Tag Archive | nene

The big SA cabinet crunch

Editorial….

Cabinet hopes are Brown, Ramaphosa, Gordhan…..

Public Enterprises Minister, Lynne Brown, reports that she is to introduce as a cabinet draft, the Lynne BrownShareholder Management Bill as part of a plan to introduce leadership ability and some form of continuity for the state owned enterprises (SOCs) under her control.   This includes Eskom, Transnet, Denel, SA Express, Alexkor and Safcol.

We hope this is the start of something big.

The last few weeks have been an exercise in disaster, so let’s try and take a positive spin on things from a parliamentary viewpoint. Whilst troubled SAA is now an independent, falling under National Treasury and if President Zuma minds his own business, Minister Pravin Gordhan is to sort out National Treasury itself and also the troubled SARS, which he re-designed in the first place and which became such a success working with Trevor Manuel.

More problem children

Meanwhile, PetroSA is in real deep water falling, the entity falling under Central Energy Fund (CEF) reporting to Department and Energy (DOE). With Minister Joemat-Pettersson not back from COP21 or wherever, the country still faces some serious energy issues. But at least the PetroSA problem is now all in the open, with somebody obviously having to take over the reins and the mess, probably CEF itself.
Oddly enough there are people in CEF who know exactly what the problem is but once again politicians pushed experts in the wrong direction, it appears.

In addition, the Passenger Rail Association (PRASA) is very much on the slippery slope and, together with SANRAL, both present highly contentious transport issues which are now in the hands of Minister Cyril Ramaphosa to untangle. Troubling times indeed.

Public Enterprises comes to the party

lyne brown 2Now Minister Lynne Brown appears to be getting the senior management of her portfolio under control and whilst we could still have shutdowns at Eskom she says, because “machines can break down unexpectedly”, the leadership is there she says, as is the case with her Denel.
Lynne Brown recently reported that there are around 700 SOCs, an extraordinary fact, but bearing in mind the fact that South Africa is reputed to have the largest head count in public service per population count, this would appear quite possible.

On the road again

With Deputy President Cyril Ramaphosa chairing an Integrated Marketing Committee, which will hopefullyramaphosa designate which entities should remain SOCs and those which should be absorbed back into their relevant departments, there appears some hope with regard to containing the ballooning public service machine which has characterised President Zuma’s presidency.

Hands off appointments

An essential element of Minister Lynne Brown’s plan is to remove the appointment to the boards of the entities under her domain away from cabinet and Ministers, including herself, to a shareholder management team that creates a leadership operational plan for all SOCs and appoints, through due process, a tightly run appointment book.

A brave proposition indeed but it does indicate that Minister Brown is her own person.

Whilst the proposals might look like state control, in fact it is a clear signal that government may have heard the message that the current system of Ministers appointing board members is not working, is open to abuse and what is worse, the consequent “jobs for the boys” system results in taxpayer’s money being thrown away through bad management, corruption and what the auditor general calls “useless and wasteful expenditure”.

On the drawing board

The Shareholder Management Bill, Minister Brown said in Johannesburg, will first need a concept paper (perhaps she means a White Paper) and such could be released after the February Cabinet Lekgotla in February, with an intention of introducing such as system by the end of 2016.

Whilst it is pretty obvious who should not be on such an appointment team, the plan begs the question of will be chosen to occupy such critical posts but it is far too early to cogitate on this one. With Ministers changing their portfolios as if it was a game of musical chairs, there is reason to congratulate Minister Brown on the statement that she herself as a Minister would be excluded from making appointments in her own SOCs.

Leadership needed

During the same address, she added that Eskom was “not out of the woods” yet and there was still not sufficient electricity to facilitate economic growth, but the leadership issue was being addressed satisfactorily with the right people being appointed. Brown said none of the entities under her control “would be approaching the National Treasury with begging bowls”.

Perhaps this is the principle being adopted behind the scenes with the SABC, which whilst not affecting business and industry other than travel costs, unlike trade and investment hurdles and industrial strategic changes, SABC is threatened by the possibility of being returned to its parent government department which at first glance appeared to be a move by President Zuma to gain control of state financed media, Mugabe style.

However, in a broad sense it seems to be Minister Brown’s idea that appointments to the top echelons running the country should be as a result of finding those qualified to do so rather than being handled by totally unqualified persons, some with solicitous intent, and others trying to retain power with dubious appointments such as having friends, in the case of the SABC, to broadcast “the truth” to specific rural audiences.

Unprincipled governance remains the one of the biggest problems facing South Africa, intrinsically coupled to (and in some cases causing} lack of growth and lack of jobs.

Croneyism

Bad appointments by Ministers and of Ministers has been the cornerstone of control by patronage, the route for corruption and the reason for sheer bad management, a practice now openly exposed but not yet controlled by any means. From a parliamentary viewpoint, let us leave it there. The rest is being said by the media but most MPs when they return to Parliament in late January 2016 will have realized that sheer stupidity can ruin their own futures and their pensions.

But if Minister Lynne Brown, in her practical and down to earth manner, can come up with the remarkable idea of Cabinet Ministers, hopefully including the Presidency as well, not interfering in who does what as far as expertise is concerned, then perhaps this can be applied to all 47 government departments and agencies.

One small step

No doubt as far as confirmation of an appointment, the Minister involved may still have to “approve” such a decision but it is worth watching the outcome of the debate on the shortly-to-be tabled Broadcasting Bill, if only to see if the appointment of inept senior appointments can be halted or reversed.

What has come out of the Eskom, PRASA and PetroSA issues is that a bad leader with no qualification or right to be in a position of leadership, or worse led by one who has supplied fraudulent qualifications, leads to frustration and anger by those with genuine skills and high academic qualifications lower down the ladder at the coalface. This is in the space of government service where technical skills are located and badly needed.

We hope Minister Lynne Brown has more of these “eureka” moments.

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Minister Nene maps survival route

Not so merry Christmas….

Editorial……

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

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

Nkandla unpleasant diversion

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

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

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

Focus is on medium term budget

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

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

When is when?

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

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

Circus with no ringmaster

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

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

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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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