LEGAL STATUS The SIU is a Schedule 3 Public Entity Reports to Parliament and the President

VISION & MISSION To be a world-class anti-corruption agency An anti-corruption agency that performs high quality investigations of corruption and takes legal action to prevent and recover losses of state assets in the public interest

Advantages of SIU Unique role in that only institution that uses the civil law to recover money Can do whole process – from investigation to final litigation Added advantage that need not prove case beyond a reasonable doubt, but only on a balance of probabilities Also, unlike criminal fraud where state has to prove subjective intent In civil law a negligent or even innocent misrepresentation is sufficient

Effective and economic investigations The SIU provides forensic investigation services at no additional cost to government Can match almost all private sector services at about a third of the cost Can also provide a proper completed investigation since it has investigative powers, members can take proper affidavits After private investigations the report usually need to be backed by proper evidence leading to delays

(Continued) Also assist with the investigation and prosecution of the criminal matter alleviating the resource constraints in the criminal justice system The Special Tribunal ensures that litigation proceedings are swift as opposed to the lengthy delays that may occur in other courts.

Building Partnerships It is vital to work with government to fight corruption effectively Focus on building good working relationships with those state institutions that need ongoing investigations Sensible to spend some of the funds going to the private sector on working with the SIU and building its capacity i.e. build capacity in the state that will be permanently available to fight corruption

OVERVIEW 2002/2003 In last year’s annual report reference was made to a 10 point strategy to put the SIU “back in business” as one of the premier corruption fighting institutions in our country. Significant progress has been made in implementing this strategy.

1. Creating certainty about the future of the SIU It is no longer affecting staff morale in the SIU Although there is not long term certainty

2. New cases for SIU There is now a steady flow of work to the SIU, esp through DCS 8 new investigations received during the year Still undue delays in receiving proclamations

3. Increasing Capacity Investigative capacity has been substantially increased : Permanent staff 40% increase - 74 to 103 Total staff 58% increase - 85 to 133 Filled old vacancies But mainly because of additional funding received from other state institutions

Important way of building capacity has been to build to develop an effective training program Increase skills of own staff But also take responsibility for training own recruits rather than “poaching”

4. Improving representivity Employment equity plan is in place plus employment equity forum   A major focus in recruitment is to improve representivity, especially at a management level Challenge in financial investigations, but achieved good progress 67% of all permanent staff are from designated groups - 43% are black If contract workers are included, 48% of unit members are black

5. Ensuring competitive salaries Salary grading performed by external consultants to align SIU salaries with equivalent structures in the public sector  Likely to be implemented during 2003/2004 Confident that this will allow us retain our present staff by offering them a proper career path And allow us to continue to recruit skilled new staff

6. Promoting greater efficiency A true project management approach adopted Successful in introducing clearer time frames and greater accountability Comparison done with best practice in the market with the aim of optimising productivity

7. Legal changes to improve effectiveness Effectiveness of SIU severely affected by a number of judgements In addition, the present referral and litigation processes are ineffective Adv Wim Trengove SC briefed for advice on possible amendments, as well as on related constitutional issues Legislative amendments to be tabled in Parliament

8. Establishing a national presence Previously SIU based in East London with teams focussed on each province and a satellite office in Umtata Decided that it would be more effective to establish a national presence Pretoria office now fully established Durban office experienced significant growth Satellite offices in Mpumalanga and Cape Town to be established during 2003/2004

9. Improved cooperation with law enforcement A special effort has been made to improve cooperation with other law enforcement agencies to ensure effective criminal action where evidence is available indicating a criminal offence With resource constraints in the criminal justice system, not sufficient simply to refer matters to the police or NPA since there may not always be the capacity to deal with them adequately

Made investigators available to assist the police in compiling dockets that are court-ready – eg Nontenja Cooperated closely with other law enforcement agencies, eg in JACT, DCS investigation, housing investigation Handed several matters to AFU where their powers more effective – Magistrates case, Nontenja, Maropeng NDPP is prepared to give delegations to experienced lawyers in the SIU to do the prosecution in cases investigated by the SIU

