framework allows our senior public servants to perform remunerative work outside official duties, with the proviso that they obtain approval and disclose their interests. This is informed by the non-negotiable principle that senior public officials should maintain the highest standards of professional ethics and that disclosure measures are aimed at preventing incidents of conflict before they occur. They also protect both senior officials and, more importantly, strengthen citizens' trust in public institutions.
Paragraph 4.5.5 of the Explanatory Manual on the Code of Conduct for the Public Service, states that:
Employees are expected to place their undivided attention, time and skills at the disposal of the Public Service as employer. The nature and demands of the job in the Public Service are such that the interests of both the Public Service and the community may be prejudiced by a public servant undertaking remunerative work outside official duties. It is therefore mandatory to obtain prior approval to perform remunerative work outside official hours.
There is no ambiguity in the statement. So, let us consider how it matches up to reality as reflected in the Auditor-General's performance audit. According to the report, 2 319 government officials had an interest in companies or CCs, close corporations, that did business with national and provincial government departments. Of those, only 75, that is 3%, had approval to perform paid work outside their official employment at the departments, whilst some departments were still determining their approval status when the report was finalised. The business contract with government by these employee-related entities for the 2005 until the 2007 financial years amounted to R615 million.
This is not only a case of an official in the Western Cape having interests in a company doing business with the Limpopo government. A total of 30 employees are identified as directors or members of companies or CCs doing business with the very same department where they are employed. It goes without saying that none of them had any approval for the work, which netted them R32 million for the period under review.
A department such as Correctional Services had four employees who transacted with the department, a contravention of the Correctional Services Act, to the tune of R1 037 000. This is not to single them out, but it is equally factual that the department has had qualified audits every year since 2001. Another person employed on a part-time basis at the then Department of Housing had interests in companies that did business with other national departments amounting to R17 million.
The Auditor-General identified a number of factors that militated against employees seeking approval. These are: One, the majority of national departments do have a system of control in place to manage the performance of other remunerative work by employees; two, the national departments do not have a database or register in place to monitor other paid work; three, designated employees were under the impression that the financial declaration forms submitted to national departments and the Public Service Commission were sufficient; and, four, the national departments rely on the integrity of employees to seek approval to perform outside paid work or declare their interests in companies or CCs. So this is rather a grim picture.
The committee recommends that national departments investigate instances of employees performing remunerative work without approval and that the relevant accounting officers take immediate and appropriate disciplinary action and report the outcomes of the investigations to Scopa.
All provincial heads of department should take immediate remedial action to henceforth ensure compliance with legislation by all staff, and that matters related to the difficulties in the implementation of legislation be addressed with the Department of Public Service and Administration.
The provincial public accounts committee should consider holding public hearings with respective provincial departments to monitor the actions taken against implicated employees by the respective provincial departments. The national and provincial departments should implement and actively monitor the systems of control to manage the performance of other remunerative work by employees.
The legal interpretation regarding what constitutes remunerative work must be speedily concluded by the relevant bodies, namely the Public Service Commission and the Department of Public Service and Administration, and be communicated widely in the Public Service.
Again, it is instructive to note that the report from the Auditor-General has hardly spurned the PSC to re-examine the framework governing outside paid work and financial disclosures. The committee was assured that baseline documents incorporating some of the Auditor-General's recommendations would be published in the near future as they are currently in the work plan of the DPSA.
In conclusion, we, in the ANC, have realised the gravity of the situation. In this regard, I must refer to the statement after the first national executive committee meeting on 18 and 19 September 2009, which referred to declaration ... I thank you, Madam. [Time expired.] [Applause.]
Madam Chairperson of the House, the UCDP is seriously concerned about the R615 million that has been misused in departments dealing with their employees in business. This spells out the following: firstly, that the tender allocation system of the departments encourages fraudulent activities. It is a system that has to be revisited; not every section in every department should allocate tenders, but there should at least be a division that deals with this.
The second issue is that we realise that the deputy directors-general of departments are not even aware of what is happening. The report that we are debating today was issued in 2006, and they were called in in August 2009. Some of them were hearing about these resolutions for the first time. That is why I support my hon colleagues who say that Ministers have also to appear before Scopa in order to account, to know what is happening in their departments and to see how their deputy directors-general are failing the departments.
Another point is that the financial management system in many departments is still wanting. We wonder about the chief financial officer, if there is an internal auditor, if there is an audit committee in every department that is supposed to be working on these issues long before the Auditor- General picks them up.
Resolutions by Scopa in this House, which have been adopted, are not taken seriously by most of the departments. Thank you, hon Chair. [Time expired.] [Applause.]
Hon Chairperson, let us not do shadow-boxing. The Auditor- General is correct: Too many civil servants and their spouses are involved in business, but what about politicians and what about councillors? Contracts have been given to political friends and party loyalists.
I can point out that since 1994, in KwaZulu-Natal, certain individuals have become stinking rich. They are getting electrical contracts, they have become suppliers; whereas before 1994 they were not known. What will help check civil servants and politicians is a special squad, within the Hawks, that can check for unaccounted-for enrichment and lifestyles, such as that from the evidence that has been led by KPMG in the Jackie Selebi case.
If you have an investigation for unaccounted-for enrichment and lifestyle in India, you are detained immediately, irrespective of your rank. By the way, for the benefit of the House, in KwaZulu-Natal, the Auditor-General had great praise for only one department, the department of sport and recreation, which was led by the MF leader, Mr A Rajbansi. Thank you. [Time expired.]
