Global South African News Wrap – 7 December 2012
Banks bent over backwards for Zuma All the president's willing benefactors: Part two All the president's willing benefactors: Part one Zuma payments: South Africans have a right to know Auditors' secret report reveals how millions flowed to President Zuma Motlanthe’s Indecision May Have Cost Him South African ANC Post Not a good year for reconciliation Habib ‘preferred candidate’ in race for Wits university rector Now up to Motlanthe to step forward, say Limpopo, Western Cape Yes for super tax ‘sure bet at Mangaung’ Future of SA mining is up for grabs at Mangaung Motlanthe’s life in danger – Lekota Motlanthe secures top ANC nomination in Western Cape SA slips further on corruption index ANC hard line on media confuses Business gets serious over lobbying at Mangaung Controversy dogs ANC’s reconvened conference Net1 shares down 56% on US probe ANC shrugs off warning on risks to SA mining SA must climb value chain and spread gains – Davies Stark difference in images of our two main political parties Outcome of Doha climate talks important for SA Members complain to Luthuli House Affirmative action to stay until equity achieved, says minister Mantashe denies ANC ‘arranges’ leadership Deals gave him power Simelane out of the NPA Ramaphosa poised for a big role in government Finance gurus could raise NEC credibility Chaos still besets ANC nominations State’s fund creates 745 jobs, costing R4m each Motlanthe: if ANC's house crumbles, voters will move
ANC dashes Mbalula's ambitions Motlanthe’s silence career-limiting Is there life in DA after Helen Zille? Millions stolen 'for ANC elders' Cwele ‘welcomes’ constitutional challenge to secrecy bill State targets ease of doing business in South Africa Mangaung may be a repeat of Polokwane ANC ‘has no handle on own changes’ Zuma in headlines over ‘perks for brothers’ South Africa ‘must be part of Agoa for sake of neighbours’ ANC showdown could be fresh start for Motlanthe — or a return to the past Motlanthe rejects ‘deals’ to secure top job at Mangaung Nkandla: Lindiwe won't let up Back-room huddle to save Motlanthe
7 December 2012 Mail and Guardian Craig McKune Banks bent over backwards for Zuma After 1994, South Africa's biggest banks bent over backwards to accommodate Jacob Zuma, who regularly splurged on credit. Contrary to sound practice, the banks often tolerated his actions. At least in the case of Absa, this was explicitly – though internally – justified on the basis that Zuma was "politically" and "strategically" valuable. On numerous occasions Zuma, often through Schabir Shaik as his "financial adviser", promised the banks that his various benefactors would repay his debts, and in some instances they did. But inevitably Standard Bank, Absa and Nedbank, among others, got their fingers burnt. Zuma's banking troubles first peaked after Standard Bank bonded a property of his in 1995. The bank had extended the bond despite Zuma having defaulted on a bond with a different bank months before. By 1997, the Standard Bank bond was in arrears and Zuma's overdraft on a cheque account there exceeded R100 000. The bank put its foot down, cancelling his credit card and obtaining a court order against him, but it abandoned this order in 1998. Disappointment In 2002 Standard Bank appears to have dropped its pursuit of the R128 300 overdraft and in 2005 it wrote off Zuma's bond account – just less than R200 000 – as bad debt. This did not stop FNB from granting Zuma a R900 000 bond for Nkandla after a senior bank official wrote: "I am sure that the powers that be will assist us where we need to bend the rules a little." Zuma benefactor Vivian Reddy had to stand security, though. From 1996 to 2004, Zuma also built up a R214 000 overdraft at Nedbank, which politely noted its "disappointment" at Zuma's lack of response to their queries. But Zuma's relationship with Absa was most telling. When Zuma opened his account in 1998, Absa business centre manager Raymond O'Neil attempted to justify the decision despite Zuma's bad credit record with Standard Bank and Nedbank, which he specifically noted. O'Neil wrote in a memorandum that Zuma was likely to be elected South Africa's deputy president the following year and Nelson Mandela was going to settle his debts. Apparently quoting Zuma, O'Neil said that Zuma's "bank balance was the last item on his mind, with more important matters regarding the country and the province to focus on". According to O'Neil: "We recommend the opening of [the] Unique package account for Minister Zuma, based on his strategic positioning and importance to the group." Within three months Zuma's account was in overdraft and he had, once again, exceeded his overdraft limits.
As Absa's patience wore thin in 2000 and bankers noted in records that Zuma's conduct was "unacceptable", there was indeed a R2-million cheque received from Mandela, but apart from R100 000 that stayed in his account, the rest immediately flowed out. Although Zuma's financial position tended to be cash-starved at the time, in 2001 Absa signed him on as a Absa Private Bank client, which is usually reserved for those with more than R1-million to invest in markets. Once again this was noted to be a political decision, seemingly in line with chief executive Nallie Bosman's view, stated in bank records, that "in terms of all financial matters" Zuma was considered "a strategic client". But soon after this Zuma was hugely overdrawn, much to some bankers' chagrin. According to a note by one of them: "The conduct leaves much to be desired, but we have little option but to live with this client in view of his position."
7 December 2012 Mail and Guardian Sam Sole, Stefaans Brümmer All the president's willing benefactors: Part two Here are the people the auditor's report identifies as having paid more than R7million to benefit Jacob Zuma between 1995 and 2006. A hand-drawn diagram on the back of an unrelated October 2000 account from the University of Zululand reflected the following plan: "R1m from Paris to Mauritius. From Mauritius to A Moodley Trust a/c and then to Juli's Trust a/c." Anand Moodley was Shaik's attorney and, KPMG says, it is possible that "Juli" referred to Mahomed. On July 12 2004 Zuma issued a cheque in favour of his Nkandla builder, Eric Malengret, for R120 000. KPMG reveals that a credit transfer of R120 000 was made into Zuma's account the same day. The funds originated from the J Mahomed Attorneys trust account. The source of the funds is unknown. On August 12 2004 Zuma issued a cheque in favour of Malengret for R30 000. Two credits, totalling R30 000, were transferred into Zuma's account the same day, R20 000 from Mahomed's firm's trust account and R10 000 from its business account. The sources of the funds are unknown, says KPMG. It appears that Zuma may also have benefited – through Mahomed's trust account – from another arms deal company, Ferrostaal, which led the consortium that won the submarine contract.
On July 6 2005, a R281 000 cheque, drawn on her trust account, was deposited into a Wesbank account to make up Zuma's arrear payments on a Mitsubishi Pajero 4x4. According to KPMG, it appears the funds came to Mahomed through three similar deposits into another of her accounts, two of which bore the reference "Ferroman". Ferroman was a local Ferrostaal subsidiary with a black economic empowerment component. Mahomed herself was a director of Ferroman, which was intended to be a vehicle for pursuing Ferrostaal's offset obligations arising out of the submarine deal. Vivian Reddy – R324 110 Durban businessperson Vivian Reddy appears to have become involved in funding Zuma's Nkandla development when financial pressures made it difficult for Shaik's companies to pay. On November 3 2000, Reddy lent R50 000 to Zuma's builder, Eric Malengret. KPMG notes: "We understand that Reddy indicated that the funds had been advanced to Malengret as a result of cashflow problems Malengret experienced due to the development for Zuma and due to Zuma's tardiness in reimbursing him for work completed." Reddy later also stepped in to assist Zuma with arranging a home loan from First National Bank. According to KPMG, Zuma applied to FNB for a home loan on June 7 2002 in the amount of R650 000. "V Reddy" was indicated as having accepted responsibility to pay the monthly instalments. A fortnight later, Reddy also signed a suretyship, binding himself for up to R400 000 should Zuma default. FNB confirmed to Reddy on December 12 that the bond over the property had been registered in the amount of R900 000. The loan was repayable over 20 years at R12 117 a month – and it was noted that the debit order would be raised against Reddy's cheque account. KPMG found Reddy serviced the bond account until May 25 2005, when Zuma took over the payments. The value of the payments until then was R274 110. On April 8 2006, the outstanding balance on the bond was R854 229. Zuma did attempt to begin to repay Reddy in 2004 – but he needed help (See Khulubuse Zuma). Reddy has said publicly that he has been repaid in full. In response to the Nkandla public- works scandal, Zuma recently told Parliament: "I engaged the banks and I am still paying a bond on the first phase of my home."
It seems likely that the president was referring to the loan from FNB. Khulubuse Zuma – R180 000 On October 30 2004, Jacob Zuma issued a cheque in favour of Reddy for R164 500 to repay the latter for servicing Zuma's bond repayments on the Nkandla development. The bank returned the cheque as unpaid, because Zuma's account was already R163 170 in the red. In February 2005, KPMG's report says, Zuma's now controversial businessperson nephew came to his aid. Zuma's cheque account revealed a R180 000 deposit on February 26 2005 with the reference "Khulubuse". "Before this deposit," KPMG says, "Zuma's account indicated an overdraft balance of R91 704. The deposit slip indicates that a cheque in the name of KC Zuma was deposited. We understand that the cheque was drawn on the account of Khulubuse Clive Zuma." Thereafter, Zuma issued seven post-dated cheques to Reddy, totalling R180 000. Khulubuse's ventures into big business – especially his involvement in Aurora Empowerment Systems' disastrous takeover of gold mines on the Rand – have been controversial. His early support for Zuma begs the question whether this past financial relationship generated any degree of presidential access or protection. Nora Fakude-Nkuna – R174 200 When Parliament's ethics committee investigated Zuma's alleged non-declaration of interests in 2003, it was presented with evidence that Bohlabela Wheels, the company of Nelspruit businessperson Nora Fakude-Nkuna, a longtime friend of Zuma, had paid the architects' fees for the then deputy president's Nkandla estate. The invoice for R34 200 was dated March 2000. In reply, Zuma and his nephew Kusa Raymond Zuma, who worked for Bohlabelo Wheels, said Kusa was responsible for the payment and had organised it with Fakude-Nkuna without Zuma's knowledge. KPMG shows further payments: August 14 2000: "KR Zuma" deposits R100 000 into the account of Zuma's Nkandla builder, Malengret. But the deposit comprises two cheques drawn on Bohlabela Wheels and one from Fakude-Nkuna. October 4 2000: "KR Zuma" makes another cheque deposit of R40000 and the details reflected in the deposit slip indicate that the drawer's name was Bohlabela Wheels.
Replying to questions on these payments in the 2003 Parliamentary investigation, Zuma "indicated that there was a verbal agreement between him and Fukude and that it was not an interest-free loan", says KPMG.
7 December 2012 Mail and Guardian Sam Sole, Stefaans Brümmer All the president's willing benefactors: Part one Here are the people the auditors' report identifies as having paid more than R7million to benefit Jacob Zuma between 1995 and 2006.
After 1994, both Nkobi and Shaik were proponents of the Malaysian Bumiputera model, a concept that entailed the establishment of businesses aligned with a political party. When Nkobi died in September 1994, Shaik found himself shut out by the ANC hierarchy. In May 1995 Nkobi's successor, Makhenkesi Stofile, wrote to Shaik telling him that, after a meeting with ANC officials, he was considered to "have no position within the ANC" and Stofile had been instructed to cut off communication. The KPMG report notes: "It is during this time when the name of Zuma started surfacing in documents at our disposal … Shaik ceased to act on behalf of the ANC (in an official capacity) but continued his business dealings under the name of the Nkobi group, involving Zuma in various instances." It was then that Shaik also began to style himself variously as Zuma's "financial adviser" and "economic adviser". Zuma, fresh from exile and with a large and growing collection of dependants, was open to Shaik's assistance. The first payment to Zuma took place on October 25 1995 – and the KPMG report traces how a pattern of mutual favours developed. KPMG notes: "It is evident that Zuma … at various points, and especially with regard to the relationship of the Nkobi group with the Thomson group of companies, attended meetings and visits with representatives of the Nkobi group on issues that were of interest to the Nkobi group." With his brother Chippy heading defence acquisition, Shaik was well placed to benefit from the decision in the 1990s to re-equip the navy. Early on, he sought an alliance with the French defence conglomerate Thomson-CSF. Thomson was also seeking access to and business from the new ANC elite. The KPMG report sketches how cynically the French calculated their success, which they believed would be dependent on pleasing the politicians and choosing the "right" local partners.
And the abrasive Shaik was vulnerable. Parallel to its relationship with him, Thomson was wooing Reuel Khoza's CNI group, perceived to be more favoured by Thabo Mbeki, then the deputy president. Zuma was Shaik's trump card and, as the report makes clear, he shamelessly used his proximity to Zuma to cajole or bully his way into deals. Zuma's key interventions came in July 1998 when he accompanied Shaik to a meeting in London with one of Thomson's top executives to reassure the French of Shaik's suitability – and later in Durban, where he was present when the formal allocation to Nkobi of a shareholding in Thomson was confirmed. In turn, Zuma was not shy about taking advantage of the financial resources Shaik provided (sometimes grudgingly, given his own precarious cash position). By way of illustration: Zuma's reliance on funding from Shaik grew from one payment of R3 500 in 1995 to 176 payments totalling R534 858 in 2004 and, finally, 61 payments totalling R819 333 in the first six months of 2005, ending just after Shaik's conviction for bribery. The total over 10 years: R4 072 500 By then, the real ambivalence of the Zuma-Shaik relationship had been captured in a way not even KPMG's figures can match. Shaik's secretary testified that her boss had complained about "politicians", exclaiming one day that he "has to carry a jar of Vaseline because he gets fucked all the time, but that's okay because he gets what he wants and they get want they want". Nelson Mandela – R1-million-plus Jacob Zuma seems to have been identified fairly early on as a financial "problem child" by Nelson Mandela. The KPMG report quotes from a 1998 internal Absa memo when the bank was considering taking on Zuma, then the ANC deputy president, as a client. The memo referred to the supposed fact that Zuma had been disciplined by Mandela and then-ANC treasurer Mendi Msimang over the conduct of his financial affairs. It also stated that Mandela had apparently agreed to settle Zuma's debts – "this info to be handled strictly confidential". "The source of the payment could not be disclosed to us at this stage. The amount to be paid will be R1.5-million," the Absa memo said. However, no funding appears to have been received from Mandela until October 2000, when the then retired president endorsed a R2-million cheque to Zuma. R1-million of that was destined as a donation to the charitable education trust Zuma had founded and was duly paid over by Zuma. Whether the other R1-million was intended for Zuma's personal benefit is unclear. Zuma issued a cheque for R1-million to an account in the name of the Development Africa Trust that had been opened by Durban businessperson Vivian Reddy.
As the Shaik trial revealed, around this time Reddy became involved in funding Zuma's Nkandla estate development. But Shaik, who controlled Zuma's accounts, stopped the payment to Development Africa, instead using Mandela's money to plug holes in his own company accounts. Shaik eventually repaid R900 000 to Development Africa – partly using R250 000 that was found to have been paid in terms of the "bribe agreement" allegedly reached between Shaik, French arms company Thomson-CSF and Zuma. Shaik completed the repayment with a R400 000 cheque to Development Africa on June 23 2005. It was striking for two reasons:
There was an outflow only days later of the same amount of R400 000 from Development Africa to the International Convention Centre in Durban, where it was accepted as payment on behalf of Zulu King Goodwill Zwelithini for his daughter's wedding – tending to confirm allegations that Development Africa was used at least in part as a slush fund to buy the king's favour for the ANC; and On the same day, June 23 2005, a new R1-million cheque from Mandela was deposited into Zuma's Absa cheque account, wiping out his known overdrafts, which stood at more than R400 000 at the end of the previous year. At least from this Mandela million, it appears, Zuma could benefit personally.
The new R1-million from Mandela came only nine days after then-president Mbeki had dismissed Zuma as his deputy following Shaik's corruption conviction. Jurgen Kögl – R107 5091 An enigmatic broker and investor originally from Namibia, Jurgen Kögl has counted a number of politicians as close friends. They included Mbeki, who stayed in his Hillbrow flat after returning from exile, and Frederik van Zyl Slabbert, the former opposition leader. Like Shaik, Kögl has been described as a "financial adviser" to Zuma. In a 2003 interview with the Mail & Guardian, he justified sponsoring politicians, saying: "There is nothing sinister about these relationships. What happens is that you provide support and find ways of making sure these guys are able to get on with negotiations or with governing the country." The KPMG report identifies Kögl's investment management company, Cay Nominees, as the source of about a dozen payments totalling R1075091 to, or on behalf of, Zuma. The single biggest payment –R600 000 into the bond account of a Killarney, Johannesburg, flat owned by Zuma – raised much interest from KPMG and Scorpions investigators, who appear to have suspected it was disguised bribe money from French arms company Thomson-CSF. The Kögl payments include: May 5 1995: R40 000 deposit for Zuma's R426 500 purchase of the Killarney flat (which appears to have been subsequently occupied by his wife Kate, who committed suicide in December 2000, and their children);
February 22 and March 5 1999: Two payments of R20 000 each to a Zuma account with Mercedes-Benz Finance for a Mercedes-Benz E-Class 230. Zuma had been in arrears since buying the vehicle the year before and Mercedes had issued a summons; June 9 1999: R40 000 to a Zuma cheque account; June 17 1999: R50 000 to Zuma's bond account for the Killarney flat. This is the day after Zuma was inaugurated as deputy president. The bond account had been habitually in arrears since at least 1997, towards the end of which Standard Bank obtained a debt judgment and nearly sold the flat in execution; August 15 2001: R183 000 to Zuma's account for the Mercedes E230. This was to settle the account in full after it had again fallen into serious arrears following Kögl's February and March 1999 bailouts; and August 23 2001: R600 000 to Zuma's bond account for the Killarney flat. This was to pay the bulk of the outstanding amount after Zuma had made no further payments since Kögl's June 1999 bailout. KPMG presents a trail appearing to show that the payments of R183 000 and R600 000 flowed from a R1.19-million transfer to Kögl's Cay Nominees from a client account at a British law firm. The audit firm speculates that the payment might have been "another structure for transferring funds" from Thomson-CSF after only the first R250 000 tranche of the R500 000-a-year French bribe had reached Shaik through a sham "service provider" contract six months earlier. The Scorpions appear to have abandoned attempts to force disclosure of the money's source in London when Kögl and Zuma went to court to stop them in 2007. When the parliamentary ethics committee investigated Zuma in 2003 for allegedly not declaring benefits, Kögl and Zuma claimed to the committee that the R656 000 known by then to have passed from the former to the latter was an interest-bearing loan repayable after 10 years.
