Critics say the Transparency International’s Corruption Perceptions Index (CPI) conveys an 'elite bias' and does not show evidence of actual corruption.
For nearly 20 years, Transparency International has scored and ranked countries according to how corrupt their public sectors are perceived to be.
Drawing on 13 data sources, and based on the perceptions of businesspeople and country experts, the 2013 CPI gives 177 countries a score from zero to 100, where zero is a perception that the country's public sector is "highly corrupt" and 100 is ‘very clean’.
To read the article titled, “Is Transparency International's measure of corruption still valid?,” click here.Source:The Guardian
- The Corruption Watch Board has noted the ongoing tensions between the Public Protector and cabinet ministers regarding her report on the upgrade of President Jacob Zuma’s Nkandla residence.
The Public Protector’s powers and functions are regulated by our Constitution. The office is subject only to the Constitution and the law. It must remain impartial and exercise its powers and perform its functions without fear, favour or prejudice. All organs of state (which include all government departments, whether national, provincial or local, and all people who are exercising public power in terms of the Constitution or any law including government ministers) are required by the Constitution to assist and protect the Public Protector in order to ensure her independence, impartiality, dignity and effectiveness.
The Board of Corruption Watch notes that the Minister of Public Works, Thulas Nxesi has publicly acknowledged that the upgrade of President Zuma’s Nkandla residence was characterised by irregularities. In the light of this admission, the Board notes with concern the reliance on ‘state security’ as a basis for the Cabinet ministers’ challenge to the release of the report by the Public Protector to interested and affected parties. The Board is deeply concerned that this approach avoids the key issues of possible wasteful expenditure and the flouting of procurement rules - neither of which fall within the ambit of national security.
Given that security considerations in the Nkandla upgrade are not concerned with the amount of money spent or the disregard of public procurement rules, the Corruption Watch Board views the ministers’ actions, including the assertion that they are the final decision-makers on all security-related matters, as having the effect of shielding any unlawful activity that may have been uncovered by the Public Protector from public view.
If the result of the ongoing tensions is that the Public Protector is impeded or hampered in her probe into Nkandla, this will severely undermine her ability to perform her functions without fear or favour and in turn has the potential to harm our democracy and undermine our Constitution.
The Corruption Watch Board calls for transparency and accountability to ensure that anyone who has acted unlawfully is held to account. In this regard, the Board calls for respect of the office of the Public Protector in carrying out its Constitutionally-mandated duties.
- Corruption Watch Board. For more information contact, Archbishop Ndungane, Chairperson of the Board, Tel: 082 894 1523.
- A review of the amended Broad-Based Black Economic Empowerment (B-BBEE) codes would reveal that the Department of Trade and Industry (the dti) has not lived up to the state’s responsibility to nonprofit organisations (NPOs) as captured in section three of the Nonprofit Organisations Act (NPO Act). Section three of the NPO Act reads - “Within the limits prescribed by law, every organ of state must determine and coordinate the implementation of its policies and measures in a manner designed to promote, support and enhance the capacity of NPOs to perform their functions.” [The] dti has, in our view, not given sufficient attention in the revised codes to NPOs. The following examples illustrate this:
Reference to the outdated Section 21 companies - the revised codes refer to the outdated Section 21 company and defines a Section 21 company as ‘an association not-for-gain incorporated under Section 21 of the Companies Act’ (of 2008) - which is clearly incorrect. The dti is essentially responsible for the promulgation of the Companies Act of 2008 which came into operation on 1 May 2011. This Companies Act has abandoned the concept of a Section 21 company, yet this outdated reference has remained within the revised codes.
Measurement of NPOs:
NPOs with an annual total revenue of R10 million or less qualify as exempted micro-enterprises and are deemed to have a B-BBEE status of ‘level four contributors’.
Importantly, a sworn affidavit of its annual total revenue being less than R10 million should be sufficient proof to qualify NPOs as exempted micro-enterprises. There should accordingly be no need for such NPOs to pay accreditation agencies to issue BEE certificates confirming their B-BBEE status. However, the codes do not deal expressly with NPOs that have total revenue of more than R10 million.
Paragraph 220.127.116.11 of Statement of 000 of the revised codes provides that: a qualifying small enterprise (R10-50 million) ‘is required to comply with ownership as a compulsory element, and either skills development or enterprise and supplier development’. No express provision is made for qualifying small enterprises that do not have an ‘ownership’ element. There is accordingly no clear guidelines in the revised codes on how NPOs with an annual revenue between R10 to 50 million will be measured.
