Peter Dickson
More than 17 000 Bisho government employees are so indebted to loan sharks that they are only being paid 25% of their salaries in the Eastern Cape provincial education and health departments.
Eastern Cape MEC for Education Stone Sizani revealed at a press conference this week that at least 1 000 government employees nationwide – illegally in league with micro-lenders in fleeing the government personnel computer system, Persal – were on the take in making the lives of an estimated 100 000 teachers and nurses a misery.
Sizani said that R23-million in illegal monthly payments to micro-lenders were being paid out in the Eastern Cape alone and that as much as R500-million could be owed.
“If this is the situation, we will never stop corruption,” he said.
Adding that “corruption must not be entrenched” in the province, only months after Bisho and the private sector agreed on a tough anti-corruption strategy at a landmark summit in East London, Sizani conceded a government investigation was pointless as it would mean “setting a thief to catch a thief”.
Members of Parliament involved in a specialised committee that has apparently been investigating the matter for a year now told reporters this week that they still had no idea how micro-lenders managed to deduct the money from the government payslips.
However, Eastern Cape MEC for Finance Enoch Godongwana said he has uncovered two distinct methods.
In the first, Persal system operators working for micro-lenders disguise the salary deduction as a “low-income housing loan”, for example. The deduction would not be listed as such because the Persal system does not accept loan entries in print-out programming.
In some instances, the Persal operator, who needs a special password to operate the system, is also the loan shark.
Godongwana said another method for public servants seeking loans was to buy – for 30c – another person’s bank statement and payslip in order to prove themselves worthy of credit in securing the loan. Money was then deducted from the victim’s salary at the end of each month.
He said this method surfaced recently in Butterworth in the Transkei, and that employees of the education and health departments were most indebted to loan sharks in the province.
Godongwana, who estimates that “as many as 1 000 people may be involved among Persal’s 55 000 operators”, says the government is fast pinpointing the illegal inputters involved, and that the Bisho executive budget council has agreed on legislation to ensure no more than a quarter of an employee’s salary is deducted in any given month.
He said regulation of micro-lending “cannot be left to the industry”, and that the Usury Act needs to be streamlined to restrict interest charges on loans. “We need legal regulation to stop the abuse.”
In other corruption-related incidents in the province this week, Sizani has given 38 senior officials 14 days to head off legal action against them on allegations of fraud.
They include the Department of Public Works permanent secretary Linda Salie, who has been suspended on full pay, and 35 department of education officials, among others.