AFRICAN REGIONAL WORKSHOP
PROMOTING ACCOUNTABLITY AND INTEGRITY IN
PUBLIC SPENDING
Frene Ginwala, former Chairperson,
Africa Union Advisory Board on Corruption
JOHANNESBURG APRIL 6-9 2010
A study by Global Financial Integrity 18 months ago
revealed that illicit financial flows from developing
countries amounted to between 850 million – 1.06 trillion
US$ annually. A new study measuring the extent of
financial outflows from the African continent is about to
be released. Reports indicate that over the last eight
years the illicit transfer of funds is likely to be in
the region of $500 billion. These amounts do not include
the amounts misappropriated and not sent to countries
outside the Continent.
I place these figures before you as just one indication
of the loss suffered by the people of Africa due to
misappropriation, fraud, cross border criminal activity
and corruption. These are resources that should have
been available for building houses, clinics, schools,
roads and creating the jobs that are so sorely required.
I do not need to tell those of you attending this
workshop, how vital is the role you can play in stemming
this haemorrhage by ensuring the proper management of
Government spending of public resources.
The subject of the workshop refers to Accountability and
Integrity Issues. I hope you reach a common
understanding of what these are, and also that you
analyse what measures and interventions are required in
order to bring these issues to the forefront in the
financial management of public resources and the
prevention of corruption.
Integrity denotes a set of personal values, belief and
morals that permeate one’s being. In an organisation we
would speak of an organisational or institutional
culture. Integrity constitutes a higher code of personal
or inherent probity that goes beyond legal prescripts.
This sets it apart from the concept of accountability
which is largely rules based. Accountability flows from
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the responsibility that an institution or person is
charged with or a responsibility that is assumed.
Accountability requires acceptance of an obligation,
responsiveness, reporting, and explanations for actions.
In the South African context the Constitution in s. 1 (d)
speaks of a “system of democratic government to ensure
accountability, responsiveness and openness”.
Section
195 states that “public administration must be governed
by the democratic values and principles enshrined in the
Constitution, including (that it) must be accountable”.
In most countries
the Constitution,
accountability is
indicator of good
there are similar provisions, if not in
then in the laws. The principle of
universally recognised as a key
governance and administration.
I do not believe that there is any society that does not
have integrity as a core value.
Cultural norms are
obviously different, and there may be differences in how
integrity is defined or manifested, but the concept of
integrity would appear to be fundamental to all cultures.
This is underlined by the fact that all societies have
some form of sanction against behaviour that runs
contrary to the common good.
The institutions represented here, individually and
collectively play a vital role in ensuring integrity and
accountability in government spending. Questions we need
to consider are: to what extent is there a common
understanding of their role, and whether they have the
necessary skills and resources to perform what is
required of them?
Professional accountants and auditors are scarce on the
continent and employment in the private sector is more
lucrative. In most countries, the Auditor General’s
office is required to establish and maintain proper
systems and procedures for fiscal management and public
accountability. In this country, with the establishment
of democracy in 1994, the Office initially also provided
training and even equipment to Parliament’s Standing
Committee on Public Accounts in order to enhance the
latter’s capacity to execute its critical oversight
mandate.
However, Parliaments must themselves adequately empower
Public Accounts Committees with skills, resources and
technical support. Without these tools MPs will not be
able to carry out their responsibilities effectively.
Parliamentary privilege should be extended to protect
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members of the Public Accounts Committee in particular,
especially when they courageously draw attention to
mismanagement and misappropriation of public funds.
Parliaments that do not consider and publicly debate the
reports of these Committees are failing to carry out
their functions and ensuring adequate oversight over the
actions of the Executive.
The Auditing profession also needs to look inward to
ensure that members discharge their responsibilities
diligently and without fear or favour. The corporate
scandals involving Enron and Worldcom in the USA
highlighted the dereliction of duty by auditors in favour
of not upsetting the client and ensuring that they retain
the business from the client. To whom are auditors
accountable? Are they only accountable to management and
the Board of Directors – what about shareholders?? What
level of integrity and ethical values do auditors aspire
to, and what is the role of the professional body in
policing the conduct of their members. Where does public
interest feature?
What role did accountants and auditors play prior to the
meltdown at Lehmann Bros? Was the pursuit of super
profits not the catalyst for the recent global recession?
The reckless pursuit of profits by financial institutions
led them to ignore the risks inherent in the creation of
new instruments. Where were the checks and balances and
oversight mechanisms that should have sounded the alarm
bells?
