Archive | Finance, economic

Parliament set for tough questioning

Editorial…

…..Busy session to get some answers

….  In the absence of any move by the National Prosecuting Authority, particularly the somnambulant National Director of Public Prosecutions Shaun Abrahams whose department seems confused as to whether 100,000 leaked Gupta e-mails constitute prima facie evidence of fraud or not, it falls to a parliamentary committee in Cape Town once again to be the first official venue for any debate of consequence on the State/Gupta corruption scandals.

In one of the first meetings of the recently re-opened Parliament, the Public Enterprises Portfolio Committee is to receive a report back from legal experts on the setting up of the Eskom enquiry.

Party vs the Church

Oddly enough, it was in also Cape Town, at St George’s Cathedral, in early June, where the fight first began.    Later, the venue was room 249 in the National Assembly, where the Public Enterprises Portfolio Committee was addressed by Bishop of the South African Council of Churches (SACC). He had then just released a report on corruption by the SACC Unburdening Panel.

It fell to the Bishop the first shot and there was a sobering moment of silence in parliamentary room 249 when he finished talking. It felt like a small moment in South African history.  What came after that seemed like a little bit of a parliamentary let-down in the following weeks but it is important that what the Bishop had to say is further reported for the record.

Take that

Bishop Mpumlwana reminded all present, and particularly parliamentarians who claimed that the Church should not be “fiddling in politics”, that the same politicians had repeated the phrase, “So help me God” when taking office.

He said that the Church had no intention of ignoring the evil that was being perpetrated on the people of South Africa and asked all to note that the Constitution ended, “May God bless South Africa.”

He also said that systematic looting of resources had created a crisis for South Africans, particularly the poor. He called upon all parliamentarians to look to their consciences and assist with “the righteous cause of tracking down all those involved” in what was now an obvious state capture plan hatched during President Zuma’s watch in which the President himself, he said, was involved.

Cry, the beloved country

In a particularly moving address, he reminded all that SACC had come out in vocal support of the ANC during the apartheid years when President PW Botha was in power.   Now was the time to speak up again on the unbridled abuse of power by an ANC Cabinet and a President “who had lost his way on moral issues.”

The Church, he said, must intervene and as a result of the SACC “unburdening” process which had been conducted some months ago, he now knew that “mafia-style control” was being exercised by a political elite in Eskom, Transnet, Denel, and other government agencies.

Ignored

An attempt was in process to gain control over public funds destined particularly regarding rail, arms and nuclear projects, the last being a totally unnecessary burden placed upon the country, he said.    He concluded with an appeal to parliamentarians present to expose the crimes committed and “restore the dream that had built a rainbow nation admired the world over.”

It was gratifying to hear in following days that the Public Enterprises committee, under chairperson Zukiswa Rantho, had instituted an enquiry into Eskom’s accounts (and also Transnet and Denel it turned out) with legal opinion to be discussed in the in the next session of Parliament.

That time has now arrived and one hopes that a lot of explanations will emerge and a lot more untruths discovered in meetings with the Department of Public Enterprises (DPE) and its apparently confused but certainly compromised leader responsible, Minister, Lynne Brown.

Looking ahead

Parliament has now a busy schedule in August to catch up on lost time with delays incurred by staging a “secret ballot” on the no-confidence in President Zuma vote.

One issue will involve the passage of the contentious Mineral and Petroleum Resources Development Amendment Bill, scheduled for a meeting with the Select Committee again towards the end of August; the Expropriation Bill; and the implementation of all Twin Peaks regulations – including those for the Financial Intelligence Centre to operate in terms of the “money-laundering” changes.

This last-named body is quoted as having handed over some 7,000 cases of suspicious money movements to SAPS/Hawks and Themba Godi, chair of the Standing Committee on Public Accounts (SCOPA), has made the public comment that any parliamentary finance joint meetings must see such matters on oversight resolved in the short term, preferably immediately.

Energy up and down

Minister of Energy, Mmamaloko Kubayi, was to be informing her Portfolio Committee on the can of worms opened with her suspension of the board the Central Energy Fund stated by her as being in connection with the suspicious sale of South Africa’s oil reserves held by the Strategic Fuel Fund.

Past Minister of Energy, Tina Joemat-Pettersson, seems to have possibly lied earlier to Parliament over the sale of these assets and she, in her subsequent silence, appears to be joining what is now a whole roomful of past ministers and director generals involved in the tangled web of deceit and manipulation at the edge of business and commerce  – some of it linked to Gupta e-mails, some just motivated by plain criminal greed.

But all Energy Portfolio Committee meetings on any subject have now been abruptly halted in the light of matters involving the possible suspension of the DG of Energy Policy and Planning, Omhi Aphane, (a long-time and experienced government staffer) on on an issue regarding of nuclear consultancy fees, according to the media.   It would appear a whistle blower is at work in DoE.

Minister Kubayi is certainly causing waves and many hope that the responsibility for Eskom is to be handed over to this Minister from the DPE, back to where it was originally rooted with all other energy resources.

Untouched as usual

The issue of debt relief legislation under the aegis of Chair Joan Fubbs of the Trade and Industry Committee will be important as will meetings on energy involving electricity, IPPs, nuclear and clearing up the PetroSA mess.   But first, this committee should sort out what is to be done with a draft Copyright Bill amending and updating anchor legislation, laws that have not been touched since 1976.

What DTI have so far come up with has legal experts in complete confusion since there appears no understanding by DTI in their draft of the difference between paintings, works of art and the high-tec world of data authorship which underwrites commerce and industry and on which depends a massive IT industry both here and mostly abroad.   Fortunately, with a person like Joan Fubbs in charge, basic misunderstandings such as this will get sorted out.  However, that such unintended consequences might have occurred worries many.

The various Finance Committees will meet for joint sessions for a number of tax and money Bills and amendment proposals and Posts and Telecommunications will hear its Department’s comments on public hearings, all regarding the ICT White Paper Policy.

Posted in cabinet, Communications, Electricity, Energy, Finance, economic, Fuel,oil,renewables, LinkedIn, Public utilities, Special Recent Posts, Trade & Industry0 Comments

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

Parliament may see delays on Mining Bill

Mining and petroleum bill to hit snags

Overwhelmingly evident is the cloud hanging over the Mineral and Petroleum Resources Development Amendment Bill (MPRDA), linked inextricably to a troubled Mining Charter, some movement on the MPRDA being necessary to restore stability to the mining industry in the form of legislative clarity.

Legislative clarity will also allow the petroleum and gas industry to hopefully go into a development phase.  Here the players need an equal playing field, the State in this case getting a free stake possibly at 20% but paying no development costs since the State now has ownership of the resources.

Free lunches

There is one further possible hurdle on the horizon.      Aside from issues surrounding the Charter, which is technically a non-parliamentary issue, the application of Parliamentary Rules regarding the great number of changes that are being made to the Bill raise procedural issues.

It is indeed a very different Bill to that which was voted through Parliament earlier and passed by the National Assembly.

For the moment, now that provincial opinion on the more recent changes to the MPRDA have been returned,  the provinces each having voted and recorded their nine mandates on the subject, the idea is that the Bill can then finally be returned to the Presidency, possibly via the NA Committee to lodge the changes.

First things first

There is a sense emerging that the offshore gas industry is a little happier with the free carry proposals but on the other side of negotiations it appears, from the media, that the Chamber of Mines is struggling to find common ground with Minister Zwane on the Mining Charter, referred to in the MPRDA but not legislatively part of it.

It is difficult to imagine any Mining and Petroleum Resources Development Act, as amended, being in force without an agreed and new Mining Charter in place. However,  developments in this area will have to be watched.

Last in queue

In the list of Bills before Parliament the MPRDA has been listed last (and therefore the longest under debate) for nearly three years, except for a short period when it went to the President.   This reflects the long tussle involved.

The four major hindrances were the extended negotiations with the offshore petroleum industry on the free carry issue; the fact that President Zuma returned the Bill approved unsigned insisting that it be considered by all nine provinces; issues surrounding what the Minister has defined as “strategic minerals”; the thorny question of mineral beneficiation and the completion of the mining charter, to which the MPRDA refers but remains not incorporated.

Next process

Many more issues have still to be debated, whilst the basic parameters will have to come to a head on the parliamentary “rules of the game” regarding the passage of the legislation itself.    Meanwhile, NCOP hearings on the Bill have been scheduled for the last two weeks of June 2017.

Throughout, the “elephant in the room” for the mining industry has remained the Charter itself which Minister Zwane has stated will be “the most revolutionary Charter ever produced.”

Possible slow down

Meanwhile on the MPRDA, Opposition members will no doubt study closely the Rules of Parliament which state, as was the case with the FICA Bill, that if a Bill is returned unsigned then only the issues for which the Bill was returned may be altered and then only once.

However, unlike the FICA Bill which was returned on the basis of one issue, that of unwarranted searches the MPRDA Bill was returned on the basis of lack of consultation with the provinces.

To amplify, if the President only returned the Bill on the basis that the NCOP and National House of Traditional Leaders had not been consulted, it may be a contested issue as to whether the Bill will be challenged under these Rules. This is a legal issue.

The Legal Resources Centre is quoted as being interested in such a challenge.

Looking ahead

For years, it has been the view of many that both industries that each should have its own “MPRDA”, especially in the light of the fact that both have their own specific and very different Charters.

Whilst crude oil, subsequently refined to petroleum and gas, are certainly natural resources now owned by the State, theoretically the only resources that are ‘mineral’ are those which have a crystalline molecular structure and are “mined”.     This would naturally exclude extracted crude oil and gas.

Two is not one

Consequently, both industries, which fall under two government departments and which are distinctively different from one another, have historically been under one piece of legislation governing all geological resources.

