Defence anti-corruption index exposes SA weaknesses

Ahead of the G20 summit, which this year takes place in Antalya, Turkey, on 15 and 16 November, Transparency International UK’s Defence and Security Programme has launched the results of the Government Defence Anti-Corruption Index (GI) for these states, including South Africa.

The GI measures the risk of corruption in national defence and security establishments worldwide, by assessing the existence and effectiveness of institutional and informal controls. Transparency International UK (TI UK) also publishes a Defence Companies Anti-Corruption Index, which measures the transparency and quality of ethics and anti-corruption programmes of 163 defence companies from 47 countries. One of these was South Africa’s Denel, which showed improvement in 2015 compared to the previous report in 2012.

In both indexes, countries or companies are ranked from band A (highest) to F (lowest) using publicly available information. For the GI, a team of experts draws together evidence from a wide variety of sources and interviewees across 77 indicators to provide the government with a detailed assessment of the integrity of their defence institutions. Country chapters also contribute to the report, which is peer-reviewed. Governments are invited to review the reports and provide additional information – this year only five governments, excluding South Africa, provided a reviewer.

South Africa performed almost to expectation, achieving mostly mediocre scores. It was placed in band D, which puts it not only in the lower half of all countries assessed but also, says TI UK, in the high risk category for corruption in the defence and security sector.

None of its fellow Brics countries fared any better – Russia and India also ranked in band D, while China and Brazil were placed in band E. Only one country – the UK – achieved an A rating, because it has strong, independent oversight mechanisms.

While G20 defence spending has been increasing rapidly – by 55.7% between 2004 and 2014 – there is little common understanding about how this power should be governed, said TI UK. The organisation found that only in three G20 countries – the UK, US, and Germany – is there evidence that parliaments are provided with sufficient information over secret spending.

And only seven countries had any meaningful oversight over the defence budget at all. South Africa was not one of those, achieving unexceptional scores in all questions relating to defence budgeting.

TI UK noted a worrying trend of rising military expenditure in places where public oversight over the military is weakest. “China, Saudi Arabia and Brazil ranked bottom of the G20, but in the last decade they increased defence spending by 441%, 286% and 225% respectively,” the report found.

Download the report.

Download South Africa’s report summary and scorecard.

Thorough assessment

Countries were assessed in five main categories of corruption risk: political, financial, personnel, operations and procurement. The five categories were divided into 29 sub-categories.

Across these categories, each government was assessed using a questionnaire, developed by experts, of 77 questions in total. Each question was scored from 0 to 4, with the following principles applying:

• 4 = High transparency; strong, institutionalised activity to address corruption risks.
• 3 = Generally high transparency; activity to address corruption risks, but with shortcomings.
• 2 = Moderate transparency; activity to address corruption risk with significant shortcomings.
• 1 = Generally low transparency; weak activity to address corruption risk.
• 0 = Low transparency; very weak or no activity to address corruption risk.

SA’s unimpressive performance

Of the 77 questions, South Africa had one score of 0, 21 scores of 1, 38 scores of 2, 10 scores of 3, and just four scores of 4. Three questions did not apply, relating mostly to conscription.

The country was placed in band C for political and personnel risks, in band D for financial and procurement risks, and in band E for operations. The latter two categories, said TI UK, were the highest risk areas for South Africa.

Because it contributes troops to UN missions, with 6 000 personnel deployed on internal and external missions, South Africa was at particular risk of corruption on operations.

But there were concerns across all risk areas. TI UK pointed out a high occurrence of political considerations and favouritism in determining appointments and promotions. This has resulted in an “absurdly high” ratio of generals per soldier – one of the highest in the world – which undermines the professionalism of the military, and destroys morale. It is also expensive and ineffective.

TI UK mentioned the Seriti Commission, which has been plagued with controversy throughout its tenure. The commission’s report is expected in December 2015 and, said TI UK, the degree of independence of its findings and the manner in which conclusions are handled by President Jacob Zuma – himself implicated in the procurement scandal – will indicate the strength of South Africa’s approach to anti-corruption.

The proposed Protection of State Information Bill (secrecy bill) also influenced South Africa’s low score. “There are concerns that ratification of the secrecy bill will make it much more difficult to access information, reduce protection for whistle-blowers and heighten corruption risks,” said TI UK.

Another corruption risk came in the form of secret budgets, such as the special defence account (SDA). This, said TI UK, limits defence procurement transparency and accountability. There was also evidence pointing to the use of the SDA for non-secret procurement in order to avoid legislative provisions, reporting, and oversight.

South Africa, in fact, has an extensive anti-corruption framework – including anti-corruption legislation, a defence corruption and fraud prevention plan, and the Directorate for Priority Crime Investigation (also known as the Hawks). However, public trust in these mechanisms is low and their effectiveness is questionable. The Hawks are seen to be affected by executive influence, TI UK added.

Other problems included little or no detail provided for past or current offset programmes, and no evidence that offset contracts are subject to competition regulations or due diligence requirements.

TI UK also pointed out that despite irregular spending, to the tune of a billion rands, revealed in the auditor-general’s 2014 report, there have been no repercussions for the misappropriation of funds. Nor did the minister of defence meet with the auditor-general to discuss the findings and how they would be followed up.

Recommendations

TI UK recommended that the government allows investigation and oversight agencies to pursue their important work impartially and with sufficient resources in order to maintain public trust in the integrity of the defence sector.

Because whistleblowing is a vital part of anti-corruption efforts, TI UK recommended that the government actively encourages it. The organisation also recommended that the secrecy bill be referred for review, to ensure that it “includes clear provisions for who can request information, when it can be classified, and with mechanisms to ensure that these legal requirements are upheld in practice, are subject to scrutiny and ensure the protection of whistleblowers”.

The South African government should clarify legal provisions regarding the use of the SDA and ensure mandatory provisions are in place for oversight of all secret expenditure by an internal and external audit function and an appropriate parliamentary committee. TI UK also said that an itemised disclosure of purchases made through the SDA would ensure the budget is spent on equipment that meets South Africa’s strategic priorities and needs.