Chairperson, the Auditor-General's report on conflicts of interest in the Public Service has raised serious issues. One of his specific concerns was the approval to perform remunerative work.
In a comprehensive audit conducted, it was found that 2 319 government officials had an interest in companies or CCs that did business with national and provincial government departments. Only 75 officials, that is 3%, had approval to perform remunerative work outside their official employment at departments.
What is very annoying about this is that the Public Service Act of 1994 stipulates explicitly:
No officer or employee shall perform or engage himself or herself to perform remunerative work outside his or her employment in the Public Service, without permission granted by the relevant executing authority or an officer authorised by the said authority.
Clearly, these officials violated the law. Business conducted with government by these employee-related entities for the 2005 to 2007 financial years amounted to R615 million.
The situation gets even worse when the Public Service Commission states in its report: Overview of the Implementation of the Financial Framework, Financial year 2007-08, that the low level of compliance, that is 70% by directors-general and deputy directors-general in both national and provincial departments, is of great concern. Surely, better compliance levels should be expected at this level as these officials take the lead in decision-making within their departments.
It, therefore, makes sense that the Public Service Commission advises the relevant executive authorities, namely Ministers and MECs, to institute disciplinary action and to charge transgressing officials with misconduct. The Auditor-General echoes these sentiments.
Accountability forms a crucial part of good management and good governance. Therefore, there must be consequences for misconduct. Guilty public servants, at all levels, must even be fired. Revision of the ministerial handbook and the handbook for managers is often mentioned in the press, but we would like to have a date for the completion of this very necessary process.
The important question, however, is whether the executive has the political will and the political guts to take these crucial steps against corruption. The Minister for the Public Service and Administration is the only one who can fire a director-general, for instance. Will Minister Baloyi be willing to take such a step in order to prove that he is serious in combating widespread corruption in the Public Service? Is he willing to compel public servants, at all levels, to sign their key performance agreements?
In the Western Cape, the DA implemented some alterations to the Public Service handbook in order to develop a climate of ethics in the Public Service. Is the Minister willing to do the same? May I remind him that he said, in July this year, while addressing the Anticorruption Learning Network in Port Elizabeth, that government needed to fight and improve its efforts to tackle this serious problem of corruption in the Public Service?
Mr Baloyi can be assured that the DA will support him all the way in fighting this immense problem, because only in doing this will we be able to start reversing public dissatisfaction and disillusionment with the Public Service in our country. I thank you. [Time expired.] [Applause.]
Hon Speaker, I think I'll continue where my colleagues in the committee left off. I will deal with one or two areas that the Auditor- General highlighted in the performance audit, that is noncompliance with both Treasury regulations and with value- added tax legislation.
Before I tackle the findings and the committee's resolutions thereon, it's important to remind the House what those Treasury regulations pertain to.
Firstly, TR 16A8 regulates compliance with ethical standards, read with practice note number SCM 4 of 2004. It prescribes that all employees and other role-players involved in supply-chain management must adhere to the National Treasury's code of conduct for supply-chain management practitioners.
Secondly, TR 16A8.5 states that an official in the supply-chain management unit who becomes aware of a breach or failure to comply with an aspect of the supply-chain management system, must immediately report such to the accounting officer in writing.
Thirdly, TR 16A9.2 states that the accounting officer may disregard the bid of any bidder, if that bidder or any of its directors had abused the institution's supply-chain management system; had committed fraud or was guilty of any other improper conduct in relation to such a system, or had failed to perform on any previous contract.
Fourthly, practice note number SCM 5 of 2004 states in paragraph 3.1(b) that accounting officers should make provision for the training of at least the practitioners who are involved in the day-to-day operations of supply- chain management.
I'm sure we all agree that all these regulations have noble intentions, and if implemented, will ensure that government tenders go to those most deserving. However, the Auditor-General found that though the National Treasury's code of conduct must be adhered to, there's no legal requirement for employees working in supply-chain management to sign a code of conduct. In short, departments do not have signed codes of conduct, or, perhaps more likely, it would affect too many bank balances.
Of the 20 national departments, 17, that is 85%, indicated that officials had not been aware of any breach or failure to comply, while officials in two departments reported supply-management system cases to the accounting officer. One department did not respond. Of the two reported, one indicated that no action had been taken, as required by TR 16A9.1(b).
Of the 20 departments, 19 departments, that is 95%, indicated that no bids were disregarded, as none of the bidders nor any of their directors had abused the system. One department did not respond, a case perhaps of "See no evil, hear no evil". Equally worrisome, cases were identified where regional supply-chain management employees had either not been trained, training had been cancelled or trained staff had not been retained.
The Auditor-General recommended, and the committee strongly agreed, that all provincial and national departments should ensure that supply-chain management sign a code of conduct committing themselves to fair and ethical procurement practices. It is the least that our people expect, considering the handsome packages earned by senior public servants and the fact that they're in the Public Service, not through compulsion, but to serve, and there's nothing precluding them from joining private enterprises, if they so wish.
I now come to noncompliance with VAT legislation. It's generally accepted that tax authorities are not to be trifled with, as anyone who's ever received a letter of demand from Sars can attest. However, there seems to be a thriving industry in noncompliance when it comes to supplying goods and services to some government departments. Section 23(1) of VAT Act of 1991 states that all trading entities must register for VAT if taxable supplies or services rendered during a 12-month period amount to more than