Reflection

Corruption in a pandemic: R15bn (and counting) – I want to pay my taxes to Gift of the Givers

By Ferial Haffajee 7 June 2021

Gift Of The Givers at Rahima Moosa Mother and Child Hospital on June 02, 2021 in Johannesburg, South Africa. It is reported that Gift of the Givers teams drilled for water at the hospital following water disruptions at the facility and surrounding areas. (Photo by Gallo Images/Papi Morake)

Industrial-scale larceny did not end when Jacob Zuma left the Union Buildings. Now I want my taxes to be used for the good of all the people.

The scale of the looting for luxury consumption pitted against the scale of the poverty and hardship you encounter everywhere is making me ill. I am sure you have the same feeling. Corruption is being exposed in real-time because the Commission of Inquiry into State Capture has made the system more transparent to civil society watchdogs.

But what the exposés of R14.2-billion – stolen from pandemic-fighting funds meant to keep the elderly, the young and all of us safe from the most dangerous virus in a century – tell us is that no money is sacred from the networks of scavengers. Fly-by-night companies and dodgy tenderpreneurs move like schools of sharks to where the next opportunity is to feed.

We have yet to read the full story, but the head of the Special Investigating Unit, Andy Mothibe, said last week that the PPE corruption was like nothing he’d ever seen before. In the Sunday Times, Sam Mkokeli described the theft as being on an industrial scale.

Mark Heywood and Ufrieda Ho, writing in Daily Maverick, uncovered that the Gauteng education department spent R431-million on sanitising schools. The Western Cape spent just over R2-million, which is likely closer to what it really costs to clean a province’s schools.

The margins are so grotesque that the contract beneficiaries almost immediately took the money, meant to keep children and their teachers safe, and blew it on expensive watches, insurance policies, new homes and cosmetic surgery. It will take years to put these people in jail – and how you recover the cost of plastic surgery, I’m not sure. Botox can’t be returned.

If you go to a vaccination site today, there is very little public education or messaging. In general, basic public health information is not being generated to answer peoples’ questions – but the health department signed a contract worth R150-million with a fly-by-night company, Digital Vibes, to do this kind of work.

It is brazen theft, and investigative journalist Pieter Louis-Myburgh will soon expose how the health department also splurged money on a nice life for the Mathers, Mkhizes and Mithas – the three families who benefited from our public health messaging money. The Guptas and Watsons (the owners of Bosasa) may be gone, but their methods remain.

In 2020, and this far in 2021, almost R15-billion has been lost to corruption, according to reports. The exposés have all been done by civil society, including the media. These have triggered investigations by the SIU. The good news is that a corruption-avoidance system is working, but the bad news is that the media scrutiny deals only with a limited number of contracts. The Auditor-General’s spending reports suggest the amounts lost are much higher.

Criminal justice reform is too slow for the speed of the hyena packs, which are already moving to infrastructure and the National Health Insurance, where the next big-money state expenditure will happen. As public administration intellectual Ivor Chipkin has written, corruption is vertically integrated into South African politics. Stopping it will take decades and, as the big three scandals of 2021 have shown, President Cyril Ramaphosa’s reformist persona is no guarantee against industrial-scale looting. 

There’s a lot to loot. 

South Africa is a middle-income country and SARS last year collected R1.25-trillion from us. Add in the provincial and local government fees and levies, and we pay Scandinavian-level taxes for basket case services. 

The impact of spending overall is poor if you look at education and health standards, or at the state of the network industries that drive the economy and unemployment – Eskom, Transnet and the data networks. The data networks are efficient but often too expensive to make an impact on development, and government has not yet managed the migration from analogue to digital to bring down costs. 

In June, we all watched as Gift of the Givers took their borehole rig to find water at the Rahima Moosa Mother and Child Hospital in Gauteng, and here earlier in the year. Ongoing water cuts meant surgeries had to be cancelled, birthing mothers could not bathe and blood from stab wounds couldn’t be cleaned off the floors. But Gift of the Givers came along and sorted the problem out without asking for a cent in return. 

We witness this time and again where the organisation will go into an emergency situation and fix it. It is already doing a significant amount of government’s work, and funding will allow an expansion. In the book “Imtiaz Sooliman and the Gift of the Givers”, journalist Shafiq Morton describes what has made the charity such a global gift. The organisation has the scale, skill and pace to do all the work our government does not do. 

So, until the thieving stops, I want the option to pay my taxes straight to the Gift of the Givers. The indirect taxes raised through VAT, the fuel levy and other forms of revenue can support the grant system, which is the most efficient of government’s programmes – although the payment system was enriching high-flyers and cronies until civil society stepped in.