7 December 2012 Mail and Guardian Nic Dawes Zuma payments: South Africans have a right to know In just over a week, delegates sent to Mangaung by ANC branches will vote whether or not to retain President Jacob Zuma. It is a grave decision for the party that was central to our liberation from apartheid and what has been a remarkably successful transition to democracy. We believe it is one that delegates must make with the fullest possible knowledge of each candidate’s suitability for high office.
Zuma and those around him have fought, however, to prevent both the courts and the public from learning the truth about the corruption allegations against him and some of his closest associates. In the process they have ridden roughshod over the justice system and put at risk the basic institutional framework of democracy, undermining the National Prosecuting Authority (NPA), the courts and intelligence agencies. The KPMG report on Zuma’s financial affairs we are reporting on and posting to our website makes it very difficult for him to continue the charade. It paints the most detailed and distressing picture available of a kept politician, not just unable, but unwilling to live within his means, dependent on an array of benefactors to fund his lifestyle and willing to grant some of them favours in return. The report also makes it clearer than ever that the 2009 decision to drop criminal charges was political rather than legal. As the Sunday Times reported a fortnight ago, prosecutors were confident that their case could withstand the "spy tapes" and the claim that some of his political enemies were trying to manage the timing of the charges to his disadvantage. Reading the report with Judge Hilary Squires’s damning findings in the Schabir Shaik trial, it is hard to disagree with them: the president has an overwhelming case to answer. His supporters may object that in publishing the report now we are "attempting to influence the outcome of Mangaung". We are unabashed, however, in playing what we believe is the proper role of the press - providing the information that enables South Africans to make informed choices in the exercise of their rights. That has not stopped the state from using every tool at its disposal to impose ignorance. When this newspaper sought to show how Zuma’s confidant and spokesperson, Mac Maharaj, had lied under oath to investigators, we were threatened with criminal prosecution and, even though we withheld sensitive information pending court permission to release it, the editor and two journalists now face criminal charges. When the Sunday Times recently sought to publish documents showing how strongly prosecutors had felt about their case against Zuma, it faced an interdict attempt. The Democratic Alliance won a Supreme Court of Appeal order that the NPA hand over the spy tapes so that their relevance to the legality of the decision to drop charges could be properly tested. Months later, both the prosecuting authority and Zuma’s legal team are seeking ways to avoid compliance. We are short-circuiting this process of denial, delay and obfuscation by exposing the entire report to public scrutiny. We are doing so without seeking prior comment from Zuma or others named in it. This is a diversion from our usual practice and it is not one we have undertaken lightly.
The right of reply is an important journalistic principle and we ordinarily offer it in advance of publication. In this case we have decided instead to offer full right of reply after publication, because it has been our own experience - and that of other newspapers - in dealing with material emanating from the arms deal investigation that an opportunity to comment is treated by the state as an opportunity to prevent publication. The press code provides that "a publication should seek the views of the subject of serious critical reportage in advance of publication, provided that this need not be done where the publication has reasonable grounds for believing that by doing so it would be prevented from publishing the report, or where evidence might be destroyed or sources intimidated". Although we would have preferred to publish comments from those affected with the report, we are convinced that the risk of being prevented from publishing it at all was real. We are also convinced that the report is a substantial and credible document, based on an assessment of hundreds of thousands of pages of documents obtained by investigating authorities and conducted by experts in forensic accounting. We invite comment from those implicated by the report itself and will publish it on our website immediately. Furthermore, we will publish in print and online detailed responses from Zuma and others identified in our reporting if they are forthcoming. This is what Judge Hilary Squires said at the conclusion of the Shaik trial: "If Zuma could not repay money, how else could he do so than by providing the help of his name and political office as and when it was asked … And Shaik must have foreseen and, by inference, did foresee that if he made these payments Zuma would respond in that way. The conclusion that he realised this, even if only after he started the dependency of Zuma upon his contributions, seems to us to be irresistible." The KPMG report supplements that inference with fresh evidence for which Jacob Zuma has provided no plausible explanation. He must now do so if he wishes to remain in office and avoid prosecution.
7 December 2012 Mail and Guardian Sam Sole, Stefaans Brümmer Auditors' secret report reveals how millions flowed to President Zuma An auditors' report lays bare how a range of benefactors funded a reckless president's lifestyle by more than R7-million. The report exposes the president as a "kept politician" - a financial freeloader who accepted money and favours on a routine and increasingly extravagant basis not only from his so-called financial adviser, Schabir Shaik, but also from other benefactors, including Nelson Mandela.
Running to about 500 pages, the "draft" report - although it is understood to be the final version - is based on tens of thousands of documents Scorpions investigators had seized from Shaik, Zuma and others. The report contains dramatic new disclosures including:
Former president Mandela came to Zuma’s rescue with a R1-million cheque on June 23 2005. This was just nine days after then-president Thabo Mbeki fired Zuma as his deputy and three days after the NPA announced it would charge Zuma. The Mandela transfer, which has never been reported before, suggests that the retired elder statesman intervened directly in the battle between Mbeki and Zuma to back the latter in his hour of need. Before this, Zuma was more than R400 000 overdrawn on his various bank accounts; Payments ordered by Shaik continued, and in fact accelerated, long after the M&G revealed in November 2002 that the Scorpions were investigating Zuma and long after Shaik was put on trial in 2004. Payment even continued for a short period after Shaik’s conviction in June 2005, until Shaik resigned as Zuma’s financial adviser the following month. Altogether 783 payments from Shaik or his Nkobi group for Zuma’s benefit were identified, amounting to R4 072 500 - well beyond the figure of about R1.25-million known at the time of Shaik’s trial. Zuma appears to have repaid less than R500 000 of this by the end of February 2006; KPMG asserts that Zuma benefited from benefactors other than Shaik and Mandela to the value of at least another R3-million. They included politically connected businessperson Jürgen Kögl; Zuma’s friend, Nelspruit businessperson Nora Fakude-Nkuna; Durban mogul Vivian Reddy; Zuma’s nephew Khulubuse Zuma, who provided cash that was used to partially repay Reddy; Zuma attorney Julie Mahomed; some unknown benefactors; and French defence company Thomson-CSF. It was Thomson (later renamed Thales) that promised a payment of R500 000 a year for Zuma’s benefit in the notorious "encrypted fax", although only R250 000 is known to have been paid; It appears that Zuma may also have benefited from another arms deal company, Ferrostaal, which won the submarine contract; and Large commercial banks bent over backwards to accommodate Zuma because of his political position and accommodated Shaik because of his association with Zuma. This was despite the fact that Zuma had a terrible credit profile and defaulted regularly.
The KPMG report was prepared on the Scorpions’ instructions ahead of Zuma’s high court appearance in Pietermaritzburg in September 2006. Prosecutors had applied for a postponement to formulate a new charge sheet based on additional material seized during the August 2005 raids that followed Shaik’s conviction - including, for the first time, raids on Zuma’s home and office. They also asked for time to deal with Zuma’s challenge to the legality of those raids. Judge Herbert Msimang refused the postponement and the case was struck from the roll without the report being tabled. It remained hidden throughout the protracted legal battles that saw the NPA clear the path to prosecution and until April 7 2009 when the then acting national director of
public prosecutions, Mokotedi Mpshe, buried it by deciding to abandon the case just days before the national election that propelled Zuma to the presidency. Against the views of the prosecuting team, Mpshe ruled that Zuma’s rights to a fair trial had been poisoned by perceived meddling revealed in the so-called Zuma spy tapes. Now the M&G’s disclosure of the wealth of evidence available to the prosecution deepens the controversy surrounding Mpshe’s decision. It also raises the stakes for the Democratic Alliance bid to have that decision reviewed. Finally, it lays bare in excruciating detail the ongoing recklessness of Zuma’s financial relationships. Those relationships not only lay the basis for the current Nkandla scandal, but expose fundamental questions about Zuma’s fitness for office. For instance:
Payments in cash to Zuma - as opposed to the settling of bills and debts increased annually from R10 000 during 2002 to payments amounting to R181 800 during 2005. Cash payments during the first four months of 2006 amounted to a staggering R305 500. Zuma blithely incurred large debts - for cars, property, loans, building his Nkandla homestead - without bothering to consider where the money would come from. There were times when not even the first payment due cleared the bank owing to insufficient funds in his account.
In the words of the report: "The financial position of Zuma deteriorated over time, mainly as a result of the fact of the shortage in daily funding required to fund his lifestyle ... Zuma’s cash requirements by far exceeded his ability to fund such requirements from his salary ... "The predicament that Zuma found himself in from the early years did not result in reduced spending on his part. Shaik, as the claimed ‘financial adviser’, also did not reduce it. In fact, Shaik funded the shortfall … Spending continued …" Sometimes this infuriated Shaik, such as in October 2000 when he ordered that construction cease on Nkandla's first phase. Builder Eric Malengret told the Shaik trial that Shaik had exclaimed: "Does he [Zuma] think money grows on trees?" But Zuma simply countermanded Shaik and told Malengret to carry on. The report revives the spectre of the "mutually beneficial symbiosis" - the term Judge Hilary Squires used when he convicted Shaik in 2005. Whatever struggle bonds Shaik shared with Zuma, the former could not fund Zuma’s spending from his own resources. The report finds Shaik was able to fund no more than 13% of the funds that were made available to Zuma.
The balance had to be funded from the Nkobi group. This placed Shaik’s cashstarved companies under immense pressure. KPMG says: "The general decline in the net cash resources for the group has a direct correlation with the amounts that we identified as having been paid for and on behalf of Zuma … As the cash balances of the Nkobi group decreased, the payments made for and on behalf of Zuma increased." In return, Shaik made blatant and repeated use of his connection with Zuma. Says KPMG: "It is evident that at least Shaik considered the association with Zuma and his wider political connectivity as a key driver to the success of the business activities of the Nkobi group … "We could not find any evidence in the documentation at our disposal of Shaik being advised or requested by Zuma not to engage in such activities, despite numerous examples indicating his [Shaik’s] approach." Shaik is often presented as the arch-manipulator in the relationship, but the scale of the payments to Zuma and the extent of the pressure this outlay placed on Shaik and his companies emerges very clearly from the report, raising questions about who was really using whom.
7 December 2012 Bloomberg
Motlanthe’s Indecision May Have Cost Him South African ANC Post Kgalema Motlanthe’s failure to openly challenge South African President Jacob Zuma for the leadership of the African National Congress threatens to leave him sidelined in the ruling party. Nominations made by ANC members ahead of a party election next week show Zuma could win backing from about 70 percent of the 4,500 conference delegates to retain leadership for a second five-year term. Zuma’s supporters dropped Motlanthe, 63, from their list of preferred candidates for the top six party positions, with most opting for Cyril Ramaphosa, the union leader turned tycoon, to replace him as deputy ANC leader. Zuma, 70, who wrested control of the ANC from Thabo Mbeki in a party election in 2007, has faced little opposition to his re-election as party leader even as his administration battles to curb a 26 percent unemployment rate and public protests over a lack of housing, water and other services. Motlanthe abided by a party ban on campaigning and refused to say if he would contest the presidency, a strategy that may have backfired. “ANC members are wondering if they want a leader who is not willing to take a position,” Sipho Seepe, a political analyst in Pretoria, said in a Dec. 3 phone interview. “It’s a reluctance which shows a certain degree of cowardice.”
Rand Weakens The 100-year-old ANC led the fight against white segregationist rule and has dominated South African politics since sweeping to power under Nelson Mandela in 1994. If Zuma is re-elected at the ANC’s national conference from Dec. 16-20, he becomes the party’s presidential candidate in the country’s next vote scheduled for 2014. The incoming ANC president is faced with restoring investor confidence in an environment of slowing growth. The rand has declined 5.5 percent against the dollar since Moody’s Investors Service downgraded South Africa’s credit rating on Sept. 27. The currency was trading at 8.7086 against the dollar as of 11 a.m. in Johannesburg. Motlanthe yesterday praised Zuma in a lecture organized by the ANC to commemorate its centenary. Zuma was instrumental in political talks that led to the first all-race elections in 1994 and in helping to end violence between the ANC and rivals in KwaZulu-Natal, Motlanthe said, according to the South African Press Association. “President Jacob Zuma’s life is exemplary of how positive thinking thrives against all odds,” the Johannesburg-based SAPA quoted Motlanthe as saying. ‘Still Agonizing’ Zuma won majority support in six of the nine provinces, while Motlanthe won backing from the other three. The party’s electoral commission will now approach candidates for the top six positions to determine if they’re willing to accept nomination. “I am still agonizing over it,” Motlanthe told reporters in Pretoria on Nov. 30. “I don’t have to be in a position of leadership. I have never regarded myself as having a political career.” Motlanthe, a former labor leader, served as president of the country for eight months between the time Mbeki was ousted from his post and Zuma installed after April 2009 elections. As deputy president he has been responsible for coordinating the building of new power plants, improving railways and expanding ports, while also overseeing the government’s anti-AIDS program. Ramaphosa Nominated “Even the people who are very loyal to him might have been discouraged by the fact that he hasn’t made clear that he is prepared to stand,” Somadoda Fikeni, a political analyst at the Pretoria-based University of South Africa, said in a Dec. 3 phone interview. “This is hardly a way of contesting this race.” Motlanthe says he isn’t interested in striking deals with various factions within the ANC that would allow him to retain his post. That may lessen his chances of winning a top post in the party and pave the way for Ramaphosa, who is the second- richest black South African, according to Johannesburg-based Sunday Times newspaper. Motlanthe “is clearly trying to play quite a principled game,” said Zwelethu Jolobe, a political analyst at the University of Cape Town. “I have yet to see a candidate who
has been successful on that basis. For the position of deputy president, it looks like Ramaphosa pretty much has it in the bag.” Ramaphosa, 60, hasn’t said whether he will contest the election. Party officials may yet broker a deal in which Motlanthe retains the deputy president post by agreeing not to challenge Zuma, while Ramaphosa is persuaded to refuse the No. 2 spot, Seepe said. Many senior ANC members want to avoid a repetition of the divisive leadership battle that occurred at its last elective conference in 2007 when Mbeki was ousted and hope to still reach consensus over posts, said Daniel Silke, a political analyst and author of “Tracking the Future: Top trends that will shape South Africa and the World”. “The ANC cannot withstand another tear in its political fabric,” Silke said in a Nov. 30 phone interview from Cape Town. “This is a short-term patchwork job.”
7 December 2012 Cape Times Page 6 Cobus Coetzee
Not a good year for reconciliation Cape Town - Only one-third of South Africans interact across racial lines, while disapproval of inter-racial marriages and integrated schools is on the increase. These are just some of the findings of the South African Reconciliation Barometer released by the Institute for Justice and Reconciliation (IJR) in Cape Town on Thursday. “We didn’t think that 2011 was a good year for reconciliation, but 2012 was even worse. The question is, how long will we be able to string along like this?” said IJR executive director Fanie du Toit. The research found nearly half, or 43.5 percent, rarely or never speak to someone of another race. This happened as many people lived in informal settlements and rural areas and did not have formal employment. Between 2003 and this year the levels of interaction between races have rarely changed, except in 2004 and 2009 when they sharply declined compared to the previous year. These were both election years. Research over the past nine years shows there are still 40 percent of South Africans who almost never talk to people of other races, while more than 60 percent of the country’s residents don’t socialise with people of other races. Altogether 3 565 people were interviewed during April and May this year across all provinces.
