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Treasury's money would be best spent, in the eyes of the public at least, on paying for top class, competent, qualified investigators and prosecutors to go after the crooked and corrupt, writes Mandy Wiener.
A few days ago, Communications Minister Stella Ndabeni-Abrahams announced that the financially crippled state broadcaster, the SABC, will be receiving a R3.2bn bailout from government. The first payment of R2.1bn was set to be transferred on Monday this week, with stringent conditions having been set before the money was released. The remaining R1.1bn would be held back until the SABC had met all the outstanding set requirements
The SABC has not made a profit in six years and has said that it was expecting another loss for the last financial year. It actually needs a bailout of R6.8bn to be able to run but it will have to do with half of that in order to avoid a blackout.
Similarly, SAA is in desperate need of a government cash injection despite already receiving a R5.5bn bailout from Treasury over the past financial year. It needs an addition R2bn in working capital until December to stay afloat. It's in even more trouble now that it has failed to submit audited financial statements in Parliament because of liquidity issues. Add to that a myriad of problems with labour issues and pending strike action.
Over the past few years, Treasury has given SAA bailouts amounting to over R20bn but Finance Minister Tito Mboweni has said that the airline must be sold off and the state cannot continue to bail out state-owned enterprises (SOEs).
State-owned arms company Denel also received a R1.8bn bailout from government this year after it was left struggling to pay salaries and suppliers. Government is considering a further R1bn recapitalisation in its budget for the next financial year. Eskom, which was horribly looted during the state capture project, is getting R59bn over the next three years.
Writing in Business Day, activist Terry Crawford-Browne criticised government for repeatedly throwing good money after bad in this manner. "Has the Treasury still not learnt anything from its dismal failures with the arms deal debacle? After years of mismanagement and corruption these SOEs have all proved to be unfixable and should be put into immediate bankruptcy instead of saddling SA and our citizens with still more debt."
Meanwhile over in Silverton, National Prosecuting Authority director Shamila Batohi and head of the Special Investigating Directorate Hermione Cronje, are trying to tackle a decade of malfeasance, corporate corruption and state capture with a meagre budget of less than R4bn.
The NPA is underfunded, understaffed and overstretched, with enormous expectations from the public. It does not have enough money to pay all of its salaries this financial year and will have to slash staff if it is to remain within budget over the medium term.
Batohi earlier this year told Parliament that vacancy rates were about 20% on average in the country. The percentage was even higher at specialised units such as the Specialised Commercial Crime Unit and the Asset Forfeiture Unit, at between 25% and 28%. This means that in actual terms the NPA had lost about 600 prosecutors since 2015 as a result of not being able to recruit any new prosecutors.
We are desperately waiting for the NPA to act in state capture cases, but the resources are simply not there. There is no money to fund them. There is little doubt this is going to have a significant impact on service delivery and perpetuate the credibility crisis of the organisation. In order to unravel the intricacies of a case like Steinhoff or Trillian, the NPA would need the very best forensic expertise in the country and it's unlikely to attract those resources with skinny public sector salaries.
According to the NPA's 2018/2019 financial report, it ominously warns that "The organisation has now reached a point where it will not be able to continue to deliver on its mandate if it does not receive an increase in its budget baseline. The lack of budget within the NPA is a very serious problem. There has been no recruitment since 2016. The impact on the delivery of justice and morale of prosecutors working in extremely challenging conditions, is huge."
Almost 90% of the NPA's budget is spent on wages, which meant a R77m shortfall for the financial year. This shortfall was funded through reallocation of funds within the Department of Justice. Batohi has also said that the new investigating directorate, headed by Cronje, would get more than R200m over the next three years but those funds are insufficient to do the work the unit is meant to.
Speaking last week at the launch of the Health Sector Anti-Corruption Forum, Batohi took the unprecedented step of pleading with the president for more money to address the lack of capacity within both the NPA and the Hawks. Batohi has instead previously resorted to "very strong budget diplomacy" with the finance minister to address this.
Batohi explained that while the NPA has received a budget allocation through the adjusted estimates of the national expenditure process, the biggest challenge to investigating and prosecuting was capacity in the NPA and Hawks.
"This will be used primarily to recruit prosecutors in the specialised commercial crimes units and capacity in the Asset Forfeiture Unit. However, the Hawks capacity still remains a problem. I take this opportunity to urge the president to address this urgently."
According to the Institute for Security Studies (ISS), the Hawks need 2 500 more investigators as it is currently running at less than 50% capacity. This is having a direct impact on the failure by the state to charge politicians and criminals responsible for pillaging billions from the state over the past years of capture.
"The Hawks' 1700 investigators, some of whom are helping the investigative directorate of the NPA, are working on almost 19 000 cases with over 15 000 accused on court rolls countrywide as of the end of March," said the ISS's Johan Burger.
Justice Minister Ronald Lamola has floated the idea of approaching private donors to fund some programmes of the NPA. This has raised concerns about how the NPA, which is already facing a credibility crisis, could compromise its independence. This just cannot be a viable option.
President Cyril Ramaphosa will know that the NPA is desperate for more money to get the job done. In his State of the Nation Address, he said, "We have asked the National Director of Public Prosecutions to develop a plan to significantly increase the capacity and effectiveness of the NPA, including to ensure effective asset forfeiture." The new Special Investigations Unit Tribunal is also expected to bring in cash – its intention is to fast-track civil claims arising from its investigations, which is hoped to bring in R14.7bn.
But for now, Treasury's money would be far better spent, in the eyes of the public at least, on paying for top class, competent, qualified investigators and prosecutors to go after the crooked and corrupt, than on bailing out a poorly run, inefficient SABC or SAA. Wouldn't you rather see the corrupt behind bars than flying on your country's national carrier?
