False billing costs SA billions - MadonselaComment on this story
Stellenbosch - South Africans are fast asleep to a corrupt practice that costs the government billions of rand.
Public Protector Thuli Madonsela warned business leaders in Stellenbosch on Tuesday about how corrupt government officials and business were siphoning large sums of public money by submitting false bills to government departments.
“This country has not even woken up to the problem of false billing. My team and I suspect our government is losing billions.”
Madonsela wants to launch a full systemic investigation next year to see how much the government loses through false billing.
She also called on society to reject “tenderpreneurship”, saying it bred corruption, which was milking the state of resources that should have been channelled towards uplifting the poor.
Madonsela said she had been shocked by the reality that there were “paper companies” only created as vehicles for specific tender deals. False billing happened when public officials and businesses colluded to siphon money from government coffers for services that weren’t rendered, she said.
“Travelling and hospitality services have specifically been fingered in this regard,” she said.
Madonsela said her investigators found false billing when they recently investigated contracts between On-Point Engineering and the Limpopo Transport Department.
The public protector found On-Point and former ANC Youth League leader Julius Malema benefited improperly from the contract, while the tenders were unlawful.
She said her investigations into RDP housing and medicine and equipment shortages, book distribution, pupil transport and feeding schemes had all pointed to problems with false billing.
“If these allegations [of false billing] prove to be true this means that public money that is meant to procure goods and services meant to alleviate poverty and underdevelopment – including health care and education – is siphoned off to line the already swollen pockets of ‘tenderpreneurs’,” said Madonsela.
South Africa has made progress but it has been “stunted by various forms of maladministration, including corruption”.
Madonsela said the recent census results showed how corruption was slowing down development and letting inequality persist.
“We committed ourselves together with other nations to halve poverty by 2015 but the census results tell a different story.”
Unemployment is at about 25 percent with 50 percent of our young people being without jobs.
“There seemingly is a correlation between provinces known to have systemic maladministration challenges and slow delivery on socio-economic rights such as health, housing and education.”
Madonsela asked business leaders and society not to turn a blind eye to corruption and to work with institutions such as the Special Investigating Unit (SIU), the auditor-general and her office to combat it.
“Turning a blind eye is not helpful. We can’t just complain about it. We all have to do something… it must be a national quest.”
Madonsela believes South Africa must set up an anti-corruption unit similar to that in Singapore that can tackle corruption head-on in the public and private sector.
“The public protector is not really designed to bust corruption but more as an ombudsman.”