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Parliament embroiled in state capture

State capture emerges as a fact  …

An impression might have been given recently that parliamentary meetings only occur as and when e-NCA cherry picks a meeting for the evening news on the subject of state capture.   Therefore, one might think, every parliamentary meeting is either about the SABC or Eskom, Transnet or Denel.   Nothing could further from the truth.

Although the perverse facts behind the carefully planned act of state capture, involving Bell Pottinger, the Gupta family, their friends and associates, the actual crime in parliamentary terms  is non-disclosure to Parliament committed by public servants in the name of the same “prominent” persons, plus lying and falsification in terms of an oath taken to serve the nation.

Parliament, as a structure, has remained untarnished as the second pillar of separated powers. It is the players who have broken faith.

Hundreds of meetings

This is not to say that truth has always been exercised in Parliament in the past nor to claim that from the President down to backbenchers, all have been unaware that fake news has been fielded in parliamentary meetings.  But what is heartening is that the parliamentary process has been an enormous hurdle for the crooked to overcome.

In any one of the four sessions a year, each roughly equating in timelines to the terms of a school calendar, there are some three to four hundred committee meetings in the National Assembly and National Council of Provinces.

The subject matters covered represent the activities of forty seven government departments, literally hundreds of SOEs and all legislation which is tabled for the Statute Book must be debated.   All this is conducted with two audiences. It is a daunting programme.

Standing out

But soon it was noticeable that it was the meetings on SOEs, particularly those with their own boards and where tender processes were involved, that there was  a common theme emerging.   In each case it was a matter of strategic decisions not being taken to Parliament for approval; balance sheets not squaring up to meet the requirements of the Auditor General and the sudden arrival of newly appointed board members with little or no experience of matters under discussion.

It all stood out like a sore thumb.   Meanwhile, investigative journalism was to become a major force in parliamentary affairs.

In fact it was the parliamentary system that began slowly to reject  the manipulative processes being fielded.  Many an MP started demanding investigative reports from Cabinet ministers with cross-party support;  parliamentary rules were enforced in order to restrain the passage of  mischievous legislation and the pointing of fingers and the use of the kind of language that is only allowed under  parliamentary privilege contributed to the wearing down of the cover-up machine.

To the rescue

Eventually, between the AmaBhungane team and the BDFM team and others such as City Press, investigative journalism saved the day.   It could then be seen in writing that many of the issues so slowly being uncovered in Parliament, where nobody could pierce the web of intrigue and see the picture in its entirety, the full story was beginning to  take shape.

The extent of the theft is still not known and still emerging are new players in the list of “prominent persons”.  There is also still no apparent follow up by either SAPS or the Hawks, nor matters acted upon by the National Prosecuting Authority.

Worse, many do not expect this to happen – so cynical has the taxpayer become and so deep are the criminal waters.  But, as the saying goes, “every dog has its day”.

In the engine room

Despite the bad publicity for Parliament and the institution itself being under fire as to whether or not Parliament is a reliable democratic tool, a good number of MPs, especially opposition members, have been slaving away.     This is despite the appointed Secretary to Parliament, Gengezi Mgidlana, going on “special leave” whilst allegations into his possible violations of the PMFA are investigated.

Mgidlana was appointed as “CEO” of Parliament by the Presidency.     His jaunts overseas accompanied by his wife are the subject of investigation and have been the cause of strike action by parliamentary staff for nearly a year, whilst their own pay packets are frozen.

This matter seems to have mirrored the very issues being debated in Parliament.   Fortunately and most responsibly, the strikes have been orchestrated so as to have little major effect on the parliamentary schedule

Top heavy

Meanwhile, despite the top guy being a passenger in his own system, notices are going out on time, the parliamentary schedule is available every morning and the regular staff are hard at it. Now is the time in the parliamentary diary when the April budget vote is activated; money is made available and departmental programmes initiated.    Hearings have been conducted on many important pieces of legislation.

There is an extraordinary team in Cape Town which runs Parliament, especially researchers and secretaries to committees.

Train smash

Added to this, if it was not enough, a normally busy schedule was further complicated by urgent meetings on poor governance; tribunal findings; briefings for new members of Cabinet and the fact that to match President Zuma’s ever-expanding Cabinet with appropriate government departments there were some fifty portfolio and select committees all being served by a reduced Parliamentary staff.

The extent to which corruption is embedded into government’s spending programme makes parliamentary oversight a difficult and lengthy task, especially when under performance or poor governance matters are involved.   It all reflects the times we live in. In one day alone there  is not enough parliamentary time for a whole range of public servants to be “in the dock” to answer questions on matters involving millions of rand.

No court of law

To be fair, it is often as difficult for the respondent to get around to answering as it is for parliamentarians to get to the truth.  When you know the boss is on the take, how does one answer?   Issues tend to go around in circles.

Sifting out the rhetoric when the truth is shrouded in political intrigue is no easy task in Parliament especially when people are frightened of losing their jobs.

As the millions of rand stolen turn into billions of rand during the early part of 2017 and parliamentary committees were introduced to new “acting” directors in charge of government funding, TV cameras popped up in all corners of the parliamentary precinct.    One was constantly tripping over metres and metres of black cable to caravan control rooms enabling the public to watch the latest saga.

Camera shy

At the same time, Parliament is clearly now being side-lined by members of the Cabinet or avoided by Directors General and this maybe because of this new found public form of entertainment of spotting the good guys and shaming the captured ones.

In the past, the abuse of parliamentary rules by the incumbent President used to be considered as country-boy innocence but now the position has changed.     As any election approaches, parliamentary rhetoric always descends into low grade babble in the National Assembly but this time it is very different.  there is a clear disconnect between Parliament and the President.

With the addition of the now infamous “white minority capital” campaign to the debate, orchestrated ostensibly as we now know from London (as probably was the over employed expression of “radical economic transformation”) most of the forty-seven ministers and deputy ministers hammered out the same slogans in their budget vote speeches 9r at any given opportunity to speak, as if orchestrated.

Looking back: 2nd session

Going back to the beginning of 2016/7, Parliament has ploughed through the Nkandla mess; the SABC crisis; the Eskom governance exposures; the troubles at SAA; the failures and manipulations at Denel; crookery at Transnet; the PRASA scandals and in the losses at PetroSA, the latter being just sheer bad management it seems driven by political desire.

All of this has involved a lot of committee time far better spent on enlightening issues to assist the economy and create jobs. The “blame game” simply led to a jungle of write offs with no explanations but, suddenly, an ill-timed series of cabinet re-shuffles rattled a hundred cages.

D-day

Friday, March 31, 2017 will always be remembered following a period of stun grenades and parliamentary brawling in the House as President Zuma announced yet another set of choices to make up his Cabinet.  In committee meetings, in no less than eight portfolios, new or changed Ministers and Deputy Ministers appeared at meetings with little background.

The second session of the 2017 Parliament had this extraordinary start and on it ending, the arrival of the Gupta emails has now confirmed and named many involved in the whole issue of truthful depositions before Parliament.  No doubt a lot more shocks are yet to come.

The next session of Parliament will represent one of the arenas where the gladiatorial challenge will be played out on state capture together with the battle to avoid fusion in the separation of powers.

It is to be hoped that spring at the end of the third session will herald more than just another summer.

 

Previous articles on category subject
Zuma vs Parliament – ParlyReportSA
Parliament awaits to hear from Cabinet – ParlyReportSA
Parliament goes into Easter recess – ParlyReportSA

Posted in cabinet, Cabinet,Presidential, Energy, Finance, economic, LinkedIn, Mining, beneficiation, Public utilities, Security,police,defence, Special Recent Posts, Trade & Industry0 Comments

FICA Bill : Hearings on legal point

President Zuma vs Parliament on FICA Bill

…..editorial……The convoluted thinking that is taking place in South Africa to avoid the consequences of the law has once again become evident in the ongoing battle between the Presidency and the Standing Committee on Finance with the return  of the Financial Intelligence Centre Amendment (FICA) Bill  by the President to Parliament and therefore unsigned into law.

Worried by warrants

The President claims that for representatives of the Financial Intelligence Centre (FIC) to visit business premises and even homes under special circumstances without a search warrant and in cases where obtaining a warrant would defeat the purpose of the search, may be unconstitutional.   FIC, meanwhile, has confirmed in Parliament that between the years 2011 and 2016, 930 warrantless searches with the consent of those searched had been carried out by its inspectors.

Rare happening


The move
by the President, after five months of inaction, has now forced Parliament to seek the opinion of senior counsel to reinforce their views that warrantless searches are indeed acceptable in terms of the Constitution.   The FICA Bill was originally recommended for signature into law and sent to the President by no lesser body than the National Assembly, then concurred to by the National Council of Provinces, both on the advice of Parliament’s own legal counsel on constitutional issues.   This is normal procedure with every piece of legislation.


This reason for further delay on the President’s part must have raised a few eyebrows at the Organisation for Economic Co-operation and Development (OECD) centre in Paris.     As those in financial circles are aware, the Bill was tabled by the Minister of Finance with the objective of not only aligning South Africa’s banking and financial institutions with global financial advances but to counter growing and localised corruption and money laundering.

Hurry up and wait

This august body, the OECD, much maligned by the Minister of Mineral Resources in tandem with his opinions on the SA banking system, is currently awaiting South Africa’s confirmation that it will comply with the latest round of requests for compliance with the fourteen rules, now amended, to counter international financial terrorism and extend the OECD’s ability to combat international money crime.