The interviews were done face-to-face in six different languages and were representative of the country’s gender, age and racial demographics. The findings show 27.4 percent of South Africans interact with a person they believe to be of another race always or often, on an ordinary weekday, while a quarter (25.9 percent) talk sometimes. In 2012 only 17.8 percent of South Africans always or sometimes interact with people of other races in their homes or friends’ houses. The report notes levels of cross-racial socialisation have changed little during the past three years, while fewer people (expressed as a percentage of the sample) talk to other people of a different race compared to 2011. “Certainly, latent and overt stereotypes, fear or trepidation about others, and even naked racism have contributed to static levels of interaction and the slow pace at which social bonds are being forged,” the report found. A large number, or 41.4 percent, also find people of a different race’s “ways and customs” difficult to understand. A quarter of people feel economic inequality creates the biggest division between race groups, while disease, political parties, race, religion and language also divide the nation. South Africans who live in affluent households in urban areas are the most likely to socialise across racial lines, while rural dwellers and people living in homogenous townships and informal settlements are the least likely. Despite the divisions, 61.8 percent believe national unity across historical divides is desirable but levels of agreement are lower among white (49 percent) and coloured (50 percent) youth. Altogether 38.8 percent say they want to know more about others’ customs and 23.2 percent say they want to interact more with people of other races. Not everyone approves of racial integration. An increasing number of people compared to last year disapprove of inter-racial marriages. Altogether 42.7 percent of white young people, between 15 and 34 years, would disapprove the most if a close relative were to marry someone of a different race. This is more than white adults (30 percent). The research also found that disapproval of school integration has been on the rise since 2010. Two years ago less than 10 percent of people disapproved while this year nearly 15 percent were against it. Fewer people object to having neighbourhoods in which they live integrated.
7 December 2012 Business Day
Page 4 Karl Gernetzky
Habib ‘preferred candidate’ in race for Wits university rector UNIVERSITY of Johannesburg deputy vice-chancellor Adam Habib has emerged as the top candidate for the position of vice-chancellor at the University of the Witwatersrand. Incumbent Loyiso Nongxa, is to leave the post in May, after a 10-year stint. It will fall to the new vice-chancellor to manage the tension between financial sustainability and a long-term vision of being a world-class institution. The Wits senior appointments selection committee is set to table its report to the Wits university council on Friday. Comments by some members of the committee suggest Prof Habib is the preferred candidate for the post. The university is also set for a shakeup in senior management positions, with the post of vice-chancellor (academic), to be advertised next year. The post of vice-chancellor (finance and operations) has already been filled by incumbent dean of the faculty of humanities, Tawana Kupe. Prof Kupe assumes office next year. Prof Habib, has already submitted his vision for Wits and has been through interviews, as have two other candidates: Yunus Ballim — who is Wits deputy vicechancellor (academic), and Liesbeth Botha, the executive director of materials science and manufacturing in the senior management team of the Council for Scientific and Industrial Research. A candidate’s vision needs to build into Wits’ existing vision to 2022. The latter includes a push for enhancing Wits’ international reputation as a research institution, as well as lowering the staff-student ratio. Along with this is raising the proportion of postgraduate students at a time when management and academics are deadlocked on a range of issues, including benchmarking academic standards, as well as research funding. At the same time, Wits together with SA’s 22 other public universities, is set to see a nominal decrease in state funding of 1%, 2% and 3% over the next three years. Institutions are also under pressure not to increase student fees. First on the agenda for the new vice-chancellor will be the tense labour relations at the institution. Wits academic and support staff this year twice engaged in one-day strikes. Negotiations are expected to resume next year, and although academics suspended their strike, they are adamant their demands are reasonable and affordable. Prof Habib said in an interview on Wednesday that both the University of Johannesburg and University of KwaZulu-Natal had reaped the benefits of encouraging productivity and research among academic staff.
Prof Habib said Wits would need to balance increasing undergraduate enrolment with teaching loads. The university would also need to focus on the shifting higher education landscape and possible changes to funding formulas, despite Wits’ strength in science and engineering — which are both priority areas for the government — which could see the institution benefit. Prof Botha said finding a balance between undergraduate enrolment rates and academic pay and research time, could present opportunities for the institution. Wits also needed to attract "third stream" income — such as state support for poor students, and policy incentives to ensure that talented students were retained for postgraduate studies. Prof Ballim declined to comment until the process had been concluded.
7 December 2012 Business Day Page 3 Natasha Marrian and Bekezela Phakathi Now up to Motlanthe to step forward, say Limpopo, Western Cape IT IS now up to Deputy President Kgalema Motlanthe to declare his availability and accept nomination for the African National Congress’s (ANC’s) top job. This was the view of provincial leaders from Limpopo and the Western Cape on Thursday after the two provinces came out in support of Mr Motlanthe at their delayed nomination conferences. Mr Motlanthe has now been nominated by three ANC provinces as well as the ANC Youth League to replace President Jacob Zuma at the party’s national conference in Mangaung later this month. But he has still not indicated whether he would accept nomination. In Limpopo, the ANC electoral commission announced that Mr Motlanthe had obtained 268 votes, and Mr Zuma received only seven. There were 437 eligible voters in the province and 275 cast their votes. Limpopo will take 501 delegates to Mangaung. In the Western Cape, Mr Motlanthe trumped Mr Zuma by a mere nine votes. Speaking after a two-day-long second attempt at holding the gathering, Limpopo provincial secretary Soviet Lekganyane welcomed the endorsement of Mr Motlanthe by branches. But it appears Mr Motlanthe’s silence over whether he will stand still weighs on his supporters. "We are not imposing Motlanthe on the ANC, we are also not forcing it down his throat. But he must consider, and if he thinks it is opportune, he can declare his availability," said Mr Lekganyane on the sidelines of the conference in Polokwane.
The province nominated ANC treasurer-general Mathews Phosa as deputy president, Sports Minister Fikile Mbalula as secretary-general, national executive committee member Thenjiwe Mtintso as deputy secretary-general, North West Premier Thadi Modise as chairwoman and Human Settlements Minister Tokyo Sexwale as treasurer. Western Cape provincial secretary Songezo Mjongile, who has been calling for change, also said it was now up to Mr Motlanthe to avail himself. "He is eligible to be elected to any position in the ANC and, as such, members that have met in this PGC (provincial general council) have pronounced on his name … it is up to those individuals now to declare their availability or not," Mr Mjongile said. The roads to the Limpopo and the Western Cape gatherings were rocky, with both failing to successfully conclude the first time around. The ANC’s top brass then gave them a second, and last, shot. In Limpopo on Wednesday, the province began registering delegates at 9am, but a large group of Mr Zuma’s supporters were excluded from the process. The group was eventually allowed to register late on Wednesday night and the actual conference began early Thursday morning. The drama did not end there, as Mr Zuma’s supporters abandoned the conference, saying they were unhappy with some delegates’ credentials. They were not allowed back in. "The margins were humiliating for them. They wanted to save themselves from embarrassment," Mr Lekganyane said. In the Western Cape, Mr Phosa emerged as the choice of most delegates for the position of deputy president. Mr Mbalula was nominated to take over from Gwede Mantashe as secretary-general and Ms Modise as his deputy. Mr Sexwale was nominated for treasurer and Ms Mtintso — who is also a former deputy secretary of the ANC — was nominated for the position of national chairwoman. Western Cape provincial chairman Marius Fransman, who backs Mr Zuma, said "it was quite tight but we respect the outcome". "It is obviously not an issue of disappointment … now we can safely say there are 90 votes that we will be taking to Mangaung in the context of at least 2,400 other votes and that is the situation that we are seeing, I am very comfortable with this," he said. Mr Zuma has the support of two provinces taking the largest delegations to the national conference, KwaZulu-Natal and the Eastern Cape. Mr Zuma also has the backing of the Free State, Mpumalanga and the North West.
7 December 2012 Business Day Page 3 Carol Paton Yes for super tax ‘sure bet at Mangaung’
FOR those who have been on tenterhooks to see what the African National Congress (ANC) will resolve on economic policy at Mangaung, the waiting is quite suddenly over. Comments from the head of the ANC’s economic transformation committee Enoch Godongwana to Bloomberg News on Wednesday, that in all likelihood the ANC would opt to increase mining taxes in line with the proposals on the table, are a frank assessment of Mangaung’s likely outcome. The surprise that followed his statements are more surprising than the statements themselves. The writing has been on the wall since the publication of the ANC-commissioned paper "State Intervention in the Mining Sector" (Sims) and has been pretty much cast in stone since the ANC’s policy conference in June. At that meeting a lengthy and tense debate was held on the issue of nationalisation, followed by even more tense negotiations over the wording of the final statements. The recommendation from the policy conference very clearly endorsed the Sims document, which rejected "wholesale nationalisation" and supported "strategic nationalisation", by which was meant the question would be decided case by case , and going by evidence available. A small but important development was that while the Sims document suggested "a super tax" on windfall profits, the policy conference stopped short of saying exactly what form the tax should take. Instead it said: "The state must capture an equitable share of mineral resource rents and deploy them in the interests of long- term economic growth, development and transformation." For Mr Godongwana, who is at pains to point out that he is not pre-empting the outcome of the conference, the point is that there is unanimity within the ANC that despite the contribution of mining companies to the fiscus, the "equitable share" is not being captured at present. "At the policy conference we said ‘capture the rent’. What we have not specified is what form of tax precisely, because that is a technical matter. "While the present regime does not capture the large profits being earned through some commodities, the counterargument to a super tax is the volatility of commodities. It is not an easy choice, and government is doing that technical work," he says . The Treasury, al though it has made no public comment, is known to be strongly opposed to the super-tax proposal . Its stance on the matter seems to be part of the reason why commentators were surprised by Mr Godongwana’s statements. Some mining companies had already persuaded themselves the idea was off the table. But while the Treasury in the past was able to hold the line on matters it considered nonnegotiable, those days appear to be coming to an end .
There is no possibility, regardless of the appeals from the Treasury or the amount of noise from credit ratings agencies, that the commitment to raise mining taxes will not be endorsed at Mangaung. The moderates — among whom Mr Godongwana is included — could still have difficulty in holding delegates to this formulation. After the policy conference there was dissatisfaction over the formulation, with the left saying the resolution was watered down by the economic transformation committee. At the last two ANC national gatherings it has become fashionable, if not essential for one’s credibility, to be seen to actively support nationalisation. Thus a long queue of people, who don’t normally bother themselves with economic debates, have now joined the discussion with enthusiasm, in what Minister of Planning Trevor Manuel has described as "vuvuzela politics". This was brought on by the ANC leadership battle, where nationalisation became the ANC Youth League’s proxy for a factional attack on President Jacob Zuma. Hopefully, with that issue settled and Mr Zuma on his way back to power, the frenzy will subside. This will make the job of the moderates easier and agreement on the formulation of "capturing an equitable share of mineral resources rents" a formality. 7 December 2012 Business Report Page 18 Donwald Pressly Future of SA mining is up for grabs at Mangaung While the media focus has fallen on the “politics” and elective processes of the upcoming ANC national conference in Mangaung, some key economic policy issues will be thrashed out, which will have a significant impact on doing business in South Africa. The state onslaught on the mining sector will reach fever pitch at the conference. Although Enoch Godongwana, who remains the party’s economic transformation committee chairman despite getting into hot water over dodgy union deals, says that nationalisation is not on the agenda, state intervention in mining will – with little doubt – be ramped up considerably. Only yesterday, the government announced, after its cabinet meeting on Wednesday, that steps would be taken to dampen the prices of iron ore and steel. It is envisaged that export taxes be raised significantly to quell the global appetite for this country’s raw mineral products. The idea, of course, is to force more of these goodies on to the South African market to enforce local beneficiation and uptake of steel. It is good in theory, at least. But with all government interventions, the result is normally a distortion in the market which will, most likely, not pan out to be beneficial to the taxpayer. Take, for instance, the establishment of the African Exploration Mining and Finance Corporation (AEMFC), the state-owned mining company that focuses on supplying coal in sweetheart deals with Eskom.
The AEMFC received a plug of R120 million from the CEF, previously known as the Central Energy Fund. This is the only reason it has been able to carry on trading as a “stand-alone” state-owned company that is supposedly in the process of exiting from the CEF umbrella. Then there is Alexkor, the state diamond mining company, which has rewritten the formula for mining management incompetence. It is simply a financial black hole. In these two examples, there has been absolutely no obvious benefit to the taxpayer. If anything, much of their highly overpaid management have simply become rich. They have achieved just the opposite of the intention to expand the state’s role to benefit the masses. Despite this overwhelming evidence that the model of a greater state role in the economy doesn’t work, Godongwana, in an interview, said that the ANC should ignore the warnings of Moody’s Investors Service and Standard & Poor’s and impose taxes and more aggressive redistributive policies on the mining sector at Mangaung. According to the State Intervention in Mining report written some months ago, superprofit taxes are a jolly good idea. Former Reserve Bank governor Tito Mboweni warned that nationalisation was just a ruse by some to plunder national resources. Yet one suspects that the prevalent thinking in the ruling party tends towards the radical positions. Chamber of Mines chief executive Bheki Sibiya told the Cape Town Press Club recently that “the powers that be” – he meant political, religious, union and community organisations – must cease their witch-hunt against the “crown jewel”, the mining sector. He warned that the sector faced some 10 000 job losses in the first quarter of next year and was already struggling to survive. Nearly 60 percent of platinum mines did not make a profit. He also said the recent downgrade of the country’s credit rating was “a vote of no confidence” in the political leadership. He said if an additional mining tax was introduced, the ANC would send the signal that it did not want a sustainable mining sector. “They want to kill the economy.”
6 December 2012 The New Age Siyabonga Mkhwanazi Motlanthe’s life in danger – Lekota Cope leader Mosiuoa Lekota has entered the ANC leadership battle by claiming that Deputy President Kgalema Motlanthe was threatened not to contest the presidency of the ruling party. Lekota told journalists in Cape Town yesterday that Motlanthe’s life was in danger for challenging President Jacob Zuma for the ANC leadership. “The deputy president of the ANC and the country has been openly threatened that if he stands against Zuma he is placing his life in danger,” Lekota said. However, the ANC dismissed Lekota’s claims saying he was the last person to talk about election contests as he was leading a directionless party.
ANC spokesperson Keith Khoza said Lekota could not even run Cope. “Cope is in tatters,” said Khoza, adding: “If there is anyone who needs advice it is Terror Lekota.” He said the ANC had programmes and it was going to an elective conference next week. “What can Terror Lekota tell us about leadership? The Cope leadership has been installed by the courts,” Khoza said. Lekota said the current ANC government had been the worst government in many years. He said the march on the Goodman Gallery by the ANC leadership to protest against the Spear painting, depicting Zuma with his genitals exposed, was in violation of freedom of expression. He said the Marikana tragedy was the last straw as the government had failed to prevent the incident from happening. Lekota added that the overall performance of the ANC government left a lot to be desired. Out of a total of 10 he said he would give the ANC government a “one-anda-half”. Khoza said it was evident that Lekota’s analysis was questionable. “You can expect that from a bitter former ANC member. He has poor judgment. Whatever he says, people will judge it with suspicion,” Khoza said. Lekota also said they would challenge the Protection of State Information Bill and the Traditional Courts Bill in the Constitutional Court. He said they were concerned that there was no public interest defence clause in the protection of state information bill and that the traditional courts bill took away the right of women to be involved in the running of their villages. He said they wanted the latter to be withdrawn from Parliament. 6 December 2012 Business Day Staff writer Motlanthe secures top ANC nomination in Western Cape DEPUTY President Kgalema Motlanthe has been chosen as the Western Cape African National Congress (ANC) nominee for party president, provincial secretary Songezo Mjongile said on Thursday. Both the Western Cape and Limpopo had missed the November 30 deadline to conclude the leadership nomination process ahead of the ruling party’s Mangaung elective conference later this month.
Mr Motlanthe won by a small margin, receiving 99 votes to President Jacob Zuma’s 90. Sports and Recreation Minister Fikile Mbalula was endorsed for the position of secretary-general, with 96 delegates supporting him against incumbent Gwede Mantashe’s 85. The final list saw Mathews Phosa nominated for deputy president and Thandi Modise as deputy secretary-general. This was after a revote. Earlier national executive committee (NEC) member Cyril Ramaphosa was nominated as Mr Motlanthe's deputy, and Jessie Duarte as deputy secretary-general. Mr Mjongile said voting for the remaining positions would continue after the nominees failed to get an outright majority. Delegates had been gathered at the Cape Peninsula University of Technology, where the provincial general council was being held, since 4pm on Wednesday. Members of the ANC NEC task team — including Public Service and Administration Minister Lindiwe Sisulu, Health Minister Aaron Motsoaledi and Gauteng Premier Nomvula Mokonyane — had travelled to Cape Town on Wednesday for the reconvened nomination conference. On Wednesday, provincial ANC chairman Marius Fransman said: "We believe that the conference will happen very smoothly, because the Western Cape leadership won’t need to deal with disputes, as that will be done separately by the NEC task team." Last week, two attempts to conclude the province’s nomination process collapsed, as a result of the provincial executive committee not having the authority to rule over branch disputes. Controversy in Limpopo Meanwhile, the conference in Limpopo was still mired in controversy on Thursday morning, following complaints on Wednesday that some delegates were being excluded and bogus delegates being registered to attend the gathering in their place. The conference was abandoned last week after violence broke out at the gathering in the hotly contested province. Registration kicked off by mid-morning on Wednesday but the process was far from smooth with tense stand-offs between supporters of Mr Zuma and those backing Mr Motlanthe. There was a heavy police presence, both at the registration and conference venue. This included check points on the road leading to the venues and a command centre at the conference hall. By late afternoon many waited at the registration venue, some complaining that they were not allowed to enter despite being legitimate delegates.
