Public Sector Financial Management, morality, culture and law

Journal of Public Administration

PUBLIC SECTOR FINANCIAL MANAGEMENT, MORALITY, CULTURE AND LAW N. Mathebula University of Limpopo South Africa

T

ABSTRACT

he purpose of this paper is to highlight the significance of morality and indigenous African cultural practices in public sector financial management. Post-1994, the South African government embarked on policy reforms and several pieces of legislation were promulgated for public service and local government regulation. This legislation included the 1996 Constitution of the Republic of South Africa, the 1999 Public Finance Management Act and the 2003 Municipal Finance Management Act. Underlying this legislation was the hope of supporting the democratic and public administration processes in pursuit of the goals of quality service delivery and sustainable development. Notwithstanding the good intentions underlying this legislation, a democratic South Africa’s financial management continues to be embedded with corruption, fraud and theft. This paper argues that the legislative framework in question has not inculcated the appropriate public sector culture and morality necessary for reducing and curbing attendant financial management sloth. The heightened culture of public sector corruption appears to insinuate that the crop of functionaries are virtually uniformly incapable of distinguishing good or right from bad or wrong intentions, decisions and actions. This paper asserts that culture and morality are both significant and complementary to legislative frameworks in public sector financial management.

INTRODUCTION South Africa’s post-1994 democratic government presided over policy reforms and promulgated new policy initiatives. In this process, the new government also propagated and legislated on the public sector financial management by introducing several pieces of legislation, inclusive of the 1996 Constitution of the Republic of South Africa, the 1999 Public Finance Management Act and the 2003 Municipal Finance Management Act. The primary purpose of these reforms and legislation was to safeguard the “state pocket”. However, the process of legislating was not holistic because some fundamental indigenous African principles and values were padlocked outside. The law on its own, if not perfected by morals and culture, cannot correct the malpractices in the public sector as Henry Hazlitt N. Mathebula

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(1963) said: “How long could a society or individuals prosper or continue to exist in which ill-manners, promise-breaking, lying, cheating, stealing, robbing, beating, stabbing, shooting, ingratitude, disloyalty, treachery, violence, and chaos?” Hazlitt (1963) brings to the fore a critical element of indigenous knowledge systems and the pivotal role it plays in every sphere of an African realm, including upholding the ethics and code of conduct in the workplace. Indigenous knowledge refers to the knowledge system entrenched in the cultural traditions of local communities, which is fundamental to sustenance and survival (Quigley, 2009); and such knowledge is based on accumulations of empirical observations interconnected with the environment (Achayra & Shrivastava, 2008). This paper therefore argues that morality and culture in an African context supersede or at least form part of the ingredients in the rule of law in curbing malpractices confronting financial management in the public sector. Before even attempting to establish the relationship between morality, culture and law, this paper seeks to conceptualise and operationalise these concepts.

CONTEXTUALISING AND OPERATIONALISING MORALITY, CULTURE AND LAW The relationship between morality, culture and law has been marked with many intellectual contentions. While culture has to do with social cohesion and identity within a particular society, morality and law appear inseparable as the two concepts seek to augment good human behaviour and perpetuate the doing of what is right over wrong. The democratic legislation drives the modernist culture in a context that is deeply African. The question that cannot arise is whether an originally African culture is immoral or not, because there is evidence of ubuntu. The latter is synonymous with good morals and respect for public property, which are the key values founded in scripts of communitarianism. To this extent, the imposition of western-style democracy could as well have created contradictory cultures wherein societies fail to establish a new identity. Without identity, any nation would be directionless and lost; perhaps, the rule of the jungle becomes prevalent under such circumstances. Given that African morality was not necessarily established and enforced through overt formal legislation, it may be virtually impossible for Africans to learn to adapt to culture at a later stage. Perhaps, the challenge is also about the reading and/or misreading as well as interpretation and/or misinterpretation of the modern laws of democracy. How are modern democratic laws to be framed in order to convey meaning that inculcates African morality? This question will certainly remain unresolved because most of the unwritten African legal scripts are characterised as discriminatory, unconstitutional and so on, whereas African morality involved unwritten laws of socialisation, which starts at birth. This paper argues that the values conveyed through the modern democratic legislation do not make for moral integrity because private enterprise, on which the system is

