Tag Archive | economic

Zuma vs Parliament

This weeks editorial comment……

ANC internal problems dominate…

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

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

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

Watching their backs

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

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

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

Pulling the donkey’s tail

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

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

Slow moving policy decisions

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

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

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

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Houses_of_Parliament_(Cape_Town)

Parliament : some clarity on policy emerging

Departments brief new Parliament..

Editorial….

Again and again the words ‘certainty’ and ‘uncertainty’ have arisen in parliamentary working committees,  not only in terms of the foreign investment climate but also in terms of borrowing, building and direction of strategies to achieve growth and the creation of jobs.

More than anything else, uncertainty seems to be South Africa’s greatest economic stumbling block. Even public utilities, let alone investors, bankers and private sector industrialists, have made submissions asking for clarity on government policy and decision making.

Cabinet indecision could be the problem. Leadership could be the problem. Let the political commentators decide but from a parliamentary viewpoint this week one sensed the first elements of certainty and clarity.

IRP being finalised

No doubt the news that the integrated resources plan is finally happening will bring more certainty to the energy sector and the recent nuclear and hydro decisions have let everybody know where that sector is going.

Whether recent decisions are considered right or wrong in the health sector, Minister Dr Motsoaledi seems to have a firmer hand on the tiller.  Similarly in the transport sector, and more than just hopefully but certainly, the first Brazilian train is due to arrive and new coaches will shortly be going through some new stations that are being built.

Minister Pravin Gordhan has brought his experience with SARS to bear on local government and his unsmiling manner will no doubt rattle many a cage down the line and produce the necessary repayment plans.   He appears, from reports coming to Parliament, to be getting around the constitutional problem of local affairs being out of bounds to national affairs and will bring a number of errant provincial and local employees to court.

Saving the day

Although Parliament still cannot amend a money Bill but only debate same,  national treasury seem to have come to the party to plug the gap in certain instances, thus getting rid of expressions like “currently in negotiation on possible funding” in departmental and state utility reporting. But a what cost and will this be enough?  Be that as it may, the gap has been plugged.

Whether recent events are good or bad news according to the governing or opposition parties, confirmation of direction in government policy takes the crystal ball out of planning and strategy.   Decisions can be made.

We sense at the moment some direction in parliamentary affairs and in the coming weeks, whilst there will be surprises for some such as the Areva nuclear build award, disappointments for some such as no reversal of the decision to proceed with carbon tax and the worry of the decision to increase electricity tariffs despite the multi-year fixing, at least we are beginning to know for certain where we are.

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Five Rand

Parliament steps up its financial oversight role

Nene briefs parliamentary oversight chair Carrim…

Commencing its work for the fifth Parliament, the standing committee on finance passed a resolution, before the recent recess, following a strategic plan briefings from SARS and Statistics SA, to step up its oversight on treasury and all other government institutions concerned with finance.

Whilst Parliament’s oversight role on the executive is a constitutional requirement, new chair Yunus Carrim, a diligent parliamentarian who has a record of running a particularly “tight shop”, appears to be fully aware of the mood of the public on state funding and that consequently the current oversight situation is not “business-as-usual” .

Reporting to Carrim and the joint standing committee, finance minister, Nhlanhla Nene, said South Africa’s economy was growing at a moderate pace but was still performing below expectations.

Picture changing

He said South Africa had to grow faster in a way that advanced the interests of the poor and which eliminated poverty. He also asked MPs to be aware that treasury’s strategic plan had been developed at a time of a better global outlook.

He said that whilst the global economic environment is showing signs of improvement, it also remains below optimal levels.   “South Africa is not an island, cut-off from the rest of the global economy”, he said.  “So our economy is performing way below the level of growth that is required to deal with the country’s triple challenges of unemployment, poverty and inequality”.

SARS, he said, was poised to collect R1 trillion in revenue but the volume of national government debt would increase from between R1.4 trillion to R2 trillion in 2016/17, the equivalent of 43% of GDP.  Projected growth figures, minister Nene told parliamentarians, would be provided when the Medium Term Budget Policy Statement was tabled later this year.

At this stage he saw no cutting back on budget votes as provisions were in place to cut back should the situation demand it.

Big backing for state lending

In the current financial year, minister Nene said, the government will recapitalise the Land Bank with R500m and DBSA with R2.5bn.    He said he would also “continue to engage with the various unions and stakeholders to in an attempt to enable a government retirement system to offer good value and protection for retirement savings.”

Finally, he said, he was committed filling all vacant positions in treasury “in order to enhance the functioning of the institution” which he saw as a pillar of the economy.   However, “stringent measures” were already in place to control over-spending or wasted expenditure by the public sector.

Treasury DG, Lungisa Fuzile, in presenting detail of treasury’s plan for the next five years, said there would be more reform of the financial sector so that it was more tightly regulated.

Down the line purchasing

In the coming year, national treasury department planned to implement an upgrade of the management of state financial systems which would allow government to control its supply chain business more efficiently. A new office of Chief Procurement Officer had been given an elevated function in line with reforms in order to centralise procurement and to save costs, in the meanwhile reducing financial leakages.

It was part of the strategic plan to immediately create a technical support programme for infrastructure, he said, and a technical advisory centre was to be completed, which had, as its mandate, oversight of major capital projects on a top priority basis.

DG Fuzile also told the MPs that further priorities were the completion of financial agreements with BRICS countries.  An example of this was the recently much publicised  establishment of a bank and a pool of virtual reserves, not in competition with the IMF, but giving alternative propositions.

Pensions to be re-engineered

Also important, he said, was that public service pensions, both civil and military, administered by the government pension fund would have their business processes “re-engineered and modernised.”

Members of the standing committee expressed the view that the deficit on the current account was of concern to them, as was the balance of payments position. Chair Yunus Carrim requested that parliamentarians be updated immediately on the work of the Davis Tax Review Committee.

Other articles in this category or as background
http://parlyreportsa.co.za//cabinetpresidential/lock-parliament/

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