Warrantless searches are allowed in most major countries where compliance with OECD conditions are sought but in the same countries, as has been worded in the FIC Bill, the circumstances to allow this only in cases of suspected money laundering are specifically worded and this includes cases where the application for a warrant or a delay in obtaining a warrant would remove the element of surprise.

Treasury wanted immediacy

The request for South Africa to conform is more specific in terms of the requirements of the Financial Intelligence Task Force (FATF), better known by banks as the criminal investigation department of OECD.    A date for compliance was set by them in February 2017 and agreed to by South Africa. The banking sector is ready to implement the new rules both in staffing terms and with systems and procedures waiting. Minister Pravin Gordhan and some senior ANC party members have been vocal with their suspicions for the delay.

Mystery motives

In what appears to be almost Machiavellian in political terms, the President, with the knowledge that he must have that Parliament was about to close for business, might, according to some MPs, have lodged his further objections to the Bill in the hope that further support for his views could be garnered from subsequent hearings, submissions and more debate.

Chair of the Standing Committee on Finance, Yunus Carrim, countered the President’s unexpected move by cancelling urgent meetings on the Insurance Bill, scheduled for debate and hearings on the last two days of parliamentary business, and called for an urgent meeting of his Committee.  

Advocate Frank Jenkins, Parliament’s legal adviser, was asked to attend and give opinion, together with manager of FIC, Pieter Smit.   Also attending was the Deputy Minister of Finance, Mcebisi Jonas and National Treasury deputy DG responsible for FIC matters, Ismail Momoniat.

Carrim firm on subject

Adv. Jenkins confirmed the sections of the Constitution provided for a Bill to be returned but only once and on specific issues.  He saw the President’s action as unusual in that a Bill, worked on for two years with every clause scrutinized and with input from constitutional experts, could be returned at such a late stage with so much time having elapsed during which an objection could have been easily submitted.

He then explained to MPs how the Constitution does indeed allow for warrantless searches in terms of the Constitution’s specific wording on the subject matter. He listed six precedents of Bills passed into law recently where warrantless searches are allowed in certain prescribed circumstances in terms of the Constitution.   He said this was not a complicated issue at law in view of precedent.

No good choices

Chair Carrim said he had no choice but to treat the FATF issue as the least worst of bad scenarios and he was forced to apply parliamentary rules to the issue in order that the President’s move could be countered with indisputable legal fact and by applying parliamentary rules objectively and strictly. He wanted to observe protocol so that the matter could become “de-politicised”.  

He said the media had called him “brave” to stand in the way of the President’s obvious wish.   This was not the case, he said, but just a matter of following the rules and respecting the fact that Parliament was the final arbiter in such matters since Parliament represented each and every citizen of South Africa.

The response

The rule, Adv. Jenkins explained to the Committee, was that should a Bill be returned to Parliament by the President, having been beforehand approved by the House on every issue in the Bill, then only the specific point, i.e. warrantless searches, could be discussed and debated subsequently and altered if seen fit. This was stated in the Constitution.   The Bill could then be returned to the President with Parliament’s view on the subject matter alone.

He said that should the Committee decide that the President’s view was a baseless argument then they could probably avoid the President referring the matter to the Constitutional Court with further long delays by supplying advice from counsel.  Chair Carrim agreed with this suggestion and with Committee approval across all parties the call for legal submissions in the form of submissions in the New Year and the matter down for hearings and debate in Parliament after it opens in February/March 2017.

Hands off the Bill

Parliament could then return the Bill to the President, Carrim explained, with full legal constitutional opinion and throughout the whole process, only the issue at hand, i.e. warrantless searches, would be allowed for debate.   No other substantive issues could be raised, debated or voted upon as the Bill had been approved by Parliament, Carrim said, and only one issue was under scrutiny.

He said, this would be clearly advertised when calling for submissions and the Speaker asked to observe the rule in any subsequent National Assembly debates.  Any other comments and observations would be regarded as irrelevant.  As far as the OECD was concerned, this was a risk that Treasury would have to handle in their meetings with OECD but this route, Yunus Carrim felt, was the better option.

Believe it or not

For the five months that President Jacob Zuma has been refusing to sign the Bill into law
and refusing to give any reason other than finding the time to “apply his mind to the issue”, any amount of publicity on the need for speed must have landed up on the President’s desk
, even if  just legal advice on the subject instructed by the President.   Lying to Parliament has now become a presidential practice, cartoonists Jonathan Shapiro, Neale Blandan and Jeremy Nell having turned President Zuma’s relationship with Parliament into an art form. 

The “G” factor

As far back as 2009, the OECD published a list of countries divided into three parts, all depending on how or whether they complied to “internationally agreed tax standards”, in select jurisdictions, tax havens or other financial centres of interest and whether they had implemented appropriate legislation in line with OECD requests.   

The procedures are now part of standard international banking procedure but now relate specially to identifying money movements of “prominent persons” and where money laundering seems possibly to be evident.

Whether the President, as the most elevated and “prominent person” in the country, might be trying to protect himself or other “prominent persons” including friends and associates alike against investigation into money movements is not, however, the main issue.

All suffer

The far more serious issue is that the President’s seeming neglect in responding for months has exposed the country’s banking and financial systems to risk.  This is quite outrageous.  The President may or may not have a good argument that it is constitutionally inviolate for the FIC to search without a warrant and possibly with or without warning beforehand  but it seems a stretch of the imagination, given his track record, that he is morally indignant.

Parliament has now issued a gazette calling for comment with the following proviso: “All submissions must therefore only deal with the constitutionality of section 45B (1C) dealing with warrantless searches in clause 32 of the Bill.     As the hearings are on the constitutionality of warrantless searches, those making submissions are requested to provide legal opinions for their arguments if possible.  No consideration can be given to submissions dealing with any other provisions of the Bill.”

Hearings are promised as well in mid-March 2017 for  generalised input on the legislation, part of Chair Yunus Carrim’s call for Parliament to investigate “transformation in the financial sector.” 

 

FIC Bill hold up goes to roots of corruption – ParlyReportSA

Red tape worries with FIC Bill – ParlyReportSA

Madonsela: state capture and corruption linked – ParlyReportSA

 

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Madonsela: state capture and corruption…

says, Zuma involved in state capture.. 

editorial.. To those who know, the silence after a bomb goes off is quite uncanny. Like the state capture bomb. Even birdsongthuli-madonsela-2 ceases and the world seems to halt for a few seconds.  Then as things start up again, people seem to gabble. Everybody is rushing about. Life starts up but the noise seems incredible, if you can hear at all that is.   Following this comes the sickening realization that there might be a second bomb.   One seems helpless.

So it was when the Public Protector’s Report on State Capture was released.   Most had the feeling that to see in writing upon the frontispiece the words “state capture” was quite surreal.   Up until then it was rumour; an “alleged” idea; something that was always “strongly denied”; certainly, shady but in any case, difficult to prove… but it certainly shouldn’t happen in our backyard anyway.

Truth must out

thuli-encaThen the bombshell report was released.  The world seemed to halt in silence whilst its 355 pages were digested. Then came the voices, mostly loud and some quite vociferous.  Some demanded more proof; some demanded immediate retribution. Many asked for the President to step down, following which was a festival of interviews on e-NCA.    Meanwhile, in Parliament the corridors went quiet.   Like a phoney war.

Rewind

Whether there is a second bomb in the form of the Hawks and the NPA again charging Minister Pravin Gordhan is purely conjecture at this stage.   It is part of a process that Parliament is not privy to.   Parliamentarians must just watch these parties go about their business, unfortunately at the expense of a jittery investment market.

What we do know is that all judicial and parliamentary processes are painfully slow and this iscropped-sa-parliament-2.jpg as it must be.   Witness the complaints if a Bill is rushed or “hammered” through Parliament.  It rarely works when carried out at speed and the process is exposed for its faults.

The law may be an ass at times and very laborious but it is there to fight corruption.  To eventually win a case against such a difficult-to-prove crime may take time but it is devastatingly successful when achieved.

However, the name Gupta is not responsible for everything.   Some of unpleasant exposures, especially in the energy field, are the result of massive incompetence rather than a temptation of financial gain.

Taking time

In ParlyReportSA, now with clients, we detail four painfully long processes which eventually will result in what may not be liked by some but have been correctly subjected to the slow but democratic procedure of Parliament – the MPRDA Bill; the investigation into the tina-joemattIkwhezi R14.5bn loss; the sale of South Africa’s strategic oil reserves; and how the mini-budget of Minister Pravin Gordhan has evaded the claws of state capture.

Our constitutional, and therefore our parliamentary system which is integrated into it, is subject to a clause which states that the president of the country is the person who is elected as the president of the ruling party’s National Executive.    This outcome only changes if that person is found guilty of breaking the law or his and her oath of office. For this outcome to be proven can take much time.

Patience a virtue

Gratifyingly also, amongst many outstanding court procedures underway, the arduous parliamentary and legislative process to ensure a recalcitrant President gets around to signing the FICA Bill, is underway.

His signature is needed in order that the countrzuma1y can meet international banking obligations and comply with money-laundering disclosure requirements. The fact that the President has not signed it, as was put before him by Parliament and has provided no reason for the apparent lack of inertia to do so, speaks volumes.  Probably a case for personal privacy will be tabled by his defence team, if he gets to need one.

