Frontline Africa Advisory

Weekly Political and Economic Review 01 March 2019

Weekly Political and Economic Review 01 March 2019

  1. Priority Bills:

Public Investment Corporation (PIC) Amendment Bill

  • The amendment bill that seeks to strengthen the accountability, transparency and corporate governance of the Public Investment Corporation (PIC), which has been beset by allegations of dodgy investments and is currently at the centre of a Commission of Inquiry, was adopted by the National Assembly on Tuesday the 26 February 2019;
  • The PIC is Africa’s largest investment manager with R2-trillion in assets that it manages on behalf of the Government Employees Pension Fund (GEPF) and other social security funds, such as the Unemployment Insurance Fund (UIF) and the Compensation Fund;
  • The bill is a transactional measure which more explicitly sets out criteria for PIC investment decision-making; to ensure greater openness and transparency on these decisions while taking into account market sensitivities; to consider direct trade union representation in the PIC board; and to provide for more effective Parliamentary oversight of the PIC;
  • Both the ANC and the EFF supported the Bill with 194 votes, 7 votes against it, and one abstention;
  • The DA, ACDP, the UDM and the COPE were particularly against having a Deputy Minister as Chair of the PIC board would open the way for political interference. UDM MP Nqabayomzi Kwankwa strongly opposed any member of the Executive chairing the PIC;
  • This is in light of the fact that one of the proposed remedies being that there be designated board non-executive seats for a representative of the National Treasury and not more than three representatives of a registered trade union whose members are the majority Government Employees Pension Fund (GEPF) – the biggest shareholder of PIC;
  • The Bill was drawn up by Parliament’s Standing Committee on Finance and has been sent to the National Council of Provinces (NCOP) for its approval before it can be signed into law by President Cyril Ramaphosa.

2. DA Election Manifesto

  • On the 23rd of February 2019, the Democratic Alliance (DA) launched its ‘Election Manifesto for Change’ at the Rand Stadium in Johannesburg;
  • The Party made its plans for the country clear: from land to helping small business;
  • The 83-page long manifesto focused on the following:
  • Fair access to real, long-term jobs,
    • Creating an honest and a professional police service,
    • Securing South African borders,
    • Stopping corruption,
    • Speeding up service delivery,

3. Patricia De Lille’s Good names Gauteng & North West premier candidates

  • Newly-formed Good Party nominated Vivien Law, as the Party’s North West Premier candidate and Nhlanhla Mtshali as the Party’s Gauteng Premier candidate in the upcoming General Elections;
  • Law is a Philanthropist and farmer in North West;
  • She also runs Parliament of the People, a non-profit organisation that establishes residents’ forums and committees in rural and urban communities where there are critical service delivery challenges;
  • Mtshali on the other hand, is the Party’s youngest premier candidate and would amplify the youth voice.

4. Commission of Inquiry

4.1. State Capture Commission of Inquiry: Eskom Board Chairperson Jabu Mabuza continues his testimony

  • Eskom Chairman Jabu Mabuza returned to the Zondo commission this week, and detailed the alleged corrupt activities that have marred the power utility;
  • During his testimony on Monday, Mabuza gave information about apparent emails between Eskom legal boss Suzanne Daniels and Oakbay Investment’s then-CEO Nazeem Howa to formulate coal agreements and draft media statements;
  • He also detailed how former Acting Eskom boss Matshela Koko allegedly leaked important information on internal programmes to Gupta associate Salim Essa;
  • Mabuza told the Commission that State Capture at the Power Utility manifested through procurement processes;
  • He concluded his testimony with a recommendation that the commission look into the conduct of Brian Molefe, Salim Essa, Zethembe Khoza, Ben Ngubane, Ayanda Ntetha and fifteen (15) others, in defrauding Eskom.

