Public sector procurement and corruption: protecting those who speak out | PART 1

Public sector procurement and corruption: protecting those who speak out | PART 1

Public sector procurement and corruption: protecting those who speak out – PART 1


The ongoing commissions of enquiry have exposed procurement-related corruption in both the public and private sector. This raises questions about civil societies’ duty to report corrupt activities, but more importantly, what mechanisms are in place to protect sources and whistle-blowers who speak out.

The media’s role as agents in ensuring that government is open, responsive and accountable, is well established. They function in a manner to expose corruption, dishonesty and maladministration. But to do this, sources must be protected.

Although, clause 11.1 of the Press Code places an obligation on the media to protect confidential source information, the more pressing question is whether journalists can be forced to disclose the identity of its sources.

Without venturing into the irony of the matter, the leading and landmark ruling on this issue is Bosasa Operations (Pty) Limited v Basson and Mail & Guardian 2013 (2) SA 570 (GSJ). This ruling stands as the leading case, as the Constitutional Court refused to hear an appeal against the High Court’s decision to protect journalists’ sources.

In July 2009, Bosasa Operations sued Adriaan Basson (then employee of M&G) and M&G for defamation. Bosasa claimed that Basson’s May 2009 article, which exposed a corrupt relationship between it and the Department of Correctional Services was defamatory. The claim of defamation was denied. Basson and M&G cited truth and public benefit, fair comment on a matter of great public interest, and reasonable publication in good faith as key defences to the claim.

During the pre-trial discovery process Bosasa sought to illicit information relating to Basson’s sources. Judge Tsoka was requested to consider whether journalists have a valid objection to revealing the identity of their sources.

Judge Tsoka found that, subject to certain limitations, journalists were not expected to reveal the identity of their sources. The judge stated that “if indeed freedom of the press is fundamental and sine qua non for democracy, it is essential that in carrying out this public duty for the public good, the identity of their sources should not be revealed, particularly, when the information so revealed, would not have been publicly known. This essential and critical role of the media, which is more pronounced in our nascent democracy, founded on openness, where corruption has become cancerous, needs to be fostered rather than denuded”.

Basson’s sources were employed by Bosasa, and feared reprisals, if their identities be revealed. The sources provided Basson with the information on the basis that their identities would not be revealed.

Basson and M&G relied on this undertaking and argued that the facts of the matter (primarily dealing with fraud and corruption between Bosasa and the Department) call-out for protection of their sources.

As Bosasa was awarded its tenders by a government department, those awards were subject to the Public Finance Management Act. The Department was therefore expected to award those tenders “fairly, equitably, transparently and in the most competitive and cost effective way”. The sources, believing that the Department acted in breach of its obligations, supplied Basson and M&G with information on which its article was based.

Judge Tsoka held that the sources revealing information of the corrupt activities was in compliance with the PFMA, the Constitution, and was in the public interest.

This ruling places value on sources speaking out against corruption, without fear of being identified.  If this protection did not exist (as Lord Denning observed in 1981) sources would dry up. Wrongdoing would not be disclosed. Charlatans could not be exposed, and “misdeeds in the corridors of power, in companies or in government … would never be known”.

Aside from source protection, what the Zondo Commission (as well as the other commissions currently underway), have shown is how important employees are in the fight against corruption. Without the need for a commission to uncover corruption, employees should feel safe enough to report any suspicion of fraud or corrupt activities within their organisation.

The Protected Disclosures Act was enacted for the very purpose of protecting private and public sector employees (“whistle-blowers”) who disclose illegal or corrupt activities perpetrated by their employer or fellow employees. According to this Act, no employer should subject an employee to any “occupational detriment” as a result of having made a protected disclosure. Such an “occupational detriment” would subjecting the employee to a disciplinary hearing, suspension or dismissal refusing the employee a promotion, in view of a protected disclosure. An employee who finds themselves in such a positon has the option of approaching the Labour Court for relief.

Section 6 of this Act allows an employee to report corrupt and illegal activity to its employer. The disclosure must be made in good faith and in terms of procedures put in place by the employer. If an employee makes a disclosure in accordance with the employer’s prescribed procedure to a person other than an employer, it is deemed a protected disclosure. The amendment to the PDA assented on 31 July 2017, requires all employers to authorise “appropriate internal procedures” for receiving and dealing with information and improprieties, and take reasonable steps to draw those procedures to the employees’ attention. It is therefore pivotal for employers to have these reporting procedures and an adequate protected disclosure policy in place, and to seek the required legal input to ensure this complies with the relevant laws.

Source protection and the PDA are just the tip of the iceberg when it comes to whether there are adequate measures safeguarding sources and protecting whistle-blowers. Part 2 of this series will consider those laws and whether or not the ambit and application of the protection stated requires further review.

Ricardo Pillay, Director and Team Leader, Construction Infrastructure and PPP Department

Athi Stoto, Director and Head of Department, Employment Law and Dispute Resolution