Delaying tactics

Either the President in this instance will waste taxpayer’s money with a long drawn out case or be advised to withdraw, as has been his practice up until now, by acceding at the last minute and will have signed or be told to.

zwaneHe and his associates know that this Bill is a critical tool in the fight against illegal transfers of funds by “prominent persons”.  Minister Zwane’s fight with the banking sector is an unnecessary sideshow connected to this process. More becomes evident in the media , day by day, of this gentleman’s shady dealings.

Dark forces

Another fight calling for patience and now being unearthed is the level of corruption within intelligence services, Hawks and the NPA.  Hopefully, this is not as deep as the relationship that Robert Mugabe had with Nicolae Ceaușescu of Hungary, based on which he built his CIO and followed the advice gained from his training with Nangking Military Academy.

hawks logoHopefully also, with the NPA, Hawks and other major undercover government departments, only such matters as  graft involving as rhino trade and state capture bribes are the tools of trade involved and the aim remains simply self-enrichment.

Hope springs

The “goodies” in South Africa have much to undertake in order to beat the “baddies”, not helped by senior ANC officials not getting off the fence for fear of being demoted on the party list and losing their pensions.    All the same, there are so many good men and women speaking out at the moment from all spheres of political and business life,  the ANC in particular,  that “the force” would appear unstoppable.

Getting Parliament back into control and equal to the Cabinet will be a long process andparliament mandela statue calling for extreme patience, as manifested by our greatest President who demonstrated such incredible patience over many years in his long walk to freedom.

Previous articles on category subject

FIC Bill hold up goes to roots of corruption – ParlyReportSA

Parliament: National Assembly traffic jam – ParlyReportSA

Red tape worries with FIC Bill – ParlyReportSA

Anti-Corruption Unit overwhelmed – ParlyReportSA

 

Posted in Cabinet,Presidential, earlier editorials, Energy, Finance, economic, Fuel,oil,renewables, Justice, constitutional, LinkedIn, Public utilities, Special Recent Posts, Trade & Industry0 Comments

Parliament to open Aug 16

Parliament .. in a galaxy far, far away

 

……editorial….There’s nothing  more like an election to disrupt Parliament and the business of running a country thanparliament 6 an election.    Probably, and to a lesser extent, the same is going on in the USA but nevertheless few politicians in SA at present seem to have their eye on the ball when it comes to important decisions on matters of state.     Parliament is, of course, in recess.

A good many of the Cabinet seem to be on a different planet. Some appear to be focusing on putting out political fires in the lead up to what is, after all, only a local election. A disproportionate amount of time seems to be spent in a parallel world of infighting, all of it totally unrelated to business and industry. Our Cabinet seem more concerned with issues such as the SABC, for example.

Short on crew

Indeed, one could be forgiven for thinking that the only people at their desks at the moment are Mark Barnes at the Post Office, Minister Lynne Brown with her fight to reform public utilities and control Eskom’s statements; members of the Competition Commission; and Minister of Finance Gordhan Pravin and his Treasury crew.

On communications matters outstanding, Minister Faith Muthambi seems to have left the planet altogether.  Minister Cwele is fighting with his own colleagues on broadband allocation,putting the brakes on a desperately late decision. tina-joematt

Minister Joemat-Pettersson seems lost as to whether to go ahead with nuclear or not; now having to decide it seems whether to have more independent power providers or not and possibly reverse her promises to the private sector; trying fruitlessly to buy Chevron with SFF money and whether or not to renew the contracts of highly experienced personnel at NERSA. This Minister seems badly off radar.

Hands off

Eskom’s unexpected statement that the private sector REIPPP clean energy programme “makes no economic sense” must have wounded DTI’s investment programme and Minister of Trade and Industry, Rob Davies, also seems missing from the control deck in the light of  Zimbabwe trade inconsistencies. Again, living in another world far, far away, not having a plan “B”.

Meanwhile, the Presidency has a whole in-tray of unresolved legislative issues to make decisions upon and, sadly,Rob-Davies decision-making appears not to be the President’s forté.     Parliament re-opens for business on 16 August and it won’t be a moment too soon.

From now until the Christmas recess, matters before Parliament will vitally affect business and industry. It would seem doubly important therefore to get this election over and hope for some coherent policy statements from Cabinet.
Previous articles on category subject
Parliament and the investment climate – ParlyReportSA
Parliament closes on sour note – ParlyReportSA
Parliament, ConCourt and Business – ParlyReportSA

Posted in Cabinet,Presidential, earlier editorials, Finance, economic, LinkedIn0 Comments

Here it comes again…. the Traditional Courts Bill

Dubious motives ……..

justice minister masuthaMinister of Justice Michael Masutha is to re-table once again the Traditional Courts Bill setting up a parallel system of justice in rural areas,  he says.   Minister Masutha was appointed by President Zuma in May 2014 and this same Bill, known to have the President’s wishes behind it, was withdrawn last year in the form it was proposed. It was thought by many to have been scrapped.

Whether this is an election ploy or whether a draft will actually appear from the Ministry of Justice for public comment remains to be seen. Should it appear, in whatever shape and form, it will have to be debated as a Section 76 Bill by all nine provincial legislatures. At least five would have to approve it for the Bill to move forward from the NCOP to the National Assembly.

Gender insensitive

It was said at the time by the media when President Zuma originally withdrew the Bill that it had been proposedtraditional chiefs
as a trade-off with traditional leaders to get rural support. The Bill then was perceived as chauvinistic by many and was certainly frowned up by legal professionals as a distinct attempt to set up two legal systems and was therefore constitutionally unacceptable.

Lulu Xingwana, at that particular time Minister of Women, Children and People with Disabilities, said the proposals “took the issue of women’s rights back into medieval times”. Her ministry was subsequently closed down.

Unexpectedly, the incumbent Minister of Justice, before his 2015/6 budget vote debated just before Parliament went into recess, told a parliamentary media briefing that he intended to re-introduce the Bill as “a priority”. He added. “We are working with representatives from traditional leadership and civil society to take this process forward, with a view to introducing the Bill in June.”

Majority provinces voted against

butheleziDr Mangosuthu Buthelezi, in his capacity as leader of the IFP, said of the old Bill when it was debated by all nine provinces, that five provinces had put in votes to scrap the proposals entirely, two would not make a decision and only two were in favour. Even then, said Mangosuthu Buthelezi, the two in favour did not support all the Bill’s provisions. In the end, he noted, the Bill did not even get past parliamentary committee stage in the NCOP.

“Its demise marked a major victory for rural people who had opposed it”, he said.    Mangosuthu Buthelezi’s view was that the Bill would bring oppression by traditional and unaccountable leaders many of whom were apartheid appointees. “It would have meant also the resuscitation of some of the boundaries of the old Bantustans”, he added.

Four tiers of govt

Chief Buthelezi also noted at the time that the Bill would mean that chiefs would become a fourth tier of government, something the country could ill afford. The Minister of Justice’s next move should be to gazette a draft for public comment.

Previous articles on category subject
President Zuma determined to push Traditional Courts Bill – ParlyReportSA
Zuma goes for traditional support with expropriation – ParlyReportSA

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Parliament closes on sour note

Oversight role threatened…..

editorial…..

We have to admit it was not a happy Parliament that closed on 25 May 2016. Whilst we try to ignore newspaper parliament mandela statuescandals and listen to the more serious debate of those trying to get things right in the interests of the country, it was indeed a troubled Parliament that went into recess.

We have delayed our report to catch the last of the meetings before the election period. Usually, where there is a forthcoming election, whether national or provincial, there are many unreasonable statements from politicians. However, it seems that this time, there are lot more issues and certainly a lot more abrasive statements than usual.

Politics aside

Many such matters have involved the question of relationships with Parliament – the institution that is supposed to stand apart, like the judicial, from political machinations. Separation of these powers is critical to the process of halting a democracy from becoming a dictatorship, so it becomes important not to enter this space. However, quite clearly some members of the Cabinet, even perhaps the Presidency, are trying to by-pass Parliament on the question of oversight.

Although this is strongly denied on every occasion when the subject comes up, it becomes more and more difficult to tell whether government officials are having pressure applied on them when it comes to telling the truth, the whole truth and nothing but the truth to Parliament.

Hence, also it is difficult to discern true government policy in the long term as distinct from Cabinet putting out fires in the short term. We will be glad when this period in South African politics comes to an end, which hopefully it will.

Parliament and its system

Mbete,Baleka sworninIt would seem to us, a fact which is supported by most commentators, that the party list system is one of the culprits in this area – a system a whereby a member of Parliament stays in service, complete with salary and pension, according to his or her adjudged service to the cause.

Secondly, all directors general of government departments are, in most cases, party appointments and currently every chairperson of every committee in Parliament is a member of the ANC Alliance. It is the integrity of that person, therefore, that matters and this, we afraid to say, seems not to be coming through from the Cabinet. Every country gets the government they deserve (Joseph de Maistre).

All is not as at it appears

It came as a shock to many to learn that what had been listened to in Parliament, such as statements and presentations from directors general and CEOs of utilities or SOEs representing massive structures such as Eskom, PetroSA, Central Energy Fund, Police Services, Defence (and even PIC), that all was not quite, shall we say, totally accurate – even in expensive powerpoint presentations and in long convoluted answers to the Auditor General. The trend has been a painful experience to observe.

