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Corruption affects us all. It threatens sustainable economic development, ethical values and justice; it destabilises our society and endangers the rule of law. It undermines the institutions and values of our democracy. But because public policies and public resources are largely beneficial to poor people, it is they who suffer the harmful effects of corruption most grievously.
To be dependent on the government for housing, healthcare, education, security and welfare, makes the poor most vulnerable to corruption since it stalls service delivery. Delays in infrastructure development, poor building quality and layers of additional costs are all consequences of corruption.
Many acts of corruption deprive our citizens of their constitutional and their human rights.
Corruption and international perceptions of corruption in South Africa has been damaging to the country’s reputation and has created obstacles to local and foreign direct investment, flows to the stock market, global competitiveness, economic growth and has ultimately distorted the development and upliftment of our people.
Public money is for government services and projects. Taxes collected, bonds issued, income from government investments and other means of financing government expenditure are meant for social grants, education, hospitals, roads, the supply of power and water and to ensure the personal security of our citizens.
Corruption and bad management practices eat into the nation’s wealth, channelling money away from such projects and the very people most dependent on government for support.
Countless studies around the world show how corruption can interrupt investment, restrict trade, reduce economic growth and distort the facts and figures associated with government expenditure. But the most alarming studies are the ones directly linking corruption in certain countries to increasing levels of poverty and income inequality.
Because corruption creates fiscal distortions and redirects money allocated to income grants, eligibility for housing or pensions and weakens service delivery, it is usually the poor who suffer most. Income inequality has increased in most countries experiencing high levels of corruption.
Adherence to good governance creates an environment where corruption struggles to flourish. Failure to adhere to the practices of good governance means stakeholders increasingly demand accountability. Mass action and strikes are organised in protest as citizens begin to lose faith in the ability or willingness of their elected officials. Political instability increases. Investment declines. The sale of shares by investors decreases the value and rating of companies. Their regulators can deny them licences, a stock exchange listing or the ability to sell products and services. Other organisations refuse to do business with them. And donors or economic organisations grant fewer loans or aid to nations whose governance is murky.