Public representatives and public servants at every level
need to abide by codes of conduct, which include regular
disclosure of assets. If you draw on the public purse,
then the public is entitled to have access to information
about the sources and extent of your wealth. A blanket
reluctance to disclose on grounds of privacy is not
acceptable, though codes of conduct can incorporate
provisions for privacy. One needs to balance an
individual’s right to privacy with the public’s right to
information.
We should note that the African Union Convention on
Preventing and Combating Corruption has created the
offence of "illicit enrichment" which is defined as “the
significant increase in the assets of a public official
or any other person which he or she cannot reasonably
explain in relation to his or her income”. State parties
to the Convention have undertaken to create such an
offence within their domestic laws.
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Unfortunately, the provisions of the Convention, which
are very wide ranging are not well known. I am not sure
to that extent Parliaments, including the South African
one, debated the Convention before ratifying it.
The Convention creates a range of acts of corruption and
related offences and requires state parties to “adopt
legislative and other measures that are required to
establish as offences the acts mentioned in Article 4 of
the Convention.” Of relevance is Article 5 (4) which
reads: “adopt legislative and other measures to create,
maintain and strengthen internal accounting, auditing and
follow-up systems, in particular, in the public income,
custom and tax receipts, expenditures and procedures for
hiring, procurement and management of public goods and
services”.
The Convention which came into force in August 2006
requires signatory countries to “establish, maintain and
strengthen independent national anti-corruption
authorities or agencies”. This Agency has to be
designated when the Convention is signed or ratified.
The Agency is required to assist in compliance and in
reporting annually to the Advisory Board, which is
established as a follow up mechanism under the
Convention. This is an aspect to which I shall return
later.
The Convention (Article 20) further provides for the
“necessary independence and autonomy” of the agency, and
requires “State Parties … to adopt necessary measures to
ensure that national authorities or agencies are
specialized in combating corruption and related
offences”.
There are and have been a variety of national and
regional anti corruption agencies on the Continent, many
of them short lived. Some have been mere talk shops,
with no power or authority. Others have had considerable
power and when effective were sometimes confronted with
obstacles and challenges from governments and those
wielding power and influence.
There have been at least two Pan African meetings of
National Anti-corruption agencies, and an attempt to
establish a permanent structure. I do not believe this
has taken off as yet.
Perhaps this workshop could discuss what are the
essential requirements for an effective anti-corruption
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agency? Should it initiate investigations, or only deal
with referrals? What investigative and prosecutorial
powers should it have? Would it have access to bank
accounts and company records? How would a governmentestablished agency be able to maintain its independence
and autonomy? Importantly, how would it be funded?
There should be a mechanism for funding such agencies,
which is not subject to the Executive power over its
resources. This is critical if they are to exercise
their functions properly. Nor should their funding be
discretionary, but should be legislated. Are there
options other than government funding? Both donor
funding and private sector funding cannot be acceptable.
We have a precedent under Chapter 9 of the South African
Constitution which establishes state institutions
supporting constitutional democracy. The Auditor General
is one of these. What other possibilities exist?
The AU Convention seeks to promote and strengthen the
development of mechanisms to promote, facilitate and
regulate co-operation among State Parties; and to develop
and harmonize policies and domestic legislation of State
Parties, relating to the prevention, detection,
punishment and eradication of corruption.
The Convention establishes an Advisory Board to assist in
the realisation of these objectives by facilitating
research, information-sharing, and co-operation amongst
States. The 11 member Board is elected by the AU
Assembly, from a list proposed by State parties of
“experts of the highest integrity, impartiality, and
recognized competence in matters of relating to the
preventing and combating corruption“. Members are
elected for two years, and the term is renewable once
only.
The Advisory Board is charged with monitoring the
implementation of the Convention and also of assisting
state parties to comply. It receives reports annually
from the designated independent national anti-corruption
authority in each Member State. The Board is required to
report annually to the Executive Council of the African
Union on compliance with the Convention by State parties.
The AU Convention endeavours to cast its net wide by
referring to corruption and related offences – it
includes passive and active bribery in both the public
and private sectors, illicit enrichment, trading in
influence, diversion of funds and concealment of funds
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resulting from acts of corruption. It is unique in
containing mandatory provisions with respect to privateto-private corruption and on transparency in political
party funding.
Art 7 of the AU Convention deals with the Fight against
Corruption and Related Offences in the Public Service,
and provides as follows:
 designated public officials are required to
declare their assets
 a code of conduct for public officials must be
established and its implementation monitored
 public officials to be trained on matters of
ethics
 disciplinary measures and investigation
procedures are to be put in place to deal with
corruption and related offences

transparency, equity and efficiency in the
management of tendering and hiring procedures

Public officials shall not be protected by any
immunity in the investigation and prosecution
of allegations of corruption
The Advisory Board is specifically required to develop
and promote the adoption of harmonized codes of conduct
for public officials.