The cowboys, such as Lucky Montana of PRASA – now disgraced, were relatively easy to spot. Quite clearly his parliamentary reports were dubious and the presentations he made were an attempt to cover up foolish mistakes and bad management but there had remained a feeling of enthusiasm to succeed in his case. Just somebody in charge who shouldn’t have been.

However, in the case of “pressure coming from the top”, there are the odd stories continually emanating from the energy debate and matters related. These are disquieting, as are matters relating to broadband allocation, the aviation industry and land reform coupled with traditional affairs and matters related to expropriation.

Divided

Aside from the unfortunate chaos in the National Assembly debates, meetings which we attend occasionallyparliament 6 only from a business viewpoint – usually budget issues, the evident atmosphere of dissonance between Cabinet and Treasury is clearly affecting and hindering the parliamentary oversight role and translating itself down to the parliamentary working portfolio committees.

A poor relationship with Treasury badly affects the “engine room” of Parliament and makes a mockery of financial control.

We can only attend, make précis on what is said and report without opinion but we can say, quite honestly in our editorial, that currently we are not impressed by the seemingly cowed body language of the public service on certain issues. Witness the decisions on the output of the SABC and although we do not report on this as it bears no business brief, it somehow manifests a Cabinet gone wrong.

We shall continue to be watchful, particularly in the area of new legislation that affects business and declared changes in government policy.

Previous articles on category subject
Parliament under siege – ParlyReportSA
Shedding light on Eskom – ParlyReportSA
PRASA gets its rail commuter plan started – ParlyReport

Posted in Cabinet,Presidential, earlier editorials, LinkedIn, Special Recent Posts0 Comments

Parliament: National Assembly traffic jam

editorial…….

Massive public service vs National Assembly…..

During the last few weeks, the sheer volume of meetings in the National Assembly of Parliament to consider eachnational assembly members government departmental budget vote and each of the departmental five-year strategic plans has been overwhelming. Little of legislative consequence emerges during such a period each year, other than the tabling of technocrat Bills rather than important policy making legislation.

Sadly to say, not too much attention is paid by the media to any of these meetings. Big plans, impressive targets, promises to overhaul this, that and the other. Most working journalists of experience have seen it all before and mostly they try to get statements on issues from either the Minister or Deputy Minister beforehand.

Time is of the essence for all. But why is this period of the parliamentary diary so extraordinarily busy?

Traffic jam in Parliament

There is unfortunately a simple answer. With too many people trying to do too much in limited government hours, the resulting traffic jam results from the fact that South Africa has probably one of the largest government structures per head of population in the world, if not the largest. If it was one of the best, as far as delivery was concerned, probably this might be acceptable but sadly it isn’t and most, both locally and internationally, know it.

unionbldgsIn the fight that has now started to prune costs, moving Parliament from Cape Town to Pretoria has been suggested on the basis that this might save considerable airfare costs, time spent sitting in aircraft and train seats when the country needs one’s administrative time in the office and pointless time spent on hotel accommodation honing up on the next day’s parliamentary presentation.

However, all of this is only a manifestation of the real problem and it does not answer the question of why Parliament is so busy at this time of year.

Odious comparisons

Minister of Finance, Pravin Gordhan is obviously in an extremely embarrassing position. He must realize himself that the Cabinet to which he belongs is arguably one the largest in the world evidenced by the fact that whilst there are thirty-five very highly paid ministers in the South African Cabinet, the USA has a “cabinet” of sixteen. China pushes it a bit with twenty-five and India manages one of the biggest populations in the world with twenty-three.

It all becomes slightly ludicrous when an additional thirty-seven Deputy Ministers are weighed in to Team South Africa.

Wrong ratio

Down the line and aside from the cost of running all these ministries, the thirty-five departments belonging toparliament mandela statue these Ministers, accompanied by some seventeen of the larger SOEs, must all report to a totally disproportionate number of MPs in Parliament, both in the portfolio committees in the National Assembly and the select committees in the NCOP.

Hence the parliamentary traffic jam at this time of year. All this at the cost of quality oversight (the job of Parliament) and the slowing down of urgently needed legislation. Meanwhile, the number of MPs is governed by the Constitution. The number of cabinet ministers and departments (and consequently the ballooning public service) is governed by the President.

The answer to the parliamentary traffic jam problem and the imperilled and much-needed cost saving exercise in terms of the Budget is therefore really a complete no-brainer.
Previous articles on category subject
The big SA cabinet crunch – ParlyReportSA
Special cabinet statement might correct damage to SA – ParlyReportSA

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MPRDA Bill returned to National House of Leaders

Some sort of movement on MPRDA at last……..

sent to clients 18 March…..In a parliamentary document recently published it is shown that the Mineral and Petroleumcoal mining Resources Development Amendment (MPRDA) Bill has been sent on a token trip through the National House of Traditional Leaders for comment in thirty days and then to be returned to the Portfolio Committee on Mineral Resources.

This is probably for some temporary major changes to be made to the Bill after debate until such time as two new Bills, one for the mining industry and one for the oil and gas industry, are drafted in time to come.     No doubt this movement was initiated as the result of the recent meeting between President Zuma and business leaders.

The extraordinary affair of the MPRDA has been going on since the first draft of the Bill was published for comment in December 2012 regulating extensively the exploitation of minerals and resources and the legal movement and transfer of resource rights.    Both industries have their own and very different BEE charters and the single Bill deals with both and many empowerment factors.

Core issues


Two issues
of note were that in the new Bill as originally proposed the Minister was to form a new “entity” which will “promote onshore and offshore exploration for and production of petroleum” and which will also “receive, store, maintain, interpret, add value to, evaluate, disseminate or deal in all geological or geophysical information” relating to petroleum and gas exploration matters.

Secondly, sections 80 and 84 of the anchor Act were to be amended to provide for State participation in any successful minerals and gas/oil development exercises carried out by the private sector, the Bill providing for a State right to free carried interest in all such exploration and production rights.
Specific details regarding the extent of the “free carry” were to be published in a government gazette, a figure of 20%susan shabangu being bandied about at the time.   “We are on the path of changing the mining and petroleum industry in South Africa, whether you like it or not,” said Mineral Resources Minister Susan Shabangu earlier in 2014.

Strong views

Accompanied by a public outcry and strongly worded objections from private industry, foreign companies and other institutions, the Bill reached Parliament virtually unchanged.    Again, brought up before the Portfolio Committee on Mineral Resources in public hearings, were strong objections from Opposition MPs and institutionalised industry, neither of whom minced their words, describing the Bill, in one case, as a “self-destruction tool of South Africa’s investment climate.”

Nevertheless, the ANC Alliance continued on their course and the Bill was hammered through in a rush at the end of the parliamentary term, the ANC summonsing through its whip sufficient numbers.

In the background, as the Bill went through Parliament, was the fact that the Department of Mineral Resources and the Department of Energy were only just completing their split apart. Crossed wires were the order of the day.

Nothing happened

Since that date the Bill has sat in limbo; a new Mineral Resources Minister Ngoako Ramatlhodi Ngoako Ramatlhodiagreeing shortly after with the with mining companies and the Chamber of Mines that the best and fastest way forward to bring certainty to the mining and oil drilling industry would be to pass the Bill subject to amendments based on a new approach to the mining beneficiation issue.

Secondly, the matter of state “free carry” could be dropped.

At the time it was guessed that at least a year and a half would be the delay if two replacement Bills were to be drafted, separating mineral resources from oil and gas in the light of the fact that both have separate and very different BEE charters. The quicker alternative to bring some certainty was that temporary amendments to the existing Bill should be made.

Despite this, the Bill has just stuck right there, in the President’s office, until recently, now moving back togas exploration sea Parliament because, as is suspected, business leaders in their recent discussions with President Zuma must have drawn his attention to the continuing lack of lack of certainty in both industries because of unknown legislative changes about to occur and an apparent inability by Cabinet to give clear policy leads.

So where are we?

So as far as the MPRDA Bill is concerned, there is movement in the goods sidings but whether any train is about to start on a journey can only be known when a meeting is scheduled by the Portfolio Committee on Mineral Resources. Yet another minister is the train driver.

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Parliament, ConCourt and Business

...editorial…

Parliament wins with ConCourt judgement…

Political comment on recent and fluid events involving Parliament and ConCourt are beyond the brief of ParlyReportConcourt other than perhaps the effect on Parliament as an institution capable of assisting business and industry. Nevertheless, these following words rang out from eleven of our judicial elders from the precincts of the highest court in the land when making their recent unanimous judgement…….

“Certain values in the Constitution have been designated as foundational to our democracy. This in turn means that as pillar-stones of this democracy, they must be observed scrupulously. If these values are not observed and their precepts not carried out conscientiously, we have a recipe for a constitutional crisis of great magnitude. In a State predicated on a desire to maintain the rule of law, it is imperative that one and all should be driven by a moral obligation to ensure the continued survival of our democracy.”

Parliament drawn in

national assemblyGiven those precepts and the fact the highest court in our land took it upon itself to chastise the Speaker of House, ANC’s Baleka Mbete, and the workings of the National Assembly in that there was a lack of respect by the Secretary for Parliament for the Public Protector’s report on the Nkandla issue.The judgement spoke volumes on the lack of Cabinet’s understanding of the principle of separation of powers and focused on its disrespect for Parliament.

But ParlyReport rarely attends the National Assembly (NA) since that it is a place where a politicized debate takes place and the NA merely “dots the i’s” on legislation and registers its vote – legislation that has already been worked on by the parliamentary portfolio and select committees, i.e. the engine room of Parliament.