Two men, believed to be supporters of Mr Zuma, were arrested on Wednesday night when a group of people tried to force their way into the conference centre. They allegedly pelted police with stones when officers tried to talk to them. The men will appear in the Polokwane Magistrate’s Court on public violence charges soon. On Thursday morning, police spokesman Brig Hangwani Mulaudzi said: "The situation is now calm. We are still having deployments in identified areas — even at the conference centre itself." He added: "We will be there until the conference finishes, and I think we did the best on our part since yesterday (Wednesday) because now the situation is calm. However, we are not working alone because there is a private security company as well." 6 December 2012 Business Day Page 5 Karl Gernetzky and Wyndham Hartley SA slips further on corruption index SOUTH Africa now ranks 69th of 176 countries considered in Transparency International’s corruption perception index for this year. Local commentators, however, are not surprised that the country has shed five places in the index, which was released on Wednesday. South Africa has fallen 31 places in the past 11 years, and it ranked behind Ghana, Namibia, Rwanda and Lesotho in this year’s edition of the index. South Africa ranked 38th out of 91 countries in the 2001 survey. The index measured perceived levels of corruption in the public sector, bribery, the abuse of public resources, secrecy in decision making, anticorruption laws and conflicts of interest in respect of government officials. There are a raft of complaints before Public Protector Thuli Madonsela. The Special Investigating Unit also has a mountain of corruption proclamations on its table, and auditor-general Terence Nombembe has found numerous irregularities in his inspection of the books of state entities. Hundreds of corruption charges against President Jacob Zuma were dropped on dubious grounds, and he is now embroiled in allegations that state coffers were raided to make improvements to his private home. Democratic Alliance (DA) spokesman on the standing committee on public accounts Dion George said yesterday the trend was "hardly surprising". SA shed 14 places in the past three years under Mr Zuma, he said. Over the past year the government has shown a "lacklustre" response to public sector corruption, and the year was characterised by "Nkandlagate", continued failure to permanently appoint the head of the Special Investigating Unit, and a refusal to adopt legislation that would prohibit officials from doing business with the state, said Mr George.
The African National Congress had also rammed the "secrecy bill" through Parliament, and few criminal charges resulted from breaches of the Public Finance Management Act pointed out by the auditor-general. Corruption Watch executive director David Lewis yesterday said the results were not surprising as the "survey echoes what we hear in the thousands of reports from ordinary people confronting corruption daily". While many leaders in the public and private sectors were deeply concerned about corruption, "the public can’t help but see the disjuncture between strong words and weak action," Mr Lewis said. DA correctional services spokesman James Selfe recently said: "The DA is shocked at the pervasive nature and extent of corruption and maladministration in government in South Africa". Special Investigating Unit probes were being undertaken into 32 municipalities (24 of which were in North West alone), six national departments, 12 provincial departments (from Limpopo, Mpumalanga, Gauteng and the Eastern Cape) as well as three parastatals. Earlier this year Ms Madonsela said corruption was endemic in South Africa. "If we don’t deal with corruption decisively, it will not only affect good governance, but it has the potential to distort our economy and to derail democracy," she said.
6 December 2012 Business Day Page 4 Sam Mkokeli ANC hard line on media confuses IS IT you? I asked S’thembiso Msomi, the political editor of the Sunday Times, as it became clear that the SABC had blacklisted us on Tuesday night. He looked at me and retorted, with a casual laugh: "It’s you." I turned to the Financial Times’ Southern Africa bureau chief Andrew England. He also laughed, saying he was not the reason a Metro FM debate we were going to participate in was called off. I was looking for reasons why the show was canned. It felt like one of us had dragged the team down. It was like we had an outcast among ourselves, or we were all counterrevolutionaries that were not to be allowed to get close to the microphones at the station. We were invited to discuss Mangaung and how the media has covered the process. We were some what nervous, being print journalists, while waiting for the clock to hit 8pm. A few minutes later host Sakina Kamwendo told us that the show could not go on. She had been instructed by her boss to cancel it. She gave no reasons and carried on with the topic of the evening. She had an open line, where callers discussed the media’s coverage. Outside the studio, we were left looking for answers. At the back of our minds was the 2007 blacklisting scandal, under Snuki Zikalala’s leadership of the SABC. I don’t remember how the victims of that blacklisting felt then. They included Karima Brown, Business Day political editor at the time.
A big part of me knew there was no reason for me to be blacklisted — call me naive. I have not "dissed" anyone to the extent that I could be banned. Topics like Nkandla have been too depressing for me, to the extent that they are not on the tip of my tongue. And I am not anti this Mangaung candidate, or pro that one. I also knew the other journalists were not the kind of guys who could end up on a blacklist. Mr Msomi is the most measured and balanced political journalist in Johannesburg, and Mr England an absolute pro. It dawned on me what had happened was a tsunami in a tea cup. Ideally, it should be ignored. But it has happened before, and it will happen again. The SABC’s explanation on Wednesday was that the composition of the show was not balanced. We were all from the same media stable. You need to have been hiding under a faulty tower to not know the distinction between the Sunday Times and Business Day. We share a building, and the Sunday Times’ publishers own half of Business Day’s publishers. The other half is owned by Pearson, the publishers of the Financial Times. As for us journalists, we don’t even share a fax, let alone ideas. We compete. In fact Mr Msomi teased me later that I was the persona non grata, for having interviewed Deputy President Kgalema Motlanthe last week. The other excuse offered by the SABC management was that the African National Congress (ANC) was not invited to the show, to convey the views of the other side. What other side? The show was on journalists, and for journalists. Above all, does it take a call from higher up to have a show cancelled in order to achieve a balanced debate? Going to the SABC, I had expected quite an interactive show, with the listeners calling in. The show’s regular listeners are not fools — some of them are active ANC members. They are capable of calling in to correct a guest. The SABC did not need to protect the ANC. If it felt so strongly, it could have called the ANC to be on the show via telephone. Not ideal, but it is still better than the short-sighted bully approach of the SABC men in suits. You do not need to cancel an entire show to achieve balance. That makes sense at the SABC: silence people to achieve diversity of views. There is always the temptation to think that the call came from the higher-ups at Luthuli House. But do not jump to conclusions. It is quite possible that an overzealous administrator took it upon himself to save the ANC. It’s not difficult to see why that can happen. The SABC is full of people who do not have qualifications or the requisite skills, but who believe they have to impress Luthuli House in their everyday decisions. I called ANC secretary-general Gwede Mantashe on Wednesday, to ask if the ANC had given an instruction to the SABC. His answer was an emphatic no. "It’s their (SABC staff’s) stupid decision, write that!" he said. For once I agreed with Mr Mantashe. I don’t see why he would instruct the SABC on how to run its affairs.
The master blaster in him enjoys a scrap too much, to such an extent that the idea of him calling in on a debate show where the ANC was tried in absentia, is not farfetched. But the abuse of political journalists by Luthuli House politicians easily makes us door mats for the SABC’s bureaucrats. They have heard South African Communist Party general secretary Blade Nzimande on his favourite topic: the bourgeois media is bad. Mr Nzimande has also criticised the SABC for broadcasting stories about former ANC Youth League leader Julius Malema, in the aftermath of his expulsion from the party. That is an equivalent of a flour bomb, if you are a manager at the SABC, without the journalistic or editorial management know-how. You are bound to feel the pressure from the likes of Mr Nzimande. It is not surprising that anything Mr Malema related hardly makes the news nowadays, unless it portrays him in negative light. Last year, the ANC revealed it was monitoring the attitudes of journalists who wrote about the party, down right to "attitudes of individual journalists". My name appeared in one of the monitoring reports, "for negative and neutral reports". I laughed this assessment of "attitudes" off when I realised they did not know their political commentators from their journalists. They had studied reports by a colleague who writes about legal and constitutional matters. Yet they saw fit to list him in the table with political analysts. Luthuli House’s hard-line approach to the media is potentially confusing to those in Auckland Park. Hence "stupid decisions" reign supreme.
6 December 2012 Business Day Page 3 Carol Paton Business gets serious over lobbying at Mangaung FOR the first time in the run-up to an African National Congress (ANC) elective conference, business has produced official lobbying documents, in the hope of influencing policy outcomes. In the past, business relied on its own key individuals to lobby key individuals in the government, but all that has changed in the five years since Polokwane. The ANC now really does set the parameters of policy, rather than belatedly getting to hear of government policies and programmes that don’t always fit with the letter and spirit of resolutions. But organised business — especially big business — has lost influence both within the ANC and in the government, hence the new direct efforts to lobby the ANC’s economic transformation committee. This committee, chaired by former public enterprises deputy minister Enoch Godongwana, is responsible for drafting the economic discussion papers and will play a leading role in writing the final resolution on the economy that emerges from the Mangaung conference.
The loss of influence came with the departure of Thabo Mbeki as the head of government and the ANC. Mbeki established mechanisms — such as the big business working group — through which channels of communication were established. The captains of industry complained about the efficacy of the forum, but since its demise under President Jacob Zuma, they may now regret what they have lost. The best channel of communication, though, was that between trusted friends Mbeki and ANC heavyweight and business luminary Saki Macozoma — which frequently saved the day when the going got rough. Although Macozoma is still president of Business Leadership South Africa, which represents the biggest companies on the JSE, Business Unity South Africa (Busa) and not the richer, more resourced body is the official channel through which the government talks to business. Busa, which counts Business Leadership South Africa as member, lacks the real clout that the latter wields in the economy. Rather than accurately reflecting "organised business" or "real business" Busa is best described as "political business". While it is active in the National Economic Development and Labour Council it is astoundingly ineffective, sends low-key individuals without any substantial business or political connections, and communicates badly. Busa’s key role has been in the selection of delegations to accompany Zuma on foreign visits, using the power of the state to latch onto business opportunities. Not surprisingly, then, the lobbies have come forward of their own accord. But how effective have they been in persuading the ANC to take the needs of business seriously? The first emerged under the auspices of the Banking Association of South Africa, which wrote a response to the ANC’s economic transformation document. Later, CEs of several of the top banks met members of the economic transformation committee. In their paper, the banks challenged the philosophical approach of the ANC to the economy, arguing against the "developmental state" and in favour of a "facilitative state", of which the primary role in the economy would be creating a better environment for doing business. This is really the nub of the problem: if the state was to focus simply on getting the basics of the business environment right, business, job creation and the economy would be so much stronger. But asking the ANC to change its philosophical outlook — particularly as expressed in a conference resolution, which (in the ANC’s book) must be "revolutionary" — is really a fruitless exercise. The banks had a little more success in getting across one of their key points: their opposition to a policy of prescribed assets classes — one of the suggestions made in one of the ANC papers. By clearly indicating their openness to some kind of voluntary approach to this, the banks probably did the savings industry a bit of a favour. The likelihood of a preference for prescribed assets of finding its way into the final resolution, is small. The second lobbying group was the Manufacturing Circle, a group whose key interests — a competitive exchange rate, industry support measures and protection from "unfair" competition — often run counter to the more free-market approach of the financial sector. The manufacturing sector, however, has a ready-made advocate in the ANC in the form of Trade and Industry Minister Rob Davies, who can be
expected to push for them not just in Mangaung, but at every available opportunity. Their voice does help to strengthen his hand. If the economic transformation resolution from Mangaung includes an insistence that the government does all it can to flatten the electricity price, their constant lobbying will have a worthwhile payoff.
6 December 2012 Business Day Page 3 Natasha Marrian Controversy dogs ANC’s reconvened conference THE African National Congress’s (ANC’s) reconvened provincial nomination conference in Limpopo was mired in controversy on Wednesday, with complaints that some delegates were being excluded and bogus delegates being registered to attend the gathering in their place. The conference was abandoned last week after a group of "violent hooligans" wearing T-shirts with President Jacob Zuma’s face printed on them disrupted proceedings, forcing delegates to flee the venue, provincial spokesman Makonde Mathivha said at the time. Six members of the ANC’s national executive committee (NEC) were sent to Limpopo on Wednesday. Earlier, Limpopo provincial secretary Soviet Lekganyane said NEC members sent to help with reconvening the nomination conference would not be welcome because they had vested interests. But ANC spokesman Jackson Mthembu said the NEC’s decision on any matter, including deployments to Limpopo to resolve nomination problems, was binding. "Such an irresponsible and un-ANC statement does not only undermine the decision of the NEC, it also fails to acknowledge that the NEC carries full responsibility for the success of the pending 53rd national conference," Mr Mthembu said. The NEC met on Monday to discuss the situation — after Limpopo, the Western Cape and North West missed last Friday’s deadline to conclude the nomination process ahead of the party’s national electoral conference in Mangaung this month. North West held its conference on Sunday after parallel gatherings were held on Saturday. However, some North West delegates complained that they were excluded from the gathering. They have threatened to take the matter to court if it is not dealt with by the party leadership. The ANC’s top brass gave both Limpopo and the Western Cape a last shot to wrap up their business. Failure to do so would result in the provinces forfeiting their nominations. They would, however, still be allowed to nominate from the floor of the Mangaung conference.
In Limpopo, registration began about mid-morning on Wednesday. But the process was far from smooth, with tense stand-offs between supporters of Mr Zuma and those backing his deputy, Kgalema Motlanthe, for the ANC presidency. There was a heavy police presence on Wednesday, both at the registration and conference venues, and this snuffed out any chance of events turning violent. Dozens of delegates at the registration points wore T-shirts bearing the face of Mr Zuma. Songs in his support blared from parked vehicles. By late afternoon many were waiting at the registration venue, some complaining that they were not allowed to enter, despite being legitimate delegates. By 6pm the conference had not started. A source, who wished to remain anonymous, said the provincial leadership and the NEC "deployees" had met to iron out disputes over delegates allowed to attend. The national team included Police Minister Nathi Mthethwa and former spy boss Billy Masetlha. It is understood that many of the disputes which led to the collapse of the gathering last week still remain. The source said the provincial executive committee (PEC) had "walked out" of the meeting with the national leaders, and the PEC members were determined to go ahead with the conference minus the national team. But a PEC member disputed this, saying the meeting had merely moved to the conference venue. Another source from the pro-Zuma faction said the PEC wanted to go ahead in the absence of the electoral commission, meant to preside over the gathering. He also alleged that bogus delegates had been brought in to replace genuine ones at the conference, to prevent nominations from swinging away from the PEC’s preferred candidate, Mr Motlanthe. Meanwhile, by early evening on Wednesday delegates at the Western Cape nomination conference were still going through the registration process without much incident.
6 December 2012 Business Day Page 1 Thabiso Mochiko Net1 shares down 56% on US probe SHARES in Net1 UEPS Technologies have lost half of their value since the company revealed that US authorities have launched a probe into a tender it won in South Africa. The North Gauteng High Court ruled in August that the R10bn social grants tender the company had won was "illegal and invalid" and a complaint was laid with the Hawks in May.
On Wednesday, Net1’s share price plummeted 47.8% to close at R35. It dropped 8% on Tuesday, bringing the total loss to over 56%. Net1, which is listed on the JSE and Nasdaq, on Wednesday assured the market that the investigation into the tender by the US justice department and the Securities and Exchange Commission did not mean that it had been found guilty of wrongdoing. The two organisations are probing whether Net1, or any of its subsidiaries, employees or associates, bribed government officials to secure the tender to distribute social grants to more than 15-million beneficiaries. The tender was awarded to Net1’s subsidiary Cash Paymaster Services early this year and AllPay, the losing bidder, took the matter to court. Both Net1 and AllPay were given leave to appeal some sections of the ruling and the matters are expected to be heard early next year. Anthony Norton, a partner at Nortons Incorporated which is representing AllPay, said on Wednesday that, in terms of the Prevention and Combating of Corrupt Activities Act, anyone in authority who had a reasonable suspicion of potential contraventions of the act involving R100,000 or more was obliged to report it to the police. AllPay had reported the matter to the Hawks in May, Mr Norton said. "Given the fact that ... Net1 is listed in the US, it appeared inevitable that the US authorities would take an interest in this matter and AllPay was advised by its US attorneys to report the matter to the department of justice, which it did," Mr Norton said. "Net1 recognised that the announcement of these investigations raises questions and concerns about the company and its Social Security Agency contract," the company said on Wednesday. Net1 said the investigations were not findings of wrongdoing on the part of any person and that it was "fully co-operating". The US authorities could be investigating contraventions of the Foreign Corrupt Practices Act, which prohibits payments to foreign officials to induce them to act in violation of their duties. It applies to any corrupt action by US businesses and nationals in another country. Companies found to be in violation of the act face fines amounting to millions of dollars and people found guilty of breaking the law might face jail terms. Democratic Alliance social development spokesman Mike Waters said on Wednesday he would ask Social Development Minister Bathabile Dlamini to cooperate fully with the US authorities. Department of Social Development spokeswoman Lumka Oliphant on Wednesday said there were legal processes under way and "all the parties involved were cooperating". She said the department had not received any correspondence from law enforcement agencies outside South Africa.