This difference between the two industries is expressed in many ways.   The petroleum industry is centred around its refineries, very much technical industries with ‘upstream’ components in importation and exploration and ‘downstream’ interests  involving distribution, retailing and property interests. Their product is very directly linked to the cost of doing business and the cost of living.

Meanwhile, the mining industry is essentially involved in extraction with massive labour factors, high capital costs, sophisticated export involvements and beneficiation.  Its product is closely linked to the survival of industry in general and is directly linked to GDP.

Legislatively, therefore, one garment certainly does not fit all  –  despite each industry having its own charter.  Inevitably separate legislation will have to be developed but such changes are seen as being down down the road for the moment.

Damaging delays 

Whatever route the Bill now takes in Parliament, any challenge to its progress will be particularly frustrating for investors if there are more delays.    Those issues mainly arise in the mining sector where far more is at stake and consequently rating agencies are flagging Minister Zwane’s actions.  The gas exploration industry is clearly tired of waiting.

The results of three days of parliamentary hearings on the Bill, which have included some side issues such as Shell SA on the future of shale gas and any demands from the House of Traditional Leaders, should prove interesting.

The major issue remains as to what is government policy is on the whole particularly regarding labour  as distinct from just Cabinet ambitions for BEE participation percentages.

Next stages

Most attention will now fall upon the complementary non-legislative document, the Mining Charter, despite the unclear parliamentary situation.   Following the public hearings, the NCOP Select Committee will summate these meetings and the relevant departments will respond over the following days.

Possibly, at some stage, Minister Zwane will address Parliament on the issue to clarify the situation of government’s view and relevant comment on the Bill will also no doubt arise from media briefings by the Ministry on both subjects. For the moment, much of the issue will be dictated by events outside of Parliament.

Previous articles on category subject
MPRDA Bill returned to National House of Leaders – ParlyReportSA
MPRDA Bill to be amended urgently – ParlyReportSA
MPRDA Bill brings changes in BEE and exploration rights – ParlyReportSA
Mineral and Petroleum Resources Bill halted perhaps – ParlyReportSA

Posted in BEE, Finance, economic, Fuel,oil,renewables, Labour, LinkedIn, Mining, beneficiation, Special Recent Posts, Trade & Industry0 Comments

Border Management Authority around the corner

SARS role at border posts being clarified ….

In adopting the Border Management Authority (BMA) Bill, Parliament’s Portfolio Committee on Home Affairs agreed with a wording that at all future one-stop border posts, managed and administered by the envisaged agency and reporting to Department of Home Affairs (DHA), were to “facilitate” the collection of customs revenue and fines by SARS staff present.

However, on voting at the time of the meeting, Opposition members would not join in on the adoption of the Bill until the word “facilitate” was more clearly defined and the matter of how SARS would collect and staff a border post was resolved.

Haniff Hoosen, the DA’s Shadow Minister of Economic Development said that whilst they supported the Bill in general and its intentions, they also supported the view of National Treasury that the SARS value chain could not be put at risk until Treasury was satisfied on all points regarding their ability to collect duty on goods and how.

Keeping track

Most customs duty on goods arriving at border controls had already been paid in advance, parliamentarians were told; only 10% being physically collected at SA borders when goods were cleared.

However, with revenue targets very tight under current circumstances both SARS and Treasury have been adamant that it must be a SARS employee who collects any funds at border controls and the same to ensure that advance funds have indeed been paid into the SARS system.

The Bill, which enables the formation of the border authority itself, originally stated that it allowed for the “transfer, assignment and designation of law enforcement functions on the country’s borders and at points of entry to this agency.”

Long road

It was the broad nature of transferring the responsibility customs of collection from SARS to the agency that caused Treasury to block any further progress of the Bill through Parliament, much to the frustration of past Home Affairs Minister, Malusi Gigaba.   It has been two years since the Bill was first published for comment.

DHA have maintained throughout that their objective is to gain tighter control on immigration and improve trading and movement of goods internationally but Treasury has constantly insisted that customs monies and payments fall under their aegis. The relationships between custom duty paid on goods before arrival at a border to Reserve Bank and that which must be paid in passage, or from a bonded warehouse was not a typical DHA task, they said.

Breakthrough

It was eventually agreed by DHA that SARS officials must be taken aboard into the proposed structure and any duties or fines would go direct to SARS and not via the new agency to be created or DHA.

This was considered a major concession on the part of DHA in the light of their 5-year plan to create “one stop” border posts with common warehouses shared by any two countries at control points and run by one single agency. More efficient immigration and better policing at borders with improving passage of goods was their stated aim.

Already one pilot “one stop border post”, or OSBP, has been established by DHA at the main Mozambique border post by mixing SAPS, DHA and SARS functions, as previously reported.

To enable the current Bill, an MOU has been established with SAPS has allowed for the agency to run policing of SA borders in the future but Treasury subsequently baulked at the idea of a similar MOU with SARS regarding collection of customs dues and the ability to levy fines.
Bill adopted

At the last meeting of the relevant committee, Chairperson of the PC Committee on Home Affairs, Lemias Mashile (ANC) noted that in adopting the Bill by majority vote and not by total consensus, this meant the issue could be raised again in the National Council of Provinces when the Bill went for consensus by the NCOP.

Objectives

The Agency’s objectives stated in the Bill include the management of the movement of people crossing South African borders and putting in place “an enabling environment to boost legitimate trade.”

The Agency would also be empowered to co-ordinate activities with other relevant state bodies and will also set up an inter-ministerial committee to handle departmental cross-cutting issues, a border technical committee and an advisory committee, it was said.

Mozambique border

As far as the OSBP established at the Mozambique border was concerned, an original document of intention was signed in September 2007 by both countries. Consensus on all issues was reached between the two covering all the departments affected by cross-border matters.

Parliament was told at the time that the benefit of an OSBP was that goods would be inspected and cleared by the authorities of both countries with only one stop, which would encourage trade. In any country, he explained, there had to be two warehouses established, both bonded and state warehouses.

Bonded and State warehouses

Bonded warehouses which were privately managed and licensed subject to certain conditions, were to allow imported goods to be stored temporarily to defer the payment of customs duties.

Duties and taxes were suspended for an approved period – generally two years but these had to be paid before the goods entered the market or were exported, MPs were told. The licensee bore full responsibility for the duty and taxes payable on the goods.

State warehouses on the other hand, SARS said at the time, were managed by SARS for the safekeeping of uncleared, seized or abandoned goods. They provided a secure environment for the storage of goods in which the State had an interest. Counterfeit and dangerous or hazardous goods were moved to specialised warehouses.

Slow process

MPs noted that it had taken over six years for the Mozambique OSBP to be finalised. SARS said there were many ramifications at international law but added two discussions with Zimbabwe for the same idea had now taken place. It was hoped it would take less time to reach an agreement as lessons had been learnt with the Mozambican experience.

On evasion of and tax, SARS said in answer to a question that losses obviously occurred through customs avoidance and evasion, so it was consequently it was difficult to provide an overall figure on customs duty not being paid, as evasion was evasion. Smuggling of goods such as narcotics, or copper, which could only be quantified based on what had been seized.

The same applied to the Beit Bridge border with Zimbabwe where cigarette smuggling was of serious concern and through Botswana.

In general, it now seems that Home Affairs is to adopt an overall principle of what was referred to as having one set of common warehouses for one-stop declaration, search, VAT payment and vehicle movement with a SARS presence involving one common process for both countries subject to a final wording on the SARS issue before the Bill is submitted for signature.

Previous articles on category subject
Border Authority to get grip on immigration – ParlyReportSA
Mozambique One Stop Border Post almost there – ParlyReportSA

Posted in Finance, economic, Fuel,oil,renewables, Home Page Slider, Justice, constitutional, Mining, beneficiation, Public utilities, Security,police,defence, Trade & Industry, Transport0 Comments

FICA Bill could meet new task force deadline

OECD money task force waiting for SA  

….sent to clients Feb 7…. Chairperson of the Standing Committee on Finance, Yunus Carrim, made it quite clear in terms of parliamentary rules that further debate on the FICA Bill aligning SA to global money laundering task force requirements are confined to the President’s reservations about the Bill’s constitutionality on the issue of warrantless searches. Nothing else was to be debated or considered despite attempts, he said.

After a “suspicious delay”, to quote the Democratic Alliance, of over five months during which the President unexpectedly failed to sign the Bill into law, it was suddenly returned to Parliament with the query a few days before closure for the Christmas recess.

Playing for time

It is suspected that the President’s office might have been making a pitch for more debating time on the Bill in 2017 and to allow the Bill to be re-scrutinised thereby causing further delay or even allowing for an ANC motion to reject the Bill.  This is according to one Opposition member on the Committee.

Following this, in a meeting hastily convened before Parliament closed, parliamentary orders were changed and Chair Carrim re-scheduled the Committee’s last meeting which was to be held on the Insurance Bill.  He instead scheduled an urgent meeting to debate the President’s move, calling for both legal opinion from the State Law Advisor and the attendance of National Treasury to learn of implications caused by the delay.

Next move

As of the result of this last-minute meeting, Parliament and Carrim have to some extent countered what seemed the purposeful delaying tactic.    The Committee agreed to call for written submissions only, preferably containing legal opinion, on only the constitutionality of Clause 32, section 45B (1C) on warrantless searches, saying only such will be allowed and no generalised observations on any other clauses or the rationale behind the Bill will be heard.

In the meeting, MPs expressed anger at the waste of public money and even Chair Carrim expressed his frustration of having to go back to the drawing board on a Bill that had already been passed. “I am getting too old for these kind of games”, he said.

Carrim concluded, “This Bill was approved by Parliament in its entirety and by a majority vote after many months of debate. Legal opinion was called for on many aspects and its signature into law was urgently required to meet international deadlines. In terms of the Joint Parliamentary Rules therefore, only the one aspect that the President has queried could be considered and the Bill was to be returned with the opinion of this Committeeafter a vote in the NA.

