DA calls for special inspector-general to prevent graft in relief fund

To prevent corruption and theft in the R500 billion Covid-19 rescue package, the DA has proposed that Minister of Finance Tito Mboweni create a special inspector-general.

DA MP Geordin Hill-Lewis said previous localised disasters, as well as regular expenditure, had been lost through illegitimate procurement practices, undue cost escalation and direct theft, which made this a necessity.

Briefing the media on Monday, the party said regular processes are suspended when funding is dispersed under disaster relief and emergency provisions of law, which has, in the past, resulted in massive wasteful expenditure, with no results.

“This inspector-general would differ from the auditor-general (AG), in that the AG only considers spending after it has happened at the end of a financial year, and cannot take any pre-emptive action to prevent corruption. Legal provision for this special inspector-general can be made in the forthcoming Special Appropriations Bill to be tabled to Parliament in June, to give effect to the R500 billion stimulus package announced by the president and finance minister.”

The party also threatened to table an amendment to the Special Appropriations Bill, should Mboweni not adhere to the request.

The party added that the functions of the special inspector-general shall include:

• Summoning information or assistance from any government department, agency, or other entity at national, provincial or local government level.
• Failure to disclose information within seven days will be regarded as a criminal offence.
• Direct departments to take immediate action to address deficiencies identified by a report or investigation of the special inspector-general.
• Prevent the payment of any monies to, or recall moneys from any individual or entity where the special inspector-general finds deficiencies, non-adherence to processes, or potential abuse of power or corruption.
• Nullify the awarding of tenders and contracts where the special inspector-general finds deficiencies, non-adherence to processes, or potential abuse of power or corruption.
• Have powers to investigate the legitimacy of any eligible businesses receiving any state-backed Covid-19 funding.
• Require an explanation of the reasons the state determined it to be appropriate to procure any goods or services for Covid-19 relief, including a justification of the price paid for, and other financial terms associated with, the applicable transaction.
• Preventing and/or terminating procurement where exorbitant pricing is detected.

President Cyril Ramaphosa’s April announcement of a R500 billion Covid-19 social and economic plan included funding to combat the pandemic, money for municipalities for provision of services, grants for relieving the plight of the poorest, funding for job creation, tax relief for distressed businesses, assistance for spaza shops and small businesses, and a loan guarantee scheme for qualifying businesses.

Businesses will also be given some relief measures, including an increase in the turnover threshold for tax deferrals to R100 million per year, while the proportion of PAYE payments that can be deferred will be increased to 35%.

Moreover, no penalties will be applied for late payments if taxpayers can show they were disadvantaged by the coronavirus pandemic.

Lastly, taxpayers who donate to the Solidarity Fund will qualify for a tax break.

Municipalities will get a boost in the form of an additional R20 billion in funding for emergency water supply to assist sanitation, as well as public transport, and providing food and shelter for the homeless.

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