PART TWO

INTRODUCTION

As far back as 1989, the authors of Uprooting poverty in South Africa; report of the second Carnegie inquiry into poverty and development in South Africa predicted that corruption would loom large in a new South Africa. Noting the high degree of corruption bred by apartheid, they argued that even were a democratic government to gain power, the old clerks would not necessarily learn new habits.1

Their prediction was uncannily accurate. Since the transition, corruption has burgeoned in both the public and private sectors; besides violent crime, it is probably the factor which most preoccupies those who express concern about South Africa's future. Analysts have warned that corruption is the single biggest threat to the Reconstruction and Development Programme, and the establishment of a human rights culture.2

Their comments underline the fact that, contrary to perceptions in some quarters that the effects of corruption are largely confined to the middle classes, this phenomenon – particularly in the public sector – has considerable impact on the poor. It is this aspect which forms the subject of this study.

This monograph, then, examines the way in which government corruption affects the poor. Because this topic spans such a vast area, only one field, social security, is examined in depth. This area was chosen because:

social security programmes, particularly pensions and other grants, are largely regarded as the state's primary attempt to alleviate poverty;3



social security programmes, particularly pensions, are known to have been affected by fraud and corruption; and



the problems surrounding the delivery of social security services to the poor characterise more general problems relating to the transformation and restructuring of government departments.

The first section of this paper provides an analytical framework for examining corruption.

Attention is paid to the relationship between corruption and developing societies, societies in transition to democracy, and the South African experience in particular.

The second section examines the state of social welfare. Particular attention is paid to the composition of the welfare budget, as well as the distributional impact of social security grants on household income. General problems in delivering these grants are examined in the context of the transformation of the public service.

The third section addresses the core issues. Relying heavily on the report of the Committee for the Restructuring of Social Security (CRSS), a body set up by the Department of Welfare in 1996, an attempt is made to understand why a situation has arisen in which huge sums earmarked for social security are lost through fraud and corruption. Several factors that facilitate abuse are highlighted, and proposals for addressing these problems evaluated.

The fourth section identifies and evaluates mechanisms for addressing corruption in the field of social security. Corruption in the criminal justice system and recent proposals to counter it are also briefly examined. Finally, indicators are suggested against which the impact of anti-corruption efforts – particularly those which affect the poor – may be measured. Future research areas are also flagged.

I would like to thank the following people for commenting on an earlier draft: Debbie Budlender (Community Action for Social Enquiry); Antoinette Louw (Indicator SA, University of Natal); Jakkie Cilliers (Institute for Security Studies); Stiaan van der Merwe (Transparency International – South Africa); Renosi Mokate (Centre for Reconstruction and Development, University of Pretoria) and Mark Shaw (Institute for Security Studies).

ENDNOTES

F Wilson M Ramphele, Uprooting poverty in South Africa: report for the 2nd Carnegie inquiry into poverty and development in South Africa, Cape Town: David Philip, 1989, p 271-272.



S Duncan, Corruption, unpublished paper, Black Sash, April 1995.



Report of the Lund committee on child and family support, August 1996; White Paper for Social Welfare: principles, guidelines, recommendations, proposed policies and programmes for developmental social welfare in South Africa, February 1997.