10. Building partnerships with government An effective partnership has been established with DCS – 25 dedicated SIU members Limpopo Dept Transport KZN Department of Housing

Notable cases Nontenja – Umtata attorney who defrauded state of R19m - Accused sentenced to 20 years imprisonment and asset forfeiture order granted Witness Protection Program (KZN) - all staff removed - investigation of widespread corruption by officials of the WPP in conjunction with NPS, DSO and SAPS – secret funds were abused, own houses let

Notable Cases (cont.) KZN Tare Weight investigation of fraudulently reduced licence weights of vehicles resulting in losses of millions – a lot of progress made and more than R1 million recovered Limpopo investigation of all drivers licences issued since 1994 in cooperation with provincial Dept of Transport Found nearly 10 000 licences issued irregularly and 1 400 already physically cancelled Working with DoT

DCS investigation Full-time project team of 25 members R17m from 6 doctors, incl R7.6 m from Dr Bham Problems with prison and private pharmacies, petrol cards Assaults, drugs, Booking prisoners out Selling of jobs Promotions and appointments – nepotism Agriculture False qualifications Irregular parole, remission

Housing investigation Housing Massive investigations of all state subsidies granted in Gauteng, KZN and N Cape – valuable lessons learnt Included are several conveyances entrusted with housing money, incl TR Mfeka, Mlaba Mkaya Inc, T Mvelase, HVB Makhanya Discussing a permanent national project with Minister of Housing

Univ Natal Law Clinic to assist small victims 42 866 sites inspected 27 projects completed

Agri-Eco investigation Final report about to be issued Major asset verification done for the State – R75 million of assets secured

JACT investigation in Eastern Cape Joint Anti Corruption Task Team in Eastern Cape – with SAPS, NPA Instrumental in setting up infrastructure Seconded members to assist in criminal investigations Have applied for mandate to investigate in terms of Act 74/1996

Umanyano investigation Recovery of assets of the former Transkei Road Transportation Corporation liquidated in 1996 A number of fixed assets already identified and being recovered

ACHIEVEMENTS Outputs Performance Measures 2002/2003 Target 2002/2003 Actual (Unaudited) 2003/2004 Target Investigation of corruption and prevention of losses to the State Savings (incl preventions) Cash recoveries R60m R40m R90,5m R37,5m R70m R50m Totals R100m R128m R120m

Savings and Preventions ACHIEVEMENTS Savings and Preventions 2002/2003 Actual (Unaudited) Total Notatable cases: Agri-Eco asset verification Namaqualand Housing Project R90,5m R75,4m R14,0m

(incl. cash recovered by third parties) ACHIEVEMENTS Cash Recoveries (incl. cash recovered by third parties) 2002/2003 Actual (Unaudited) Total Notatable cases: Department of Correctional Services Ghost Workers – pension funds R37,5m R17,0m R14,0m

ACHIEVEMENTS Description 2002/2003 Actual number of cases 2003/2004 Target number of cases Criminal prosecutions initiated Criminal prosecutions concluded Disciplinary proceedings initiated Disciplinary proceedings concluded Other remedial action initiated Other remedial action concluded 13 1 125 unknown 3000 1400 200 300

ACHIEVEMENTS Notable cases: Department of Correctional Services Limpopo Department of Transport KZN Housing conveyancers Not always possible to quantify impact of SIU

BUDGET - INCOME Details 2002/2003 Unaudited 2001/2002 Audited Income - Government Grants - Department of Correctional Services - Limpopo Department of Transport R25,5m R22,9m R 2,5m R 0,4m R21,9m R21,5m R 0,0m

BUDGET – EXPENDITURE Details 2002/2003 Unaudited 2001/2002 Audited - Operational salary expenses - Operating expenses - Non-operational salary expenses - Overhead expenses (incl. Depreciation) R30,2m R16,2m R 8,3m R 3,1m R 2,6m R19,6m R 9,6m R 5,1m R 2,8m R 2,1m

Excellent administration and financial controls PFMA compliant Good use of information technology Serious about training – eg Computer Based Training

Thank you