6 December 2012 Business Day Page 1 Monde Maoto
ANC shrugs off warning on risks to SA mining GLOBAL analysts warned on Wednesday that South Africa was losing even more lustre as a destination for mining investment, but the African National Congress (ANC) once again brushed off their concerns, insisting that changes would be made to the mining regime at the party’s conference later this month. Mining companies operating in South Africa intend investing $3bn in projects over the next 19 years, compared to $55bn in Australia and $33bn in Brazil, according to research by global advisory firm Deloitte Touche Tohmatsu, released on Wednesday. South Africa has mineral resources worth an estimated $2.5-trillion. Mining companies across the globe were concerned about higher costs, resource nationalisation, corruption and skills shortages, the Deloitte research showed. Mining executives in South Africa have been warning for months that they will not invest in a climate of policy uncertainty. Anglo American CE Cynthia Carroll on Tuesday called on the government to establish clear regulations, as mining companies had decades-long investment horizons and would not invest "if there is a fear of arbitrary and unpredictable regulatory change". Deloitte’s annual Tracking the Trends in the Mining Sector report placed South Africa 12th out of 20 countries that mining companies intended investing in over the next 19 years. Its report said that this year was a "watershed year" for the South African mining industry. "It was the year in which the labour relations framework was tested beyond breaking point, with tragic consequences, and a spread beyond the mining sector," the report read. "It was also a year in which companies had to balance rising costs and falling commodity prices and balance the demands of workers, communities, government, regulators and shareholders." Tony Zogbhby, Africa mining leader for Deloitte SA, said on Wednesday that for a second year in a row, mounting costs topped the list of key issues affecting the mining industry. South Africa’s mining industry was mature, which was a huge factor when making investment decisions.
"The gold miners have to go deeper underground and invest in new machinery... the platinum miners will have to tackle degrading ore for platinum group metals," Mr Zogbhby said. He said one of the reasons for investors flocking to Australia rather than South Africa was the scarcity of capital, and the need to contain rising costs. The ANC will ignore ratings company advice and call for an increase in mining taxes, Enoch Godongwana, the party’s economic policy head, said on Wednesday. He said the party must ensure that the lives of poor black South Africans improve or risk giving an opportunity for populist leaders to stir up social unrest and erode the ANC’s dominance. "Unless we do some radical transformation, we’ll create fertile ground for an uncontrollable revolution," Mr Godongwana said. Moody’s Investors Service and Standard & Poor’s have downgraded South Africa’s debt, citing slower economic growth, after the worst mining strikes since the end of apartheid and political pressure to raise spending. "We’re kind of in a Catch-22 situation because there are people who listen to Moody’s and when we go out there and raise money, it becomes expensive," Mr Godongwana said. "We may take a hit. We’ve got to make a choice, do we please Standard and Poor’s and Moody’s or do we deal with the kind of constituencies we’re facing? We’re walking that tightrope." While Mr Godongwana ruled out the ANC conference agreeing to any form of mine nationalisation, he said increased taxes on mining were possible. The party had not identified which minerals would need higher taxes as delegates needed to consider the effect on the mines, he said. "It may well be that we will not increase tax on gold because most of the gold mines are marginal." Nomura International economist Peter Attard Montalto said Mr Godongwana’s comments flew in the face of expectations that the ANC would shy away from specific policy pronouncements at its conference. "If what Mr Godongwana says is actually enacted ... then (credit rating) downgrades in the first quarter of next year actually become more likely again." International credit insurer Coface said in its third-quarter report on the mining industry, released on Wednesday, that "all indicators suggest a negative trend, with reduced production and profitability levels". "The long-term effect of the recent strike action is still to be realised, with the foreign investment confidence index at a 10-year low," Saijil Singh, lead analyst at Coface, said on Wednesday. "The lag effect of the strike action suggests negative output growth for the remainder of the year, continuing into the first half of 2013." Mr Singh said this was expected to have a negative implication for the gold mining, construction and steel industries, directly contributing to already high input costs.
He said rising labour costs continued to put pressure on profitability. "This has led to a trend for major industry players to reduce their South African operations and increase their production capabilities in surrounding states. "This does not bode well for South African unemployment levels as well as the economy in general." Mining contributes 5% to South Africa’s gross domestic product, but the centrality of the mining sector to the economy was illustrated by the fact that just under 50% of total export revenue is attributable to mining and quarrying, Coface said. "It is also a major area for foreign direct investment. Reduced exports are negatively impacting on the balance of trade as well as on the rand," Mr Singh said. "Credit risk for mining services companies continues to increase. Coface is noting exponential growth in the number of these companies applying for business rescue," he said. "It is expected that the level of liquidations, insolvencies and protracted defaults will continue to increase into 2013." 5 December 2012 Business Report Page 18 Ann Crotty
SA must climb value chain and spread gains – Davies “We need to elevate our place in global value chains and not be satisfied with just being primary producers and exporters,” Trade and Industry Minister Rob Davies told delegates at the “Capturing the gains” conference in Cape Town yesterday. He said that the government would consider changing the way it awarded licences to ensure that more of the value of primary products accrued in South Africa. He also suggested that South Africans should take a more assertive stance with international customers, referring to Brazilian negotiators who said: “If you want our products you can have them, but here are our conditions.” He said that South African producers and workers needed to secure a place in the global value chain that would ensure they received more of the profits generated by the value chain. Davies said the challenge facing fruit farmers and workers in the Hex River Valley was about “sharing the benefits visibly with all the participants”. Davies was commenting on the first day of the resumption of protest activity by farmworkers and seasonal workers in the Hex River Valley. The workers are demanding an increase in the basic minimum wage from about R69 a day to R150 a day.
Delegates at the conference said that local farmers would have difficulty in increasing wage rates because they were under severe pressure from the powerful major retail chains, particularly those in Europe, which dominated the supply chain for table grapes. Research by UCT academics has revealed that European retail chains capture as much as 42 percent of the final retail price of South African table grapes. By contrast, South African farmers take home only 26 percent of the price. Davies said that his department and the Department of Agriculture were committed to supporting the sector’s drive to capture a greater share of the value chain. Davies told Business Report yesterday that it was essential for the farmers and the workers to be organised to undertake collective bargaining. “In discussions with the farmers and the workers I pointed out that they will be able to get a better deal if they engage in collective bargaining,” Davies said. While tensions were high ahead of the resumption of protest activity, there were few reports of violence or intimidation, apart from several arrests and the unconfirmed shooting, by police, of four protesters early in the day. In a statement issued ahead of the protest action, Agri SA regretted the failure to resolve the dispute and noted: “Real wages should preferably and in most cases be higher than the minimum wage.” The farmers’ lobby group said, in contrast to Davies, that “applicable wages [should] be negotiated at farm level because practices and circumstances differ between farms”. The farming body recommended that performance bonuses be used increasingly to supplement income “and policies should be applied which could enhance agriculture’s profitability as well as the sector’s ability to provide quality employment opportunities on a broad basis”.
5 December 2012 Business Day Page 9 Allister Sparks Stark difference in images of our two main political parties THE past two weeks have been revealing. As we watch the African National Congress (ANC) stumbling towards Mangaung, with three provincial nomination meetings collapsing in chaos, its presidential candidates still undeclared and their policy positions unknown, we have also seen the Democratic Alliance (DA) walk away from its Boksburg conference having defined itself more clearly both demographically and politically. Two words spring to mind comparing the two — sloppy and smart. Never has the ANC’s policy of prohibiting open campaigning appeared more absurd. Everyone knows the country is in deep trouble, with the economic growth rate down to 1.5% and factions within the ruling alliance at each other’s throats, yet the prospective candidates for national leadership are not supposed to declare
themselves or, heaven forbid, tell us what political policies they have in mind to pull us out of the mess. In the past fortnight, I have listened to both President Jacob Zuma and his presumptive challenger, Deputy President Kgalema Motlanthe, address members of the foreign press corps, the people whose reports will do more than anything else to shape the impressions of foreign investors about the state of our nation — and heard both say absolutely nothing of substance. Motlanthe’s most revealing contribution to the national guessing game was to tell the journalists that the election of the ANC president was "not really a popularity contest as such", and that he was "not really a politician" — not in a professional sense, at any rate. "I have a political attitude," he confided, "but my approach is that I will always do my humble best at whatever level I am." He went on to explain that the ANC president’s job was really to give effect to the collective organisation’s policies, which, if taken at face value, means it doesn’t really matter who the president is: it’s the collective that counts. The trouble, of course, is that the ANC collective is so horribly divided that determining its collective will is well nigh impossible. It, and the country, desperately need leadership. Knowing Motlanthe, I have no doubt he could provide that leadership, but the rules of the game make it improper to spell out his policy ideas to the public. This is ridiculous. Yet Motlanthe is determined to play the game strictly according to the rules, which at this stage seems likely to put him out of the running for both the Presidency and the deputy job. As for Zuma, I doubt there is any policy thinking for him to impart, yet paradoxically it has long been clear that he is a shoo-in for a second term. Then there is Cyril Ramaphosa, the hero of the Convention for a Democratic SA and the man who should have succeeded Nelson Mandela as president and who now belatedly looks like the frontrunner to be Zuma’s next deputy, which would put him in pole position for 2019. At the time of this writing, he has uttered not a word on any aspect of policy. The DA’s federal conference, meanwhile, saw the opposition party define itself more clearly than ever before. Most strikingly, anyone who attended the two-day event at the OR Tambo Hall in Boksburg would immediately have noted the lie that this is a "party of whites", as the ANC and parts of the media regularly assert. The majority of faces among the 1,500 delegates were not white. Nor is the DA’s leadership. After an open election in which candidates campaigned for specific positions, only two of the top seven are white — Helen Zille, elected unopposed as leader, and Anchen Dreyer, one of three deputy chairmen. While Zille claims the DA is now the most nonracial party in the country, Motlanthe concedes that the ANC is alienating minorities and losing its grip on nonracialism. He
says it has become a majoritarian party that no longer sees itself as the leader of a nonracial society. But it was in policy terms that the DA defined itself more precisely. Tim Harris, its shadow finance minister, described the party’s policy of "an open opportunity society" as "the opposite of the ANC’s policy of state capitalism". While its basic ethos was liberal, he said, the DA was not a libertarian party — libertarianism being an extreme laissez faire political philosophy advocating only minimal state intervention in national affairs. "It is not a party of free-market fundamentalism," Harris insisted, "nor is it a party of ivory-tower idealism." He described it as a practical, pragmatic party that would cut red tape, fix education and get the economy moving in line with its 8% growth plan. But it was the party’s outreach to the poor that I found to be the most interesting. Until now, the DA’s main inroads into the black electorate have been among the middle class, "born-free" students and career-minded young people. The ANC’s most solid support base, on the other hand, has been among the poorest of the poor, who are totally dependent on it for the welfare payments that are their only means of subsistence. Now the DA is turning its attention to that otherwise neglected group. This began some months ago with the DA’s call for a youth wage subsidy to circumvent the trade unions’ opposition to reduced wages for first-time workers. Zuma has supported the idea as a way of reducing youth unemployment, but continued Congress of South African Trade Unions opposition has blocked its passage through the National Economic Development and Labour Council. So it is going nowhere. Now the DA is reaching out to the poor in other ways. Harris revealed that its policy included a commitment to break up the big state monopolies such as Eskom, South African Airways and Transnet to include some private shareholding, with the poor also having a share through stokvels — the private savings schemes popular among the poorer sectors of the black community, where members contribute monthly sums to a central fund, which is distributed to a different member each month. Such an innovation would give thousands of poor people a stake in the economy and a give a significant boost to their living conditions. There are about 90,000 stokvels operating in SA, involving about R12bn in annual investments. Bolder still is a DA commitment to give freehold rights to the occupants of all RDP houses, shacks in informal settlements and communal land in the former bantustans. This is in line with the ideas of the distinguished Peruvian economist, Hernando de Soto, who argues that the poorest of the poor actually have many possessions but that it is all "dead capital" because there is no documentation attesting to their ownership and value. Property is the most valuable possession. Give poor people the homes and land where they are living and give them title deeds certifying their ownership and, in De Soto’s terms, you will "unlock the dead capital" and make it usable. The property can
be leased or sold or used as collateral to raise a loan to start a small business. It can also be passed on as inheritance. That would be truly meaningful land transference. It would leverage millions of people into the mainstream economy and transform their lives, giving meaning at last to that otherwise empty slogan of the ANC’s: "A better life for all."
4 December 2012 Business Day Page 5 Sue Blaine
Outcome of Doha climate talks important for SA DOHA — South Africa has a vested interest in ensuring that this year’s United Nations climate change talks in Doha, Qatar, end solidly. The 2012 conference is seen as needing to come up with a way to implement the decision at the Durban talks in 2011 to conclude a new, legally binding, global agreement on how to keep humanity’s greenhouse gas emissions low enough to keep the overall rise in world temperatures to below 2°C by 2015. If this year’s talks fail, the so-called Durban Platform will be remembered as a failure. An insider to the informal BASIC negotiating group (South Africa, Brazil, India and China) said South Africa was under particular pressure to ensure this year’s talks did not derail the Durban Platform and if the Qatari government’s hosting of the talks did not push matters to closure at the end of the week, South Africa would have to find ways to take matters in hand. "We all know that if these talks do not succeed we’ll be back to 2007," Water and Environmental Affairs Minister Edna Molewa said in a meeting with South African journalists attending the Doha talks. It has been debated whether the 2007 talks in Bali, Indonesia, achieved anything worthwhile. A tussle between the European Union (EU) and the US, often backed by Canada, Russia, Australia and Japan, resulted in a compromise that demanded only "deep cuts" in global emissions. This year just short of 200 nations have come together in tiny Qatar, with one of the chief tasks being to bring conclusion to the Durban Platform. The largest stumbling block is securing enough finance from the developed world for the developing world’s adaptation to, and mitigation of, climate change’s negative effects. While the "fast-start finance" — $30bn in the three years to December 31 — has largely been received, there is enormous concern about how the developed world will increase this kitty to the promised $100bn a year from 2020.
The tussle over how the money should be disbursed, and what "new and additional" money actually means, has been one of the dominant themes in the talks this year. It has been complicated by the global financial crisis. Action Aid International climate change campaigner Brandon Wu said industrialised nations’ "broken promises" on finance threatened to derail the talks. "If the US and others continue to refuse an agreement on new levels, on transparency and on sources (of finance) then developing countries should consider walking away from the table completely," he said. "Several independent studies have shown that the previous round of climate finance promises weren’t met. Previous promises were not entirely ‘new’, nor ‘additional’ to existing foreign aid and they did not meet the required level," Mr Wu said. At Durban it was agreed the talks would continue under two "tracks". The first would include those countries still committed to the 1997 Kyoto Protocol, the world’s first and only legally binding agreement on how to keep greenhouse gas emissions’ cumulative effect below a level that would see world temperatures rise 2°C. The second would work out what action was needed in the longer term, when a new legally binding agreement was in force. The Durban talks agreed that a new legally binding agreement would be settled by 2015, and implemented by 2020. The largest stumbling block to all this is securing agreement on how to finance the developing world’s low-emissions development, both in adapting to climate change and in mitigating its effects. Several of the world’s heaviest greenhouse gas-emitting nations — among them the US (at the top of the list with 23.53% of total emissions), Japan (sixth, 4.04%) and Russia (fifth, 5.72%) — have opted out of a second Kyoto Protocol commitment period, and Canada (ninth, 1.82%) has stepped completely outside the protocol. However, the members of the BASIC negotiating bloc — Brazil (1.32% of total global emissions), South Africa (1.46%), India (5.83%) and China (second, 23.53%) — are still keen on the protocol as a stopgap to the new deal. "The Kyoto Protocol is the only rule-based system we have and we need to work under that system," Ms Molewa said. "If we lose the KP completely we would have to negotiate rules from the beginning again and that could take years." But Ms Molewa said she was optimistic. The Durban talks had cemented global allegiance to "multilateralism", and this allegiance had seen off the EU’s attempt to unilaterally impose carbon taxes on flights into its 27 member states. The Doha talks’ quiet pace is set to speed up on Tuesday when the "high-level segment" of the conference begins. This is when government ministers take political decisions based on the negotiating texts thrashed out during the conference’s first week, which was notably quiet.