Most of this “engine room” process has only been slightly compromised by the ConCourt judgement.

ParlyReport’s mandate also is to watch and observe government departments as they spell out their targets, policies and decision-making on major issues affecting business and industry as they report to their relevant committees in terms of oversight. Some of these committee debates are intelligent contributions in the national interest, others less so. Here the system with government departments reporting to Parliament is even less compromised by the ConCourt judgement.

Political debate

The National Assembly, however, is where the political, ideological and debate on party lines takesEFF 2 place, assumedly in a democratic manner but sadly turned into a circus quite often by the EFF. However, one should remember that the judgement of ConCourt was as a result of a decision on the matter brought by the very same Economic Freedom Fighters vs Speaker of the National Assembly and Others and Democratic Alliance vs Speaker of the National Assembly and Others.

In other words, some of the people have spoken but not all of the people. At National Assembly level the ANC closed ranks on the impeachment motion as the nation knows and which was their democratic right whatever the Opposition members might have thought and said. The sight of the Speaker being told to stand down and for the Deputy Speaker take over was sad to see but for the rest, it was democracy in process.

Throughout, the final debate, the level of insults was high but this could be expected on an impeachment motion but Parliamentary procedure was observed by all; the bells rang for ajournment and consideration; the votes counted; the results confirmed on the motion to impeach and all other outstanding motions called for, before closing.

speaker UKIt was just noisier than PMQ in the British Houses of Parliament, that’s all.

In the end it may be said that the Constitution was the winner. The Parliamentary process was indeed observed after ConCourt had noted that the subject matter of the charges had resulted an abuse of Parliament in a number of ways. Now the political process takes over and however dirty it may seem at times in National Assembly debate, this is indeed democracy.

Where it goes wrong

It is unfortunate that what was not foreseen by the authors of an otherwise an excellent Constitution (or perhaps foreseen but could not be avoided) is the fact that South African MPs get their jobs and receive their pensions, perks and housing on a party list system which is very much adjustable, we have learnt, not only by parliamentary performance and hearing the voice of the Party whip but by other elements outside of Parliament.

In the case of the ANC Alliance, who are the majority by far in both Houses, obviously this leads tolithuli house patronage by those who run the party list at Luthuli House. It is a fact which cannot be avoided. One could say the same for the DA, the EFF and any smaller party that patronage must apply when MPs are not answerable, as is the case in South Africa, to a particular constituency of citizens.

In the case of South Africa, this leaves national policy and leadership very much in the hands of Luthuli House, particularly because Jacob Zuma is not only President of the country but, as is ANC practice, he is also the elected leader of the ANC. It was at this point the system failed and but not because of parliamentary failure.

Puppet on a string

What ConCourt found therefore was not only that President Zuma was guilty of certain charges and had to take remedial action but there had been a determined ANC attempt, with considerable success, to run the National Assembly from Luthuli House. It was on the Nkandla issue that ANC MP and party whip, Stone Sizani, probably realized that things had gone too far and that he was probably implicated.

Mbete,Baleka sworninThe eleven judges unanimously singled out the current incumbent of the position of Speaker of the House, Baleka Mbete, as also being tangled in the web of patronage. She has denied this but has conceded the “matter could have been better handled”. In fact, later she handled matters a lot worse in the initial moments of the motion on impeachment even agreed to by the ANC who obviously saw that she should have recused herself.

Outside the ring – a little

But as far as business and industry is concerned, our institutions are a little more insulated from such shenanigans.

Whilst all committees are indeed run by ANC Alliance chairpersons (the Standing Committee on Finance was originally by tradition chaired by the majority opposition party but now changed by the ANC) public hearings on legislation are encouraged. The public may attend any meeting government oversight hearings, which ParlyReport does – as well as members of the media, and all members of the public can attend any meeting with the exception of the Security and Intelligence Committee debates.

Good, healthy debate

In our ParlyReport this fortnight, we report on the very sensible suggestions of the Bankingbasa logo 2 Association of South Africa (BASA) made to the Standing Committee on Finance on the Financial Intelligence Centre Bill, tabled by the Minister of Finance. These suggestions were not only heard but acted upon.

In fact, BASA with other financial institutions were invited to subsequent debates under committee Chairperson Yunus Carrim (SACP) and with National Treasury, under the guidance of Ismail Momoniat, a Bill was crafted that was much more acceptable to all.

In some cases, changes called for were justified successfully by Treasury not to be in the national interest in terms of the international call for compliance against money laundering but in other cases calls for less red tape and overwhelming paper work heeded and requests for better definitions acknowledged. For example, the list of “prominent persons”, i.e. those who might be involved in “suspicious transactions”, is to be compiled by Treasury itself and not left to the intuition of financial institutions and the private sector, all suggested by BASA and other financial institutions and bodies.

Separation of powers still there

In conclusion then, it will take the continued support of business with submissions and voicing opinion at hearings at committee level to keep the playing fields level and to point out what is best for South Africa’s economic interests by influencing debate at this level. Business has rarely expressed its voice in the National Assembly since this is not the forum for such unless a summons to appear is made.

parliament 6As for the future of the National Assembly itself there is very little anybody can do until the majority party gets its moral compass adjusted in terms of its relationship with this important component of Parliament, the issues ahead being purely political ones.

The Constitution, Parliament and the Public Protector’s office have survived and the ordinary democratic process of citizen politics now holds sway, hence the current issue ahead of business and industry being described by Standard and Poor as “political noise”.

 

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Parliament under siege

NEHAWU strike chaos in Parliament…  

Editorial …Cultures under the microscope….

parliamentary committeeTwo cultures are developing in South Africa.  One is to lie to Parliament during oversight meetings, or to put it more politely telling “untruths” as was re-defined by one DA MP after being told to apologise during investigations into statements by the Department of Trade and Industry on who had leases or not in terms of the Centurion Aerospace Village issue.

The other unpleasant culture, which is also growing fast, is to ignore the separation of powers between Parliament, the Presidency and the Judiciary. Not that Parliament or the Judiciary has done anything wrong but certainly the Nkandla issue is a demonstration of where the problem might lie.

If such instances, particularly in the case of “untruths”, the media is usually quick to pick these things up and a whole horrid mess, whatever it is, comes out in the newspapers.  

As a parliamentary affairs website, we keep away mainly away from the lurid headlines but unfortunately we are witnessing more and more departments appearing before their relative portfolio committees appearing dysfunctional and without policy. This must relate directly to a Cabinet not in touch with the business of governing and government.

Eye not on the ball

Most of the Cabinet, especially No.1, seem to be travelling to conferences worldwide. The portfoliozumatravel committee on energy, for example has not met in three weeks nor is any meeting scheduled, at this stage, before Parliament closes.

However, departments controlled by Ministers and members of the SACP are indeed busy which would indicate either two factions within the Cabinet and two distinct attitudes towards the use of Parliament and the passage of legislation.

Consequently, we have ignored the two perfectly good opportunities to report on developmental issues or state policy in the transport area where failure of policy or malfeasance is represented either by poor governance or telling “untruths”.  This is where the journalists present do a good job.

Business alerts only

What went on in the SAA and PRASA presentations to portfolio committees, both reporting a litany of poor governance, lack of financial controls and dubious tender processing, probably represents everything you know already.   Quite clearly these two state entities have made a total mess of things but missing targets or who appointed their best friend to get the job is not what we are really interested in.

Sadly, it all comes down from the top and we have a feeling that the relationship between Parliament as a working tool of democracy and Cabinet will worsen as we head towards an election and attempt to please voters.

As an example, a ridiculous piece of legislation entitled the Traditional and Khoisan Leadership Bill has been withdrawn by the Cabinet and now referred by President Zuma to the Council of Traditional Leaders for the consideration first. This will result, if eventually comes before Parliament again and is bulldozed through, as being a forerunner in amending the Traditional Leaders Act Framework Bill in what appears to be a policy of establishing two systems of justice for South Africa.

Sand in the cogs

nehawuOn the second issue of Parliament not being allowed do its work, our President has said very little and certainly done nothing when a piece of land and buildings, not in Cape Town by law but in national South African territory and certainly a Key Point, was recently invaded by hooligans. Meetings have not been held for well over a week, except in certain essential cases such as Budget appropriation approval – probably, as one commentator sourly advanced, because nobody would get paid.

However, importantly, breaking up the working structure of Parliament is a completely different issue from the EFF being ejected from the National Assembly for breaking House rules.  This is a criminal issue.
In this case, a crowd waving sticks and knobkerries invaded committee rooms, singing so loudly that MPs could not think or converse with each other. The intent was clear. To break up Parliament. Most of the crowd were wearing red NEHAWU vests.

Embarrassing

All visitors, whether an official from Union Buildings, an Ambassador or a CEO from a corporate giant, have to obtain a special daily pass to get into Parliament by showing their credentials, yet none of these persons who broke into Parliament have been arrested or charged for wrongful entry. ParlyReportSA sits with many a consular representative as an observer and we hate to think what kind of reports are going back to Embassies, onwards and upwards.

It was a sad moment for the South African Parliament and even more sad that the violation neither disturbed the Presidency or invoked any retribution from the Speaker of the House. And it’s not because either party do not understand the Constitution but rather they seem not to care.

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President Zuma determined to push Traditional Courts Bill

Traditional courts mean two legal systems….

contralesa logoMinister of Justice Michael Masutha, has promised the return of the Traditional Courts Bill very shortly setting up a parallel system of justice in rural areas.  Minister Masutha was appointed by President in May 2014 and was answering a parliamentary written question.