In contrast, provision was made in the initial Codes of 2007 for an Adjusted Generic Scorecard and an Adjusted Qualifying Small Enterprises Scorecard to accommodate entities that do not have ownership like NPOs. NPOs with an annual turnover between R5 to R35 million were eligible as qualifying small enterprises in terms of the Adjusted Qualifying Small Enterprises Scorecard which did not have the ‘ownership’ element.
The scorecard element dealing with Socio Economic Development (SED) Contributions is perhaps the most important element for most NPOs. Corporates would usually make donations towards NPOs to implement the SED activities. What qualifies as SED Contributions is defined by the revised codes. The revised codes provide that SED Contributions must be for the objective of facilitating income generating activities for targeted beneficiaries. This appears to be different from the initial codes where the objective of SED Contributions was facilitating sustainable access to the economy for those beneficiaries. These are two seemingly different objectives.
However, the definition section of the revised codes reverts to the language in the initial codes and provides that: ‘The objective of Socio-Economic Development Contributions is the promotion of sustainable access for the beneficiaries to the economy.’ It appears therefore that SED Contributions can be for the purpose of facilitating income generating activities and promoting sustainable access for the beneficiaries of the economy.
The revised codes provide that until 10 October 2014, a measured entity may elect to use the Amended Codes of good practice or the Generic Scorecard of the initial Codes. By implication, NPOs do not have this option because the Generic Scorecard includes the ownership element. NPOs will accordingly have to use the Revised Codes.
- Ricardo Wyngaard, Ricardo Wyngaard Attorneys www.nonprofitlawyer.co.za, Email: firstname.lastname@example.org
- South Africa has approximately three million orphans, a number that is anticipated to increase drastically in the next two years.
A study conducted by the South African Institute of Race Relations (SAIRR) estimates that by 2015, there will be more than 5.5 million orphans in South Africa. The study also found that South African families would rather provide foster care than adopt them.
“A lot of orphans are looked after by their extended families or family friends in a private, informal arrangement known as kinship foster care,” says the SAIRR.
While this is the case, several local nonprofit organisations (NPOs) have rolled up their sleeves and are pulling out all the stops to address this issue.
Just outside Potchefstroom in North West is an innovative social enterprise that is fast becoming known for its social development work in the sprawling township of Ikageng. Made by Mosaic is a job creation project of Mosaic Community Developments, a NPO started in 2008, but it is its special focus on developing a sustainable orphan care model that really makes it different.
Mosaic’s modules include providing housing and job opportunities for foster families, constructive afterschool activities for children and holistic life skills training for all involved. In return, the foster parents are expected to maintain employment, to pay rent for their house, and to financially support their families.
“We identify a family with two or more orphans formally in their care, and then we build a proper house for them that they can rent at an affordable price. We also create employment opportunities for them, empowering them to better provide for their families and gain valuable job skills training,” explains Jordan Ridge, Made by Mosaic’s manager.
Made by Mosaic’s vision is to create jobs in the craft and food industry, not only for parents involved in their programmes, but also for other people who struggle with unemployment in the surrounding community. When Made by Mosaic started, they had one product line-knitted scarves. Now, they continue to knit and crochet products, including blankets, hats, shawls, and baby products, and have expanded to include a leather workshop that manufactures handbags and a kitchen from which they sell rusks, cookies, chutney, lemonade, and gourmet cupcakes.
Ridge adds that Mosaic does not just want to employ people, but it also wants to empower and develop them holistically. For this reason, the organisation is currently developing a comprehensive life skills training programme that will qualify employees for more high-end work in the future.
By all accounts the programmes Mosaic runs have been successful. Jordan cites the example of Dorah Moeng, who is fostering two orphans and has one child of her own. In 2011, Mosaic provided Moeng and her family with a three bedroom brick house, a huge improvement from their one room tin shack. Moeng started working as a volunteer for Mosaic, and was later promoted to the level of Assistant Manager.
“My life and my children’s lives have changed for the better. I am now able to provide for my family, pay for their education, and other necessities with the wages that I earn through the Mosaic employment,” she says with a smile.
Although Made by Mosaic is a for- profit business, all income goes towards growing the business and supporting the NPO, Mosaic Community Developments. As a result, all operations work towards providing employees with the skills needed for higher level employment.
Made by Mosaic maintains a sustainable and socially responsible South African supply chain, so that the impact of the business can reach beyond the employees and develop the country’s economy as a whole. All items are handmade, thus enabling the company to produce special or customised orders, and Ridge explains that they can accommodate a wide range of requests.
