South Africa Vision

President Cyril Ramaphosa has outlined several measures undertaken by government to end state capture, rebuild damaged institutions and foster a culture of ethical public service and accountability.

Addressing the Commission of Inquiry into State Capture and Corruption on Wednesday, President Ramaphosa said these measures have aimed at changing the way in which the Cabinet functions, strengthening institutions that had been ‘captured’, starting with changes in leadership of some of these institutions.

These measures also included changing the way in which State Owned Enterprises (SOEs) were managed and overseen by government as a shareholder and making necessary policy decisions to address shortcomings and reinforce oversight.

“One of the critical projects currently underway to strengthen the state involves the professionalisation of the public service. This aims to ensure that the public service is shorn of political partisanship and that the most qualified individuals enter its ranks,” President Ramaphosa said.

Government has prioritized rebuilding and restoring law enforcement agencies that were deliberately weakened to limit their ability to act against those involved in corruption and state capture.

“I therefore decided that the appointment of the new National Director of Public Prosecutions should be undertaken through a public and transparent process. This was the first time an National Director of Public Prosecutions (NDPP) was appointed in such a manner, which did much to restore the confidence of South Africans in the institution,” the President said.

Government has established the Investigating Directorate in the office of the NDPP to work on high profile complex cases of corruption and fraud.

“Its members have unique expertise in this field and it has shown the capacity to speed up investigations and see prosecutions do take place,” the President said.

Restoring the confidence of taxpayers

In May 2018, President Ramaphosa established the Nugent Commission of Inquiry to investigate governance failures at the South African Revenue Service (SARS) and to propose ways to restore the confidence of taxpayers.

“Its recommendations are now being implemented to redress the wrongs of the past and ensure that SARS never again falls prey to the improper motives of a privileged few. The impact of this work is already evident at SARS,” the President said.

Other areas of progress include the work that the National Prosecuting Authority (NPA) Asset Forfeiture Unit has done recovering the proceeds of economic crimes, recapacitating the NPA with more qualified personnel, and changes in leadership of entities such the Public Investment Corporation.

“This has been supplemented by the work of the Fusion Centre, where all relevant law enforcement entities share information and support each other in investigating these kinds of corruption. Discussions of how to institutionalise this form of cooperation are now under way,” the President said.

In October 2019, the Special Investigating Unit (SIU) Tribunal started its work and has shown its value in recouping monies wrongfully taken from state coffers.

State Security Agency

The President has assured the Commission that government is attending to the challenges at the State Security Agency (SSA).

“As has been made plain in this Commission, our Intelligence Services are in dire need of attention. To this end, the implementation of the recommendations of the High Level Review Panel chaired by Dr Sydney Mufamadi is at an advanced stage.

“I am assured by the leadership of the relevant agencies that illegal operations identified both in the Panel Report and the investigations conducted by the SSA leadership are being identified and terminated,” the President said.

Investigations continue on these and other wrongs within the SSA and in collaboration with law enforcement agencies.

The President said covert activities are now subject to scrutiny by the Auditor-General.

Late in December 2019, President Ramaphosa also reconstituted the National Security Council, which he chairs, to ensure better coordination of the intelligence and security-related functions of the State.

Political responsibility for the State Security Agency now resides in the Presidency and deliberations continue on the Panel’s recommendation to split up the SSA into distinct domestic and foreign intelligence services.

Repositioning SOEs

The President said government envisages a fundamental overhaul of the state-owned enterprises model that addresses not only the deficiencies that permitted widespread corruption, but that also enables these companies to effectively fulfil their social and economic mandates in a sustainable manner.

“To this end, Cabinet has established the Presidential State-Owned Enterprises Council to reposition SOEs as effective instruments of economic development through stronger oversight and strategic management.

“Government is working towards an SOE ownership model that clearly separates the responsibilities of ownership, policy development and regulation.

“Effective ownership will become more centralised to enable greater transparency, accountability and oversight, and subject all strategic SOEs to more rigorous requirements for financial and operational performance,” the President said.

Government is implementing standard guidelines on the appointment and remuneration of State-Owned Enterprise (SOE) boards and executives that prioritise the recruitment and retention of appropriate skills, experience and competencies.

This includes a clear delineation of authority and responsibility between elected public officials, non-executive directors and executive leadership.

Efforts to protect public money

In addition, government is working to ensure the rigorous implementation of controls over the use of public money as the best way to protect the abuse of those funds.

The National Anti-Corruption Strategy, which was developed together with representatives from business, trade unions, academia and civil society, including religious organisations, was approved by Cabinet in November 2020.

“The Health Sector Anti-Corruption Forum, which was launched in September 2019, is a critical element of our fight against corruption.

“Legislative changes have been made, and others are underway, to fight corruption and reduce the likelihood of a recurrence of state capture.

“The amendment to the Public Audit Act as a good demonstration of this has granted the Auditor-General significant powers to secure consequence management where public funds are misused,” the President said.

He said this was a significant step in the fight against state capture as it targets the perpetrators of fraud and theft.

“Another set of powerful measures to prevent corruption and state capture include changes to the way in which the public service is managed. Critical sections of the Public Administration Management Act of 2014 have now commenced.

“These include the prohibition on all public service employees conducting business with the state, the development of norms and standards of integrity, ethics and discipline in the public service, and the establishment of the Office of Standards and Compliance. Further sections will be commencing this year,” the President said.

Legislation meant to entrench greater checks and balances in public procurement is in the pipeline and will be finalised as soon as possible.