Advice sought

It was agreed by the Committee that legal counsel specifically would be sought on the constitutional aspects raised and this would be returned together with the Bill as it stood for signature in an attempt to convince the President not to refer the matter to the Constitutional Court and further delay implementation of a law approved by Parliament.

Adv. Jenkins, State Law Advisor, told Yunus Carrim that he could see no grounds for the contention that the circumstances of warrantless searches were not properly circumscribed in the Bill and were thus legal. It was established that FICA had already conducted some 380 warrantless searches.

Adv. Jenkins pointed out that in terms of the Constitution and Parliamentary rules the President could only return a Bill once to Parliament, whatever the specific subject or subjects.  Thus, this was the only issue that should be debated and considered by Parliament.

It would also be preferable, he said, to return also legal opinion based on supporting input from public hearings, but he advised that once again this should be confined to the subject matter, i.e. warrantless searches.

Country exposed

Meanwhile, President Zuma’s obviously purposeful delays have exposed South Africa to further detrimental opinion from the Financial Action Task Force (FATF) who are holding a plenary meeting of the OECD in Paris in February, Treasury deputy director-general Ismail Momoniat told Chair Yunus Carrim.

South Africa could well be slapped with a warning letter or even a fine at taxpayer’s expense for failing to sign into law amendments to the Financial Intelligence Centre Act, he said, and added that this would not be helpful at the time of a Standard and Poor financial rating exercise to be carried out in the New Year.

Local banks at risk

Even a mild rebuke from the Task Force could have significant consequences for SA, DG Momoniat said, since it would raise concern among foreign regulators and banks about SA’s commitment to vigilant financial regulation.     This in turn would have a ripple effect throughout the economy since correspondent relationships between the global network of banks are vital to effect payment for South Africa exports and imports.

Carrim responded that of the two bad options resulting from the President’s actions, the least damaging was to ignore OEDC opinion for the moment, take proper legal counsel on the issue and await the opening of a new session in late January/early February 2017 for a water-tight case to go back to the President’s office. DG Momoniat acknowledged that Treasury noted the course that was being adopted.

Jeremy Gauntlett S.C. was to be contacted and the question of warrantless searches be considered by him, the wording revised if necessary according to counsel given and the Bill returned to the National Assembly for adoption based on any revisions, if made.

Rules for submissions

The final position was therefore that all submissions to Parliament had to only deal with the constitutionality of section 45B (1C) dealing with warrantless searches in clause 32 of the Bill and those making submissions were requested to provide legal opinions for their arguments .

It was suspected that Black Business Forum and other groupings would make a determined effort widen the scope of the deliberations.

Any submissions on other provisions of the Bill, not the subject of the hearings, had to be made separately in more public hearings to be held on “Progress on Transformation of the Financial Sector”, tentatively set for 14 March 2017. Those additional hearings will be advertised separately, said Carrim’s parliamentary notice when published.

Previous articles on category subject

FICA Bill : Hearings on legal point – ParlyReportSA

FIC Bill hold up goes to roots of corruption – ParlyReportSA

Red tape worries with FIC Bill – ParlyReportSA

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Credit regulations to squeeze racketeers

Debt relief and credit under microscope

… sent to clients 22 Dec 2016…. Further powers for the National Credit Regulator to regulate against reckless lending have been reaffirmed as necessary and the subject of debt relief for needy persons considered.

This conclusion was the result of a series of hearings conducted by Parliament and criteria are to be developed for the application of debt relief measures and how this could be achieved are now being studied.

Such criteria could include target groups of debtors who would be eligible for the relief; the period in which the measure would apply; the type of debt that would be covered and how the measure could be implemented.

An earlier study, commissioned by the National Credit Regulator (NCR) some months ago, concluded that there was a need for the National Credit Act to make provision for the introduction of some form of national debt relief but the NCR decided to consult Parliament and to involve public input.

Growing debt bubble

Whilst reckless lending and irresponsible borrowing which led to the disastrous housing bubble in the US, Joanna Fubbs, as chairperson of the Portfolio Committee on Trade and Industry, acknowledged that the situation regarding any retail debt bubble is not as bad in SA.   Nevertheless, she said that for some time she has been concerned that the National Credit Amendment Act is not working in the best interests of vulnerable groups.

On the issue of debt relief, whether from reckless lending or not, it was agreed some time ago by the Committee that it was important for stakeholders to be consulted to establish a better picture.  A parliamentary select committee, chaired by MP Eddie Makue of the same Committee, was formed to investigate whether debt relief would be an acceptable policy for SA and to organise parliamentary hearings focusing on banking input and debt control aspects.

The brief

The Portfolio Committee also recommended to this subcommittee that there needed to be a better understanding between the excesses of lending, the plight of borrowers and a view established on regulations which should refrain from fostering any culture of not paying debt in the hope that it might be written off.

Meanwhile, it has been proposed by the Department of Trade and Industry (DTI) to extend the powers of the National Credit Regulator to conduct proactive investigations into reckless lending . They would also be asked to impose administrative fines and to empower the Minister to provide debt relief mechanisms through further regulations, yet to be drafted.

Also, NCR submitted that it had already laid out its own proposals to tighten up existing regulations and penalties for perpetrators of reckless lending which the Regulator was currently entitled to enforce under the Act but the views of the Regulator were to be sought on debt relief by Makue’s Committee.

DTI view

DTI has since confirmed to this Select Committee that it was their view was that the Minister of Trade and Industry, Rob Davies, should be given the power to prescribe debt relief measures, the nature of which must be carefully thought through . At the time, DTI acknowledged that banks and credit providers had to make their views known preferably in a series of hearings now conducted.

NCR view

National Credit Regulator, Nomsa Motshegare, has confirmed to the Select Committee that in their view some form of debt relief is necessary given the reasons of the country’s slow economic growth; retrenchments that were taking place; and rising unemployment figures.

In general, she said, these factors had already diminished household income and led to difficulty for consumers to repay loans.   The NCR had found, they said, that there was a willingness in general amongst banks to find ways to relieve the financial burden of indebted clients, many of them stating that they did this already, but there was considerable doubt on whether this should or could be backed up by any enforcement measures and regulations.

 The banks

In this regard, during further public hearings, Cas Coovadia of the Banking Association of SA (BASA) emphasised that legislated debt relief for all would have negative consequences since this was far too prescriptive. He  called for “a customised debt relief approach that would suite various portfolios” as a better principle to follow.

At the outset of the discussions, Coovadia stated that BASA did not support the principle of debt forgiveness as an objective.  One of the banking system’s foundation principles, he said, was the need to efficiently and legally lend money to borrowers and to collect repayments from borrowers to settle the loans.

He told parliamentarians. “A confluence of pricing, regardless of individual consumer risk, will arise at a portfolio level to offset the inability to price for the risk.    This will mean that consumers who have a good repayment history will no longer be rewarded for such behaviour when they apply for further credit.”

He warned that blanket debt forgiveness would accelerate irresponsible borrowing and said all banks offered means to repay and gauged the circumstances when lending.   Any failure to perform on this principle would have severe consequences for the industry and economy; would increase risk to depositors/savers; would impose a cost on society; and would limit credit providers’ ability to extend credit, he said.

Making a plan

Nedbank said that the option of rehabilitation was always a preferred course rather than hard legal collections and the bank had recently adopted a philosophy in general banking terms that to become proactive in terms of debt relief solutions was the far better solution for those who had over-extended themselves.

They said the situation between credit provider and consumers should remain “mutually beneficial”, which principle bore in mind that the economy of the country was less affected.   Nedbank confirmed that a satisfactory low, in their view, of 4.6% of their clients could be classified as technically in total default without the any possibility of rescue, as at the end of 2015.

Too prescriptive

Individual banks, such as Standard Bank, Absa, First Rand, Capitec and African Bank generally supported BASA’s view that prescriptive laws or regulations regarding lending, collection and debt relief would remove the principle of case by case treatment which in turn, they said, would probably inhibit loans being granted or drive up their cost

Debt and labour

Chamber of Mines was blunter and took the view that employee over-indebtedness was a major problem in labour relations and “fed into unrealistic wage demand” scenarios.  Indebtedness, they said, was one of the major catalysts in recent mining unrest.

They were clear that education on family accounts and the implications of over borrowing had to be stepped up, rather than complicated prescriptive measures on relief that would favour one and not the other.  More important they said was that loan sharks should brought under control and whose malpractices were rife amongst the mine working community.

Ms Sue Fritz, speaking for the Chamber, said that any form of debt relief provisions must consider the danger of undermining the basic principle that with the ability to borrow came the understanding such debt had to be repaid or quality lending would cease and debt might increase.

Cosatu view

Cosatu’s Matthew Parks urged that some form of debt relief be provided to a defined base of categories, such as retrenched workers; those only on social grants; the poor; working-class and middle-class students with student loans and borrowers who had paid off a large part of a loan but fallen on hard times. He also appealed to parliamentarians that there was a need to crack down on loan sharks, formal and informal.

Paul Slot, speaking as president of the Debt Counsellors Association, said some form of debt relief was necessary to counter the current high level of household debt, noting that according to the association, 54% of those in financial trouble simply applied for more debt to extricate themselves.

Conclusions in process

The Select Committee has now made a call upon on the National Credit Regulator to tighten regulations further on loan sharks and the registration process.  Chairperson Eddie Makue has now reported back on the hearings to the Portfolio Committee but has noted in Parliament that he was deeply concerned that a large amount of vulnerable people remain exposed to unregulated credit and can become victims purely because of greed alone on the part of the lender.

On reckless lending, it was noted that often ridiculously high repayments from the poor were a weapon used to gain control of assets.    Makue said, “The NCR has to protect poor South Africans against such lending by unregistered and immoral micro-lenders.   In most rural and semi-urban areas people maintain their existence through borrowing and the interest they sometimes get charged is shocking, and interest rates should be capped by law”, Makue said.