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founded, encourages profiteering at all costs. There is a complex nexus of morality, culture and law that is unique for each society. Probably, some societies may even consist of multiple varieties of such nexus because of their internal diversity of culture, morality and unwritten law. It is against this background that this paper seeks to provide a theoretical crossing-point of the concepts of morality, culture and law with a view to bridging the gap that exists in the analysis of their considerable overlaps. Morality The concept of morality as derived from the Latin word mos, meaning customs or peoples’ values and traditions, heritage or ways of life and conduct within a given community (Walligo, 2005). Except for operational purposes, morality has not been given sufficiently convincing definitions for conceptual purposes. Within societies of black Africans, there is a shared sense of morality which is based on the concept of ubuntu (Walligo, 2000). Ubuntu is a term translated as human kindness. It is an idea of the Southern African regions that means humanness, and is often translated as humanity towards others (Hailey, 2008). Ubuntu may further be understood as a cultural practice embedded in black Africans and applicable to administrative practices, which may in turn cause unethical conduct in African governments (Sebola, 2014). In African societies and particularly South Africa, there is a general expectation that people should conduct their official duties with due cognisance of humanity, respect, loyalty and honesty, among others. However, the concept of morality is often confused with ethics (Waliggo, 2005) due to their similar principles of regulating the relations between people and the communities they live in. Morality should be viewed more as customary or traditional values (Idowu, 2005) and the conduct within communities. To this end, it should be expected from individuals with an African origin, where there are millions of proverbs (Idowu, 2005; Mkandawire, 2011) seeking to promote good behaviour, humanness, loyalty and faithfulness, among others, that they conduct their public duties morally, particularly in the handling of public money. Culture As a complex subject in anthropology, the concept of culture is not an easy one to describe. Culture can be defined differently according to the geographic location in which one is situated. Marana (2012) states that culture is not a static set of values and practices but rather relentlessly recreated as people adapt and redefine their values and practices due to changes in the situation and the interchange of ideas. To this end, individuals can be caught between different cultures by being tourists or exposed to different social backgrounds. According to Brumann (1999), culture means the whole complex of traditional behaviour that has been developed by the human race and is successfully learned by each generation. Furthermore, culture can be understood as a learned behaviour, which in many instances has to be acceptable in society (Groombridge, 2002; Falicov, 2003; Kavanaugh, 2006) and shared beliefs, values, customs, behaviours (that is, good behaviour), artefacts, N. Mathebula

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and expressive symbols (Geertz, 1957) that members of a particular society use to interact with their world and with one another (Zion & Kozleski, 2005), often for common good. These definitions befit the African and South African contexts in particular, wherein the culture is in well manifested (Hazlitt, 1963) and described as well-constructed. Culture plays a critical role in all realms of life including honesty and loyalty. It is due to cultural constructions that individuals in charge of public finances can, as Hazlitt (1963:9) puts it, have “good manners, promise-keeping, truth-telling, honesty, fairness, loyalty, consideration for others, peace and order, and social cooperation”. Although the South African culture is becoming increasingly diverse, urbanised and westernised due to globalisation and technological advancements, indigenous culture remains imperative and cannot be underestimated in dominions of life, particularly in the management of public finances. Law Legal philosophers have long debated the question: “what is law?” The basis of this contention is that law is more abstract and difficult to define in nature (Radin, 1938; Humphrey, 1945; Poposil, 1972). The definition of the concept of law is or ought to be developed by drawing on the works of jurists and anthropologists (Johnson, 1977). According to Idowu (2005), law is one of the greatest institutions and social practices ever developed by man. Despite controversies that exist on the meaning of the concept of law, scholars such as Hadfield and Weingast (2011) define law by the actuality of institutions that characterise contemporary western democracies with centralised production of legal rules by legislatures and where courts combine with centralised “strong-arm” enforcement of those rules by duly constituted governments. This definition, however, may merely indicate the framework of the legal system and not the law per se. Humphrey (1945) broadens the definition by articulating that law is a rule of human conduct that emanates from a source recognised as component by legal order and which prescribes the imposition of a sanction or penalty in the event of disobedience. In modern society, laws emanate from some organised body having competence under the constitution or delegated legislative powers. The concept of law as enunciated by Humphrey (1945) fits well into the current discourse by realising the need for punishment, penalties and sanctions for infringement under sets of rules and codes of conduct by those bound by the law. As has been highlighted, the concept of law is not an easy one to define. The notion of law as described by Johnson (1977) refers to a body of written statements constituting the rules, norms and prescriptions that have been explicitly formulated and accepted as authoritative and appropriate. In the South African discourse, there are law-making bodies conferred with the authority by the 1996 Constitution to make laws. However, the enacted laws lack punitive measures in instances of infringement (Schönteich, 1999; South African Law Commission, 2000), which has in turn led to rising crimes in relation to public finances.