"From the reports I have been getting the negotiators have almost exhausted the technical issues.... Things could have been driven much more intensely, but this is an implementing COP (Conference of the Parties to the UN Framework Convention on Climate Change) and the vibe is different to last year," Ms Molewa said. Ministers began arriving at the weekend, and on Monday heavyweights such as EU climate commissioner Connie Hedegaard and US special climate envoy Todd Stern could be seen in the rooms and halls of the talks venue, the Qatari National Convention Centre. The possibility that, through the course plotted by the Durban Platform, these annual talks could come up with "a new world" was "exciting", Ms Molewa said. "It excites us all ... there could be a new world agreement that binds everyone," she said. 5 December 2012 Business Day Page 3 Setumo Stone
Members complain to Luthuli House THE African National Congress’s (ANC’s) nonchalance over branch disputes arising from provincial nomination conferences suggests that the party is determined to press ahead with its national electoral conference in Mangaung at all costs, despite some members making allegations of vote-rigging, fraud and manipulation. A group of aggrieved ANC members from North West camped outside Luthuli House on Tuesday and demanded to meet ANC secretary-general Gwede Mantashe to register their complaints, which include vote-rigging and manipulation. If these were not urgently resolved, sources in North West said "branches will not be left with any option but to approach court and interdict the outcomes of the provincial nomination conference and national conference". Business Day was also in possession of a copy of a petition by a group of disgruntled ANC members in the Eastern Cape — which sources said was this week sent to national officials — requesting that the province’s nominations conference last Saturday be declared "null and void" because of alleged procedural irregularities. The Eastern Cape and North West ANC branches are divided between supporters of President Jacob Zuma and Deputy President Kgalema Motlanthe for the party’s top position. Their respective conferences nominated Mr Zuma. Mr Mantashe said at a media briefing on Tuesday he had not received any complaint from the Eastern Cape. He said delegates who were aggrieved that their preferred candidates did not make the cut had another chance to nominate from the floor in Mangaung. He dismissed the allegations of procedural irregularities, saying it was only talk in the media.
For a candidate to be nominated from the floor, they must be supported by at least 25% of the conference delegates. With 4,500 branch delegates expected in Mangaung, this will mean 1,125 hands from the floor. Last year, the ANC had a similar internal conflict ahead of the municipal elections, when branch members protested that provincial and regional leaders replaced legitimate ward candidates with their preferred people. A probe was conducted by ANC national executive committee member Nkosazana Dlamini-Zuma, who last month recommended that the ANC fire some local government councillors following evidence of fraud and manipulation in the processes that nominated them. The ANC’s electoral commission is expected to announce the outcomes of the nominations process next week.
4 December 2012 Business Day Page 2 Linda Ensor
Affirmative action to stay until equity achieved, says minister EMPLOYMENT equity legislation has not yet achieved its objectives in South Africa, and while it is moving in this direction, the process is slow, Labour Minister Mildred Oliphant said on Tuesday. She stressed, however, that while the increase in the representation of blacks and women in the middle to upper levels of business, government and other organisations was small at this stage, it would not have been possible without the Employment Equity Act. The minister’s comments were contained in a written reply to a parliamentary question by Congress of the People MP Diratsagae Kganare. Replying to another question, by Freedom Front Plus MP Anton Alberts, on whether the policy of affirmative action was a permanent feature of South Africa’s constitutional democracy, Ms Oliphant said she did not see the need for a sunset clause for the affirmative action provisions of the Employment Equity Act. This, she said, was because of the "slow progress of transformation" of the labour market and the fact that affirmative action had not been implemented to the full satisfaction of the constitution. On the contrary, the minister believed there was "room for strengthening the compliance and enforcement mechanisms of this act in order to expedite transformation and address the imbalances of the past". She noted that the act, of which affirmative action was a key element, was enacted to give effect to a provision of the constitution that required it.
"Whether affirmative action will be a permanent feature of the constitutional democracy is mainly dependent on the action taken by those with the economic power to bring about change and transformation in their workplaces by creating working environments that are free from unfair discrimination and filled with equal opportunities for all, irrespective of race, gender, disability, marital status and so forth," Ms Oliphant said. "As long as our workplaces remain as unequal as they are now, that is how long it will take to remove affirmative action from our national agenda." Questioned about the eradication of racism and discrimination in the workplace, Ms Oliphant said proposed amendments to the Employment Equity Act would enhance accessibility to justice as it would empower the Commission for Conciliation, Mediation and Arbitration both to conciliate in unfair discrimination cases and to arbitrate. "This amendment of the law will assist in ensuring that discrimination cases are handled expeditiously without any burden of having to worry about legal costs, which most workers cannot afford anyway," she said. "We believe that this measure will assist in providing the majority of workers with equal access to justice as far as cases of unfair discrimination are concerned." The minister dismissed as a "fallacy" the idea that the collective bargaining system was over-centralised. She noted that only 20% of workers were covered by centralised collective bargaining, with the wages and conditions of employment of the rest being determined outside this system. On progress made in talks on a collective bargaining system for the platinum industry, Ms Oliphant said in reply to a question by Democratic Alliance MP Sej Motau that the main parties in the sector had held a number of meetings with the aim of securing the long-term stability of industrial relations in the sector. "The reports that I have been getting to date indicate that parties are indeed making some progress," she said, adding that the process could take some time as there would have to be consensus on the new model.
5 December 2012 Business Day Page 1 Natasha Marrian
Mantashe denies ANC ‘arranges’ leadership LEADERSHIP by arrangement is not in the vocabulary of the African National Congress (ANC), secretary-general Gwede Mantashe says, in what is seen as a swipe at Deputy President Kgalema Motlanthe. Mr Motlanthe this week said he was adamant he would not be part of any "deals" to secure a leadership position at the ANC’ s elective conference later this month.
Mr Mantashe did not name Mr Motlanthe when asked about leadership elected by "arrangement" at a media briefing in Johannesburg on Tuesday, following a meeting of the ANC’s national executive committee. But he said it was the "tradition and culture" of the ANC to hold regular conferences where leadership positions were contested. "Let me confess that I have not been to a meeting that tried to arrange leadership," he said. The ANC’s national executive committee would "not dare" open discussion on an "arrangement about leadership", Mr Mantashe said. "It wouldn’t happen." However, he drew a distinction between "making arrangements" and "lobbying". "There will be attempts by comrades to lobby each other … because people have preferences. I’m not sure if that will fall into a category of an arrangement. "People lobby each other, it’s part of democratic processes. If they convince each other and somebody withdraws a nomination in favour of another comrade, I don’t think we should see that as an arrangement," he said. Mr Mantashe said "arranging" leadership was when "you go and negotiate a place for an individual". Lobbying included "convincing each other". Mr Motlanthe, who has been nominated by the Gauteng ANC and the ANC Youth League to challenge President Jacob Zuma for the leadership of the party, said making arrangements before the conference pointed to a lack of appetite for elections. The debate on "arranged leadership" follows reports of plans to boost Mr Motlanthe’s prospects after provincial nomination conferences indicated that Mr Zuma was the leading choice of ANC branches to become party president for a second term. Mr Motlanthe has not yet indicated whether he would accept nomination for the top spot. ANC members backing Mr Zuma are nominating national executive committee member and businessman Cyril Ramaphosa as deputy president of the party. Political analyst Steven Friedman said on Tuesday Mr Mantashe appeared to be responding to Mr Motlanthe by saying it was "okay to make deals", because delegates did not have to accept them. The ANC is aware Mr Motlanthe’s stance "made sense" in principle, but need him to co-operate to avert "crisis" — fallout from another divisive leadership battle. Leadership by "arrangement" deals appeared to have been adopted at the elective conferences of the ANC’s allies — the South African Communist Party and the Congress of South African Trade Unions (Cosatu), with leaders re-elected unopposed.
Cosatu also took a decision to "engage" with Mr Motlanthe not to stand against Mr Zuma if he was nominated. General secretary Zwelinzima Vavi warned removing Mr Motlanthe from his position would spell disaster.
5 December 2012 The Times Page 17 S'Thembiso Msomi
Deals gave him power Am I the only one who finds it ironic that a political figure whose rise up the ladder was partly due to behind-the-scenes dealings now says he doesn't want to be made a leader "by arrangement"? In an interview published by Business Day on Monday, Deputy President Kgalema Motlanthe all but ruled out the possibility of a deal whereby he would remain the ANC's second-most important leader after its Mangaung national conference next month. With President Jacob Zuma now almost guaranteed to be re-elected as the ruling party's head honcho at Mangaung, Cosatu and other moderates in the Zuma camp have been hoping that a deal to retain Motlanthe would be struck before the conference. This would involve a trade in which Motlanthe agrees not to challenge Zuma for the top post and Zuma supporters, in turn, withdraw their nomination of businessman and ANC national executive committee member Cyril Ramaphosa for the deputy presidency. Even though the outcome of most of the ANC's provincial general council meetings last week indicate that Motlanthe is unlikely to beat Zuma, he made it clear in the Business Day interview that he was not interested in any pre-conference wheeling and dealing, saying this would take away the branches' right to nominate leaders. "Elections in an organisation are an instrument for strengthening the organisation, not weakening it - but that's only when it works and people accept it for what it is," he said. In his strongest indication yet that he would not accept an offer from Cosatu and other Zuma supporters for him to withdraw from the presidential race in return for continued tenure as deputy president, Motlanthe said: "I don't want to lead an organisation where I have no sense of what the members think of me, and by arrangement. I would never do that. That is why it's important that their assessment of you and the expression of their will must not be interfered with." This, to me, is a puzzling stance, coming as it does from a man who has often benefited from deals entered into by senior leaders with little input from the general membership.
He rose to the rank of general secretary at the National Union of Mineworkers in 1992 because a group of union leaders - supported by ANC bigwigs - believed that the former Robben Islander was a more suitable successor to Ramaphosa than the then NUM deputy general secretary, Marcel Golding. In the run-up to the ANC's Mafikeng conference in 1997, very few ANC branches knew enough about Motlanthe to elect him as the party's secretary-general. But the intervention of senior ANC leaders, including stalwarts such as then president Nelson Mandela and Walter Sisulu, ensured that Motlanthe was elected unopposed to the post. According to what current ANC treasurer-general Mathews Phosa told Motlanthe's biographer, Ebrahim Harvey, there was no contest because the election was decided "more than a year before" by party leaders. Surely party branches had no say in this. Motlanthe's criticism of the recent Cosatu and SACP conferences - at which top leaders were returned to office without contest - is contradicted by the fact that he seemed to have no problem with this in 2002, when he and other ANC leaders were returned to office unopposed at the Stellenbosch conference. Surely that, too, was "by arrangement"? But, despite these contradictions, and Motlanthe now appearing unlikely to remain in the party's top structure after Mangaung, the ANC would do well to take his warnings in the interview seriously. The party, he warns, is fast losing the "non-racial" character necessary for it to lead us into becoming a truly united nation. More devastating for the ANC is his suggestion that debates are stifled by people thinking "about whether there will be jobs tomorrow or not". Motlanthe is critical of the ANC's increased reliance on its majority in parliament to shoot down debates instead of developing strong counter-arguments. "As the ruling party, if you do that, you undermine the other task of uniting people. Unity means people must have a sense of belonging and feel that they are valued as members of the South African nation. If you simply say: 'You're out on the basis of numbers', that message will be heard and understood by those who don't have the numbers," he said. ANC branches might have chosen Zuma over Motlanthe to lead them for the next five years, but if they want the party to do well in the 2014 general elections, and subsequent polls, they should listen carefully to what the deputy president is saying.
5 December 2012 The Times Page 2 Staff
Simelane out of the NPA Disgraced former national director of public prosecutions Menzi Simelane has been quietly removed from the National Prosecuting Authority and stripped of his membership of the Johannesburg Bar. The Johannesburg Bar met last night to discuss the finalisation of charges against Simelane. His appointment as NPA boss was declared invalid by the Constitutional Court. His testimony at an inquiry into the fitness to hold office of his predecessor, Vusi Pikoli, was deemed disreputable. Simelane was not expected to attend last night's meeting of the bar, at which, according to the bar's chairman, Modise Khoza, members Mike Hellens and Dumisa Ntsebeza would speak. Hellens is the prosecutor in the matter and Ntsebeza is the chairman of the bar's professional committee. Simelane was replaced by acting National Director of Public Prosecutions Nomgcobo Jiba. The Constitutional Court's ruling followed the findings of the 2008 Ginwala Commission of Inquiry. The head of the commission, Frene Ginwala, expressed her displeasure with Simelane's evidence, stating that his testimony was "inaccurate ... without basis in fact and law". President Jacob Zuma has appeared reluctant to announce Simelane' s dismissal, or to name his successor. The National Prosecuting Authority has confirmed that Simelane is no longer on its payroll. NPA spokesman Bulelwa Makeke yesterday said: "He no longer works for the NPA in any capacity." She said a permanent appointment had yet to be made. Makeke referred all questions about Simelane's contract, successor and contract termination payout to The Presidency and the Justice Department. Simelane could be paid millions of rands to terminate his contract. Justice Department spokesman, Mthunzi Mhaga said: "Simelane's contractual issue is being addressed. Processes are currently under way to bring it to finality." Presidential spokesman Mac Maharaj failed to respond to questions. Simelane, speaking through his father, Bheki, refused to answer questions.
A Johannesburg Bar member said that though Simelane was no longer a member of the bar, "this does not mean that he will escape the disciplinary proceedings". He described the charges Simelane is facing as of a serious nature. "They come from allegations that he interfered in the independence of the national director of public prosecutions. If found guilty, he faces disbarment," he said. Khoza said those at the meeting would hear from Ntsebeza where the matter stood and when proceedings would begin. "Advocate Hellens will brief members on the state of the charge sheet," he said. Simelane, who was placed on special leave by Zuma, was appointed the NPA's head in 2009 despite Ginwala's comments about his conduct. The Constitutional Court found the reasons Justice Minister Jeff Radebe gave for advising Zuma to ignore Ginwala's rulings were insufficient. It said that Zuma's judgment was "irrational" when it came to appointing a fit and proper person to the job. SIMELANE - A SOCIAL MEDIA BUTTERFLY WHILE Menzi Simelane has quietly slipped under the radar, he has been trending on Twitter, tweeting about justice, politics and the ANC elective conference. Politics: "The only political analysis that matters most is that from the leadership of political parties directly. Everyone else is guessing." "A decision on how the [African National Congress] deploys its human resources is a collective one by the leadership, informed by many considerations." "So it's not a democracy because you don't like it." "In exactly 16 months new members of parliament will take their seats in the National Assembly. So what are your plans if you don't come back?" "So what is your exit strategy?" "Changes in the political landscape may bring fear of the unknown. Where seeds of democracy have been planted fear is replaced with opportunity." Justice: "A confession is different to an admission. Know the difference." "Human smuggling and human trafficking are different things." "Unconstitutionally obtained evidence can be thrown out even if accused escapes prosecution."
Democracy: "What constitutes a democratic society will always be informed by the changing nature of society. It is always evolving." - Graeme Hosken
4 December 2012 Business Day Page 3 Stephen Grootes Ramaphosa poised for a big role in government AS THE majority of African National Congress (ANC) provinces have now formally nominated President Jacob Zuma, most of them have also nominated Cyril Ramaphosa as his deputy. It is now becoming clear that what was first thought to be a tactical ploy to nominate him merely as a message to the current deputy president, Kgalema Motlanthe, could well become reality in the next few weeks. This would appear to set Mr Ramaphosa on the path to also becoming deputy president of the country, after the 2014 elections. However, neither Mr Zuma nor Mr Ramaphosa have expressly said what type of role he will play as the deputy president. Mr Ramaphosa left active office in the ANC fifteen years ago, but has remained in the national executive committee during that time. However, his is a voice that has not been publicly heard in our public debate. It appears the biggest role known to the public he had played, was during the national executive committee debate on whether to recall then president Thabo Mbeki. Mr Ramaphosa is widely believed to have argued strongly for Mr Mbeki to go. But his focus has been primarily on his business interests, which have grown substantially. It would appear many people involved in business hope that Mr Ramaphosa brings this experience into the government, should he become Mr Zuma’s deputy. The constitution treats the deputy president as it does any other member of Cabinet, and thus any role or power assigned to that person are at the behest of the president. This means Mr Ramaphosa would have only those powers Mr Zuma would want him to have. It appears unlikely that he would gain any authority over the criminal justice system, where Mr Zuma has put only his closest allies. Mr Zuma appears to play a more active role in the security cluster than he does in those bodies that set economic policy. Thus it seems Mr Ramaphosa may play a role here. At the moment, economic matters fall under Finance Minister Pravin Gordhan, Economic Planning Minister
Ebrahim Patel, Trade and Industry Minister Rob Davies, and Planning Minister Trevor Manuel. Currently, Mr Ramaphosa is the deputy chair of the National Planning Commission, and has appeared to play a major role in the proposals developed by that body. These have been generally welcomed by business organisations, who feel that they are achievable, and bring a decisiveness to policy issues that is not always present in government debates. Economic policy discussions in the government seem to fall along an ideological faultline, with Mr Patel and Mr Davies on one side, and Mr Gordhan and Mr Manuel on another. Should Mr Ramaphosa be given a role in shaping economic policy, he would be likely to side with Mr Gordhan and Mr Manuel. Both former president Thabo Mbeki and President Jacob Zuma have tended to give relatively minor roles and powers to their deputies. Mr Zuma may now be in a different position, as presumably he will not run for a third term as ANC leader, or as president of the country. This might mean he (Mr Zuma) would consider giving Mr Ramaphosa a bigger role in government. Mr Ramaphosa may well have to steer clear of labour issues in general, and mining issues in particular, because of his status as a Lonmin director. Should Mr Zuma try to give him responsibility for the labour or mining sectors, it could be seen as an attempt to weaken him. 4 December 2012 Business Day Page 3 Natasha Marrian and Karl Gernetzky Finance gurus could raise NEC credibility FINANCE Minister Pravin Gordhan and former South African Reserve Bank governor Tito Mboweni have been nominated to be counted among the African National Congress (ANC) top brass — its national executive committee (NEC) — by the party’s largest province, KwaZulu-Natal. This is according to the province’s nomination list which was given to Business Day on Monday. The presence of the respected finance gurus would likely enhance the credibility of the NEC, the party’s highest decision-making body between conferences, in the eyes of investors. The country’s image suffered a blow recently after labour unrest in the mining and agriculture sectors, and uncertainty over leadership ahead of the Mangaung conference, led to two credit rating agency downgrades. This prompted the state to release a package of measures to enhance the economy and boost investor confidence. The nomination emerges from President Jacob Zuma’s home province and the ANC’s largest delegation to the national conference this month. The list also includes former finance minister and National Planning Minister Trevor Manuel.