State debt relief and debt relief regulations

The “jury is still out” therefore for 2016 on the issue of DTI tabling a Bill and the subject of debt relief generally.

Parliament closed 7 December and will resume this debate early in 2017

 Previous articles on category subject

National Credit Act Bill aims to help consumers – ParlyReport

Treasury proposals on debt control approved – ParlyReportSA

National Credit Amendment Bill changes – ParlyReportSA

 

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Hide and seek over R14.5bn Ikhwezi loss

Facts on Ikhwezi loss held back

…sent to clients 12 Dec… In the first of several meetings of the Portfolio Committee on Energy regarding Central Energy Fund’s Ikhwezi Project, chairperson Fikile Majola has agreed with ANC MPs and Opposition members to reject the Department of Energy (DOE) report on the PetroSA impairment or write-off amounting to R14.5bn.  Continue Reading

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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

Foreign assets amnesty Bill underway

Timing of window period resolved as 30 June

…..sent to clients 15 Sept…  The Standing Committee on Finance has now behind it the call for comment on a revised draft Rates and Monetaryfinancial-darwin Amounts and Amendment of Revenue Laws Bill which proposes a Special Voluntary Disclosure Programme (SVDP) for financial amnesty  in respect of offshore assets and income.     The process is therefore well underway for the introduction or tabling of the final Bill from Treasury.

The draft Bill was coupled with a second draft for comment, the Draft Rates and Monetary Amounts and Amendment of Revenue Laws (Administration) Bill, which handles implementation of the amnesty. 

gordhan2The original proposals were made by Treasury in June of this year following the statement made by Minister Pravin Gordhan in the 2016 National Budget. The idea is to again encourage non-compliant tax-payers to voluntarily disclose offshore assets and income, with a window period of opportunity to do this bearing in mind that the global standard for automatic exchange of information between tax payers is coming into force in 2017.

Alterations made

Changes to the original proposals are a re-definition of trusts to include those located externally; tax relief will apply to tax assessments going further back in date and undeclared amounts derived from foreign assets will apply for the financial years from March 1 2010 to Feb 28 2015, the common date for tax assessments.

Foreign assets

In the case of foreign assets, the tax applied was to be applied at 50% of the highest value of all assets offshore, the foreign currency conversion rate forsars-logo valuation being the highest Rand spot rate of the years applied for and declared.    A request to reduce this to 40% has been accepted by Minister Gordhan.       Treasury feels that anything less will cause discomfort those who have declared foreign assets correctly and have paid normal tax rates in the meanwhile.

Taxpayers who disposed of any foreign held assets prior to 1 March 2010 will also be able to apply for relief under the SVDP window, any tax to be payable in South Africa.    The application form is called the Voluntary Disclosure Application Form (VDP01) and can only be accessed via the SARS e-filing system if the current system is to be used for this particular SVDP.

More time

Financial advisors and banks have also pointed to the lengthy processes involved in filing applications, particularly where foreign asset valuations are involved and Treasury have indicated that the window period will run now from 1 October to 30 June 2017 to accommodate this.

The gazette states, “The SVDP (and the acceptance of electronic SVDP applications using the SARS e-filing platform) will commence on 1 October 2016 and will continue until 30 June 2017.    South African residents (individuals, sole proprietor, partnerships, deceased estates, insolvent estates, South African trusts, close corporations and companies) and former South African residents will be allowed to disclose their foreign assets held in contravention of the Exchange Control Regulations, 1961 (Regulations) as at 29 February 2016. Exchange control applications to the SVDP Unit are to be made pursuant to the provisions of Exchange Control Regulation 24 (Regulation 24).”

Particularly relevant is the addenda, “Please note that any party involved in a foreign exchange transaction that is currently under investigation by FinSurvmoney may not apply for administrative relief.”

From the proposals, it can be seen that R10m plus R1m a year is the maximum size of legal offshore investments that can be made by SA residents currently under the Act. This cannot be used to “offset” against any levy rendered against a disclosure, says SARS.       Corporates can still invest up to R1bn without informing the Reserve Bank.

Safe with SARS

SARS has said the average turnaround time is currently about 16 working days per case submitted.

Nothing has yet discussed in any way before the Standing Finance Committee on the issue of the Panama Papers, nor probably will it be, but the 1,700 South African names purported to be on record now with SARS from the Papers has been cited by some as a possible reason the Bill had not been tabled.

It is quite clear from the gazetted statement that no claims for amnesty are possible in general terms whilst an ongoing SARS investigation is in process.  ThisAfrica Money might disbar certain high profile cases therefore.

A final Bill is therefore now anticipated in Parliament for hearings, debate, concurrence by the NCOP and passage to the National Assembly for a vote since, presumably, nothing will happen until the Act is amended by both Bills.
Previous articles on category subject

Parliament debates three financial market and tax Bills
Budget 2016: more on amnesty – ParlyReportSA

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FIC Bill hold up goes to roots of corruption

Bill originally approved by Cabinet

.….. sent to clients 20 Aug…..Going to the heart of the issues facing National Treasury on money launderingzuma9 and financial crime, or in this specific case the Financial Intelligence Centre Amendment Bill (FIC Bill), is the failure of President Zuma to give assent to the Bill and to sign it into law.

The delay in adding his signature gives yet another signal that there is lack of interface in constitutional terms between the Presidency, the Cabinet, National Treasury and Parliament and all of this adds more uncertainty in the economic sphere.

fic-logo-2The main objective of the FIC Bill is to conform with international pressure placed upon South Africa to update its governance ability to monitor international financial crime. During the passage of the Bill, however, it became quite evident to interested parties that the Bill could expose a lot more about South Africa’s own internal money laundering, inflows and outflows, than simply making a contribution to the global money laundering problem.

This, of course, was the original point made by international agencies when calling upon countries to agree to such legislation.    Countries have to clean up their own affairs in the process.

Crime busting

Africa MoneyThe Bill intends enhancing South Africa’s anti-money laundering (AML) processes to combat more effectively the crime of financing of terrorism to be achieved by amending the anchor Financial Intelligence Centre Act “so as to define certain expressions”.

However, in exposing monies destined for terrorism, a lot more than just terrorism could become evident in the category to be classed as “prominent persons”, a fact which has been endlessly debated in Parliament and why the Bill has come to the fore in the media.

More entrants

The fact that some in the Cabinet may not like the preamble to the Bill is evident, particularly expressed byzwane Minister Zwane in his ridiculous call for a judicial investigation to investigate the motives for calling the banking sector to report to Treasury on individual groupings and persons and for an investigation into the banks themselves for closing the accounts of certain “prominent persons”.

The target of Minister Zwane’s diatribe, the major banks, are a grouping simply preparing for the FIC Bill to become law since they know it was tabled by the Minister of Finance, having been approved by the Cabinet in the first place and having made considerable input to the parliamentary process. Also they must realize that the Bill in turn will make considerable demands upon them in terms of time and money and will be a test of integrity for all.

Split in the ranks

ramaphosaThe delay, even if for a moment, is one of many factors giving rise to the belief that the Cabinet is “at war with itself”, a fact which Deputy President Cyril Ramaphosa admits. President Zuma attempted dismally at first to distance himself from Minister Zwane’s attack on the banks, then seemingly relented but suspiciously will not let the banks proceed with the FIC Bill by making it law to set up the paper trails.

Commentators say the President is effectively involved in a web of issues involving alleged “state capture” and perhaps therefore instructions to hold up the Bill maybe upon advice from elsewhere from parties involved in the bigger picture.

No stroke of the pen

However, the very act of signing or not will eventually show if it is the President is alone in this matter since a cabinet statement in 2015 stated that the Cabinet had approved for the Bill for tabling.Parliament awaits, holding its breath, for clarification from the Presidency.  President Zuma is now, of course, embroiled on issues over the Public Protector’s report on “stature capture” by the Gupta family and, like so many other important state issues, the FIC Bill has gone on to the back burner.

In the meanwhile others, including actors who would definitely be defined as “prominent persons” as defined by the new Bill, are now crowding the stage and expressing their views, so the FIC Bill must be touching a raw nerve somewhere.

The old argument

jimmy-manyiDespite the Bill being passed by State Law Advisors, now one Jimmy Manyi, previously a corporate public affairs head, a DG in the Department of Labour and previously a Cabinet spokesperson and recently President of the Progressive Professionals Forum – all in a short period of time – has lodged a constitutional challenge to the Bill, presumably on the basis of invasion of rights regarding pr1vacy. 

MPs have complained that the Bill in question has been debated at length over one year at portfolio committee level; hearings were conducted with public expression therefore being accounted for and finally the Bill was passed by a unanimous vote in the National Assembly.  Whether nefarious or not, one must assume that any delay by the President is for good financial reason and bearing in mind the call is in fact an international call to upgrade the SA money laundering watch, the stakes are high.

At this stage nothing is stated as fact and rumours abound.     An exasperated Minister of Finance Gordon Pravin stated in an interview run by E-NCA, “Well if I can’t get the Bill through then we must just try something else.” He added, “They had just better come and arrest me. What have I done?”, he asked.

The aim

pravingordhanIndeed, the parliamentary record shows quite clearly what Minister Pravin has done.    By introducing this Bill and having had it agreed to in the National Assembly, a paper trail  is to be established in conjunction with banks on any suspicious movement of money involving “prominent persons”.   Locked cupboards will be looked into therefore and it seems as if someone or a section in the Cabinet  has had second thoughts about the Bill.

Hopefully, the stall is only temporary and the Public Protector’s report is released

Aims of Bill

Treasury originally said in their briefing to Parliament that the four principal objects of the Bill were to align the country with international standards on AML and to counter terrorist bodies; to enhance customer due diligence within financial institutions; to provide for the implementation of the UN security council resolutions relating tomoney laundering the freezing of assets of persons suspected of financial crimes; and for the FIC to introduce a risk-based approach by financial entities to the current aspects international financial crime.