4.2. Mokogoro Inquiry: Jiba faces tough questions

  • On Monday the 25 February 2019, Nomgcobo Jiba took to the stand once again for further cross examination;
  • During her appearance on Monday, Jiba maintained that she did not obstruct any prosecutions of high-profile individuals to protect them while at the NPA;
  • She also denied any relations with the controversial African Global Operations, formerly known as Bosasa, including being under its payroll;
  • The question by the inquiry relating to her alleged involvement with Bosasa came after former Bosasa Chief Operating Officer Angelo Agrizzi testified before the Zondo Commission that former Correctional Services Commissioner Linda Mti would meet the NPA team weekly to give Jiba R100,000 in exchange for confidential documents regarding the investigations into Bosasa;
  • In her testimony, she stressed profusely that she never met Agrizzi nor Mti, adding that someone, somewhere, might have been receiving money, but not herself.

4.3. PIC Inquiry: Testimony on a Divided PIC Board

  • PIC Board Chairperson and Deputy Finance Minister, Mondli Gungubele delivered his testimony on Monday the 25th of February 2019;
  • He claimed that it was proven that the transaction involving AYO Technology Solutions ignored PIC governance procedures and approval processes;
  • However, on Tuesday the 26th of February 2019 PIC Director Dudu Hlatshwayo gave evidence before the judicial commission which contradicted what was said by Board Chair and Deputy Finance Minister Mondli Gungubele;
  • Hlatshwayo testified that Gungubele refused Board Members an opportunity to interrogate the facts of the preliminary audit report and forced board members to take PIC decisions related to AYO Technologies based on a draft report;
  • According to Hlatshwayo, the forensic report on which the decision was taken was riddled with factual inaccuracies;
  • On Wednesday 27 February 2019, PIC Board Member Sandra Beswick corroborated evidence given by Dudu Hlatshwayo;
  • Beswick said the concerns she raised about investments and processes at the corporation were largely ignored;
  • She added that she red-flagged other controversial deals, including investments with VBS Mutual Bank and Daybreak Farms;
  • What was further irregular, was the fact that that chairman Mondi Gungubele told the board the Finance Minister wanted everyone to resign otherwise they would be fired, said Beswick;
  • However, the Board did not communicate with the Finance Minister directly, to confirm it what the Chairman Mondi Gungubele had conveyed.

5. Special Investigation Unit Tribunal

  • President Cyril Ramaphosa has announced the appointment of a Special Investigations Unit Tribunal to fast-track the finalisation of matters that the Special Investigating Unit (SIU) refers for civil litigation following the conclusion of their investigations;
  • According to Presidency, fast-tracking these matters through the Special Tribunal will enable the SIU to recover monies and or assets lost by State Institutions through irregular and corrupt means; thus, ensuring that those who are responsible for the loss of monies and or assets by state institutions are held accountable;
  • The litigation process includes both public and private sectors persons and entities;
  • The Presidency said the Special Tribunal, which was established in terms of Section (2)(1) of the Special Investigating Units and Special Tribunals Act 74 of 1996, would be headed by Judge Gidfonia Mlindelwa Makhanya for a period of 3 years;
  • Ramaphosa also appointed the following Judges as additional members of the Special Tribunal:
    • Judge Icantharuby Pillay
    • Judge Johannes Eksteen
    • Judge Selewe Peter Mothle
    • Judge Lebogang Modiba
    • Judge Thina Siwendu
    • Judge David van Zyl and
    • Judge Sirajudien Desai

6. How to fix Eskom

  • A combined engineering discipline group, under the auspices of the Engineering Council of South Africa (ECSA), met with the Minister Pravin Gordhan, Minister of Public enterprise on Friday to discuss their concerns and solution over difficult supply challenges at Eskom;
  • Purpose of the meeting was to discuss operational challenges, engineering, technical capacity and capability, restructuring and the financial viability faced by the utility. The meeting also reiterated the engineering fraternity’s commitment to being part of the ever-lasting solution in resolving the power generation constraints which forced the Utility to implement load shedding;
  • Following the engagement, the engineering community has been asked to propose a framework for working together with Eskom and the ministry to find a solution in operational, logistical, systems, maintenance and capital project areas of the challenge faced by Eskom;
  • The Minister, in consultation with ECSA, tasked the South African Institute of Electrical Engineers (SAIEE)’s CEO, Mr Sicelo Xulu to present an analysis of the challenges facing Eskom.  The proposal should include ways in how the South African Engineering fraternity could get involved, and assist, Eskom;
  • Minister Gordhan will develop a coherent plan to achieve operational stability, effective, proper maintenance and system resilience in the electricity network.

