Meeting report

Pasco submission

Mr Bothatho Molotlegi, shareholder representative for Royal Bafokeng Holdings (RBH) informed the Committee that RBH had invested in Pasco and its mandate for Pasco was profit driven as the money was used to develop the Bafokeng community. RBH was the investment arm of the Bafokeng. The partnership between Pasco and RBH could be viewed as a strategic partnership.

Dr Mark Welman, Managing Director, Pasco, stated that the organisation was a wholly owned South African company that was involved in risk management and had been in existence for 13 years. Pasco was involved in a number of corporate risk management projects with government and private institutions. In the past, Pasco had worked with the Special Investigations Unit (SIU), South African Revenue Services (SARS) as well as the South African Police Services (SAPS).

Dr Welman pointed out that the Department of Home Affairs (DHA) could benefit from the services offered by the company. DHA had a vested interest in maintaining a positive reputation and effectiveness. The concept of visible integrity was important for any government department. Those who interacted with the Department had to see integrity. Visible integrity should be demonstrable and visible to the general public. Sound integrity risk management was the bedrock of any turnaround strategy.

A lack of emphasis on integrity management within companies and departments could inhibit any strategy. A key emphasis was that integrity management was not something that just happened. Frontline Integrity applied to most government departments and especially DHA. Foreign investors were increasingly reluctant to invest in areas where corruption was prevalent. The second reason why frontline integrity was important was that the first point of contact for individuals trying to get into the country was through a Home Affairs representative. DHA was the mother of all the other departments as it looked after the citizens. Integrity was defined in terms of behaviour, not belief or values. For Home Affairs, Pasco would define integrity risk in terms of any behaviour that compromised the strategic objectives of the Department, its reputation and the physical or psychological well being of its personnel. The concept of integrity went beyond honesty. Integrity was defined in terms of behaviour; it should be consistent with the strategic objectives and expressed values of an organisation. It had to be consistent with the laws of the country, the values and objectives of the Constitution and South Africa’s human rights laws.

Compliance was different to obedience. Behaviour was an objective point of reference. Obedience was doing as one was told to do and compliance was doing the right thing as consistent with the values of a Department. If a Department’s consistent value was for wrongdoing to be reported and its employees did this, they were being compliant. Pasco’s first recommendation was always to advise a conversion from a culture of obedience to one of compliance and assuring an employee that they would be protected if they came forward. Another advantage of looking at integrity, as behaviour was that it was not subjective. Integrity became assessable and one could monitor it. Integrity also facilitated for stakeholder relationships. Integrity allowed for proactiveness instead of reactiveness. The implementation of the integrity management system began with an organisational analysis, identifying integrity managers. The behaviour of integrity managers had to show integrity; they eventually end up being the guardians of integrity for the entire establishment.  Integrity could be readily turned around. 

DHA would be in the frontline for the World Cup in more ways than one. The international media had decided to be very critical about this World Cup and over inflated all sorts of threats and risks. There would be a critical gaze on the country and one should not be surprised if certain unscrupulous paparazzi decided to go in with hidden cameras and try to find out if they could get a false passport. The integrity in Home Affairs would go a long way in assisting the men and women in uniform as a frontline defence as it would prevent the drug dealers and crime syndicates from infiltrating the country. Integrity would obviously play a key role in social development. Pasco had developed the concept of integrity at work; this was a combination of all the concepts.

Discussion

Ms J Terblanche (DA) commented that it was essential for new staff to be properly vetted. How long would it take to turn around the view that DHA was corrupt?

Mr Welman responded that the vetting of new staff members was essential but Pasco was sceptical of current vetting practices. The vetting practices of Pasco were done through interviews and identifying certain traits as red flags, e.g. if someone drank too much. One of the best ways of dealing with the problem was to come in and attempt to re-vision integrity. An example this would be to offer amnesty in exchange for admittance of wrongdoing. If managers were taught to deal with bad practices and identify them then integrity problems could be reduced by up to 90%. The turnaround time depended on a lot of things; if everybody put in enough effort then this could be done in months as opposed to years. Anything longer than 18 months would indicate that the project was not very effective.

Ms M Maunye (ANC) asked if Dr Welman had met with the DHA to discuss what he had just presented to the Committee. 

Mr Welman replied that he had not met with the Department but was hoping to do so soon.

Mr Molotlegi added that the issue of staff morale was also about being able to recognise the work-home related issues. If management could recognise the work-home issues that staff go through and assist them, this could go a long way in terms of the turnaround strategy as already witnessed in the RBH organisation.

Mr Z Madasa (ANC) questioned how Pasco would work with the Department if it had the opportunity to do so. The problem with the Department was broader than the organisation itself, it was also societal. This problem was exacerbated by the large number of undocumented immigrants who were trying to remain legally in the country. This resulted in underpaid officials being tempted by illegal immigrants and syndicates who were willing to bribe them. It was an impossible thing to ask of officials to be strong in the face of temptation. A holistic approach was needed for example strengthening the border.

Mr Welman replied that he disagreed with the notion that it was impossible for officials to resist temptation. It all came down to individual decisions and integrity was a decision. For the revenue services, Pasco had turned tax compliance around. A simple model was introduced in order to encourage citizens to pay taxes. This was done through four pathways to compliance; the first was rewarding citizens for doing the right thing e.g. reporting somebody for attempted bribery. The reward need not be a financial one. The second pathway was through a persuasive threat of punishment. The emphasis however had to be on being persuasive. The third pathway was the process of extinction. This was to say that if one wanted individuals to do the right thing, then the obstacles that prevented them should be taken away. In a SARS environment, it was to simplify the process of filling out tax forms. This did have some resemblance with DHA. Employment conditions and processes had to be simple and unambiguous. There had to be a move away from things being bogged down for 6 – 18 months at the Council for Conciliation Mediation and Arbitration (CCMA). This was half the problem with corruption in the country. At an investigative level when corrupt individuals were caught they would smile and say they would go to the CCMA even though they were guilty. Employer an employee rights had to be protected equally. The final pathway was a combination of the three previous methods into a consistent package.  The SARS case showed that one could start from the bottom up. Staff members became passionate and their outlook on the public changed and members of the public changed. Members of the public would phone the hotline and report corrupt officials. They did this because they saw that something was being done against corruption.

Mr Madasa indicated that the second step of the model outlined by Mr Welman was the most agreeable to him. The lack of applicable action had been the biggest problem in government. Most departments had congestions of disciplinary cases, which were never finalised. Currently, if one was caught or guilty of wrongdoing, they would be transferred as a way of punishment. This only presented new opportunities for further wrongdoing.

Ms Welman disagreed with Mr Madasa’s assumption that everybody was corrupt under the right circumstances.

The Chairperson thanked Mr Welman and informed him that although the Committee could not force the Department to work with Pasco, it did have persuasive powers and would recommend Pasco to the Department.

Mr Gcinile Mabulu, Parliamentary Liaison Officer, Ministry of Home Affairs, described the presentation as very good and tempting. He was certain that the Minister would be interested in such a partnership.

Other Matters

Mr Eddie Mathonsi, Committee Secretary, informed Members about the invitation from the Department of Sports to visit SADC countries, which would be entry points during the FIFA World Cup as well as all the host cities. These oversight visits would be conducted together the Portfolio Committees on Tourism and Police.

Ms Terblanche pointed out that the Committee already had its programme and that it might not be possible to fit in all these visits.

The meeting was adjourned.