Treasury countered any argument that dis-investment would be encouraged by the Bill with the answer that a lack of compliance with international rules by South would be worse but now the silence on the FIC Bill seems to have taken a back seat in National Assembly questioning in the face of rows over state funding, “state capture” and individual financial investigative probes.

Prominent persons

yunus carrimMuch debate, took place at the time within the Standing Committee on Finance when the Bill was originally debated over the definition of “prominent persons both domestic and foreign”. These were the persons who were to be monitored as part of the Treasury’s appeal to banks “to know their clients better”. The meetings were chaired by the obdurate, diligent and politically respected Yunus Carrim (SACP) and finally recommended to the House.

Treasury’s Ismail Momoniat was at pains to state to Parliament at the time that “there was no implication or presumption that prominent persons being investigated were presumed to be involved in any financial crime.”

Getting to know you

Probably the provisions most likely to affect entities operating in South Africa are the clauses affecting due diligence. Those that are accountable in terms of the Act will be required to undertake ongoing customer due diligence overviews in order to establish the identity of “the beneficial owner” and a customer’s full identity and whereabouts.

This might be where the problem lies for Cabinet, not necessarily just about the “G people”, as referred to indavid maynier Parliament by David Maynier, Shadow Finance Minister (DA), but which might involve issues of party funding – the sources of which at the moment do not have to be declared to Parliament.

Objective views

As put by Roger Southall, Professor of Sociology, University of Johannesburg and quoted in précis form by Creamer Polity, “The ANC is appropriately anti-corruption in its official stance, and indeed has put in place important legislation and mechanisms to control malfeasance. Equally, however, it has proved reluctant to undertake enquiries which could prove embarrassing.” Parastatals still account for around 15% of GDP, Southhall notes.

Whilst Minister Lynne Brown said she was determined to overhaul all state entities, nobody its seems was ready for President Zuma to assume the chair of the new idea of a State Owned Enterprises Council, meaning that he is in charge of para-state strategy – the policy of which was announced many months ago in that government wants a greater slice of the R500m spend on goods and services to go to emergent suppliers.

President Zuma said in Parliament on that issue that the reason for the consolidation was to bring about cross-cutting coordination as a policy within state utilities.

Getting control

Southall continues in his article in similar vein, “The ANC continues to regard the parastatals as ‘sites of transformation’ with certain corporations distributing financial largesse to secure contracts and favour from government. However, their success in so doing is hard to prove given the secrecy of party funding. Secondly, ANC politicians at all levels of government have sought to influence the tender process in their favour.”

On the good side, the Department of Public Service and Administration has, for instance, a draft a Bill underway for Parliament that will require all government departments to put in place measures to prohibit employees and those in special consultancy positions from “directly or indirectly” doing business with government.

Furthermore, the Public Finance Management Act, signed by President Zuma, has proven to be a well-tuned tool to control misdirected state expenditure. The FIC Bill will be the anchor legislation needed to dig deeper into AML money movements.

Who blinks first

fic-bookWith the FIC Bill, the next move then must come from the Presidency, if he remains in  office, to give good reason to send the Bill back to the Parliament despite the agreement of the South African banking system to comply with Treasury requirements to report. This is a day-to-day developing issue.

Quite clearly, some banks have forestalled their problems by refusing to handle certain business banking accounts of “prominent persons”, perhaps pre-empting that the Bill would receive Presidential assent and thus earning the ire of Minister Zwane “in his personal capacity”.

Whether the FIC Bill might get further to the very roots of the party funding system is another matter but for the moment the focus was on “prominent persons” and the necessity to get the banks into action in terms of the law.

Meanwhile, the Portfolio Committee on Trade and Industry will continue to debate the “Twin Peaks” legislation which will again tighten up on banking and financial procedures on both regulatory and prudential aspects. But here again, there might be delays.

Previous articles on category subject
Red tape worries with FIC Bill – ParlyReportSA
Parliament, ConCourt and Business – ParlyReportSA
PIC comes under pressure to disclose – ParlyReportSA

Posted in cabinet, earlier editorials, Finance, economic, Home Page Slider, LinkedIn, Security,police,defence, Trade & Industry0 Comments

Anti Corruption Unit overwhelmed

Focus on top down elements of patronage 

….editorial….As Parliament went into short recess, the Anti-Corruptionhawks-2
Unit, the combined team made up of SARS, Hawks, the National Prosecuting Authority and Justice Department, divulged that some 400 cases of public service corruption have been “successfully prosecuted since 2014”.

Out of hand

To have that number of public service thieves arrested is no small number but there is a worrying afterthought.   One wonders how many Anti Corruption Unit cases have been dropped or unsuccessfully prosecuted, given the fact such icebergcases are difficult to prove and there is often poor performance of by investigation teams. Like an iceberg, probably only one seventh of corruption in the public service is apparent.

sars logoCases currently under investigation in both the public and private sectors were given as 77, now 78 since Tom Moyane, head of SARS and member of the Anti Corruption Unit itself, at the time admitted to the Committee that he had not spoken to the Hawks about his second in command, Jonas Makwakwa.

Laundry list

The question by MPs was about the mysterious R1,2m deposited into Makwakwa’s private banking account.  According to reports it appears Moyane has subsequently rectified the situation and reported the event.  So yet another enquiry must start, which will only exacerbate the relationship problem between Moyane and the Minister of Finance, Gordhan Pravin.

Added to these national events in Parliament is the fact that corruption investigation remains particularly problematic at provincial and local government levels where it can go on undetected. The story emerging from the Tshwane Municipality is a case in point. The National Council of Provinces has no part to play in such matters.

Top down problem

Over the last few weeks, events in the parliamentary precinct have dominated the domestic media and consequently there is no need to repeat what is patently obvious.  South Africa clearly faces a leadership problem as far as financial governance and policy initiatives are concerned.

hawks logo
Doubt has placed, in the media in main, on the leadership integrity of the Hawks, NPA and, to some extent, with the Anti Corruption Unit inasmuch as their relationship with the President is concerned. A weary public waits for the next story of public service patronage.

Public service heads appear at times uncomfortable when they are reporting to Parliament and seem to be looking over their shoulder at times to see if what they have done or said is politically correct. Troubling is the fact that regulatory bodies are at odds with the ministries that founded them.

Bottomless pits

Although progress has been made on the national level in developing legalmoyane frameworks with provisions and regulations to address theft of public funds, such as the Prevention and Combating of Corrupt Activities Act and the Public Finance Management Act (PMFA), the good guys are still behind in the race to catch the bad guys.   A sad conviction rate of 28% on cases brought before the court by the Assets Forfeiture Unit overall was quoted to the Standing Committee.

Poor leadership

On the same subject, the surprising failure by the President to sign into law the Financial Intelligence Centre Bill to fight money laundering in terms of international prudential agreements has represented a further setback. Hopefully this is only temporary since the country needs to join up the dots to encircle organised corrupt financial activity.

Worse, some government SOEs appear to conducting their own affairs without approval by Treasury. Cabinet members are involved. Witness the extraordinary offer made by the Central Energy Fund, reported in the media, to Chevron for its refinery in Cape Town and downstream activities in the form of 850 fuel outlets, presumably backed by the funds emanating from the sale of the Strategic Fuel Fund (SFF) reserves unauthorised by Treasury.

Upstream mayhem

Tesliso MaqubelaDDG Tseliso Maqubela of Department of Energy has now told the media that SFF sold the 10 million barrels of crude in storage in December at rock bottom price of $28 a barrel to a unit of Glencore, Vitol and a company called Taleveras. The condition of the sale was apparently, Maqubela said, “that the oil (will) not be exported and so the government considered it remaining as part of its strategic reserve stockpile.”

Shadow Minister of Energy, Pieter Van Dalen MP, citing Business Day, said the sale has been connected with Thebe Investment Corporation – “the ANC linked investment arm”, he added.   Vitol is the company that has allegedly bought the fuel stock and which owns Burgan Cape Terminals next to Chevron, the deal being linked by Van Dalen with Thebe for the building of its new storage tanks. Burger had just been awarded a 20-year lease by Transnet for land needed.

cape-town-harbourChevron brought to Parliament its case against Burger saying it was improper to build a new tank terminal next to its refinery for Burger to store oil for trading whilst they had no Transnet pipeline to Gauteng as did others from Durban but the chair of the portfolio committee accused Chevron of monopolistic behaviour. Subsequently the complaint was rejected. It was shortly after that Chevron announced its intention to sell its refinery.

Twisting path

Whether the Minister of Energy, Tina Joemat-Pettersson knew all of this when she appeared before the Portfolio Committee of Committee on Energy,tina-joematt her attendance covered in this report, is a moot point.   If she did know something, she is culpable in that she withheld the information, both from Parliament and possibly Treasury.

Alternatively, if she didn’t know that an offer was made to buy Chevron and that SFF had sold the state’s oil fund’s reserves to Swiss giant Vitol, possibly involving Thebe Investments, she should resign immediately as an incompetent.  Where the R4.4bn odd involved in the sale by SFF has landed up is not clear and when the oil will leave SFF’s Saldanha terminal and move to Burger in Cape Town is also not clear.

Clearly, in our view, this has been a major transaction known about at Cabinet level and the DA has called for an urgent enquiry. This will presumably bring the Asset Forfeitures Unit’s number of cases under investigation up to 79.   And so it goes on.  Tegeta and Eskom included.

Nothing but the truth

One senses a continuing cover up by government departments in reporting to Parliament for fear of upsetting any Minister’s apple cart, whereas Parliament should be a refuge of openness, accountability and public oversight on state activities and act as an arbiter to represent the people of South Africa.

vincent-smithIn the darkness, we saw a flash of light and a refreshing change when ANC MP, Vincent Smith, in grilling the Hawks as part of the Anti Corruption Unit interview, reminded them fiercely “This Is Parliament. If you cannot speak the truth, then do not speak at all.”  Whilst that remark may encapsulate the current problem, it may be also the cause of some Ministers and government officials choosing not to speak at all.

