Corruption Watch (CW) launches 2018 Mining Royalties Research Report at Constitution Hill

Non-profit organisation Corruption Watch (CW) launched its 2018 Mining Royalties Research Report at Constitution Hill.

The launch highlighted the complexities and challenges in the management and distribution of mining royalties to people living in mine-affected communities, the majority of whom are noted to remain without any tangible benefits.

According to the programme director of the launch, head of legal and investigation of CW, Deborah Mutemwa-Tumbo, since 2004, South African law has decreed that mineral and petroleum resources belong to the people of South Africa and the state must act as a custodian of these resources. “In partnership with the Open Society Foundation, CW embarked on a project to examine the history and evolution of South Africa’s mining royalties system, with the aim of facilitating and improving transparency and accountability in the distribution of these funds to communities.”

She explained that the CW team conducted research into two unique systems of community royalties’ administration, the Lebowa Trust in Limpopo province and the development accounts in the North West by the Bakwena ba Mogopa community. “Although both systems of administration have been largely discontinued, it was important to study those systems and their evolution into an equity sharing form of revenue, in order to understand how and why the problems occur in revenue management, with a particular focus on corruption vulnerabilities and key risk areas.”

Executive director of Corruption Watch, David Lewis stated that the plunder of mining royalties may be the most appalling tale of corruption and maladministration in a country where such tales abound. “It involves huge sums of money stolen from some of the most poverty-stricken communities in the country. And unlike the stories we read about and hear about every day, it is largely happening under the radar precisely because the affected communities have no voice.”

One of the speakers at the launch, legal researcher for CW, Mashudu Masutha explained that the key risks identified include lack of adequate community engagement, the involvement of traditional leadership, mining companies entering into revenue-sharing agreements with select members of the community, and the role of provincial government. “Our research involved interviews and engagements with community members, we also documented specific case studies which brought to light some of the widespread abuse, corruption and unethical practices that have filtered into the mining royalties system over the years. The findings showed that in both Limpopo and North West communities, the normal course of administration had been compromised from the outset.”

She explained that the organisation provides a range of recommendations that could start to address the gaps in the system that make widespread looting and corruption possible, including the establishment of mechanisms to address those gaps and create a platform for communities to finally benefit from mining on their land.”

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