Morton writes that Sooliman works on the principle of being proactive, not reactive. The South African state is reactive. He is a medical doctor with expertise in nutrition that is recognised in hotspots around the world. 

Right now, my taxes are a grudge payment – but to Gift, I would give with joy.  

South Africa has a growing hunger problem – possibly the worst of the Covid impacts as the Nids-Cram studies have repeatedly found. Gift of the Givers has helped develop food products that help with micronutrient deficiency and they can feed people at scale. Sooliman knows how to fundraise and people want to entrust the organisation with their money. 

When the “green army” (the colour of their volunteers’ tracksuits) went into gear after the University of Cape Town fires earlier this year, the organisation had to tell people to stop giving as they had received enough.

Right now, my taxes are a grudge payment – but to Gift, I would give with joy.  

Sooliman’s finance manager describes their approach to money and trust. “Allaudin [a staff member] knows he can’t even move a toothpaste tube without me wanting to know why.” The trust link between the citizen and government has been smashed by corruption. 

Gift of the Givers does its work without politics and works with all communities. Too often today, our development funds are used as political patronage, as was the case with the Estina dairy farm project in the Free State.

The charity works around the world in natural disasters and during wars – and it works quickly. In the book, Morton writes that its teams of doctors can get a hospital ward up and running in six hours. Their team drilled the borehole at the Rahima Moosa hospital in under a day. This, while the snail state in South Africa retards development and health, as the pace of the vaccine rollout is showing. 

In 2011 in Somalia, the Gift of the Givers team set up the hospital to help people who had not seen doctors in decades. “…The South African medical teams based at four hospitals became the unsung heroes of Mogadishu. The figures were and still are impressive: nearly 11,000 patients seen, 80 surgical procedures and 10,000 families supplied with dry rations,” writes Morton about a short intervention.

Running a state is not the same as running a disaster operation, but Gift of the Givers is now a permanent institution in South Africa. It has started villages, runs water systems and keeps the wolf from the door of thousands of homes. The book reveals how the organisation is a logistics machine – just what South Africa needs desperately. It can scale up quite easily because of its network effects that are made quite clear in the story of Gift of the Givers. And it partners well with other organisations for impact.  

The tender system in South Africa optimises opportunities for corruption for the connected elites, especially in the provinces where the lion’s share of public funds ends up. 

The state spends upwards of R500-billion in buying (or procuring) from businesses annually. Politics is now about influencing how that money is spent and with whom it is spent. Procurement is often about paying the highest price – the preferential procurement system to ostensibly support small black businesses. 

This explains how Gauteng can, for example, blow over R400-million on school cleaning. For citizens, it means less spending on development and more on the creation of a party elite.  

The only way to break that system is to spend in the way of a non-profit. Sooliman leverages Gift of the Givers’ buying power and networks to get as much as possible for the best price possible. We can strip profit as a motive from the public purchasing equation, as it should be in a country like ours where rising unemployment has driven millions of people into poverty.

There is a movement across the country to ring-fence public funding from corruption. In Makana the community had the council dissolved, and it is now developing its own blueprint for governing itself. In Koster and Swartruggens in North West, a court granted an order allowing residents to take over the waterworks ruined by the municipality.  

In Vryburg, the business organisation Sakeliga will go to court to ask for an order allowing it to withhold payments from the Ditsobotla and Naledi municipalities in Vryburg and to make payments directly to Eskom. 

People have had enough of corruption.

The idea of being allowed to pay my taxes to Gift of the Givers is not outlandish. What is outlandish is that public servants entrusted with the sacred stewardship of caring for us during a pandemic have allowed at least R15-billion to be stolen. DM

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All Comments 56

  • I don’t know what to say Ferial.
    Stomgeslaan how those entrusted in government can throw billions away for a few trinkets.
    And how disgusted I was to hear Ramaphosa coddle the Black Business Forum at a dinner that they will be given business opportunities with the vaccine roll out.
    Who even thinks like this while we have a serious situation re vaccines…??
    That’s just not normal.

    • Why does cr’s dinner speech disgust you? He is being an anc man, that’s all. Remember – the anc first, then anything and anyone else may follow. (If there is anything left … )

  • “Right now, my taxes are a grudge payment – but to Gift, I would give with joy.”

    It’s sad that it’s come to this. I have no problem paying my taxes, not only to support the things that make life better and to support public services, but to extend my earnings to others who need it far more desperately than I do.

    Instead I sit and read the news each and every day about how the ANC and other political/financial elite have GORGED upon South Africa, and even now there are people who hope to steal what they can and disappear before anyone has noticed.

    Yet, despite their atrocities, most will still vote ANC because they can’t even read this article, let alone form an opinion on it.