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PUBLIC SECTOR FINANCIAL MANAGEMENT IN SOUTH AFRICA The conduct of public affairs is intricately interlinked to the specific morality and culture, rather than just the law. Whereas the law is necessary and important, it merely establishes the culture that conveys appropriate values and views. The latter may be inculcated without codified law because reading of legislation, even when appropriate, may motivate intent for deviation. That is, it is not adequate to moan about the promulgation of legislation because moral conduct depends on receptiveness of the values and views conveyed therein. In practice, societies that promulgate legislation that are strictly fixed on guiding conduct tend to solicit even more sophisticated means for circumventing prescribed requirements. For example, a democratic South Africa’s legislative provisions are sound and wellmeant, but the fight against corruption appears to be lost as questionable dealings such as those of the Nkandla Project, which was supposed to cost a mere R27 million in 2009, came to escalate to over R246 million in 2013. Worse, such questionable morality seems to be condoned and defended by the ruling party, the President and other significant state apparatus. At the dawn of a democratic dispensation in 1994, the South African government embarked on the promulgation of a number of policies and pieces of legislation in an attempt to heal the wounds caused by the apartheid regime (see Motala, 2006; Kahn, 2007; Brockerhoff, 2013). As has been contended, South Africa has what one could argue are the best policies to augment sound financial management in the public sector. However, such pieces of legislation fail to recognise the utmost importance of indigenous African cultural practices that are brought about by morality. Such cultural practices could have assisted with the recognition by civil servants of personal values in conducting public affairs. Furthermore, the promulgated policies failed to explicitly impose punitive measures and mechanisms on offenders who selfishly and unduly enrich their private pockets with public funds. In African societies, theft, dishonesty and undue enrichment are culturally a taboo that carries severe consequences (Obiechina, 1992; Familusi, 2012). It should be acknowledged that the pieces of legislation portrayed below are not the only avenues promulgated to govern financial affairs in the public sector. However, they remain the principal in governing public sector financial management. Legislative framework Constitution of the Republic of South Africa, 1996 The majority of pieces of legislation promulgated after 1994 aimed at upholding the provisions of the 1996 Constitution are enshrined in Sections 213, 215 and 219. The principal objective of the 1996 Constitution is ensuring that financial resources are managed in a sound manner across all spheres of government. It further makes provision for the enactment of national legislation that gives pragmatic effect to such ideals. N. Mathebula

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Public Finance Management Act, 1999 (Act 1 of 1999) (as amended by Act 29 of 1999) The Public Finance Management Act, 1999 is one of the most important pieces of legislation passed by the first democratic government in South Africa. It sought to promote the objective of sound financial management in the public sector in order to maximise service delivery through effective and efficient use of scarce resources. However, corruption and fraud epidemics limit the objectives against the wishes expressed in this Act (Masiloane & Dintwe, 2014) and other policy frameworks pertinent to the promotion of public sector financial management. The objectives of the Act may be summarised thus (Luyinda, Herselman & Botha, 2008): • To modernise the system of financial management in the public sector • To enable public sector managers to manage financial affairs and be held accountable • To ensure the timely provision of quality information • To eliminate waste and corruption in the use of public assets. As one of the principal pieces of legislation in public sector financial management, the Act carries the provision of clarity and channels to be assumed in ensuring that waste and corruption are curbed. However, this Act further lacks the imposition of punitive measures on transgressors of its provisions. This paper argues that enacted statutes cannot be deemed sufficient in promoting acceptable behaviour in the management of public finances, thus calling for the inclusion of provisions that are aimed at endorsing good moral behaviour. Municipal Finance Management Act, 2003 (56 of 2003) Local government in South Africa has been under a great deal of distress in the past few years due to financial irregularities that manifest in this sphere. The Municipal Finance Management Act, (2003) was promulgated in an attempt to curb such challenges. As a sphere of government closer to its constituents that is equally charged and mandated with the provision of services to communities, a municipality could be regarded as one of the major custodians of public funds (Mpehle & Qwabe, 2008). However, corruption and other malpractices in local government continue to be rife despite the enactment of this Act. The objectives of the Act may be summarised as follows (Masiloane & Dintwe, 2014): • Seeking to ensure transparency, accountability and appropriate lines of responsibility in the fiscal and financial affairs of municipalities and their entities • The management of their revenues, expenditures, assets and liabilities and the handling of financial dealings • Budgetary and financial planning processes and the co-ordination of those processes with the processes of organs of state in other spheres of government • The handling of financial challenges in municipalities including procurement.