Source: South African Government News Agency

Deputy President David Mabuza says without urgently resolving inequalities in society, South Africa cannot successfully build and grow as a nation.

“Without urgently and tangibly addressing inequalities in society, nation-formation becomes a statement of intention rather than a statement of fact,” the Deputy President said on Wednesday.

Mabuza was addressing the 4th Human Resource Development Council (HRDC) Summit underway at Gallagher Convention Centre in Midrand.

The Deputy President addressed the summit in his capacity as Chairperson of the HRDC, a national multi-stakeholder advisory body established with the objective of improving the foundation of human resources in South Africa.

Held under the theme ‘Skills required for the 21st century’, the three-day summit aims to facilitate building the foundational knowledge to respond to the dictates of the changing world of work shaped by the realities of technological advancements.

Mabuza said the theme of the summit is relevant in the South African context to ensure that no one is left behind, as “we implement measures to rebuild and grow the economy”.

The Economic Reconstruction and Recovery Plan, Mabuza said, is premised on reviving the economy devastated by the COVID-19 pandemic, through investment in employment creation initiatives, building the relevant skills and training for the economy, industries and jobs for the future.

“It is encouraging that the objectives of this 4th HRDC Summit focus mainly on building the foundation and skills for a transformed economy and society, and building a capable and ethical developmental state.

“These objectives are significant since the HRDC, as a multi-stakeholder advisory body, is uniquely positioned to ensure that we capacitate the unemployed, those in workplaces and those still in our schooling system, with requisite skills that can respond to new world realities and to make South Africa globally competitive,” Mabuza said.

The Deputy President said the HRDC should use the Revised HRD Strategy to address the four broad challenges of poverty and inequality, quality of education, absorptive capacity of the economy, and social cohesion that will cumulatively contribute towards the attainment of the National Development Plan’s outcomes.

“Before deliberating further on this 4th summit, let us reflect briefly on what was agreed to in 2018 at the 3rd HRDC Summit, to ensure that we underline policy and programmatic continuity, and avoid reinventing the wheel. As social partners, we have to ask ourselves the question whether between the period of the last summit and this one, have we sizeably delivered on equipping and capacitating our young people with practical solutions.

“If we are to recalibrate our human resources development efforts to be skills-based, innovation-led and entrepreneurial-focused, we must be deliberate in implementing resolutions that we take at each summit. That is why at the end of this summit, we need to emerge with a concrete plan of action that will demonstrate measurable progress by the time we meet for the next summit,” he said.

Mabuza welcomed the summit’s focus on building the foundation for a transformed economy.

“We presume there will also be strategic and thematic continuity between this 4th summit and previous summits in areas of implementing pathways and partnerships between training institutions, labour and industry.”

Source: South African Government News Agency

National Treasury has warned members of retirement funds not to withdraw their funds, unless retiring, resigning or retrenched from work, as the funds are legally not empowered to allow pre-retirement withdrawals, until the law is enacted.

Giving more details on the approach and planned timelines concerning the proposal to allow for greater preservation with limited pre-retirement withdrawals from retirement funds, Treasury said that even before the advent of COVID-19, government recognised that many members may need to access part of their savings in particular unexpected circumstances.

“It is for this reason that the Minister of Finance noted in the 2020 Medium Term Budget Policy Statement (MTBPS) and 2021 Budget that consideration is being given to allow limited pre-retirement withdrawals from retirement funds under certain conditions, provided that this is accompanied by mandatory preservation upon resignation from a job,” the department said in a statement.

The department said the government has been engaging with trade unions, retirement funds, regulators and other stakeholders to discuss how to increase savings and improve preservation and allow limited withdrawals, without creating liquidity and investment risks.

“Any consideration for early access will require legislative and fund-rule amendments because the current law and policy prohibits any pre-retirement access to retirement savings, unless an employee resigns or is retrenched.

“It is expected that the earliest that any changes would become effective for a new withdrawal mechanism is 2022. However, the withdrawal process will not cover the Government Employees Pension Fund (GEPF), as it is not regulated under the Pension Fund Act, and hence no COVID-related withdrawals will be allowed,” the department said.

Redesigning retirement system requires thorough consultations

Treasury emphasised that retirement funds are primarily designed to encourage individuals to save while working to finance consumption later during retirement.

Government provides generous tax deductions and benefits to encourage all working people to save and preserve more for their retirement.

It also warned that redesigning the retirement system to allow for limited withdrawals with mandatory preservation is complex, and requires thorough consultations.

“Government has been working on a more structured two-bucket system that will enable the restructuring of future contributions. One bucket is to be preserved until retirement, and the second bucket will allow for pre-retirement access during emergencies or extraordinary circumstances.”

While these measures cover pension and provident funds, the National Treasury said that a harmonised approach on withdrawals is also being considered for retirement annuities.

It also warned that implementing any new system allowing limited withdrawals with preservation will take time because “in addition to prior consultation, legislative and fund rule amendments have to be done and fund administrators will also have to change their systems.”

“Design work and consultation are ongoing, further announcements and the public release of the proposed measures for public comment and consideration will be made shortly, before or at the 2021 MTBPS. It is envisaged that the necessary legislative amendments will be introduced in Parliament thereafter.

“It is expected that any changes to the law would only become effective next year at the earliest, and some of the medium-term provisions may take even longer to take effect. The government remains committed to encouraging South Africans to save more, both for their retirement and for shorter periods before retirement,” the department explained.

Source: South African Government News Agency