  • I agree with you Ferial. It is time our tax money goes to organizations that really care about our country and its people.

  • Ferial wonderful idea but how can really, and legally, stop paying our taxes and pay to the likes of GotG?
    A tax revolt is often spoken and suggested, how on earth can this really happen?
    There’s got to be some solution

    • Hi, speak to your Tax consultant, you can already legally donate – as long as they are registered and can provide you with a S18A certificate. You then include this certificate under your tax return and it is subtracted from your total Tax payable.

      Section 18A of the Income Tax Act (Act 58 of 1962): Section 18A(1) of the Act provides for a deduction of donations in the form of cash or certain types of assets made, inter alia, to Public Benefit Organisations (PBOs) approved under section 30(1), provided that the donor is in possession of a valid receipt and the deduction does not exceed 10% of the donor’s taxable income.

      The biggest issue in this if you are on PAYE is that you need to pay in cash and will only get the benefit once you do your tax return. Maybe one of our readers who can support us from a tax perspective can assist with further detail?

      Note – Not only Gift of the Givers, think about other organisations too? Your local non-profit schools, Helpende Hand etc, just check that they are registered and can provide you with the S18A certificate, and discuss the details and maximum allowed with your Tax consultant.

      • Hi there, just to correct this – the donation is not subtracted from your tax payable, it’s subtracted from your taxable income on which tax payable is calculated.

        So for R100 donation, you don’t get a R100 tax credit. Instead, you get a deduction (ignoring limits). Where you’re in the 41% tax bracket already, the deduction will effectively save you 41% (i.e. R41) in tax, which means making a donation of R100 actually only “costs” you R59.

        I’m sure you are aware of this, but reading the response gives the impression the actual tax payable is reduced by the donation made.

      • I think we want more bang for our buck than 18A allows. If the person is on an ‘average’ income then likely they can donate R30,000 to charity but that “saves” them only 26% (their marginal tax rate)

        We want to do our tax calc, end up owing say R100k, say screw this the government can have R50k and the other R50 goes to Gift

      • Thanks Mark! Appreciate the clarification. Agree with Johan that the S18A donation isn’t going to make enough of a difference overall.
        I spoke to one of my colleagues in Poland yesterday, they are under discussion for increasing their upper taxable bracket to 50% and he wanted to know what we pay here, he was frustrated (As am I) that working at his level has no incentive for further growth. I explained our levels of service (Lack of service and apathy) to him and the levels of corruption that government allows to continue – He questioned why we are allowing this to happen! His comments, coming from someone who grew up under communism was insightful.
        I think that at some point and from a socially responsible perspective we need our own John Galt movement to get Atlas Shrugging.

  • Without the political will to close all the corruption taps the only solution is for civil society to ring fence taxes for services. We need parliament to pass a law that will automatically give citizens the right to divert their tax payments to institutions that are not managed by corrupt politicians and civil servants!

    • This suggestion may be practical. Can the opposition parties who are working for a better future please raise their hands and say Aye? Be progressive for a change – which is what is expected of them instead of wasting their energy on after-the-fact lack of oversight excuses?

      • Don’t wait for the Dom Ape to do something – they have become irrelevant and screwed us over with property rates when they ran Joburg (same lack of scruples like cANCer and EFFies). I suggest one starts a tax revolt at Municipal level – where we pay for services that we do not receive. There are examples in rural towns where the residents’ associations have taken over the collection of local rates (through the required legal action) and administering it for the benefit of the community. Once that has been achieved en masse it can be easier scaled up to a national level. Where are all the rate payer associations in this?

  • Gift of the Givers are amazing and I would be happy to have them receive double the taxes that are reluctantly paid to be stolen.

  • I am with you on this! Let’s do it. A year ago I was optimistically paying money into the Thuma Mina fund. Then I changed to supporting the CAN networks. But Gift of Givers – yes.

  • Couldn’t agree more. In other countries where I lived, I happily paid my taxes. Here I pay, but what good does it do???

  • With you all the way. Perhaps GoG could set up an account into which our taxes would be paid and they take the interest from the tax-dues paid – much like we do with rates in Pmburg. I have no problem paying taxes but paying Politicians to loot is crazy.

  • Unfortunately, the actions of GotG just paper over the cracks. You need catastrophic failure for people to bring about change. As long as GotG keeps water in hospitals nd people’s homes, the ANC is safe. Sad

  • We seriously need “people with influence” to start a mass protest re the paying of taxes. They might take a few to court for non-payment, but try taking millions!

  • As a tax paying citizen I watch from the sidelines helplessly. We wring our hands, we protest, we write letters but what can we really do? What concrete action can we take that clearly sends the message ‘no more, this has to stop’.

