30 April 2019

South Africa: Zulu Commended for Swift Action On Alleged Graft

The chairperson of Parliament's Portfolio Committee on Small Business Development, Ruth Bhengu, has applauded Minister Lindiwe Zulu, for acting swiftly against officials who were fingered in the forensic investigation report by the Office of the Auditor-General.

In a statement issued on Monday, the committee, through its chairperson, said the development was important for the fight against corruption in government.

Zulu recently placed nine officials on suspension for their alleged involvement in corruption and fraudulent activities.

"History will judge us harshly if we fail to remove corrupt officials, who sabotage government programmes designed to uplift those who are poor and struggling to get out of poverty," Bhengu said.

The committee said during oversight visits to KwaZulu-Natal, Eastern Cape, Gauteng, Limpopo and Mpumalanga between 2014 and 2017, it observed that grants from the Department of Small Business Development that were meant for small, medium and micro enterprises (SMMEs), as well as cooperatives, did not impact positively on the recipients.

"The committee came across many frustrated entrepreneurs and cooperative members who were struggling to get off the ground, despite having received grants. It is against this backdrop that it recommended for a forensic investigation to be conducted by the Office of the Auditor-General on two programmes of the department, namely the Black Business Supplier Development Programme (BBSDP) and the Cooperatives Incentive Scheme (CIS).

"Although it took the former Director-General, Prof Edith Vries, a long time to see the need for a forensic investigation to be conducted, she later agreed, following continuous engagements," said Bhengu.

The committee said it has taken note of the fact that Minister Zulu had the difficult task of providing political direction to a new department that inherited officials and programmes from the Department of Trade and Industry (dti).

"Corruption and fraudulent activities identified in the forensic report point to a well-established network involving officials who were inherited from the dti, network facilitators and service providers who operated outside of the dti, in collaboration with officials in the Department of Small Business Development to enrich themselves," said Bhengu.

The committee said it strongly believes that the network involving officials in the Department of Small Business Development and network facilitators and service providers is designed to defraud the government, thereby sabotaging efforts to address poverty and unemployment.

"The committee would recommend that further forensic investigation should include the years preceding the establishment of the Department of Small Business Development when the BBSDP and CIS grants belonged to the dti," said the committee.

Bhengu reiterated that in recognising the important role played by small businesses in job creation, the National Development Plan has put a target of 9.9 million new jobs by 2030.

"That target cannot be achieved when resources designated to enable small businesses and cooperatives to create much-needed jobs are diverted to line the pockets of greedy officials.

"Minister Zulu has demonstrated how recommendations by committees of Parliament and Chapter Nine Institutions should be implemented by those called upon to do so," Bhengu said.

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