Good governance is a prerequisite for preventing and
combating corruption, while the scourge of corruption
undermines good governance.
Corruption is therefore a
governance challenge.
The concept of a National
Integrity System is fundamental to the development of an
anti-corruption discourse.
It comprises the building
blocks
necessary
for
the
long-term
fight
against
corruption and other forms of unethical and anti-social
behaviour.
Its core elements are constituted by a
society’s value system.
These values must be constantly promoted and should
permeate the structures, practices and principles of the
state, the corporate sector and civil society.
The
values include accountability, transparency, equity,
efficiency, development, and fundamental rights and
freedoms
including
freedom
of
speech,
access
to
information, democracy and participation.
Significantly, Article 5 (8) of the Convention requires
states to “Adopt and strengthen mechanisms for promoting
the education of populations to respect the public good
and public interest, and awareness in the fight against
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corruption and related offences, including school
educational programmes and sensitization of the media,
and the promotion of an enabling environment for the
respect of ethics”.
Specific measures or actions relating to anti-corruption
strategies and interventions need to be identified within
particular institutions.
A National Integrity System
therefore
provides
both
the
institutional
and
philosophical basis for both enforcement and preventive
action against corruption.
It is also necessary to understand and realise that
corruption in government expenditure does not only focus
on the public official. Who is the person or institution
that is the partner in the corruption; the source of the
inducement for public officials to deviate from their
duty? We must therefore also examine issues relating to
integrity and accountability in the private sector if we
are to completely address the matter.
And should there
not be a blacklisting of companies and individuals who
are found guilty of transgressions? Governments as well
as international financing institutions such as the world
Bank and the African Development Bank should bar guilty
companies from tendering for contracts in projects
financed by them.
Once corruption becomes entrenched, its negative effects
multiply.
It induces cynicism, because people begin to
regard it as the norm.
It undermines social values
because people find it easier and more lucrative to
engage in corruption than to seek legitimate employment.
It encourages the personalization of politics.
As a
result, people come to rely on connections and favours
instead of formal political, social and economic rules,
and
illegitimate
use
of
state
resources
becomes
acceptable.
Integrity and accountability cannot be confined to
particular institutions or to isolated areas of public
life. They are universal principles and must apply
across all spheres of society.
Accountability is not simply about a relationship,
between public representatives or officials and the
public. Many professional bodies claim to be accountable
only to their peers, and not to the public.
Yet their
actions and failures impact on large numbers of the
public.
Often there is a claim that at every level
governments are accountable to the opposition parties.
The reality is that all governments must first and
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foremost be accountable to the citizens as a whole, and
not separately to members of this or another party. They
should account, in a number of ways, but primarily to the
elected
representatives
of
the
public,
i.e.,
to
parliaments, or legislatures, or municipal or local
councils. Political parties can have internal mechanisms
to hold their representatives accountable, but this
cannot substitute for public accountability.
The
media
demands
accountability
from
public
representatives, but to whom is it accountable and how?
The power of the media conglomerates to influence public
opinion should be exercised responsibly.
The public
needs to raise its voice to act as a check on the media
to ensure that its power is not abused, and allegations
are not made recklessly.
All rights in a democracy are linked to responsibility
and obligations, and everyone has to account for how they
fulfil these.
Sharing a common understanding of the
concept of integrity will go some way to providing the
benchmark for what constitutes acceptable behaviour and
that which falls foul of that standard.
Above all we need strong and determined leadership. The
example set at the top levels of the political power
structure across all political parties is extremely
important. However, other leaders in society cannot be
bystanders and point fingers at politicians. The leaders
of financial institutions, the private sector, religions,
professions, culture, and all civil society bear equal
responsibility for our standards of behaviour.
We need
to practice what we preach.
We cannot expect integrity
from others unless the leaders conform to high ethical
standards.
Culture is not static. It is dynamic. It has to evolve
to
meet
new
challenges
and
adapt
to
changing
circumstances.
Regrettably, we can see that in many
societies cultural values have been eroded by greed and
corruption.
Once entrenched, corruption creates an
ethical vacuum.
The challenge for us all is to make
integrity part of our culture again, and to re-instil
integrity as an essential value in our societies.
Improving
governance,
promoting
accountable
and
transparent
government,
and
strengthening
the
institutions that can hold government accountable, are
essential to meeting that challenge.
Frene Ginwala 7.04.2010
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