eBusiness Weekly
Fin24
South Africa is facing a political crisis with “dysfunctional, weak and retreating state institutions”, and simultaneously focusing on fixing them while combatting corruption is the only way forward, according to former deputy SA Revenue Service (SARS) commissioner Ivan Pillay.
“A weak state is not in our interest – it is only in the interest of criminals,” said Pillay at the annual Helen Suzman Memorial Lecture in Johannesburg on Tuesday evening.
Suzman was the lone representative of the Progressive Party in the apartheid Parliament, where she opposed a number of apartheid laws and brought to light atrocities committed by the regime.
“Regrettably, many of the anti-democratic practices which she devoted her life to combatting persist, despite a new democratic order, and a constitution that is admired by all democrats,” said Pillay.
The state of our institutions
The performance of state institutions are “unpredictable”, and one of the threats these institutions face is unmoderated group interests, said Pillay, citing “the taxi industry, the construction mafia, organised crime, and illicit cigarette manufacturing and sales” as examples of this.
However, getting rid of corrupt people in the state is not the only solution, said Pillay.
“Our well-being is tied to institutions,” he said. “If we have failing institutions, we are going to be in trouble.”
According to Pillay, there are damning reports from the Auditor-General every year – whether on national, provincial or local level – and, while the government initially responds to the furore following such reports, eventually “nothing happens”.
Pillay referred to this as “back-end governance”, which neglects the core business of state institutions, leading to continuous crises and “huge backlogs”.
“There is no point in auditing an institution when the basics have not been put into place,” he said.
“Then you are auditing transactions – you are not auditing systems.
“Most of our leaders and managers are interventionists – they are not system people.”
This approach forces people to work at lower levels than they should be, breaking down systems and leading to “a fragmented and disjointed government”, he said.
Design flaws
“Design issues” have also largely contributed to the state of SA’s institutions, said Pillay.
The three spheres of government have added complexity to an already complex situation, and “we have neutered the public service commission” by removing it from the centre of government. Pillay said government’s attempt to govern public finance solely through the Public Finance Management Act is inadequate.
Subjective factors such political interference and the roles of top public servants being too fluid are also contributing to the weakening of state institutions, he said.
“We drove out most technical and managerial competence,” he said. “And new entrants to government have no experience in government.”
Pillay attributed this to the fact that “apartheid was not benign – it was evil”.
“It kept us out of government, it did everything it could to keep us out of power,” he said.
“The biggest role of governance is to ensure that the management that is in place does what it is supposed to do.”
Pillay referred to the efforts made by SARS which allowed it to become a “world-class institution”.
“There was no magical thinking in SARS,” he said. Rather, the institution made use of data and evidence to build its competency model, focus on system thinking, and improve and standardise its processes.
‘No silver bullets’
There are no “silver bullets” that will fix the state of the country’s institutions, Pillay said. Rather, medium- to long-term efforts are required.
“We need to be convincing politicians that institutions are important and that we should protect our institutions – politicians are very quick to attack institutions,” said Pillay, adding that civil society has a large role to play in reaching consensus on this issue.
Governance systems must also be adapted and made more explicit, he said.
“We have got to fight corruption and fix institutions at the same time” in order to maintain stability and synergy in the country while making progress, said Pillay.
As a country with limited resources, Pillay recommended a “bottom-up” approach that involves concentrating these resources on specific issues and utilising state institutions that are currently functional.
“Helen Suzman set a very great example and it applies to us in this difficult time,” he said. “She was never afraid to be a minority, even of one, and, like her, we shouldn’t be shifted from our main goals.”
Pillay identified South Africa’s main goals as those which can be found in the Constitution – building state capability with strong institutions, building energetic civil society organisations, voting in a competent government, and generating more stability in the country.