The Bill was withdrawn last year in the form proposed.

The fact that the question was put by no lesser than Mathole Motshekga, the African National Congress chief whip and a member of the ANC department of legal and constitutional affairs, indicates a strong desire by President Zuma to see this Bill through during his tenure in office.

In his reply, minister Masutha, previously deputy minister of science and technology stated thejustice minister masutha introduction of the Bill would be accompanied by dialogue with all stakeholders and “the broader public”. The contents of the Bill will be extended to (inter alia) women’s groups, academics and the legal profession, he said.

Bill perceived as chauvinistic by many

The reason for mentioning women’s groups was no doubt specifically for the ears of those who furiously objected to the first version of the Bill including those of his own party and the then minister of justice, Lulu Xingwana.   It was said at the time that president Zuma had proposed the Bill as a trade-off with traditional leaders to get rural support.

opening parliamentOpposition leaders have stated that if the Bill is “anything like the first version it will not have a hope of passing a constitutional test” but, nevertheless, quite clearly justice minister Masutha must believe his new draft has got the wording right.

South Africa will have two legal systems

Whatever happens, the Bill is bound to give rise to objections from many from parties on a number of subjects not only from gender prejudice, to the aspect of legal anomaly and retarding constitutional development.

Dr Buthelezi, in his capacity as leader of the IFP, said of the last Bill that in debate in all nine provinces, five provinces gave mandates to vote to scrap the proposals, only two being favour, and even they did not support all the Bill’s provisions.  In the end, he noted, the Bill did not get past parliamentary committee stage in the NCOP. “Its end marked a major victory for rural people, who have opposed it since 2008”, he said.

Back to 1960

The point raised by Dr Buthelezi at the time was that such law that “would bring back oppression byLesedi traditional unaccountable leaders, many of whom were apartheid appointees, and it would also mean that the government is not committed to the equal citizenship as promised by the Constitution.”

His complaint was that the Traditional Leadership and Governance Framework Act of 2003 “locked rural people into the tribal boundaries created by the 1961 Bantu Authorities Act.”

“So now we not only have the resuscitation of the boundaries of the old bantustans but it is proposed that the chiefs are a fourth sphere of government within them.”   This, he concluded, was despite of the striking down by theof 2004 which gave control of land to traditional councils.

Bill “mediaeval”

lulu xingwanaLulu Xingwana said, as minister of justice at the time, said the proposals made in the Bill “took the issue of women’s rights back into mediaeval times”. Justice Minister Masutha, who will has tabled the Bill, comes himself from a small rural village in North Limpopo.  He studied for a BJuris degree at the University of Limpopo (then the University of the North) from 1985 to 1988, and obtained an LLB Degree from the University of the Witwatersrand in 1989.

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Budget vote speeches: Out of touch with each other

Editorial….

DTI does flip flop on B-BBEE pointing…..

elephant and bayThere have clearly been were two big elephants in the room during budget vote speech time in the National Assembly over the last two weeks – Eskom and BEE.    Then, suddenly, with DTI reversing their decision to reduce B-BEE pointing award benefits for broad-based employment schemes – one of the elephants disappeared.  It was an amazing flip flop in government policy.

But in actual fact this represents no change, in reality – just simply the fact that the whole structure of what was proposed was seen by all as impractical, unenforceable and to industry, unacceptable.

Backstage dramas

Whether it was business and industry pressure that forced the change, the Chamber of Mines or even the trade union movement itself, after two surprising gazettes announcing reduced awards in terms of black empowerment for broad based shareholder schemes, including employee schemes so carefully Rob+Daviesworked out in the last two years, and the second gazette correcting the fact that such changes were not retrospective, what happened behind the scenes will never be known. We think it was minister Rob Davies himself who put his foot down.

In a private comment, when sympathising with the minister for having to reverse his department’s announcements so publicly, his answer was “When something goes wrong you have to put it right.”  We admire for that and told him so.

Energy issues remain at the core

As far as the first elephant in the room, the energy crisis, it remains.    Unusually, this year despite all the speeches, the amount of media briefings and portfolio committee debates, including the millions of rands spent on airfares with some forty odd departments and SOEs fielding full teams reporting, it was only the minister of energy, Tina Joemat-Pettersson, who really tackled electricity and the issue of Eskom – all the other ministers appearing avoiding the issue like the plague, even public enterprises.

Correcting the past

What indeed was noticeable, at portfolio committee level as well, that each reporting team and each minister seemed to be more anxious to report on transformation and state ownership issues, as if some very clear dictate had been received that the ANC was not delivering on its election mandate in these areas and this was really the main priority.

Whilst lip service seems to have been paid, and then only in some instances, to the need for foreign investment and issues of the country’s rating image, the lacklustre address by the minister of trade and industry gave only more credence to the belief that redress for past injustices was the only big elephant in their lives and in Union Buildings.

Transformation not economics at forefront

In the committees, where all departments have been reporting on progress towards annual targets, this now being the last quarter, the most important slide in any PowerPoint presentation (following clarity on the audit process) was always the racial makeup of the department concerned in terms of reaching transformation targets and what race ratios currently existed. The theme was obvious.

We have listened to many thousands of words spoken over the month and more is yet to come as we write, but it is all too evident that there is a massive discord between business and industry and President Zuma’s cabinet on priorities.

Final word

Trade and industry minister, Rob Davies, warned parliamentarians in his budget vote speech, when mentioning BEE matters , that members should  be aware that the President had indicated that the central task was to bring about radical economic transformation.      Which really said it all.

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Expropriation Bill has now to be faced

Much of the sting goes out of Expropriation Bill…..

landseizuresThe subject of expropriation, not necessarily of land but any property, has now reached the stage of a considerably watered down third Bill which has now been tabled and whilst there are grumbles from many quarters, it appears that the new Bill has not caused the same furore as its predecessors.

The long awaited Expropriation Bill (B4-2015) came before Parliament in the form for a briefing to the portfolio committee of public works attended by the minister of public works, Thulas Nxesi, the briefing itself remaining very much in the hands of the deputy minister, Jeremy Cronin.

Great emphasis was laid by both ministers on the difference between expropriation as a “public purpose” and expropriation “in the public interest”, a difference they said that was clearly laid out in South Africa’s Constitution.

Public purpose, public interest

nxesiMinister Nxesi in his introduction said if there was a need to put up electricity lines or build a road, it was then for a “public purpose” and he saw that there could be no argument – a statement which was later queried by opposition members.

However, minister Nxesi said, expropriating property for “public interest” had to pass a rigorous rationality test as stipulated in the Constitution but a major problem with all Bills previously tabled was that there was no recourse to the courts and on this issue the cabinet had decided to withdraw them. Jeremy Cronin seemed to come to the rescue with a far more detailed and rational presentation.  

He argued that expropriation was an essential mechanism or tool for any state in any country to acquire property under certain instances but much emphasis had been laid in South Africa on the issue of land and white commercial farmers.

He admitted that whilst “public interest includes the nation’s commitment to land reform” in the Bill before them, a fact emphasised in the preamble to the Bill, the proposed legislation was very much in the nature of a mechanism to deal with expropriation rather than say who it applied to.

Expropriation just a “tool”

croninMinister Cronin added that this was one of many reforms taking place to bring about equitable access to all South Africa’s natural resources and reforms to redress the results of past racial discriminatory laws or practices. Such a preamble existed in much of South Africa’s legislation since 1984.

He said, “The Constitution requires “just and equitable” compensation to be determined by having regard of all circumstances without placing undue weight on any single or particular factor. National, provincial and local government were empowered to expropriate property to varying degrees through several pieces of legislation, he noted.

Deputy minister Cronin tracked the history of the Bill before them stating that the 1975 Expropriation Act was totally unconstitutional as it gave draconian powers to the state and was “wisely” withdrawn. A further 2007 Bill was also removed on these grounds and the current Bill was unable to be processed for Parliament before the 2014 elections.

In line with Constitution

settlement_law_justice_However, he said, the Expropriation Bill B4-2015 seeks to ensure consistency with the Constitution and to provide uniformity of procedure of all expropriations without interfering with the powers granted to the expropriating authorities.

Opposition members claimed that the Bill enlarged upon the definition of “public interest” contained in the Constitution and the Bill could not do this constitutionally. Nor did the Bill talk to in broad terms to the issue of compensation, whether it be a commercial farm or alternative accommodation for a shack dweller.

They argued that the new Bill did not talk to the issue of the interest of a bank in terms of a mortgage and where the bank might stand on such issues. The Bill now tabled, minister Cronin said, detailed the manner in which the expropriating authority had to follow, as well as setting up the process of evaluation and the authority to do this “in a just and administrative way”.  

On mortgages and loans from a bank, he said it was the bank that will be expropriated and not the individual.

Credibility of Bill challenged

masangoDA member Masango contradicted this and said any agreement or loan was between a person and the bank and not the state and the bank and he asked how the Bill could have possibly got through the NEDLAC process.

He also raised the issue of poor people not be able to afford litigation if the process of expropriation was contested. ANC member Madlopha said “whilst the media had been rubbishing the Bill, saying that it targets white commercial farmers”, the Bill in her mind gave the state power to expropriate with only a simple notice to the property owner, a process which seemed to contradict with common law.

