The governing ANC is choking under a debt burden of more than R200m, forcing tax authorities and the Unemployment Insurance Fund to garnish millions from the party’s bank account every month for some years now as it has scrambled to keep up with payments.
When Cyril Ramaphosa took office as party president in December 2017, the ANC owed more than R100m to the SA Revenue Service as it grappled with over R400m in total debt. The debt started accumulating in 2010, three years after Jacob Zuma won the party’s internal election to become its leader. This means that while Zuma was president of SA the ANC was not paying taxes and unemployment benefits for staff during the period of state capture.
Insiders told Business Day that some of the debt has been repaid and it is now about half what it was four years ago.
The ANC’s financial woes, which have seen it regularly failing to make monthly salary payments for its staff, could undermine the party’s bid to recast itself as a well-run steward of the country after nine years of disastrous management that saw the country lose its investment-grade sovereign ratings.
Leaders of the ANC, who did not want to be named, and some in Cosatu and the SA Communist Party (SACP) said other than the party’s dirty laundry being aired in public over its failure to pay staff, warring factions had become violent in recent months.
“A number of us have faced armed robberies and the guys were looking for information,” said Solly Mapaila, deputy general secretary of the SACP.
The financial problems as well as tension between factions — which combined to ensure that the ANC could not register candidates in at least 30 municipalities — come months ahead of the local government elections and before the national conference in 2022, when the next leader of the party is due to be elected.
Though it is not unusual for the ANC’s candidate selection process to be chaotic, even bloody, ahead of an election,
the fact that the party missed an Electoral Commission of SA (IEC) deadline to submit candidates signals that leaders are struggling to control warring factions.
A cursory analysis of candidate lists shows that the party could be at risk of losing Tshwane, Johannesburg, Ekurhuleni, Mangaung and Mbombela should the IEC not reopen its list process.
It has failed to register dozens of candidates in those metros. The ANC has now called a special national executive committee this weekend to deal with the crisis.
The party has also in recent months been facing financial pressure as donations dried up due to the Political Party Funding Act, which requires political parties to declare funds donated over R100,000.
The ANC — which withdrew its application on Tuesday to have the IEC reopen its systems to allow parties to submit their candidates pending the outcome of the IEC’s application at the Constitutional Court to postpone the elections — will still contest the local polls despite its shallow pockets.
The Constitutional Court will hand down a landmark judgment on whether elections can be postponed to next year.
Executive chair of the Institute of Election Management Services in Africa and former IEC commissioner Terry Tselane said the IEC’s submissions to the court were weak and the court is unlikely to rule in the commission’s favour, meaning that the elections would go ahead as scheduled.
“For the credibility of the elections to be maintained, the IEC would have to tread carefully and ensure that they don’t compromise on any aspect in terms of the law. Any political party that is affected by the decisions of the commission may approach the courts,” he said.
The IEC approached the Constitutional Court to postpone the elections arguing that it is impossible to hold free and fair elections under current Covid-19 conditions, with low vaccination rates and restrictions on political gatherings.
The electoral body based its arguments on a report by former deputy chief justice Dikgang Moseneke, which recommended that the elections should be postponed to February 2022 when the health risks associated with the pandemic would have subsided.
While awaiting the top court’s judgment on the postponement of the polls, the IEC is continuing with its elections timetable as though the polls would be held in October as scheduled. This included opening up the nomination processes on August 3 for political parties and independents to submit their candidates. The process closed on August 25.
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