It is understood that Mr Mboweni and Mr Gordhan were also nominated by Gauteng at its conference. If elected, Mr Gordhan’s presence on the NEC is likely to irk some sections of ANC ally the Congress of South African Trade Unions (Cosatu), which want to see changes to South Africa’s macroeconomic policies. This included Cosatu’s second-largest affiliate, the National Union of Metalworkers of South Africa, which emphasised strengthening the NEC ahead of the ANC’s elective gathering and is at the forefront of the call for a radical economic shift. Mr Gordhan is a former member of the South African Communist Party, but was not part of the NEC leadership core elected at the ANC’s 2007 conference in Polokwane. Cosatu president Sdumo Dlamini has also made it onto the KwaZulu-Natal and Eastern Cape nomination lists. He is seen to be a close ally of Mr Zuma, and has urged unionists to make their presence felt among the party’s top brass and accept nomination to the NEC. ANC Free State secretary William Bulwane said on Monday Mr Dlamini also featured on its list, along with other prominent trade union members such as National Education Health and Allied Workers Union general-secretary Fikile Majola. Outspoken Cosatu general secretary Zwelinzima Vavi was not included, as he was in charge of the "biggest" workers organisation and the province had decided "we can’t take out everyone" which would risk undermining the federation, Mr Bulwane said. Mr Vavi earlier this year said he would not accept nomination onto the ANC’s leadership structure as it could undermine his independence. He was, however, reportedly nominated by the ANC in the Eastern Cape. Another former trade unionist on the list of nominees is Public Works Minister Thulas Nxesi — who has defended alleged state spending on Mr Zuma’s home in Nkandla. NEC members who were seen as part of the "forces of change" — calling for Mr Zuma’s replacement with his deputy, Kgalema Motlanthe — did not make it onto the KwaZulu-Natal and Free State lists including Fikile Mbalula and Tokyo Sexwale. Tony Yengeni did not feature either. Embattled Limpopo education MEC Dickson Masemola was also nominated for an NEC spot by the KwaZulu-Natal ANC, as well as former youth league leader and Mr Zuma’s former spokesman, Zizi Kodwa. Mr Masemola was excluded from the Limpopo electoral delegation to Mangaung as he is an ally of Mr Zuma and the Limpopo leadership are among those calling for change. Now that the nomination process is concluded, those nominated are likely to be approached about whether they will accept the task. The electoral conference officially starts in Mangaung in two weeks’ time.
4 December 2012 Business Day Page 3 Natasha Marrian and Karl Gernetzky Chaos still besets ANC nominations THE African National Congress (ANC) national executive committee would allow Limpopo and the Western Cape to convene their nomination conferences on Wednesday as the two provinces could not hold their gatherings before last week’s deadline due to "violence" and "logistical delays," ANC sources said on Monday. The provinces are both divided over the two candidates, President Jacob Zuma and his deputy Kgalema Motlanthe. Meanwhile, delegates from North West approached the party’s top brass to complain about alleged vote-rigging. North West has been wracked by infighting ahead of the party’s national elective conference this month in Mangaung. It is split between those supporting Mr Zuma for a second term and those backing his deputy, Mr Motlanthe, for the presidency of the party. Chairman Supra Mahumapelo is allied to Mr Zuma, while secretary Kabelo Mataboge backs Mr Motlanthe. After a false start to the nomination conference and parallel gatherings, North West eventually pulled together its nominations on Sunday — which favoured Mr Zuma. But many branches were unhappy with the process, saying it was manipulated. North West ANC Youth League chairman Papiki Baboile said these branches travelled to the St Georges Hotel in Irene on Monday where the ANC’s national executive committee was meeting to discuss the nomination conferences which had taken place across the country last week. "Those delegates were denied access to the conference and they were going there to raise … their view that the conference was rigged," Mr Baboile said. A national team had been dispatched to North West at the weekend to assist with the disputes, but the group felt they had not done enough to address their concerns. The leaders included ANC national executive committee members Nathi Mthethwa and Thaba Mufamadi. A source in the province said about 200 branches were excluded from the nomination conference and around 150 delegates were replaced with other members. New branch reports were added to the nominations from branches during the provincial conference on Sunday. North West will be represented by 234 delegates at the party’s Mangaung conference, out of a total of 4,500. Six of the nine provinces nominated Mr Zuma to retain his position after Mangaung and for ANC national executive committee member Cyril Ramaphosa to step in as his deputy. Two of the three ANC leagues also threw their weight behind the incumbent.
One province, Gauteng, and the ANC youth league nominated Mr Motlanthe to replace Mr Zuma. A senior ANC leader, who wished to remain anonymous, cautioned that the difficulties in the nomination process could result in problems at the national elective conference in Mangaung. The problems would arise when the conference tried to adopt credentials from North West — linked to its attendance list. The ANC will hold a media briefing on the outcomes of the national executive committee meeting on Tuesday. 4 December 2012 Business Day Page 1 Ntsakisi Maswanganyi State’s fund creates 745 jobs, costing R4m each Since its launch last year, the government’s R9bn Jobs Fund has placed 745 unemployed youths into jobs through one of the projects that have benefited from the fund. The fund, promised by President Jacob Zuma last year in his state of the nation address and launched in June, provides grants to government departments, companies, municipalities and non-governmental organisations to create work opportunities. It is managed by the Development Bank of Southern Africa, has a budget of R9bn to be spent over three years and a target of creating 150,000 jobs. So far, the fund has received more than 3,500 applications and its investment committee has approved 54 projects, at a cost of R3bn. This has been matched with R3.7bn from applicant organisations. Of the 54 approvals, 27 projects have been allocated to contractors, who will help implement them. The 27 projects have signed agreements for funding of more than R1bn. The administrators of the fund said at a media briefing in Johannesburg on Monday that they hoped to speed up the implementation of projects that had received grants. Tamera Campbell, executive director of the Harambee Youth Employment Accelerator, said 745 permanent jobs had been created with Jobs Fund grants. The Treasury could not confirm this on Monday, but said it was conducting an audit of jobs created. Investment Solutions chief strategist Chris Hart said he believed the fund’s targets would not be met in the time frame.
"I am sceptical of these kinds of initiatives because they cannot compensate for bad policy in the first place. If we had good policy, there would be no need for such initiatives," he said on Monday. "I do not think it will ever become effective, because it is aimed at big business and not small businesses, which have the capacity to create jobs. I do not see them meeting their jobs target in that time period." At the launch of the Jobs Fund, the government admitted that there were already many institutions and funding instruments to help small businesses grow. Brian Whittaker, deputy chairman of the Jobs Fund’s investment committee, said on Monday that their aim went beyond the target of creating 150,000 jobs. "It is not only about the short-term target. It is about finding new ways of doing things. If the country is to solve its unemployment crisis, we have to find new ways of doing new things," he said. "I’m really concerned that we should challenge people to come and tell us about a new way of solving some of these old and very difficult problems. We are getting some good ideas, but we could have more." There are 4.7-million unemployed people in South Africa. Since the recession in 2009, many have resorted to self-employment as formal sector jobs dried up. The Jobs Fund was intended to lower the cost and risk barriers that prevented innovative models, partnerships and ideas for job creation from becoming a reality, by providing matched funding to applicants with new ideas. Of the 27 projects that have signed agreements, 19 have been approved for nongovernment organisations, five for private companies and three at public sector institutions, and 745 jobs have been created. The Jobs Fund administrators said on Monday that the slow pace of approvals and job creation was due to delays in contracting. This was mainly due to an overestimation by applicants of the number of jobs that their projects would create, and the inability by some applicants to meet the conditions attached to the grant. "The approved funding for the 54 projects … will result in the creation of about 65,000 new, permanent jobs and the placement of about 42,000 unemployed people into existing vacancies. We think those numbers are proceeding quite well," Mr Whittaker said. The Jobs Fund announced on Monday that it was calling for new applications for funding. It is looking for new business models, products and markets in enterprise development, including "umbrella" initiatives that could be channels of support for smaller enterprises or benefit these indirectly, such as the facilitation of market linkages and supply chain diversification. The fund is also seeking to co-finance "light" infrastructure investment projects.
It was targeting established companies or organisations with plans to expand existing programmes, or pilot innovative approaches to employment creation, with a special focus on opportunities for young people. "Future windows (for applications) will be opened, but enterprise and infrastructure development are our focus right now," Mr Whittaker said. Monitoring mechanisms have been put in place to ensure grants are not misused. • This article was amended on December 4 2012. The Jobs Fund has not created 745 jobs costing R4m each, as was reported earlier. The 745 jobs were created at one project that received funding. Since its establishment, the fund has approved 54 projects requiring R3bn, but not all of that funding has been disbursed. The fund believes these projects will create 65,000 new permanent jobs by 2015.
4 December 2012 The Times Page 4 Dominic Mahlangu Motlanthe: if ANC's house crumbles, voters will move Deputy President Kgalema Motlanthe has warned the ANC that if it fails to listen to the concerns of ordinary South Africans, voters will chose a new political home. In an interview with the British Broadcasting Corporation yesterday, Motlanthe said the ruling party must remain relevant and not merely bask in past glories. "If we fail to stay on our toes because of the cries of our people, then we don't deserve to hold these positions of responsibility. "People have a right to judge the ANC for what it is today and not what it was, and [on] how they experience it. The harsher that judgment, the better for the ANC. We ought to hear the truth," he said. The ANC is to hold its elective conference in Mangaung from December 17 to December 20. President Jacob Zuma is expected to be nominated for a second term. The campaign for Motlanthe to take his place seems to have fizzled out. Motlanthe, who does not normally give interviews, spoke candidly to the BBCand The Times' sister publication, Business Day, yesterday about the challenges the ANC faces as a ruling party "If ordinary South Africans don't see in the ANC a natural political home, an instrument [that] addresses their own concerns, they will shift to other parties." Asked about the type of leadership needed in South Africa today, Motlanthe said the country needed to be in a position to tap into the available talent and create conditions for such talent to thrive.
He said this could not be a matter decided on the basis of partisanship or party political affiliation. "The country has lots of talented people. "The trick lies in knowing how to create an environment in which all of them can come to the fore and make a contribution," he said. "You have to appoint people that are far more talented than you are if you are to succeed [as a leader]." Motlanthe continues to play his cards close to his chest and again refused to state whether he will accept nomination by party branches that want him to challenge Zuma. He told the BBC that he would respect the ANC nominations processes before deciding on whether to accept the nomination to challenge for the top post. "As soon as the electoral commission approaches me with that question, I will give an answer." Yesterday Motlanthe told Business Day that he will not accept "deals" to secure himself a leadership position at the ANC conference next week. He told the newspaper that he would not be part of pre-conference wheeling and dealing because that took power away from the party's branches, which should be allowed to express their will without interference. Six of nine provinces voted in favour of nominating Zuma and businessman Cyril Ramaphosa as his deputy, forcing senior party members to seek a solution that will keep Motlanthe in the party fold. Party members close to both the pro-Motlanthe and pro-Zuma campaigns said "a plan" was needed to stop the party imploding. Last week, Cosatu general secretary Zwelinzima Vavi warned that Motlanthe's exclusion from leadership would polarise the already fractured organisation.
2 December 2012 Sunday Times Page 4 George Matlala
ANC dashes Mbalula's ambitions SPORTS Minister Fikile Mbalula's campaign to oust ANC secretary-general Gwede Mantashe at the ruling party's national congress this month seems to have collapsed. Nomination trends from the provinces this week show that Mbalula's chances of taking over from Mantashe are almost non-existent as the incumbent enjoys support
even in areas hostile to President Jacob Zuma. Mantashe is linked to the Zuma camp. Mbalula, with the support of the ANC Youth League, ran the longest campaign against Mantashe - calling for his ousting as far back as early 2009. But the demise of expelled ANCYL president Julius Malema, who championed Mbalula's cause, has rendered the campaign redundant. The league is the only structure of the ANC that has nominated Mbalula to take over from Mantashe. ANC provinces, which hold more sway than the league, overwhelmingly rejected Mbalula's candidature this week. As expected, KwaZulu-Natal, the ANC's biggest province, Free State and Mpumalanga, all backed Mantashe for another term. The nomination conferences in Western Cape and Limpopo - where Mbalula was banking on support - both collapsed because of disputes over the eligibility of delegates to Mangaung. Gauteng, which nominated Deputy President Kgalema Motlanthe as its presidential candidate, also picked Mantashe over Mbalula. Mantashe received 249 votes to Mbalula's 148 - evidence of a vote of no confidence in the sports minister who is aligned to the Anyone But Zuma (ABZ) grouping. The setbacks suffered by the ABZ group in the nominations - which showed Zuma well ahead of Motlanthe - has also not helped his ailing campaign. Some of his close allies blamed the failure largely on Malema's expulsion and his continued vitriolic attacks against ANC leaders. But those in Mbalula's inner circle blamed his demise on the fight for the deputy presidency between Human Settlements Minister Tokyo Sexwale and ANC treasurer Mathews Phosa. Mbalula is said to have thrown in his lot with Phosa, weakening his support in Sexwale's strongholds, including the Eastern Cape. A source close to Mbalula, speaking on condition of anonymity, said the minister's campaign was also derailed by his failure to use his position as ANC campaigns head to consolidate support by addressing rallies organised by the league and other structures. "People have been complaining that he has not been helping them with audit processes. The league has been organising events and he doesn't pitch," he said. "The change forces have been demobilised by the removal of Julius. This had a serious impact. Mbalula has been critical of his [Malema's] conduct. We are shocked by how he has been insulting people. We are now paying the price," he added. Another Mbalula campaigner said the former youth league president's candidature was thrown off the rails by divisions within the anti-Zuma grouping.
2 December 2012 The Sunday Independent Page 14 Karima Brown
Motlanthe’s silence career-limiting Deputy President Kgalema Motlanthe’s 15-year career as a member of the ANC’s powerful top six could come to a close later this month in Mangaung. Motlanthe was elected party secretary-general in Mafikeng in 1997, promoted to deputy president in the 2007 putsch in Polokwane, and hopes to seize the presidency in Mangaung. But this no longer seems likely, since the numbers have simply refused to stack up for Motlanthe and his supporters. Technically, November 30 was the ANC’s deadline for nominations from all its structures, including provinces and leagues which had to hold provincial nominations conferences to consolidate their candidate lists that originated from the branch nominations. These nominations must be lodged with the electoral commission of the ANC by no later than the first week in December, after which the electoral commission will approach all those nominated to check whether they are accepting nomination. Of course, the candidates are free to decide whether they are available and can do so up until the nominations close on the floor at the conference. But judging by the outcome of the provincial nomination conferences, Motlanthe’s chances have all but faded. With about two weeks to go before the ANC changes guard, the ABZ (Anyone But Zuma) crowd, also known as the Forces for Change, who have spearheaded the anti-Zuma push, using Motlanthe as their candidate to try to dislodge Zuma from power in the ANC, appear not to have mustered sufficient numbers to ensure their man not only contests the presidency, but wins the election in Mangaung. But it’s not Motlanthe’s inability to successfully contest Zuma for the presidency of the ANC that has sealed his fate. It is his failure to get nominated as Zuma’s deputy that suggests that he is unlikely to be returned to the party’s top six. The ANC does make provision for candidates to be nominated from the floor, provided that they can get 25 percent of the voting delegates to back their nomination. But this scenario is unlikely to affect the election for the top six, given the slates that have emerged thus far from the provinces and leagues. But even in the unlikely event that Motlanthe somehow gets on the ballot for president as well as deputy president, his chances are slim in both contests. If he challenges Zuma, he is likely to lose, given Zuma’s numbers, and will definitely rule himself out as deputy president, given that Zuma’s backers are hardly going to help install a deputy who challenged their presidential candidate.