Blaming apartheid and more

Minister Cronin responded along the lines that in expropriation, the property clause in the Bill of Rights guided the process. Indeed, argument, he said, will no doubt occur on “just and equitable compensation matters” but this did not remove “the consideration of colonial injustice”.   

It was the Constitution, he said, that insisted that in determining “justice and equitable” compensation it should include the process of “restitution”. Deputy Minister Cronin commented that expropriation did not just affect white commercial farmers and any compensation would consider the amount of bond outstandings. 

He concluded that the new Bill was attempting to shorten the process of any litigation. He added that the NEDLAC findings on the Bill would be supplied to Parliament and suggested that the committee ask Agric-SA to appear before them to obtain their views.

Other articles in this category or as background

Zuma goes for traditional support with expropriation –

ParlyReportSA New approach to land reform – ParlyReportSA

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Zuma goes for traditional support with expropriation

Editorial….

Session ahead may bring clarity on expropriation…….

NAIt is a difficult time for business and industry to establish exactly where they are in terms of the legislative environment in South Africa, land expropriation and state or BEE participation being mainly the issues.  However, the cabinet must be aware of the need expressed in many circles for more certainty in terms of the investment climate.

The Bills held back by the Presidency for re-consideration or signature are re-emerging slowly back into the public sphere.   Aside from the highly controversial Traditional Courts Bill adding power to the arm of President Zuma’s supporters in rural  leadership roles but offending women’s rights groups, now re-tabled in Parliament in a different form, as a section 76 Bill, is the Expropriation Bill.

Being a 76 section Bill means that the proposed changes and the formation of a state valuator’s office as thezuma traditional final arbiter on land restitution will have to be debated in all nine provincial legislatures and a mandate provided to the National Council of Provinces to gain concurrence with any vote on the Bill taken in the National Assembly. 

It is interesting to note that some time ago, President Zuma let it be known that he would also like to see this Bill considered by the House of Traditional Leaders. This is probably in the light of the debate now emerging that traditional chiefs were not consulted properly, if at all, in terms of the Restitution of Land Rights amendments.

Serving notice

Crucially, the Expropriation Bill still seeks to allow any ‘expropriating authority’ to take property by serving a notice of expropriation on the owner stipulating the value the state will pay, presumably according to the state valuation if there has been an appeal.

Commentators have noted that the new Bill differs in that the state may then serve a further notice of expropriation, which could be less, more or not necessarily revised at all, and the owner will be deemed to have accepted that transfer of land to the state unless the owner commences litigation within 60 days.

The short amount of time to respond and appoint and brief counsel and the fact that litigation, a highly costly process (costs being to the owner not the state), will no doubt be an issue debated extensively in Parliament. At this moment the main opposition party has been caucusing on the Bill. The fact that the Bill will now have to be debated in all nine provinces will leave a fluid situation for some time yet.

Struggling to produce

The Protection of Investment Bill remains an unknown quantity. Speaking to the DTI legal advisor, all he could say was “We are struggling with it”. 

Similarly, no tabling notice has been published with regard to the Private Security Industry Bill.

No energy  outcome

At the time of writing the “Five Point Energy Plan”, promised by the cabinet “war room”, has also not been presented to Parliament, the minister of energy advising all that it was necessary to have first a trip to the DRC and discuss the Grand Inga Hydro project.

Instead of her unadvised non-appearance in Parliament, a presentation by the department of energy took place, monitored in this report. What did emerge however was that future regarding the intended energy mix is also very fluid, there clearly being a division of interest in what is necessary to bring about in the short term better service delivery to the poor and in the longer term the needs of investors.

Traditional support

Time and time again, since his state address to the nation, President Zuma, where land matters are concerned, has made reference to the Council of Traditional Leaders, the majority party having no doubt realised that this base of power can either be pacified or radicalised – a very sensitive area and where the least service delivery by government occurs.

In his speech opening the National House of Traditional Leaders, he encouraged traditional leaders to take advantage of the 2013 Restitution of Land Rights Act as amended and rushed through at the end of the last Parliament and for them to put in claims.

The amendment Bill passed reopened the window for lodging restitution claims, but retains the restriction that dispossession must have taken place after 1913. The hints by the President in subsequent days in further briefings that the date of 1913 “is negotiable” have led to further claims being notified some of them apparently going back many hundreds of years. 

Once again, this will only be finalised when parliamentary debate finally takes place as the issue is bound to be raised but the whole matters adds to current uncertainty.

Hole in the pocket

Meanwhile the budget for what can be paid out in the form of restitution has been decided by minister of finance Nene and was presented in the last budget to Parliament in the current session.

President Zuma’s reference in Parliament to land held by foreigners in the state of nation address produced an unfortunate atmosphere which was somewhat mollified by off-the-record remarks by ministers to the media but no legislative clarity for Parliament to consider has emerged.

Indeed, a difficult time for business and industry, not forgetting that the Eskom issue is about to be raised again in forthcoming portfolio committee meetings in the coming week, hopefully bringing some clarity to the issue of reliable electricity supply.

Editorial only

Posted in cabinet, Cabinet,Presidential, Electricity, Facebook and Twitter, Justice, constitutional, Land,Agriculture, LinkedIn, Trade & Industry0 Comments

Debate on Nkandla to intensify

Facts on Nkandla with MPs…..

effIn an internal parliamentary question paper, M Khawula, an MP of the IFP-KZN, asked for a reply in writing from the minister of police to his question, “Which structures, buildings and/or areas have been declared national key points and, secondly, what qualifies such to be declared national key points.”

He was not to know that minister of police, Nkosinathi Nhleko, would be forced out of blustering and show that president Zuma’s country homestead in the hills of KwaZulu-Natal, Nkandla, was indeed a national key point whereas, as illustrated by a newspaper in the parliamentary recess, nuclear experimental station, Pelindaba, north of Johannesburg, was not.

The reply in writing from the minister in the parliamentary replies of 19 September, in response to Nhleko’s question, was as follows, “To publish or to make known a list of all national key points would to a large extent defeat the purpose of the National Key Points Act 102 of 1980, namely the protection of such NKP’s. It is therefore not policy to provide such a list for public knowledge.”

When is a key point not one?

The minister added to the written note, “In terms of the National Key Points Act, section 2 deals with the declaration by the Minister of Police and I quote; “Declaration of any place or area as a National Key Point.

(1)  If it appears to the Minister at any time that any place or area is so important that its loss, damage, disruption or immobilization may prejudice the Republic, or whenever he considers it necessary or expedient for the safety of the Republic or in the public interest, he may declare that place or area a national key point.

(2)The owner of any place or area so declared a national key point shall forthwith be notified by written notice of such declaration.

That was the full extent of the reply from the minister.      Meanwhile in the recess, the opposition has written to the Speaker of the House, requesting that President Zuma be forced to respect the Constitution and answer questions from MPs in the National Assembly orally on a regular basis.

Weight of the law

settlement_law_justice_In the meanwhile during the recess, Judge Roland Sutherland in the Johannesburg high court  ordered the minister to hand over the list of national key points and national key point complexes in “the next thirty days” to the parties complaining, who were the Right2Know Campaign and the South African History Archive. Such was finally acceded to.

It is now understood from a statement made at the proceedings by the Mail and Guardian, who joined the action as a friend of the court and who were represented by advocate Matseleng Lekoane, that according to the Act, security guards are allowed to search and seize peoples’ belongings if the people were in a national key point. “They were also allowed to use guns to do this”, she said.

Adv. Lekoane argued that if this was the type of reaction that people, including journalists, might face, then they had the right to be prepared for it. “You need to know the status of a place so you can inform your conduct,” she argued.

Just so we know

The advocate representing Right2Know campaigners, Steven Budlender, had earlier complained that his client was only asking for the names of the places not the addresses.

In any case, he added, it would not make a difference to the country’s security if places like OR Tambo International Airport were publicly known as national key points.  This is because, Budlender said, the “dark forces” that the minister’s counsel feared would inflict harm on the country do not need to be told that a place is important. They would already know.

He was responding to argument made by counsel for the minister of police who said that revealing which buildings and places were NKPs would place national security at risk. “This does not stand up to logical scrutiny”, said Budlender.

Judge Sutherland said minister Nhleko’s refusal to release the list was unlawful and unconstitutional, and ordered the ministry to pay the legal costs.   The matter will no doubt be tabled for discussion in the next parliamentary session by which time it will be even clearer what the realtionship  between President Zuma and Parliament will be after his State of Nation Address.

Maybe appeal

However, debate at parliamentary committee working level will now be at a different level in the new session . The facts are there and what was fog in a bucket is now in the open for proper debate.

Other articles in this category or as background
http://parlyreportsa.co.za/cabinetpresidential/nkandla-debate-rekindled-da/
http://parlyreportsa.co.za/cabinetpresidential/nkandla-ndp-argument-rages-go/

Posted in cabinet, Cabinet,Presidential, earlier editorials, Facebook and Twitter, Justice, constitutional, LinkedIn, Public utilities, Security,police,defence0 Comments

Zuma vs Parliament

This weeks editorial comment……

ANC internal problems dominate…

zuma-Sonanational assemblyWhilst the task of  a parliamentary monitoring function such as ParlyReportSA is to observe impartially the workings of Parliamentary portfolio committees as they affect the business and the industrial scenario, it would be absurd to go to a concert and ignore the music.

The problem with Parliament at the moment is an unpleasant background sound which affects to a great extent not only the focus of any business to hand but which also points to a disconnect between the conductor and the orchestra within the governing party.