In 2012, the company received a host of success and accolades. It was one of a few companies from the region that were selected to exhibit their products at Design Indaba in Cape Town. It was also selected as one of the participants to join Fetola’s award winning business support programme, Legends.
In addition, founder and manager Ridge was chosen as one of ten Google Zeitgeist Young Minds to attend an international conference hosted by Google in London. In 2013, Made by Mosaic opened its first store and the first gift shop destination in Ikageng at its location in Extension 11.
Made by Mosaic’s products are currently sold in South Africa and the United States, with partnerships being developed in Germany. Their products are also available online at (Shop Made by Mosaic). Made by Mosaic’s new online store will launch in December of 2013.To learn more about Made by Mosaic and their products, refer to www.mosaicsa.org.
- Abram Molelemane is the media coordinator at Fetola.
British charity Oxfam has warned that the conflict in the eastern Democratic Republic of Congo is far from over and says it is vital to set up a political process to address deep-seated grievances in the troubled region.
In a press statement, the organisation points out that, "With more than 30 other armed groups active in the region, the conflict is far from over," adding that civilians were being exposed to daily violence.
It further calls on the Congolese army and the United Nations force in the vast central African country to take clear steps to minimise the negative impact of operations on civilians.
To read the article titled, “Oxfam warns DRC conflict far from over,” click here.Source:Times Live
- There are many risks that confront nonprofit organisations today and some arise where an organisation has a phase of rapid growth in resources. We have noted this, particularly in relation to new ‘social movements’, with activism at their core, which have been achieving significant success in raising public awareness and in raising funds.
Charles Tilly defines social movements as ‘a series of contentious performances, displays and campaigns by which ordinary people make collective claims on others.’
A number of such movements have received substantial initial funding leading to rapid growth, others are still growing or are poised to grow.
With growth comes both increased numbers of paid staff (employees), who are often deployed over a wide geographical area, and increased levels of activities. Together, these areas of growth result in an increased need for effective financial management systems and controls and for an organisational infrastructure that few can afford, or are prepared to pay for.
As budgets get bigger (due to increased monthly financial commitments), the need for good financial management increases but the associated costs become more difficult to finance, especially if the initial funders later withdraw or reduce their support. We are now seeing large, previously well-funded and effective organisations using up their hard-earned reserves (built up over many years) in order to meet their on-going obligations to pay staff and other running costs. What is happening?
With some exceptions, we are seeing funding shift away from established organisations, some of the funding is then switched to emerging social movements and related organisations which are seen to offer a new dynamism, mobility, profile and exposure at a lower cost than the more established organisations with a longer track record. Whatever your views are on whether this is a wise move on the part of funders / donors and on whether such funding will be for the longer-term, our experience tells us that, if you do not invest in the very necessary costs of systems, controls and infrastructure or the lack of them will come back to bite you!
Lack of effective financial management systems, controls and infrastructure may result in one or more of the following:
- Inability to account for, and report back to funders and supporters on, funds received;
- Disgruntled staff, funders and other stakeholders;
- Waste and/or misappropriation of resources (including, but not limited to, cash);
- Damaged reputation;
- An inability to carry out necessary financial planning and strategic financial thinking;
- Cash flow crises.
Financial management expertise
Failure to set up appropriate financial management systems from the beginning is a big mistake and a patch-up job later, when the gaps and negative consequences are already obvious, may prove to be more expensive than the implementation of good systems from the start would have been. At a later stage, it will also become even more difficult to secure funding to implement / upgrade systems. Every organisation (regardless of size and track record) needs access to financial management expertise. Good finance administrators, bookkeepers, accountants and financial managers are in short supply and are expensive to employ, but all organisations need the skills they offer. This is not an expense to hold back on and it is wise to:
- Employ or contract experienced and well trained finance staff or service providers from the outset; and
- Ensure the finance staff are given adequate support and training in line with their responsibilities.
- This article first appeared on the CDMS Website.
The Opposition to Urban Tolling Alliance (OUTA) says government's plan to slash the perks of officials is welcome, but more needs to be done to ensure tax money stays in the country.
OUTA chairperson, Wayne Duvenage, states that what was shocking to the alliance is that e-tolls, paid for by local motorists will enrich a foreign company with more than R13 billion over the next 20 years.
“The National Treasury should be doing all they can to prevent South African taxpayers' money - for use of social infrastructure - from leaving the country, let alone enriching any private company, foreign or local,” argues Duvenage.