Legal jungles

Concurrent with the number of judicial enquiries into strange contracts, bad senior appointments, misuse of privileges and a litany of unaccountable expenditure without proper approval, what also has increased is the statement used by many when speaking to Parliament, including ministers, that the full facts cannot be given “because the matter is sub-judice”.

The number of matters that are sub-judice would not be so great if powers were given back the Treasury to re-assume its proper place in the parliamentary process.  Expenditure, if not approved by Treasury, would never see the light of day.

In conclusion

parliament 6Bad governance and corruption is the fodder that feeds the right wing anger sweeping the world and creates the spectacle that we see almost daily in our National Assembly, the creation of which institution is supposed to be one of the three pillars supporting the Constitution.

Previous articles on category subject

 Parliament, ConCourt and Business – ParlyReportSA

Parliament and the investment climate – ParlyReportSA

Anti-corruption law is watered down, say critics – ParlyReportSA

Nkandla vs NDP: the argument rages – ParlyReportSA

Parliament closes on sour note – ParlyReportSA

 

 

 

Posted in cabinet, Earlier Stories, Facebook and Twitter, Finance, economic, Fuel,oil,renewables, Home Page Slider, Justice, constitutional, LinkedIn, Public utilities, Special Recent Posts, Trade & Industry0 Comments

Carbon tax offsets on the way

Tax offsets plan almost ready for Parliament

sent to clients 12 Aug     Only a little reminding is needed that 29 July 2016 was the deadline for comments to carbontax1Treasury on the forthcoming carbon tax offsets plan which Minister of Finance, Pravin Gordhan, has promised will come into effect 1 April 2017 with some saying it might even be as early as 1 Jan 2017.

It was in 2014 that National Treasury published the first carbon tax discussion paper for public comment. It was agreed the that such a tax would be phased in over a period of time, the first phase running up to 2020. The marginal rate was the envisaged at R120 per tonne of CO2 and during phase-one, a basic percentage based threshold of 60% will apply for tax offsets below which tax is not payable in order to assist with transition into the new scheme.

SARS as usual

Everything has been based on South Africa’s commitment to the Copenhagen agreement signed in 2009 to reduce greenhouse gas emissions by 34% by 2020 and 42% by 2025 – below the “business as usual” scenario.   The motivation provided for the tax remains as “so the cost of climate change an be reflected in the price of goods and services”.

sanedi carbon capIt was agreed that the tax would be administered by SARS.    Since that date, whilst the pro and cons of such a tax caused heated debate in some circles as to whether an introduction of a price mechanism could influence consumer and producer behaviour, the inclusion of Eskom in the tax net left many feeling somewhat helpless due to the utility’s enormity.

Eskom maybe dictates

OUTA complained that “Eskom’s various electricity tariff increases of almost three times the rate of consumer price inflation over the past eight years has become a tax of its own on society.”

They added that the electricity increase impact had resulted in fact to a reduction in electricity and energy as a result and this, which coupled with reduced production and consumption, had inadvertently caused a reduction of greenhouses gases having already taken place, OUTA said.   Of course, this remains totally unproven.

Neither Cabinet nor Treasury/SARS have replied to OUTA’s call to note “unintended consequences”.  No Treasury official it appears has felt that the Copenhagen Agreement can be dis-respected and have presumably felt that OUTA’s platform that a drop in national growth, due to global events and construction problems, has had little to do with the actual design of an overall process to cut carbon emissions over the next period of fifty years or so. The argument continues.

Quantifiable is the word

Now the first phase of the tax offsets are being set in concrete with Treasury having called for comment on theemissions final formula for the first phase of tax proposals, proposing, as before in the draft, that companies can reduce their liability for carbon tax by up to 5% or 10% of their total greenhouse gas emissions, depending on their sector, by investing in qualifying projects that result in quantifiable greenhouse-gas reductions.

Treasury says that the qualifying investments and offsets are likely to be in sectors such as agriculture, public transport, forestry or waste management and the accompanying documents note…“The proposal to use carbon offsets in conjunction with the carbon tax has been widely supported by stakeholders as a cost-effective measure to incentivise GHG emission reductions.”

How not to pay tax….offsets

“Carbon offsets involve specific projects or activities that reduce, avoid, or sequester emissions, and are developed and evaluated under specific methodologies and standards, which enable the issuance of carbon credits”, SARS concludes.

It is worth noting that tax legislation usually comes in the form of a “money” Bill which Parliament can debate butgreen scorpion not amend. Should the debate raise issues, then Parliament can address Treasury who will, according to their dictates, reconsider and change if they alone see fit.  

The general feeling seemed to be from hearings was that this event had to happen in line with other established economies, although OUTA has remained strong on its views that Eskom as a major player in the energy mix is distorting the situation.

The Treasury website has all the details of rules on which tax regulations will be based.
Previous articles on category subject
Treasury’s plan for carbon tax – ParlyReportSA
Carbon offsets paper still open – ParlyReportSA
Carbon Tax under attack from Eskom, Sasol, EIUG – ParlyReportSA
Treasury sticks to its guns on carbon tax – ParlyReportSA

Posted in Energy, Enviro,Water, Finance, economic, Fuel,oil,renewables, Mining, beneficiation, Special Recent Posts, Trade & Industry0 Comments

Parliament awaits to hear from Cabinet

Same Parliament, same Cabinet, different mood

..editorial……Parliament has now resumed with the same Cabinet, the same 400 MPs, the same ANC Allianceparliament 6 majority instructed whips and the same names in the party benches but the ambiance is very different.     This subtle fact, however, matters little in the immediate future.   Legislation before the National Assembly (NA) will still be subject to a simple numbers game when it comes to voting. Well, almost.

In the case of a Section 76 Bill, that is a Bill that needs not merely the concurrence of that portion of the 400 MPs that sit in the NCOP but subject to full debate by all nine provinces and a mandate returned in favour or not, there might be the beginnings of healthier opposition. Power at local level has been emboldened since Parliament last met.

So far, matters of consequence have been that the Department of Energy has presented its REIPPP plan with support from most other than Eskom with no Minister present and the Mineral Resources Portfolio Committee has re-endorsed a revised Minerals and Petroleum  Resources Development Amendment Bill for process by the NCOP using its ANC majority. Again no Minister was present. Eskom will be presenting on this and matters regarding coal any day.

Old tricks

jacob zumaHowever, presuming the picture in Parliament stays as it is until the 2019 national election with Jacob Gedleyihlekisa Zuma at the helm as President, it will be interesting to see what type and how much legislation is hammered through the NA by the ANC using the same old tactic of deploying party whips with threats of being moved down on the party list system for a total majority, timed last year in a rush just before a recess.

Notably, now in the case of three Bills sent for assent after being voted through, the three were not signed by President Zuma into law acting on legal advice.

With this trio now back with Parliament on the grounds of either suspected unconstitutionality and/or incorrect parliamentary procedure, the issue is now whether the coterie of Cabinet Ministers that surround the President, with Director Generals appointed by and who report to those Ministers, will take Parliament more seriously.

Not hearing

Good advice is not good advice when it comes in the form of a last minute warning not to put signature to any Bill thereby turning it into an Act of law. Plenty of such advice not do this in respect of a number of Bills was previously given during parliamentary portfolio committee debate, at parliamentary public hearings from affected institutions, business and industry and even earlier in public comment when the Bills were first published by gazette in draft form.

Similarly, the lesson seems not to be learnt in higher echelons that the independent regulatory entities are also not to be ignored – institutions from the Office of the Public Prosecutor to ICASA, from NERSA through to the board of the Central Energy Fund and from National Treasury to international courts, the UN and international bodies protecting human rights. Parliament is due to hear from ICASA any moment.

Most worrying, however, are the attempts to by-pass Treasury when presenting policy to Parliament. Ideological bullying can bankrupt a country in no time.

Such issues as Minister Aaron Motsoaledi’s National Health Insurance dream and Minister Joemat-Pettersson/President Jacob’s Zuma’s dream of six nuclear energy reactors – plans that the country should not possibly not countenance from a financial aspect – have neither been presented to Parliament in the proper national budget planning form or officially and financially endorsed.

Missing money details

Minister of Health, Aaron Motsoaledi, has gone as far as a White Paper to Parliament on the NHI and Minister Joemat-Pettersson has briefed Parliament on nuclear tendering. Treasury have said nothing about a financial plan in each case. Money is short, as evidenced by Treasury stepping in on the provisions for BEE preferential procurement. Somewhere there is a disconnect.

As for President Zuma’s continued pressure to bring traditional leaders into the equation with what amounts to two separate judicial systems and has even talked of the equivalent of four tiers of government – one therefore not even reporting to Parliament and certainly no idea of local government and nor subject to the PMFA  has its problems. President Zuma has used his ally, the Minister of Justice, to table the Traditional Courts Bill before Parliament. Opposition parties will walk out on that one, we are sure.

The Speaker of the House, Baleka Mbete, as part of the same coterie, has made a mild signal that the days of Cabinet maverick behaviour, even arrogance, towards Parliament and no respect for the separation of powers may be coming to an end. The SACP is clearly not happy. That is where the new ambiance felt in an unchanged Parliament may play an unofficial part and pressure may start building.

