Little more than a week into 2022 and the ANC has already managed to burn down parliament through sheer incompetence at best — or factional infighting, radical economic transformation style, at worst — and spit in the face of the judiciary after the release of the first volume of the state capture commission report. American insurrectionists, eat your hearts out.
Not to worry though. Minerals & energy minister and ANC national chair Gwede Mantashe told his adoring congregation after a meeting with traditional healers in Limpopo on Friday that SA is not going to the dogs. He took aim at commentators who focus only on challenges without recognising gains made under the perpetually shocked President Cyril Ramaphosa.
But the jarring disconnect with economic reality raises fresh concerns that there just isn’t sufficient recognition and urgency to act on reforms. SA is facing record unemployment, a credit rating several notches into junk and largely dysfunctional local government and state-owned enterprises (SOEs) that deliver negative returns on investment while the state’s debt burden balloons to R4.5-trillion in the next few years. (For every R5 that is raised by the government, R1 is now spent on servicing the debt.)
Then there is the latest IMF report telling us that “without decisive action to remove obstacles to investment and reduce government’s need to borrow, SA will be unable to create lasting growth”.
The most urgent of these is to reform the policy of cadre deployment. The release of a selection of minutes of the meetings of the ANC’s deployment committee between 2018 and 2020 (a relatively benign period when viewed against the years of wanton state capture), thanks to legal action by the opposition DA, rips off the bandage to reveal the festering wound that is the reason SA finds itself teetering on the brink of social and economic disaster.
My wishes for SA in 2022 are to replace deployment with independent selection committees for key SOEs, and genuine commitment to unblocking the obstacles to genuine public-private partnerships.
The practice of deploying party loyalists to key positions occurs in other parts of the world. In the US, for example, the top two echelons of public servants are replaced along with new governments. However, the deployment embraces properly qualified and competent people who know what they are doing. Read through the first tome of the Zondo report into state capture and clearly the only qualification relied upon by the ANC’s notorious deployment committee for key SOE boards is allegiance to the party.
The policy is mentioned only four times in the first volume of the Zondo commission report and will surely be covered in greater detail in subsequent volumes.
But acting chief justice and chair of the commission Raymond Zondo doesn’t mince his words: “What Mr [Vlok] Symington said about how highly regarded [the SA Revenue Service] was internationally before it was subjected to capture by Bain under Mr [Tom] Moyane’s leadership is no different from what I was told about SAA at some stage, Eskom at some stage and Denel at some stage, each of which were subsequently run down considerably with rampant corruption and state capture. All of which happened under the watch of the government of the ruling party, the [ANC].
“Most, if not all, of these entities were led by the [CEOs] and boards of directors who would have been approved by the ruling party through its national deployment committee. These entities did not drop overnight from the internationally highly regarded entities that they once were to what they subsequently became. The decline happened over a number of years, but both the government and the ruling party failed dismally to make any effective interventions to halt the decline. Either they did not care or they slept on the job or they had no clue what to do.”
Judging by Ramaphosa’s tired speech at the ANC’s 110th birthday celebration (written by a committee — and it showed), the ANC remains deluded and unable to correctly assess the root cause of what ails it and the country, and seems destined to be consigned to the dustbin of history as just another in the long line of African liberation movements that have failed to embrace the complexities of transitioning to a modern political party capable of managing a large, open economy.
Speaking to a couple of CEOs recently — Dominic Sewela of Barloworld and Roland van Wijnen of PPC — it’s clear that our grand infrastructure plans are moving along as swiftly as Shamila Batohi’s prosecution of the crooks involved in state capture.
We’ve had a couple of infrastructure conferences and 50 strategic projects announced, yet all I can see is the Beitbridge upgrade being built. The thing is, nobody believes the government any more when it says it will spend on infrastructure to unlock growth.
SA’s infrastructure problem is not, primarily, a money or spending problem. There is, arguably, plenty of private capital available for infrastructure. It’s the lack of suitable, bankable projects and of the policy and regulatory decisions to enable them that’s holding back investment.
The private sector can’t finance new roads if there’s no clarity on how they will be paid for, nor new power plants if the minister won’t sign the requisite determinations, nor rail and port infrastructure if Transnet continues to monopolise it.
My wishes for SA in 2022 are to replace deployment with independent selection committees for key SOEs, and genuine commitment to unblocking the obstacles to genuine public-private partnerships.
Sadly, I think a Proteas series victory over India is more likely.
• Avery, a financial journalist and broadcaster, produces BDTV’s ‘Business Watch’. Contact him at Badger@businesslive.co.za.
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