To read article titled, “Keep the money in SA, Outa pleads,” click hereSource:IOL News
- Beware of Greeks bearing gifts! Beware of city slickers from Gauteng offering joint ventures in deep rural settings! Beware government imposters running pseudo non-governmental organisations (NGOs)!
In her latest newsletter, Helen Zille, the Democratic Alliance leader states, “The ANC [African National Congress] has now resorted to starting NGOs that receive state funds to drive the ANC’s agenda. Why else did Agriculture Minister, Tina Joemat-Pettersson’s department transfer R2 million to an organisation led by Nosey Pieterse, an ANC cadre, shortly before it fuelled the violent strike on Western Cape farms last year?”
This rang some bells with me, after a bruising year of bullying by two other NGOs, one from Johannesburg the other from Pretoria.
Zille goes on: “And why else did Jacob Zuma’s cousin, Deebo Mzobe, start an NGO called the Masibambisane Rural Development Initiative that was reportedly pledged R900 million from various government departments to distribute food parcels in the run-up to the 2014 election? (The plan has since apparently been put on hold)”
In a Sunday Times article on 12 September 2013, Mark Heywood, executive director for SECTION27 writes, “The intimidation of social-justice activists is not unheard of in the new South Africa. The problem is that its incidence seem to be growing. In our experience, teachers and health workers who have provided evidence of corruption or mismanagement - even textbook shortages - have been threatened with dismissal or demotion, something that led us (the public-interest law centre SECTION27) to file a complaint with the Public Protector in 2012.”
Beware of Greeks bearing gifts!
We were approached in February 2012 to form a joint venture with an out-of-province NGO. They wanted to bid on a tender related to government’s Community Work Programme. They were well informed about it, we realised later they were too well informed. We now suspect that our joint venture won the bid because of insider trading. Put another way, because they never had any intention of operating a joint venture, it was just their ticket - as erstwhile civil servants - to win the bid and then hit the ejector-seat button to dump our NGO. The bid rules stipulated that only an Mpumalanga-based NGO could bid, with a minimum threshold of R3 million per annum turnover. They did not qualify on either account. They were simply looking for ‘a tame NGO’ to put on a leash.
Beware of city slickers from Gauteng offering joint ventures in deep rural settings!
From our bitter experience, here are four warning signals to watch out for:
- Fat-cat salaries that are out of line with NGO norms in the province. There is a South African Revenue Service (SARS) prerequisite that stipulates such alignment. Otherwise, the organisation’s tax exemption status could be withdrawn;
- A joint venture formed only for the purposes of bidding on a tender is legally in no-man’s land. It is only a figment of your imagination. It is not registered anywhere, it is not an entity, so it cannot open a bank account or get its own tax number. One organisation or the other must take on the Finance and there goes the joint control and any hope of the joint benefits that the Law requires of any joint venture. The city slickers know this and try to play you for the fool by saying you must sue the joint venture for damages, not them;
- Name-dropping in Waterkloof-esque fashion. They are buddies with the Minister. One of their Board members is a struggle hero with a high-level job in government. The chief executive officer travels on a diplomatic passport. Their intimidation tactics are clever - for example, they tell your local staff that they have been offered an important post in government after the successful completion of the project tendered;
- They have a Stalinist appetite for information that can be used against you. They will read your hand-held whenever you are not looking. They have ‘moles’ planted somewhere between the printer and the desk because lots of people get to see even the most confidential documents. Your external hard drives and even laptops will disappear in apparent break-ins, only for you to perceive later that they curiously possess data from those devices.
If you were wondering what Zille was smoking before she wrote the newsletter quoted above, let me assure you that State capture is alive and well and living in Mpumalanga.
Home of the January murders, where we are still waiting for explanations and convictions regarding 17 people shot (14 of them killed) between 1998 and 2011, every January. All of them whistle blowers, we concur with Heywood as well. Asking impertinent questions is a very dangerous business. Yes. They dismiss and demote, leaving a joint venture run by only one NGO, then when you legally terminate the joint venture because it is not one in terms of Law, they trundle on, as if they were still a joint venture.
The only explanation for this happening is government complicity. Desmond Tutu Centre for Leadership (C4L) has reported this to the Public Protector. Not to mention repeated incidents of fraud to law enforcement. They simply operate an illegal Provincial Implementing Agent (PIA) using illegal methods under government’s protection.
On 2 June 2013, City Press, quoted ANC secretary-general, Gwede Mantashe, on corruption in the ANC: "When a tender is issued, you find there is already a structure of collaboration..."