7. SACP threatens to dump Ramaphosa over his plan to unbundle Eskom

  • The South African Communist Party threatened to dump President Cyril Ramaphosa if Eskom was unbundled to benefit a new group of “opportunists” with business interests;
  • The warning comes after Ramaphosa announced in his State of the Nation address that Eskom would be split into three units – transmission, power generation and distribution;
  • As well as claims that the proposal was designed to benefit his brother-in-law, billionaire businessman Patrice Motsepe;
  • In an interview at the party’s Central Committee’s three-day meeting in Johannesburg, Solly Mapaila, the SACP’s first Deputy Secretary General stressed that, since Ramaphosa became the President of the ANC a new group of opportunists with business interests had emerged and the communist party would fight against this;
  • Motsepe has since denied all allegations of standing to benefit from the unbundling of Eskom.

8. BOSASA Employees Receive Termination Letters

  • Many employees at the African Global Operations, formerly known as Bosasa, are expected to down tools indefinitely as the services and facilities management company faces liquidation;
  • On Friday, workers were shut out of the firm’s Krugersdorp head office, a day after the High Court appointed a liquidator to wind up the company;
  • In an interview, angry and panicked staffers stated that they received termination of employment letters;
  • However, they were convinced by the Union and Liquidator Cloete Murray to return to work, though liquidator could not confirm how long the workers would be employed for.

9. DA lays formal complaint with IEC over ANC’s Bosasa-funded election “war rooms”

  • On the 27th of February 2019, DA leader Mmusi Maimane wrote to the IEC Chairperson, Mr Glen Mashinini, requesting a full-scale investigation into the Bosasa-funded war rooms used by the ANC to campaign ahead of the 2011, 2014 and 2016 elections;
  • Mmusi Maimane pointed to Section 9(e) of the Electoral Code of Conduct, which states that: “No registered party or candidate may abuse a position of power, privilege or influence, including parental, patriarchal, traditional or employment authority to influence the conduct or outcome of an election”, arguing that the conduct of the ANC was in contravention of the Code of Conduct.

10. Change in Cellphone Data Rules

  • South Africans have been warned, as of the 28 February 2019, if they use out-of-bundle data, they will also be able to roll over data;
  • These are some of the new rules contained in Independent Communications Authority of South Africa (Icasa)’s end-user and subscriber service charter;
  • Other rules include:
    • Cellphone providers cannot switch subscribers over to out-of-bundle use – without consent,
    • Cellphone providers must allow subscribers to roll over unused data before the expiry date,
    • Cellphone providers must allow subscribers to transfer data to other clients who use the same provider, and
    • Cellphone providers must send subscribers 50%, 80% and 100% data depletion notices,
  • These new rules affect the country’s four biggest cellular networks providers;
  • To counter the new rules, Vodacom planned to charge consumers up to R49 to roll over data, while Cell C’s planned to charge nearly half the amount;
  • This sparked angry reaction among Vodacom clients, resulting in Vodacom reconsidering a new charge to roll over data;
  • Telkom and MTN will not charge for data rollover.