  • Hear hear especially about begrudging every cent paid in tax to the benefit of the hyena pack. Simply the most disgusting people on the planet and equally disgusting bling.

    • This is a dream Ferial, as noble a thought as it is. The SA government will never release its grubby mitts from your tax obligations. This corruption mess is, IMHO, irreversible. We are firmly in the Africa mould of leadership corruptibility and corruption. There are 53 states in Africa – point out for me any five economic, political and social success stories please. I’m not asking for a 50% pass rate here, just a 10% pass rate. Our kids save one are now off-shore, most of our assets ditto, and when the last kid leaves we go too. Africa Adieu.

      • If enough of us believe it is possible, how can they stop us? They cannot imprison all the tax payers. Besides, we are millions being finacially raped by a handful of them. Power to the people!

  • I am constantly astounded by what a bunch of cheap thieves the deployed ANC cadres are, they sold out our country for tiny sums of money and enabled the big guys to walk away with a fortune.

  • I’m a complete noob on tax matters, but how much charitable giving to a registered charity (such as GoG?) is tax-deductible? Is there a way in which we can start doing this (paying at least some of our taxes to Gift) TODAY?

  • An amazing organisation. They succeed because they have the desire to assist others and not enrich themselves. The caregiver who assists with my husband is actually earning much more than that required to register as a taxpayer. I mentioned this to her and explained that she would lose several hundred rands a month of her income to SARS. She was totally confused by this concept and asked where the money went. I said to the government so your child can go to school and you can go to hospital etc, etc. somehow she believed that these services are just there, provided by the government. Needless to say we agreed to continue her pay without worrying about SARS. After this article I wish to do the same and donate large portion of my income tax to Gift of the Givers.

    • Rosemary -you have hit the nail on the head – I’ve believed for a long time that the ‘we demand’ culture including many of those we see sleeping or playing games whilst sitting in parliament have no concept of where the govt money comes from, no understanding that govt has no money other than what tax payers pay, so actions that continue to drive taxpayers offshore only shoot ourselves in the foot

  • I couldn’t agree more. Imtiaz Sooliman is my hero of heroes. I just wished that I were younger – I’d have loved to join his team.

  • Fantastic idea Ferial. And I remember Cyril telling us at the start of the pandemic that there would be no corruption around Covid 19 procurement… Why do we still believe any of them??

  • I cannot say this enough…”People have had enough of corruption.”
    and
    “Right now, my taxes are a grudge payment – but to Gift of the Givers, I would give with joy and I do.”

  • Amen, Ferial. Amazing organisation. What job satisfaction for those who are part of it. A model of how the world should be run. Look a little closer at the kinds of people who are involved and their values. There’s the nub of it.

  • In desperation I have gravitated towards a tax revolt. We were very successful with the eTag revolt which was just another tax being added to our already top heavy tax contributions. I like the idea of directing our taxes to Gift of the Givers. They are honest and the money would benefit the entire population and not just the elite few. As the government has proven every day for the past 27 years, they simply cannot be trusted so have Gift proved they can. Just saying.

  • I’m always happy to donate to Gift of the Givers because I know where the money goes. They are always there in a crisis – no hidden agendas.

  • Great article …….am now quite depressed 😒 …..we are really powerless to do anything while the ANC voting cattle return these incompetent thieves to power at every election.

  • Ferial, you need to keep writing this sort of stuff. Personally though , I’m not sure I can keep reading more of what the ANC is doing to this country. Nauseated.

  • The GotG has to be nominated for the Nobel Peace Prize every year, until they win. They deserve the honour and will spend the prize money decently.

  • It was revealed that Eskom was paying R26 per roll of toilet paper. And when the CEO decides to sack the procurement officer he gets charged with being a racist! If this pillaging carries on there will be nothing left to steal in 10 years and we’ll all be united in poverty

  • You can make a donation and claim some of it back against tax payments. However, an out and out tax revolt is the only way forward – if you starve the beast it will die. Kieswetter knows this – ergo SARS increased arrogance and intransigence in dealing with taxpayer issues now with iron fists – not, I note, with the politically untouchables however.
    The trouble with a tight fist is that the harder you squeeze the less you are able to hold. SARS will learn this lesson one way or the other.

  • Excellent article and so depressing. What leaves me foaming at the mouth is the incredible arrogance with which the looting is done and then the no accountability. ‘I didn’t know’ and off they go for another round of looting. We all know who they are but there is no shame. They remain in their posts and carryvon regardless.

  • Perhaps a few million of us could pay a court bill to allow us to pay a percentage of our taxes to Gift of the Givers for services the government is incapable of delivering due to corruption and lack of skills

  • ANALYSIS

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