SIU progress report on COVID-19 PPE procurement investigations; Digital Vibes investigation Public Accounts (SCOPA)Parliamentary Monitoring Group 07 December 2021SIU briefing: Investigations into COVID-19 procurement Adv Andy Mothibi, Head, SIU, said that the SIU appreciated the opportunity to update the Committee on its investigations into the irregularities and other procurement infractions committed during the COVID-19 pandemic. 

As well as PPE procurement, the SIU had investigated, for example, procurement relating to the infrastructure part of the COVID-19 response. The current briefing was based on the SIU’s sixth progress report. The seventh and final report would be submitted to the President on 10 December. He said that as the SIU moved towards concluding its investigations, it would be focusing primarily on ensuring that consequence management was implemented. In some cases, consequence management entailed civil litigation, mainly in the Special Tribunal. The SIU also made referrals to state institutions for disciplinary action; referrals to the National Prosecuting Authority (NPA) for criminal prosecution; and referrals to other regulatory authorities. Additionally, the SIU’s final report would include systemic recommendations, which it would probably engage with the National Treasury about. Between April 2020 and June 2021, R138.8 billion had been spent on the COVID-19 response. 

The SIU had investigated contracts amounting to R$14\mathrm{.}8$ billion $(11\%).$ The vast majority of the contracts under investigation fell under provincial governments: of the R$32$ billion that provincial governments had spent on COVID$-19-$related contracts, R$11\mathrm{.}6$ billion $(36\%)$ was under investigation.

The SIU was investigating $5054$ contracts, awarded to $2686$ service providers. At the time of the report, the investigations had been finalised in respect of $1461$ contracts $(29\%),$ amounting to R$7\mathrm{.}3$ billion, and had not yet begun in respect of $7\%.$

The completed investigations had found irregularities in $555$ contracts $(38\%)$ worth a total of R$3\mathrm{.}1$ billion. Of the investigations outstanding at the time of the report, most were in Gauteng, where the SIU was still investigating $1777$ contracts worth R$4\mathrm{.}5$ billion $–$ with the high$-$value contracts concentrated in the provincial Department of Education and in infrastructure projects $–$ and in Mpumalanga, where it was still investigating $605$ contracts worth R$572$ million. Adv Mothibi said that the picture had changed immensely since the report had been submitted $–$ all investigations were now complete or underway, and he thought that investigations had to be finalised in only two provinces.

Question 1 

Concerning the extract and with practical examples, examine the notions of irregular expenditure and procurement infractions and provide a utilitarian explanation of why they constitute an ethical crisis in the public sector

Question 2 

From the extract, assess the extent to which the capitalist economic system contributed to the ethical issues in government procurement processes during the COVID-19 pandemic.