11. SABC Board

  • Portfolio Committee on Communication has published the names of the twenty-four (24) candidates that are set to fill eight (8) the South African Broadcasting Corporation (SABC);
  • The candidates include:
  1. Mamodupi Mohlala-Molaudzi
  2. Bernedette Muthien
  3. Jasmina Patel
  4. Adv Nakedi Ribane
  5. Dr Marcia Scikwa
  6. Siphile Buthelezi
  7. Prof Sathasivan Cooper
  8. David Maimela
  9. Mpiyakhe Mkholo
  10. Adv Lufuno Novondwe
  11. Mary Papaya
  12. Luvhuwani Matsila
  13. Sembie Danana
  14. Itani TseisiI
  15. Rowan Nicholls (CA)
  16. Mfanozelwe Shozi
  17. Nokuzola Ehrens
  18. Mmabatho Ramagoshi
  19. Wiliam Malema Ramoshaba
  20. Lulama Mokhobo
  21. Gift Buthelezi 
  22. Adv Motshedi Benjamin Lekalakala 
  23. Nkosana Mbokana
  24. Adv Mathews Mofokeng 
  • The CVs of the candidates were published on Parliament’s website;
  • The committee will conduct interviews next week from March 5 – 7 2019.

12. Public Protector Busisiwe Mkhwebane Survives Vote against a Probe into Her Early Removal

  • Public Protector Busisiwe Mkhwebane will not be probed for possible removal from office following a majority of six (6) against (4) votes by Parliament’s Portfolio Committee on Justice and Correctional Services on Tuesday the 26 February 2019;
  • The DA, in particular was unhappy with adoption of the report recommending that it was premature to start an inquiry into Mkhwebane’s early removal from office, which was originally introduced by Chief Whip John Steenhuisen;
  • The EFF, on the other hand, which was originally been unhappy with Mkhwebane’s appointment, was among the six people who voted for the adoption of the report recommending that it was too early to start looking into Mkhwebane’s early removal from office;
  • In February 2018 Steenhuisen asked the National Assembly to expedite the procedures to remove Mkhwebane;
  • This was after Mkhwebane came under fire over a finding she made against Absa in a report on the Bankcorp-CIEX matter and had to cover some of the costs incurred by the South African Reserve Bank out of her own pocket.

13. Public Protector’s naming and shaming

  • Following her survival and frustrated by a lack of funds to follow up matters in court, Adv Busisiwe Mkhwebane took the unusual step of naming the government institutions that failed to comply with her office’s reports;
  • Speaking at her offices in Tshwane, Mkhwebane mentioned the failure of Minister of Police Bheki Cele to provide protection for Thabiso Zulu and Les Stuta, who had blown the whistle on corruption exposed the use of public funds;
  • She also called out Minister of Defence Nosiviwe Mapisa-Nqakula for failing to implement her remedial action in the matter of former Lieutenant Babalo Mvithi in the South African National Defence Force. According to Advocate Mkhwebane, Lieutenant Mvithi and his family are without a source of income due to maladministration by the Department of Defence and Military Veteran;
  • Mkhwebane further named Treasury and Former Minister of Higher Education and Training Blade Nzimande for failing to implement the remedial action mentioned in a report that looked at alleged procurement irregularities, maladministration, nepotism, corruption and victimisation of employees at Tshwane South College in the 2017/2018;
  • Mkhwebane has released 70 reports since she started as Public Protector in 2016, of which 21 have been taken on review and her office is only defending 13 of those, which have an impact on the office’s responsibilities, due to resource constraints.
  ELECTION WATCH
 
Proclamations need to be published in Government Gazette by the 26 February 2019, this therefore means that South Africans have until close of business on Tuesday, 26 February 2019 to register to vote   http://anceasterncape.org.za/national-assembly-passes-motion-to-dissolve-parliament/  
South Africans Abroad: Had until the 26 February 2019 to fill in the VEC10 Form to Vote Overseas on 27 April 2019  
https://www.sapeople.com/2019/02/26/south-africans-abroad-fill-in-the-vec10-form-now-to-vote-overseas/  
  AFRICA WATCH  
 
Liberia News: Son of Liberia’s former President Ellen Johnson Sirleaf Arrested
http://www.sabcnews.com/sabcnews/liberian-central-bankers-arrested-after-probe-into-missing-millions/  

Nigerian election: Muhammadu Buhari, re-elected president of Nigeria & Atiku goes to court http://www.theafricareport.com/West-Africa/nigerian-election-atiku-goes-to-court.html
              
Senegal election 2019:               
http://www.sabcnews.com/sabcnews/senegals-sall-in-sweeping-election-victory/                                             

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