Most things that happen in the precincts of Parliament will affect the commercial world to some degree or in one way or another but currently, if our observations are correct, there is an overriding obsession within the Presidency to convey to voters an image that “all is well”.  In Parliament it is all too evident that things at times are not that well.

Watching their backs

The top priority with the presidency appears not to be with the commercial and industrial body corporate and dealing with the country’s economic issues but to battle on with the image problem the ANC Alliance’s relationship has with its own historical audience.  It was minister Jeff Radebe who had to make the statement on country’s most important issue, the energy crisis.

Raymond Suttner, a former ANC underground operative, political prisoner and leader, who rarely misses an opportunity for sanguine comment, said recently, “The ANC has become an organisation in which only one man can be acknowledged as a leader.”

He continued, “Before local government elections, the ANC is burdened with a president who is literally running away from Parliament, the country’s main democratic institution. In subordinating democracy to the needs of “uBaba”, fundamental democratic principles are being jettisoned.”

Pulling the donkey’s tail

The legislative and government departmental policy issues that involve our watchful eye rarely involve the EFF circus but it is interesting to note that at parliamentary working portfolio and select committee level, the few EFF members and not so many but nevertheless much emboldened DA MPs, are tending to ask better and more direct questions.

However, a lot of this is designed to get under the “ANC’s skin”, as distinct from informed, serious and challenging commercial questioning.   Much will play out in the coming months, particularly once the municipal elections are over and the posturing in that direction ceases.  All the same, President Jacob Zuma’s relationship with Parliament is not currently a happy one. Inordinate delays are common.

Slow moving policy decisions

In regard to the analogy of the irritating background sound caused by this disconnect, for the moment then the music will just play on.   Fortunately, it does not affect to any great extent the work of the more dedicated chairpersons of committees but it still seems that in order to get policy decisions out of cabinet, nobody seems to move without the assent of President Zuma and no convoy is faster than its slowest ship.

This irritating factor will also not affect parliamentary oversight to any great extent as better systems are now in place for checking departmental financial performances and the reporting of departments and utilities to reach their service targets.

Unless of course, as happened with Eskom, material facts are withheld.  In this regard, the maintenance of freedom of speech and an unencumbered media remain vital.

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Minister Nene maps survival route

Not so merry Christmas….

Editorial……

candlesWithout wishing to put a dampener on festive arrangements, the last few weeks of the closing parliamentary session, which included the medium term budget from minister Nene, have seen a difficult period, not in the least caused by fiascos in the National Assembly with the EFF. Baiting President Zuma, whatever the reason, has nothing to do with running a country.

Such hooligan behaviour completely demeans the status of Parliament but worse, it also denigrates all the real work that is going on the engine room of Parliament, the working committees.  Some observers are quietly happy that the ANC Alliance is being called to account on certain matters but the overall effect has been to take South Africa perceptually into dangerous waters.

Nkandla unpleasant diversion

The Nkandla issue has clearly damaged the political standing of Parliament as well as giving the media a field day, or a field month as the case turned out to be.  But in the parliamentary portfolio, ad hoc, finance standing and NCOP select committees, the work has gone on and it has been a busy and difficult period as a result of the necessity to approve finance minister Nene’s medium term budget.

Difficult because some fifty utilities, government departments and section nine companies had to declare their objectives, say how things were going and reflect upon the auditor general’s findings on each of them.   Difficult because cabinet statements are really giving no true direction on questions being asked every day in Parliament.   Difficult because it is still the first year of a new Parliament and everything is running late with new MPs.

Whilst the auditor general (AG) may have declared that government departments only received 15% unqualified reports, the balance of 85% are qualified to some degree by the AG.  A learning process. This means the working committees have seen it, everyone knows about it and the system works. This is the difference between weekend newspaper reporting and monitoring. It is not just a question of putting a positive spin on things but recognising that there is, indeed, a force working for morality and financial correctness.

Focus is on medium term budget

Nevertheless, minister Nene’s budget speech was still the key issue of the last month, not Nkandla as the perception might be.  Nene’s remarks that “business is a key area in fostering the ideal that the NDP becomes a reality” had the all too familiar ring of what Alec Erwin had to say twenty years ago when the ANC promised private and public partnerships on energy matters. Nothing happened of course, the ANC embarking upon ten years of infrastructure inactivity.

In fact major private sector participation in the country’s development was totally halted at that point and has since never really got going.

When is when?

Now the question is being asked once again as to whether the government will actually ever embark upon real hard core private/public investments, other than dishing out a few solar and wind power projects. This is the question being asked by opposition MPs in Parliament at working committee level, ignoring for the moment the embarrassing fracas upstairs in the National Assembly.

It is difficult to imagine in parliamentary terms that minister Rob Davies, minister Tina Joemat-Pettersson, minister Jeff Radebe, minister Lindiwe Sisulu and minister Lynne Brown will ever truly understand the tenets, motivations and passion that drive businesses, even perhaps the President himself.  South Africa suffers from bad politicians, not necessarily bad government.

Circus with no ringmaster

What the presidential national planning commission is actually saying to the cabinet is an issue that cannot be guessed at by anybody at this stage, such private messages certainly not being conveyed in Parliamentary papers. In fact nobody seems to be talking, the DA having as little knowledge as half the SA cabinet, it appears.

Consequently minister Nene’s hopes appear somewhat lame at this stage. To be positive however, it may be that as next year’s parliamentary oversight programme on service delivery targets gains momentum, as it has already, accompanied with all the political pain that will occur if voters remain dissatisfied, political reality may force the governing party to at last start walking the talk that minister Nene espouses.

Posted in cabinet, Cabinet,Presidential, Energy, Facebook and Twitter, Finance, economic, Land,Agriculture, LinkedIn, Public utilities, Trade & Industry0 Comments

DTI gives warning on investment climate

High administered prices a threat…

42X90693In an apparent warning to the economic cluster, a deputy DG at department of trade and industry (DTI), Garth Strachan, warned that South Africa was reaching “a tipping point” where administered prices, either levied or taxed by the various state departments, were so high that it was making the cost of doing business in South Africa totally impractical.

 

There was neither an attractive climate for investors because of high state administered prices, he said, nor did it make any easier DTI’s developmental programme in support of the NDP and attracting investors.

In a frank presentation to the portfolio committee on trade and industry, he qualified DTI’s position during his candid commentary with the caveat that as far as the regulation of administered prices were concerned, such as electricity, port and rail freight charges, road transport costs and water tariffs, that these were not the core competencies of DTI although they were adversely affecting DTI’s current IPAP 6.

Undermining investment climate

He noted later in his talk that in the successive implementation of various IPAPs, including the current industrial plan, DTI had found that administered prices constituted a total impediment to economic development.   In fact, now in 2014, they were providing a “serious economic shock”, as he put it, to the viability and competitiveness of the manufacturing sector.

Garth Strachan commented that the addition of carbon tax could push South Africa to the ‘tipping point’, unless the proposals were with “carefully calibrated policy interventions.”

As far as electricity was concerned, it was DTI’s view that the actual problem lay in the funding structures of local government, especially where no allowance was made for infrastructure upgrading and maintenance. Water shutdowns were also an increasing problem, he said.

He told parliamentarians that in one instance a global investor had experienced 140 electricity and water shutdowns. He did not indicate over what period.

International comparisons

He said that on electricity tariffs, whereas in 2009 when compared to China, the USA, Canada/Quebec, Abu Dhabi, Kazakhstan, India and Russia to give a fair geographic spread, South Africa had been with a group that had the lowest in prices, it now had the “gold medal” for being the highest of all and by 2020 the situation would be exacerbated unless something dramatic took place.

Strachan said that in the World Bank Report of 2013, SA port charges were amongst the highest in the world; container charges being 710% more than the global norm and automotive cargoes costing a premium of 874% more than the global norm. This detrimental fact was compounded by port and rail freight inefficiencies to local destinations.

He told parliamentarians that in DTI’s view it was extraordinary that exports were virtually subsiding raw material exports such as iron and coal.  In the case of coal, this was 50% below the global norm and iron ore approximately 10%, according to 2012 figures, these being the latest DTI could get.

This led, Strachan said, to the unfortunate situation where the country exported iron ore at a net loss to the country but imported girders, cranes and containers, for example, at possibly the highest in the world.  It was impractical to have subsidies passed on to exporters of primary products penalising importers of necessary needs, he said.

On carbon tax, he dismissed any “one size fits all” programme as contributing to the overall problem by making things worse and on climate change generally, he said that DTI was already working towards the protocols agreed by South Africa “through a range of measures to support energy efficient systems and investment in energy.”    These were part of DTI’s manufacturing enhancement programme, he noted.

He said there should be a shift in pricing “in favour of less carbon intensive sectors which are more labour intensive and value adding”. He quoted particularly steel, polymers and aluminium, which he said should be considerably below import parity levels.

Nullifying NDP objectives

Garth Strachan concluded that with manufacturers already going out of business, the issue of administered prices was probably the most important issue facing South Africa at the moment in the search to create more jobs.

Parliamentarians noted with concern what DDG Strachan had illustrated in his review. Many called for a joint portfolio meeting on the subject with public enterprises, transport and energy, despite the subject of administered prices also not being a core function of the trade and industry committee. For example, it was noted, they had no parliamentary right to influence such bodies as Transnet and Eskom, nor deal with treasury on tax and tariffs.

 

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