Budget Speech 2022

Madam Speaker, corruption is a major blight on our country.

It has lowered our economic growth potential, made us fiscally more vulnerable, and severely weakened the capability of the state.

Accounting officers need to ensure that their procurement processes have integrity, provide value for money, and are free from interference from politically connected persons and bidders.

We also need to be clear on what we are fighting.

We must differentiate between corruption and minor transgressions of the rules of policy prescripts that are audited as irregular expenditure.

The National Treasury is engaging with the Auditor-General to continue to ensure transparent disclosure of minor transgressions, but outside the financial audit process.

As I indicated last year, the Public Procurement Bill will be tabled before Parliament in 2022/23.

In light of the recent Constitutional Court judgement on the preferential procurement regulations, and the first Zondo Commission report highlighting abuses in state procurement, we are revising the Bill to take account of these developments.

We will also be responding formally to the Zondo Commission report.

In the meantime, we must take bold steps to improve state capability and reduce the scope for procurement corruption.

Working with SARS, the Investigative Directorate in the office of the National Directorate of Public Prosecutions, has brought charges against a company Director and a Gupta associate involved in the corrupt ESTINA Dairy project.

This is on charges of fraudulent VAT refund claims, under-declaration of plant and equipment expenses, and exchange control violations. SARS is also recovering the fraudulent refunds that were claimed.

We are also dealing with illicit trade.

Just yesterday, SARS conducted a search and seizure operation.

This operation uncovered another consignment of illegal tobacco products, bringing the total value of illicit tobacco seized during the pandemic to over R350 million.

Overall, SARS has raised assessments of R18 billion additional duties, cancelled the trading licenses of 3 operators, liquidated one operator, and referred 8 cases for criminal prosecution.

Finally, we are addressing the weaknesses in fighting fraud and money laundering identified in our recent mutual evaluation of our anti-money laundering system by the Financial Action Task Force (FATF).