The same article quotes him as saying that: "They do not know the difference between a salary and what should be used to serve our people"…"Commitment we had to fight apartheid has been replaced with greed."
Greed makes them clever, though. What they cannot get away with in government, they know that they can pull off in an NGO setting. Because on the whole, civil society is not regulated as rigorously as the public sector. So what do they do?
Trojan horse, corporate raiding and now State Capture.
- Chuck Stephens, Chief Executive Officer at the Desmond Tutu Centre for Leadership.
- There is one day on the South African calendar when suits are exchanged for overalls, ties disappear and everyone knuckles down to do their 67 minutes of voluntary service in celebration of Nelson Mandela each year. But companies that are going beyond their 67 minutes are reaping the real rewards of volunteerism.
In an increasing competitive global business environment, companies are not only looking to increase and improve their productivity, but are also looking at ways that give them a competitive advantage and community standing. Many business leaders agree that a strong organisational culture, with a motivated, engaged workforce can be the intangible difference that sets the company apart. New research from Deloitte suggests that there is a link between frequent participation in workplace volunteer activities and this desired organisational culture.
Internationally, there has been a strong move towards corporate conscience with many top companies encouraging employees to participate in ‘one to one’ donation schemes or active volunteerism. In South Africa, the trend has been slower to take hold; many of the bigger corporates have developed their corporate social investment (CSI) strategies to include volunteerism, but other companies tend towards doing their part on Nelson Mandela Day, but even then sticking to straight forward CSI spending.
The importance of volunteer programmes in companies should not be underestimated and if strategically developed, they can benefit the organisation, the employees and the community as a whole. These programmes can become the vital link between business and civil society. Business guru, Richard Branson, believes making a difference in people’s lives and making a profit are not mutually exclusive and that a healthy profit means that a community supports and appreciates the services a business offers and how the business is managed.
Active community participation and sense of selfless service are known to increase an individual’s sense of well-being and happiness. When this is done through the company they work for, it increases pride in the organisation, a sense of fulfillment and a belief in what they are doing. These programmes are also known to teach employees new skills, particularly the so-called ‘soft skills’, improve confidence and earn them respect.
According to the eighth annual Deloitte Volunteer IMPACT survey (2011) millennials (21-35) who frequently participate in workplace volunteer activities are more likely to be proud, loyal and satisfied employees than those that do not. Of those who did volunteer, 70 percent said that a company’s commitment to the community would be a factor when choosing between two potential jobs. However, volunteering is not a purely altruistic decision, as 51 percent of all those surveyed also wanted their volunteerism investment to benefit them professionally.
Corporates like MTN Group, Absa Group and Standard Bank Group, all have developed programmes, sometimes referred to as skills-based volunteerism, that go beyond the typical short-term ‘crèche painting’ scenario. They have aligned their business strategies with corporate conscience projects that are visible, have a long-term effects within the community they operate in, that speak to their corporate vision and acknowledges and values the individuals involved.
The MTN Foundation, for instance, has aligned itself with the national imperative of education for all and has followed this as their theme over the last two years. Employees have been involved in various schools programmes, across all the provinces, from the building and refurbishment of infrastructure, installation of ICT equipment to providing much needed provisions and digging vegetable gardens.
Volunteerism can never be mandatory, but companies that have embraced this ethos, particularly when it is visibly top-down, have found their employees enthusiastically engaged and committed over the long-term. The MTN annual employee volunteerism initiative; 21 Days of Y’ello Care campaign has not only mobilised high levels of staff participation for the period of the campaign, but has also seen many of the employees continue their volunteer commitment on an ongoing basis.
In a country as divided as South Africa, these programmes can go beyond the workplace, the community and the individual, and speak directly to an understanding and humanity needed to change prevailing attitudes.
- Kaelo Engage, a Johannesburg-based content creation agency. For more information contact Mandisa Mbenenge, Tel: 011 303 7027, E-mail: email@example.com.
The Seriti Commission of Inquiry into the arms deal has been postponed to 21 October 2013, following the Right2Know (R2K) campaign’s call for a fully transparent process at the commission to expose alleged corruption and abuses of power linked to the arms deal.
R2K states that it was concerned by reports of attempts by the Seriti Commission to limit the public's right to know.
The campaign mentioned an apparent secrecy surrounding the list of Armscor witnesses and the limited access to witness statements, and believes that the limited cross-examination of witnesses risked the commission being depicted as a one-sided process.
To read the article titled, “Seriti commission postponed,” click here.Source:SABC News