 
Previous articles on category subject
Parliament to open Aug 16 – ParlyReportSA
Parliament under siege – ParlyReportSA
Radical White Paper on NHI published – ParlyReportSA
Zuma’s nuclear energy call awaits Treasury – ParlyReportSA
Here it comes again…. the Traditional Courts Bill – ParlyReportSA

Posted in cabinet, earlier editorials, Electricity, Energy, Finance, economic, Fuel,oil,renewables, Health, Justice, constitutional, 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

PIC comes under pressure to disclose

Unlisted investments of PIC queried….

matjilaWhen asked for information on how the Public Investment Corporation (PIC) had invested its funds, Dr  Daniel Matjila, Chief Executive Officer, told parliamentarians that the most he could do, even with ‘listed’ investments, was to give only names. Any terms and condition of any investment agreement could not be made public. On ‘unlisted’ investments, he held back completely.

He was then formally asked by David Maynier (DA) if the PIC had invested, directly or indirectly, any funds in any Gupta-owned enterprise. He was also asked for details of any financial implications upon the Government Employee Pension Fund (GEPF) and other pension fund assets resulting from the dismissal by the President of former Finance Minister Nene.

Confidentiality

Dr Matjila responded that the fund “could not cross the line of disclosing private information” and the members ofPIC logo.2 the Standing Committee on Finance, before whom he was appearing “should not read into his statements any insinuation that the PIC was protecting information.” He noted that he was totally aware of the fact that the PIC was under investigation for passing funds to the ANC and any such idea “was totally false”.

As far as funds to any Gupta owned business was concerned, Dr Matjila replied that the organisation stood by its earlier answers to the media that it had not invested directly in any Gupta owned enterprise. Following this remark, ANC MPs stood by Dr Matjila and told Opposition members that the PIC could not become “entangled” in such questions which were veiled with gossip and insinuation. It was the word “directly” used by Dr Matjila that caused the question.

Sub-judice

yunus carrimThis point was emphasised by Yunus Carrim, Chairman of the Committee, that most of the questions that were concerning Mr David Maynier should only be dealt with after the investigation of the possibility of ANC funding by the PIC had completed its course. He said that Dr Matjila was bound by circumstances to say nothing.

Present at the standing committee meeting was Deputy Minister of Finance, Mcebisi Jonas, who said the reporting process of h a pension fund to the committee should not get side-tracked with politically motivated questions. Maynier had asked this time about the possibility of “indirect” investments by PIC of any Gupta businesses.

On the issue of the effect of the ‘9/12 issue’, as referred to by Dr Matjila when Nhlanhla Nene was fired, he reported that the impact of this event had caused “significant losses” to the PIC portfolio. The GEPF lost R95bn, the Unemployment Insurance Fund lost R7bn and the Compensation Fund had lost R3bn – all managed by PIC and the event had been most worrying.

However, he said that the performance of all the funds had been subsequently excellent in the sense that recovery was achieved quite quickly – in fact “the recovery represented more than all the PIC funds lost within those two days of crisis.”

Information withheld

David Maynier (DA) remarked that funding was still shrouded in mystery and that he was “extremelydavid maynier uncomfortable” that the PIC would give no information at all on the “unlisted” investments of PIC.

Reporting generally, Dr Matjila said the fund had benchmarked itself and its operations compared favourably with “top private sector investment companies”. The GEP Fund “had shown over five years a 14.3% interest factor compared, he said, to a global median of 9.9% and a local investor median of 10.1%.” It had invested approximately R33.9bn in numerous portfolios aimed to drive transformation and create jobs, he said.

He told parliamentarians that the PIC “had invested approximately R33.9bn in numerous portfolios aimed to drive transformation and create jobs.” He said any risk taking was carefully managed and remained on the conservative side. Furthermore, he assured MPs that PIC did not take any risk that could not be “managed”.

Listed investments growing

Dr Matjila said that for all investments, the total allocation was now R400bn and “partners were always sought that would make positive returns”. ‘Listed’ investments in the last five years had grown from R495bn to R892bn recording a growth factor of 12.5% per annum.

vodacom logoThe PIC always held to principle, he said, that there was always a need for BEE compliant businesses to be considered so that it attracted a portion of government expenditure. ‘Unlisted’ investments, nevertheless, had large share of the market holdings, he said, with roughly R55 billion allocated to this form of investment. The total allocation for PIC investments, including GEPF and UIF, was approximately R400bn.

On investment policy, Dr Matjila said that his team liked to look at partnering with other stakeholders that added value and knowledge to make sure that maximum benefits and input from any arrangement were received.

Downstream SMME outlets

On SMME development, Dr Matjila said that PIC was “in discussion with groups such as Spar and Woolworths to ensure that small business was represented in their current growth patterns.” He said it would seem important for PIC to participate further in the Barclays Africa “sell down”. PIC, he noted, had invested in many international and local companies with assets within South Africa “in order to drive economic growth and increase job creation.”

Dr Matjila turned finally to ‘unlisted’ investments and said PIC had a slate of roughly R55bn to work from. Such investments were usually international, he said, and were not necessarily BEE compliant. David Maynier (DA) asked whether the GEP Fund management was “comfortable with the fact that a confidentiality clause existed on so many investments and the fact that disclosure to Parliament was denied.” Some ANC members also mentioned disquiet on this issue. Maynier said he intended to pursue the issue of non-disclosure of “unlisted” investments further.

Previous articles on category subject
Retirement savings subject of treasury probe – ParlyReport
Treasury calls for “Twin Peak System” with two financial bills – ParlyReportSA

 

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Immigrant visa problems dominate debate

sam mototabaNorthern agriculture seen as visa defaulter…….

sent to clients 15 June…..Sam Morotoba, DDG of Public Employment Services, Department of Labour (DOL), told parliamentarians that it was DOL’s view that visa immigration policies for South Africa must involve cutting down on the flow of unskilled immigrants into the country.

From the nature of the debate, it was evident that DOL was more concerned on the creation of jobs for South Africans and not the issue of visa granting to specialist cases, a fact which gained the support of most  MPs.

Sam Morotaba said that amongst the massive inflow of undocumented persons crossing what is some 4,000kms of border there were those that did find work, had no entry visa and were totally exploited in the process. Most of the border was totally “porous”, he said.

More facts emerged during the particular Labour Portfolio Committee meeting when both DOL and the Department of Home Affairs (DOHA) jointly made presentations on immigration policy.   The practical aspects of the issue of work permits to foreigners, normally called “temporary visas” were discussed.

Not asylum seekers

Over 70% of the non-documented labour problem occurred in Limpopo Province, according to DOL figures.    It was also shown that there were approximately 300,000 illegal immigrants in the country at present, whether they were working or not.   Refugees from war and refugees seeking asylum were a completely different issue, Morotaba said, and they represented a much smaller number, .

sa border beit bridgeSpecially conducted “raids” on farms and businesses in the Northern areas and which were carried out by the few inspectorate staff that were available to DOL were frustrated by the advent of the cell-phone.    Messages were simply sent ahead by immigrant employees advising that a “raid” was in progress and workers who had no documentation but wanted the work simply went into hiding.

Some employers told their employees not to come to work when appointments with DOL inspectors were made. “Raids”, in conjunction with South African Police Services,were extremely difficult to undertake unless the matter was serious enough to consider that a possible breach of the law had taken place.

Traffickers

The problem was exacerbated, said Morotaba, by traffickers that postured as labour “sellers” and went from farm to farm offering cheap labour in the form of immigrants without documentation looking for work.    Inspectors had resorted to “raids” on Friday “paydays” and also at night.  Employers were generally unhelpful; gaining access to farms was difficult; and the success rate in finding illegal immigrants was therefore low, said DOL.

Farmers remained the major culprits, it became apparent – an issue which has been the main theme of chairperson Lumka Yengeni of the Portfolio Committee on Labour for a number of years.

DOL said that there were more than five million legal immigrants in the country and the laws of South Africa demanded that all workers be protected, whether illegal or not, in terms of the Constitution. This had to be borne in mind, they said.

Desperate people

However, underpaying desperate people who had no temporary visa and housing them in filthy conditions, was farm labourersquite a different matter and was a contravention of all international principles. This was the issue facing DOL.

Also, some companies and employers simply did not want to test the local market for labour suitability or could not be bothered to try, DOL said, and also probably also wanted to avoid UIF participation, collection and payment and few farmers got involved in the cost of skills training.

Home Affairs briefing

The main agenda of the portfolio committee meeting in question was the subject of the nature of relationships between DOHA and DOL. Also their observations were requested on the current position with regard to delays in issuing visas and DOHA was asked to give a technical explanation of where the visa issuance process was headed.

DOHA was represented Acting Chief Director for Visas, Home Affairs, Modiri Matthews, supported by Ronnie Marhule. Modiri Matthews said his department was mandated by the Immigration Act to deport those unlawfully in the country.

visa stampHe made it clear that the Immigration Act stated that a temporary residence visa could be granted only for the categories of Study, Treaty, Business, Crew, Medical Treatment, Relatives, Work, Retired Persons, Exchange and Asylum.

It was only when a permanent resident permit was issued that the holder was entitled to live in South Africa on a permanent basis, with all the rights and obligations of a citizen except the right to vote and use an SA passport. This was standard in most countries, he said.

Visa classification

There were three kinds of visas – Corporate, General Work Visa and a Business Visa.   Most farming entities and general business fell under the category of corporate visas, where a requested number of foreigners was needed by an employer.

Proof had to be supplied that despite a diligent search, the applicant could not find suitable SA citizens or permanent residents to occupy the positions; the job description had to be given; and it had to be conditional that salary and benefits paid would not be less than standard agreed emoluments.

Home Affairs confirmed that feedback indicated that the current system is too cumbersome due to DHA’s lack of capacity to handle the volume of applications; the fact that “standard operating procedures” within the department were ambiguous; that many officials were insufficiently trained and turnaround around times were too slow.

Speeding things up

Modiri Matthews promised parliamentarians that new electronic systems were in place to ensure a more secure system of interaction between DHA, DOL and Department of Trade and Industry (DTI) – the latter being responsible for issuing the quota or number of visas issued, all of which had expiry dates. The plan envisaged is that once the permission is issued by DTI, for DHA to take 30 days and DOL no more than 8 weeks to process a visa request andvisa with hand DHA to issue or decline.