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Similar to the Public Finance Management Act, 1999, the Municipal Finance Management Act, 2003 presents sound principles for ensuring that public money is safeguarded against corruption and other malpractices affecting the state and the capacity of service delivery. However, the Act fails to present practice for the prevention of corruption and the imposition of punitive actions against perpetrators of corruption and thieves. It is against this background that this paper argues for the supplementation of morality whereby public officials will be guided by their conscience and indigenous taboos (Idowu, 2005) in handling the public pocket. The following section of the paper discusses a relationship or at least a link that should suffice in the public sector. Although the paper is biased towards the use of law(s) as the only mechanism of ensuring sound financial management, it is strongly believed that civil servants raised in an African society should uphold their humanity in public office.

THE RELATIONSHIP BETWEEN MORALITY, CULTURE AND LAW The role of morality and culture in curbing mismanagement, particularly in financial affairs, is a momentous protagonist for their final success and/or failure. In a country such as South Africa where government funds are extensively misused (Ambe & Badenhorst-Weiss, 2012), and law enforcement branding public officials accepting bribes is needed (Van Veldhuizen, 2013), the application of pieces of legislation alone cannot locate and redress instances pertaining to corruption and malpractice. Similarly, other countries around the world have adequate edicts aimed at averting corruption, but the general citizens and civil servants have little regard for them (Treisman, 2000; Buscaglia, 2001). This consequently has an adverse outcome by creating a culture that accepts corruption, immorality, and crime because the law fails to inflict castigatory measures. It goes without much articulation that disproportions between law, culture and morality cannot be remedied with legislation alone. In South Africa, a traffic officer could play a positive role in upholding morals in society. However, accepting bribes and the failure to record traffic violations that subsequently lead to uncountable road deaths, undermines the humanity of being an African. The use of law (pieces of legislation) to create a moral culture can assist in reducing corruption and malpractice in managing government money (Kolstad, Fritz & O’Neil, 2008) and halt the bribing or acceptance thereof by public servants (Newburn, 1999; Zekos, 2004). It should be reiterated that corruption through practising African cultural norms and morality can be curbed. However, this position demands that public servants apply their autochthonous cultural practices as well as core values of the indigenous knowledge systems, where stealing is a taboo (Masaka & Chemhuru, 2011). The failure of the law to change the attitudes and behaviour of the citizens culminates in a moral conflict, thereby resulting in government officials N. Mathebula

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acting in their own interest. For South Africa to minimise or even curb corruption, consideration must be given to changing behaviour, cultural norms and morality in citizens in order to support and encourage good behaviour, because culture that supports good morals produces change. Sebola (2014) comprehensively rounds it up by positing that the use of legislation, while compromising the African way of living, has compromised several African governments, South Africa included, due to Western conceptualisations of legislations.

CONCLUSION This paper sought to highlight the importance of morality and African cultural practices as ingredients that could be added to legislative frameworks and laws to curb malpractice in public sector financial management in the South African context. The paper argues that although the pieces of legislation can provide a solution on matters of corruption, public servants need to modify their attitudes through the provisions enshrined in the statues in executing their public affairs. However biased, the paper acknowledges that altering human behaviour in a society that has reached a stage of moral decay is a challenging task.

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