The Private Business Interests of South Africa`s Elected Officials
In all modern democracies some elected officials hold private business interests. People invariably occupy more than one social role, elected officials prove no different.
In all modern democracies some elected officials hold private
business interests. People invariably occupy more than one social
role, elected officials prove no different. However in transitional
democracies there often exists a significant overlap between the
political and economic elites, with many elected officials holding
private business interests. In the post-2009 election period, the South
African press have highlighted the issue of potential conflicts of
interest existing in government. One report revealed that 42% of
President Jacob Zuma`s new executive is registered with the Companies
and Intellectual Property Registration Office (CIPRO). This clearly
illustrates the overlap between the public and private lives of elected
South African officials in the country`s young democracy.
Holding private business interests while being employed as a public
official may result in a conflict of interest; yet any attempt to
prevent officials from possessing these interests is nonsensical.
Preventative measures would prove nightmarish to implement and monitor
and furthermore, officials possess the democratic right to possess
outside interests. Simply put, conflicts of interest will occur.
Their occurrence does not automatically imply that corruption will
ensue. If effective and efficient monitoring and oversight measures
are in place to manage conflict of interest situations, corruption can
be avoided. Whilst the media`s emphasis of the many private business
interests held by elected officials may serve to prick the ears of the
public and in this way encourage them to hold officials to account, the
concern over the volume of interests held by elected officials is
misplaced. Attention should instead be given to whether or not the
correct oversight measures exist to ensure that conflict of interest
situations do not lead to corruption.
At all three levels of government the annual process of financial and
asset disclosure is used as a means to expose existing or potential
conflict of interest situations. The idea is that if these interests
are exposed, the potential for corruption diminishes. Whilst this
sounds good in theory, in practice a different picture emerges.
Research undertaken by the ISS Corruption & Governance Programme
has found that while private business interests are indeed being
declared, very little examination of these disclosures takes place. In
all seven of South Africa`s provinces that have Provincial Registrars,
who are tasked with keeping a register of members` financial
interests, these individuals are not permitted to investigate private
business interests that they may regard as suspicious of their own
accord. Before taking any type of investigatory action, these
Registrars are legally compelled to wait for a formal complaint against
an elected official to be lodged, or for their respective ethics
committee to give the mandate concerning any investigations to be
undertaken.
The irony is that those with the most contact with financial
disclosure forms, who see them year in and year out, are essentially
left out of the oversight process. Their role becomes that of ensuring
simple compliance, elected officials submit disclosures and their box
is ticked off on a checklist, no proactive oversight of the forms
appears to occur. This is not surprising as there is no incentive for
Registrars to examine disclosures over time for irregularities, with
the knowledge that they are unable to investigate of their own accord.
The oversight at national parliamentary level of disclosure forms
unfortunately does not prove to be much different. At this level, it
is the Joint Committee on Ethics and Members` Interests that undertakes
the investigation of any irregularities on the part of members of
parliament. Investigations by this committee have only occurred
following complaints made by fellow parliamentarians, or after the
media has kicked up a fuss. Once again, the Registrar of Parliament,
who is the most familiar with the disclosures, is not equipped with
suitable investigatory powers that would allow for effective oversight.
At local level certain metros do not even have an individual/office
assigned to assess the declarations that are made each year.
Designated officials exist to collect these forms and to once again
ensure that they have been received however, once received they seem to
be stored away never to be seen again, unless one of the councillors
becomes involved in some or other media hype.
One might assume that given the substantial powers awarded to
members of the executive at both the provincial and national level,
that these officials would be thoroughly vetted in terms of their
annual disclosures. This is not the case. Although provincial
executive members are legally required to declare both to the
legislature and to a designated official in their respective Premier`s
Office, many of them declare only to the legislature, as such these
provincial executive members are often overlooked. The inability of
many Provincial Parliamentary Registrars to institute investigatory
proceedings of their own accord does not bode well for effective
oversight. With respect to the Presidency and other National Executive
members, it is the Public Protector who would investigate any
irregularities. Investigations only occur after an official complaint
has been made; once again no pre-emptive examination of the disclosure
forms seems to occur.
Given that government oversight of disclosure appears weak, much
responsibility rests with members of the public and with the media.
Effective oversight then depends in part on the ability that ordinary
citizens have to gain access to disclosure forms for review. Attempts
made by the ISS Researchers to test the implementation of the access to
information act, delivered varied results. Certain institutions were
very forthcoming whilst others declined to provide access to their
disclosure forms. Weak internal government oversight measures together
with the difficulty experienced by ordinary citizens in gaining access
to disclosure documents for review, suggests that much needs to be done
to prevent potential or existing conflict of interest situations from
ending in corruption.
Elected Officials at all three levels of government have private
business interests. Research generated as part of an ISS project on
Conflicts of Interest shows that in 2008 approximately 59 percent of
National MP`s held shares and 45 percent directorships in companies. At
the provincial level, approximately one third of all MPL`s held
outside interests from 2004 to 2008.
Attempting to prevent elected officials from holding outside
interests would be near to impossible. Instead of highlighting the
extent of an individual`s business interests, it might be more
beneficial to focus on the following key points: firstly, the weak
nature of oversight in the current disclosure framework and secondly,
the difficulty experienced when attempting to gain access to disclosure
documents. If effective oversight of disclosure forms is not undertaken
then the purpose of disclosure, which is to expose conflicts of
interest and to prevent these situations from ending in corruption, is
not fulfilled. Declarations of private business interests are then
only completed for process sake, trumping the need for real probity.
Rosemary Vickerman, Commissioned Researcher, Corruption and Governance Programme, ISS Cape Town