When asked by MPs whether or not Home Affairs had a tracking system on visas granted but which had expired, whether working or not, Modiri Matthews responded that they had and the number of expired visas currently stood in the area of 30,000, which were on the tracking system.

Waiting period

Present at the meeting were also Ronnie Marhule, Acting Chief Director of Permits and Visas and Phindiwe Mbhele, Director for Corporate Permits and in question time, Angie Loliwe of the ANC complained to them that if the application were with DTI for even only 2 weeks, then the DOL process was added for thirty days and with Home Affairs adding about 8 weeks, there was not really any possibility of waiting less than three months for any one application to be processed at the very best. This was too long, she said.

Both Directors stated that there were “pressure points” mainly related to capacity to deal with the volumes of applications and this mainly affected “corporate” visas to farm workers. They told members of the Labour Committee that they were trying to deal with this, especially where urgent business applications were concerned.

They reminded MPs that with nearly 300,000 illegal immigrants, systems such as an “expired document” process was a time consuming business and DOL “had their work already cut out with the farming situation and inspections.”

One track discussion

Ninety per cent of the meeting time was spent discussing farm labour problems in the light of ANC problems with illegal labour entry to the North. Modiri Matthews said that there were only 11 centres in South Africa handling visa applications. There was a new office in Sandton, Johannesburg, he said, specifically geared to business needs.

To the irritation of some of the ANC members it was confirmed that the offices in East London and Port Elizabeth had been closed.   There was only one office for the whole of KwaZulu-Natal.   However, Matthews said there was was a specific plan to open two new business offices -presumed to be Cape Town and Durban.

Previous articles on category subject
Home Affairs gets tough on expired visas – ParlyReportSA
Home Affairs gives reasons for visa changes – ParlyReportSA
Agri-SA gives views on minimum wage – ParlyReportSA

Posted in Finance, economic, Labour, LinkedIn, Special Recent Posts, Trade & Industry0 Comments

Central Energy Fund hatches fuel plan

A lot going on at Central Energy Fund…..

Central Energy Fund (CEF), the state utility which controls the Strategic Fuel Fund (SFF) and fosters PetroSA, cef logohas again been outside of a plan that has Parliamentary approval or, it appears, Treasury knowledge.    CEF falls under the aegis of the Department of Energy (DOE) and is therefore responsible to Minister of Energy, Tina Joemat-Pettersson.  Clearly there is much going on of which Parliament knows nothing – in recess as it is.

The history of CEF’s  problems go way back before the period during which  previous Minister of Energy, Ben Martins, held office and even before Ben Martins, as an MP was chairperson of the Parliament Portfolio on Energy. Most of CEF’s troubles appear to involve the fuel storage facilities  at Saldanha Bay on the West coast and PetroSA’s operation on the East coast, causing considerable negative comment from the portfolio committee and Ben Martins himself at the time. Sadly, Minister Martins was not chosen to remain by President Zuma.

tina-joemattQuite clearly a plan has been hatched to meet Cabinet ambitions.

Glaring omission

It was only after  Minister Joemat-Pettersson’s current budget vote speech did the investigative journalism of the newspaper media discover the sale of almost completely the entire SA reserve oil stock of the Strategic Fuel Fund (SFF) held at Saldanha Bay.

Not only was the sale concluded without any mention but the quantity of fuel involved appears to have been a major financial  decision  undisclosed in any cabinet statement.    It appeared that CEF had allowed SSF to sell 10 million barrels of crude — close to the entire stockpile — in a closed tender at the point that the oil price had bottomed at somewhere around R34 Brent.

It also appears that this was without the agreement of Finance Minister Pravin Gordhan and Treasury whosepravingordhan concurrence is needed under the Central Energy Fund Act.  How this will play with Treasury and the Auditor General is not clear, nor whether when and how CEF intends to replace this. The Democratic Alliance will no doubt be asking for answers in parliamentary question papers.

What the Minister said

It is interesting to note exactly what the Minister had to say to Parliament about SFF in holding back, it appears, on such major financial move. She told MPs that in line with the Presidential Review Commission on State Owned Entities (SOEs) that her Ministry had been working towards “a review of the composition of the CEF Group of companies.”

She went on to say, “Our work in this area includes the strengthening of the entities in the oil and gas sector and the stated policy objective of the creation of a stand-alone national oil company, using PetroSA as a nucleus.”
SFF had a good revenue base, she said.

saldanah bay 2“We shall finalise this work by October 2016”, Minister Joemat-Pettersson said and she would revert to Parliament on Cabinet views and strategies for a revised energy sector framework. “Accordingly, in 2015, the Ministry of Energy issued a ministerial directive for the rotation of strategic stocks in the SFF and this has resulted in an increased revenue base for SFF whilst at the same time maintaining stocks within our storage tanks for security of supply.”

Long term view

“This as a result, the Minister continued, “of a long term lease and contractual agreements with the buyers. The estimated revenue to accrue from this process is around R 170 million per annum, significantly boosting the balance sheet of the SFF.”

The Minister concluded that through the rotation of strategic stocks and trading initiatives the SFF had further consolidated its ability to be self-sustainable. “This has also allowed us to replace the unsuitable stock that we have been storing in our tanks which has been both uneconomical and did not contribute to security of supply.”

“The SFF will continue to ensure that it is able to respond to any shock in the market, whilst optimally making use of the opportunities presented in an evolving oil sector”, she concluded regarding West coast activities.No figures were given nor a clear indication mentioned that a sale had been concluded.

  SASAL LOGOHowever she was particular in supplying numbers regarding the joint venture between Sasol and Total when she said, ” Effective from 1 July 2006, Sasol Oil sold 25% of its shares to Tshwarisano LFB (Pty) Ltd, a broad based black economic empowerment consortium comprising of 150,000 direct shareholders and 2,8 million beneficiaries. The value of this transaction amounted to nearly R1.5 Billion, making it a significant BEE transaction in the liquid fuels industry.”

Trading nightmare

Therefore, the sale of nearly the entire reserve held by SFF, whether it is kept in the same tanks at Saldanha or not, at an oil price when at it’s very lowest, “suitable” or not, and being obliged by the Act to eventually replace it some later point should get an explanation.   However, it seems that there was an incentive to sell.

Also, to have to buy back at an oil price which is currently already well over double would appear to be completely against the tenets of the Public Finance Management Act; what the Auditor General is bound to call “fruitless and wasteful expenditure”; and contradictory terms of the Minister’s statement to Parliament that the SFF “has the jacob zumaability to be self-sustainable”. Unless, of course it is bolstered by external funds. 

Gas nightmare.

Parliament is of course closed for the election recess but no doubt there will be a parliamentary uproar on the subject – if not an investigation, which will come on top of the further current investigation of CEF’s activities as far as PetroSA is concerned.Once again the question will arise on how it was possible for PetroSA to continue with Project Ikhwezi when drilling for gas for two years in an area already defined by experts as impractical in lieu of fault lines in the projected gas field.

Central Energy Fund seen as politically driven

R11.7bn was the total “impairment” of PetroSA, the result of underperformance of Project Ikhwezi in its efforts to supply gas onshore to Mossgas. The total PetroSA loss for 2014/5 was in reality R14.6bn after tax. Currently a team comprising of industry experts is now defining a new strategy to save the PetroSA in its offshore struggle on the East coast, according to DOE reports to Parliament.

Roughnecks wrestle pipe on a True Company oil drilling rig outside WatfordThe experts were not named but the exercise is entitled Project Apollo and reports were also given to Parliament that the team has progressed well so far, said controlling body Central Energy Fund during 2015.

PetroSA was originally flagged by Cabinet some twelve years ago as “South Africa’s new state oil company”.     Last year, CEF described at the time PetroSA’s performance in their annual report to Parliament as “disappointing”, resulting in harsh criticism last year from the Portfolio Committee on Energy. The subject was not raised this year by the Minister in her Budget vote speech.

Failed deal

What, however, was raised in opposition questioning in the National Assembly by Pieter van Dalen, DA Shadow Deputy Minister of Energy, was Central Enegy Funds venture into the proposed purchase of Engen’s downstream activities from Malaysian company Petronas, known as “Project Irene”. This was understood to be the Cabinets secret plan to own the promised state oil company.

fuel tanker engenThe purchase from Petronas, who own 80% of Engen, was an attempt through Central Energy Fund to gain a foothold in the fuel retail and forecourt space by acquiring a stake in Engen, South Africa’s largest fuel retailer. The remaining stake is held by the Pembani Group.

First try

The board of PetroSA was repeatedly advised by both transaction advisers and the Treasury, according to Deputy Shadow Minister van Dalen, “that the proposal to buy the Engen stake did not make good business sense.”
“However,” van Dalen said to MPs, “the project was strongly championed by Minister Joemat-Pettersson and President Jacob Zuma. In the end, the deal fell through due to lack of financing.’These sort of things cannot go on”, he said.

The last word

This particular meeting in the National Assembly was completed by Shadow Minister of Energy, Gordon Mackay,gordon mackay DA attacking the Minister for “misleading the country on nuclear energy deals.”

He concluded after a long speech on the subject of the proposed nuclear build programme and what he referred to as “anomalies”, with the remark “We must ask ourselves Chair – why is our government doggedly pursuing this nuclear deal. It is clearly not a deal in the interests of the poor. It is clearly not a deal in the interests of business. It is clearly not a deal in the interest of the nation.”

Gordon Mackay did not know about the Chevron approach, or at least he did not indicate that he did.

Previous articles on category subject
Central Energy Fund slowly gets its house in order – ParlyReport
PetroSA on the rocks for R14.5bn – ParlyReportSA
Chevron loses with Nersa on oil storage – ParlyReportSA

Posted in Energy, Facebook and Twitter, Finance, economic, LinkedIn0 Comments

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