A Motlanthe challenge for deputy president will also split the anti-Zuma forces, who have nominated other candidates such as Mathews Phosa and Tokyo Sexwale, who got the nod from the youth league last week. Of course, Phosa and Sexwale could withdraw in favour of Motlanthe, but it is difficult to see what would persuade them to take this altruistic course for a man who, by then, will have lost in his bid for the presidency. While Zuma has maintained the numerical edge in his bid for a second term as ANC president, his supporters have always maintained that Motlanthe was their candidate of choice as his deputy. But all that changed last week when the ANC’s largest province, KwaZulu-Natal, chose nominated ANC businessman Cyril Ramaphosa as its candidate to replace Motlanthe as Zuma’s deputy. The ANC Women’s League quickly followed suit, setting the tone for other Zuma supporting provinces. By Friday morning Mpumalanga endorsed the same slate for its top six set in motion by KZN. So, too, did the veterans’ league. The Eastern Cape followed suit by endorsing Zuma and Ramaphosa in the early hours of yesterday morning. While Gauteng nominated Motlanthe for president, they did so by a very narrow margin. Motlanthe received 238 votes while Zuma received 173. More interestingly, Ramaphosa received 175 votes for the position of ANC deputy president, which underscores my point about Motlanthe’s chances slipping fast. The other big loser is, of course, Sport Minister Fikle Mbalula, who lost out against ANC general secretary Gwede Mantashe. Mantashe received 249 votes compared with Mbalula’s 148. Mbalula’s poor showing in Gauteng underlines the extent to which the anti-Zuma forces have failed to cohere around the top six slate. Free State has also endorsed Zuma and has opted for Baleka Mbete as its deputy president candidate. In Limopopo, at the time of going to print, Zuma-supporting branches looked set to capture this province. In the event that they don’t, the margin for victory for Motlanthe will also be extremely small. So why did Zuma’s forces dump Motlanthe in favour of Ramaphosa so close to the conference? The answer to that question can be traced back to Motlanthe’s refusal to signal either privately or publicly whether he wanted the top spot in the party. While Motlanthe’s backers made no secret of their desire to see him take on Zuma, Motlanthe decided to keep mum.
Those who claim to have had meetings with him to try to understand what his plans were, say that he is impossible to read at the best of times. Depending on who in the ANC one speaks to, Motlanthe was either dead-set against contesting Zuma, or in it to his eyeballs. This ambiguity is vintage Motlanthe, who did the same five years ago. He also kept the ANC in suspense at the Polokwane conference in 2007, when he played his hand only at the very last moment and stood on the Zuma slate for the position of deputy president, with his support being key in Zuma’s defeat of President Thabo Mbeki. But his reticence has backfired this time round. Zuma backers were not prepared to go to Mangaung without knowing whether Motlanthe was an opponent or an ally. Moreover, the insistence of top Motlanthe aides to the media that he plans to challenge Zuma if nominated by the branches didn’t help to assure Zuma backers that they were not going to be double-crossed at the last minute. The Left and some ANC powerbrokers that back Zuma’s second-term bid, but prefer Motlanthe to Ramaphosa, were unable to convince the bulk of the ANC’s rank and file that Motlanthe had no real ambition to challenge Zuma. In the caucuses that were held to thrash out the candidates and where the horse trading happened, backers of Motlanthe for deputy president were outnumbered. The ANC provinces and leagues who put Ramaphosa in play argued that Motlanthe had left it too late and that their decision was motivated by his lack of candour rather than their rejection of him as a suitable candidate. What seems clear now is that the Zuma crowd has decided to move beyond Motlanthe, and has set sights on putting in place a team it hopes will not only lead the ANC, but also kick-start the party’s 2014 elections campaign. With Ramaphosa on the ticket, many leaders in the ANC hope the ZumaRamaphosa duo can capture the ANC’s traditional voter base among the rural and urban poor, as well as those sections of the black middle class and business who need to be convinced that the ANC remains a broad church on economic, social and political policy matters and will best represent their aspirations in the government. They are convinced that Ramaphosa is, in any case, a better bet to reassure and recapture that constituency in a tough election. The loser is Motlanthe, the man who built a political career out of committing to nothing too soon.
2 December 2012 The Sunday Independent Page 13 Marianne Merten Is there life in DA after Helen Zille?
DA LEADER Helen Zille emerged stronger than ever from the party’s federal congress, with a proposal for a deputy leader receiving an overwhelming thumbs down. Re-elected unopposed, she will lead the party into the 2014 elections with a secondary leadership tier peppered with those close to her. They include Wilmot James, who was re-elected federal chairman and, among his deputies, Mmusi Maimane, the national spokesman whose appointment she signed off on. There are also parliamentary leader Lindiwe Mazibuko and Cape Town mayor Patricia de Lille. There is no doubt Zille will lead the 2014 election campaign aggressively and with boundless energy. And, even if the elections do not bring the DA its touted takeover of Gauteng and the Northern Cape, they will produce polling success. And those who want a future in opposition politics will no doubt be toeing the line. But then what? While it may be un-PC to talk of the cult of “Helen”, as everyone in the party seems to refer to her, Zille’s grasp on the leadership reins is nothing but solid. And she’s adored. A biographical video of “our leader” was shown at the federal congress before her grand stage entrance: it included photographs spanning her days as a Rand Daily Mail journalist to her current post as Western Cape premier. At least one woman delegate, according to reports, was moved to tears by her address, and several others enthusiastically supported just about every statement she made. During later discussions on a deputy leader, several senior members spoke against the idea, saying they took their instructions from Zille and that she was the woman for the job. That job, as Zille has hinted, will end in 2015, when the DA holds its next federal congress. Unless she reverses her position, a new leader must be elected. But the pool is pretty shallow in the shadow of Zille. Mazibuko will have to develop gravitas and political nous beyond Brand DA in parliamentary politics, where decorum means everyone is always “The Honourable”. The jibes of ANC MPs and ministers referring to her as “mtwana wam or “mtana am [my child]” pale against the rough and tumble of the broader national political scene and within a highly divided society, where she represents a small elite. Mazibuko reached wider DA membership during her rounds of party provincial congresses earlier this year. And she’s done her own campaigns: walking with women to fetch water and with pupils to school – an Eastern Cape SA Democratic Teachers’ Union (Sadtu) member recently had charges of trying to run down Mazibuko withdrawn. Clearly, Mazibuko has fans: she represents the aspirations of professional success and her story has the rags-to-riches motif representative of the DA’s opportunity society – from researcher to parliamentary leader.
But she loses out among the carefully-planned and rehearsed moves of parliamentary politics, never mind the often brutal cut and thrust of realpolitik. Cope leader Mosiuoa Lekota’s performances during parliamentary question time, even though they have resulted in his being expelled twice, and his off-the-cuff ability to give as good as he gets, shows the absolute necessity of a broader understanding of national political and social dynamics in a society divided by complex faultlines, rather than juxtaposing ANC failures against the DA’s delivery success. Similarly, Maimane represents that pool of young, black professionals the DA wishes to capture, while also being attractive to the DA’s next big vote target: the born-frees – those born in 1994, who for the first time will vote from 2014, and who have little or no nostalgia for the anti-apartheid struggle, but face unemployment and the prospect that without political connectivity they would not succeed. Maimane describes himself as “a child of Soweto”, of a mother from the Eastern Cape and a father from the North West, and emphasises that the DA’s equal opportunity society has made it possible for him to stand as national spokesman, now deputy federal chairman, before the DA congress. As national spokesman, Maimane has a guaranteed platform. Yet, since his appointment, he has been overshadowed by Zille and Mazibuko when it comes to commenting on DA affairs or pushing the DA line in the public eye. Will he have the nous for national politics, and continue to position the DA as an alternative to the ANC on its own merits rather than in continual reference to the ANC’s failures, real or imagined? James proved wooden when he chaired the federal congress. As the man credited with canvassing the DA’s Eight Percent Growth policy document – the basis of the 2014 election manifesto – he criss-crossed the country meeting DA provinces. The former academic is perhaps more comfortable within the corridors of legislatures, research institutions and party offices, rather than with ordinary members. Where else could a future DA leader come from? Zille broke the party tradition that the leader rises from the parliamentary caucus when she took the job in 2007 while serving as Cape Town mayor. Questions were then asked whether it could be done, but the parliamentary leader post was delinked from that of party leader and Zille proved naysayers wrong. DA Youth leader Magashule Gana’s election as one of the three deputy federal chairmen opens a window of opportunity. And it is intimately tied with internal tensions in a party which currently holds voter support, rather than membership, dear, and public representatives’ contributions to council, provincial legislatures and Parliament in keeping with their portfolios, over grassroots social involvement and a wider social appeal. Gana, who has risen through the ranks over the past 10 years, is the odd one out: all his leadership peers are public representatives. This was used against him during the run-up to the federal congress elections, but a sustained behind-the-scenes campaign ensured those in favour of a more socially
conscious grassroots outreach, beyond voter mobilisation, put the quintessential outsider Gana up there. It is in many ways a small, but potentially significant shift in a party which has been shaped by Zille. Today’s DA is a far cry from the collection of white liberals it once was, as diversity characterises its leadership, public representatives and members. Anyone describing the DA as a party of “madams”, “tea girls” and “baases (bosses)”, does the body politic and citizenry a disservice. While the integration of the New National Party political culture of T-shirts, goema goema and the banjo-playing, singing Pieter Marais, one-time Cape Town mayor and Western Cape premier, was an anathema to the more genteel liberals, the DA has adapted. It has not died. Zille’s determination and political brinkmanship saw it balloon from a 1.7 percent party under Tony Leon to one scoring 25 percent of the votes in 2011, and her pursuit of a political realignment of opposition parties has reinvigorated rank and file and public representatives alike. Arising out of her stint as Cape Town mayor, holding together seven disparate parties, talk of political realignment became more pronounced from 2009. Opposition party round-table talks followed. However, earlier this year, some opposition leaders balked. United Democratic Movement leader Bantu Holomisa rejected the DA’s proposal to take out dual party membership. After all, such dual membership appears to be polite talk for killing off opposition parties. It was used to merge the NNP with the Democratic Party to form the DA in the early 2000s and, more recently, the Independent Democrats, which ceased to exist at municipal level last year and will vanish at provincial and national level in 2014. Lekota has also raised concerns, while the ACDP remains sceptical and its bad memories of being outmanoeuvred at the Cape Town council meant it threw its weight behind the ANC to clinch some Western Cape councils after last year’s local elections. Thus, while eight opposition parties formed a united front over the vote of no confidence in President Jacob Zuma, this did not necessarily show the DA as leading the opposition pack – but that the ANC could face a serious challenge if opposition parties united around issues. Regardless of who takes over from Zille, there is the slick “blue machine”. Focusing on voter support, rather than potentially tricky membership figures, plays to the DA’s strengths. Number-crunching has been developed into a fine art by former party strategist Ryan Coetzee and others in support of tracking increased backing. It has served well to underscore increased voter support of two to three percent in township and rural wards in the 2011 municipal election. But it is hazy terrain. Take for example the recent by-election at Ward 8 in Hammanskraal, which Zille cited in her federal congress opening address as an area where party support had increased by 350 percent.
Unpacking the numbers paints a different picture. The DA won 551 votes against the ANC’s 2 195 from just over 3 000 votes cast on the back of a 24.6 percent voter turn out on November 7, according to the Independent Electoral Commission (IEC). In the May 2011 local government election the DA won 583 votes against the ANC’s 10 223 on a voter turnout of 53.4 percent. The DA is not incorrect in its claims – the Gauteng DA preferred highlighting a jump to 18.3 percent from 4.6 percent – but the calculations rely on relative statistical analysis. Not a word was said about the DA losing the by-election in Matzikama to the ANC. Much of the talk is about Brand DA, or the “blue wave”. Much is about Zille, both as party leader and premier, those close to her and a political rhetoric positioning the DA as upholders of accountability and delivery against the standard set by the ANC. The question is whether Zille, focused on fulfilling her promise of numbers and opposition political realignment, will make it possible for a new leader to grow and emerge over the next three years. It carries a risk: a different leader could well lead to a different DA.
2 December 2012 The Sunday Independent Page 1 Dianne Hawker
Millions stolen 'for ANC elders' Former Land Bank chief executive Phil Mohlahlane claimed that he wanted to donate part of his alleged R32.5 million Land Bank loot to sponsor the ANC’s 2007 national conference and also pay for the retirement packages of senior ruling party leaders. This is according to the State’s charge sheet in the corruption case against the controversial Mohlahlane, who was also fired as head of a Limpopo agriculture parastatal for forged qualifications. One of the former accused in the case, Khutso Masoma, has now turned State witness and will testify against Mohlahlane and his co-accused, former Gauteng Housing MEC Dan Mofokeng. The case is being heard in the Commercial Crimes Court in Pretoria. The two are accused of fraud, corruption and money laundering involving R26.5m. Mohlahlane is also accused in another case involving fraud worth R6m. Former AgriBEE fund manager Masoma is expected to reveal details of the Babagolo (sePedi for elders) scheme when the case goes to trial.
The scheme, according to the prosecution, was Mohlahlane’s financial ploy to create the impression that it was a funding vehicle for the ruling party. In the latest charge sheet, the prosecution explains how Mohlahlane – who has been painted as the kingpin – allegedly implicated the ANC in a massive fraud. Mohlahlane is alleged to have “instructed” Masoma to arrange for large sums of money to be paid into the trust account of Matuba Maponya Attorneys for nonexistent projects. “Accused number 1 [Mohlahlane] presented to Mr K Masoma that a farm, Deeside… in the district of Bela Bela should be bought for Babagolo. “The meaning of Babagolo, as referred to by [Mohlahlane], included the concept that money should be used to provide for exit packages or pensions for senior ANC government officials,” the charge sheet reads. Eventually, R19m went into Maponya’s trust account between October and December 2007 under the guise of Babagolo, the State argues. The money was allegedly used to buy several properties and a Volvo worth R480 000 through the companies owned by Mohlahlane and Mofokeng. Masoma is also expected to testify that he helped Mohlahlane cheat a legitimate project of R4m from the R6m Land Bank allocation in October 2007. “After the approval but before the payment was made [Mohlahlane] indicated to Mr Masoma that he wanted [R4m] of this money for Babagolo and to partly sponsor the ANC conference that was to be held in Polokwane [in 2007],” the charge sheet reads. Mohlahlane also wanted his sister appointed on the farm with a monthly salary of R17 000, the charge sheet says. Eventually the dairy farming project ran short of funds, and it asked for a bailout. Maponya released R1m – but Mohlahlane allegedly “demanded” R250 000 “for arranging the transfer”, the State says. The funds were allegedly transferred to several entities, including: * In January 2008 another R3.5m was paid to Maponya’s account which ended up in the account of Nhzelele Resources, a company where Mofokeng was a director; * Half a million ended up in the bank account of Madlela Attorneys. The State does not know what the payment was for; * R2.2m was used to buy a house in Pretoria where Mohlahlane eventually lived; and * The rest of the money paid for quadbikes, a bakkie and a Mercedes. Asked to comment on what the payment was for, Pleasure Mashamba of Madlela Gwebu Mashamba Attorneys said he would not comment on a case which was still before court.
The firm boasts on its website that its clients include the ANC’s controversial investment arm, Chancellor House. “For the record I do not have any instructions from any of our clients in our law firm to discuss their matters with third parties, including the press,” he said. ANC secretary-general Gwede Mantashe said he was not aware of any donations or a scheme established to bankroll the party. “Mohlahlane was never an official of the ANC. He cannot run schemes for the ANC when he is not an official or office bearer. If he had any arrangement with individuals, that is his problem,” he said. The National Prosecuting Authority (NPA) and the Hawks say there is no evidence that the money made its way to the |ANC’s coffers. “The investigation revealed that no money was used for |the ANC conference and that there is no evidence that money was paid to any ANC politician as |an exit or retirement package,” NPA spokesman Medupe Simasiku said. Hawks spokesman Paul Ramaloko said investigators believed “the false schemes |benefited the accused in person and cannot be linked to any |institution”. On Saturday Mofokeng would not comment, saying “we will have our time to respond”. “I don’t want to touch on that subject [the case].” In court this week, prosecutor AJ van Rensburg said attorney Matuba Maponya had also turned State witness. He said Maponya’s statement “obviously had an impact on the charge sheet”. Mohlahlane could not be reached for comment. However, Mohlahlane’s lawyer André Steenkamp has questioned the late introduction of another witness. He said Maponya’s statement was dated November 23, an indication that the state was “still busy with the investigation”. Steenkamp appeared for Mohlahlane for the first time this week, and said he had yet to study the 15 000 page charge sheet. Mofokeng’s lawyer, Lehlohonolo Adonisi said he was also uncertain whether he would be ready for trial by January. “The State is insisting that they are ready. We are saying that they need to give us more information. That request emanates from us reading the docket,” he said. Mohlahlane and Mofokeng remain out on a R40 000 bail.
3 December 2012
Business Day Page 5 Wyndham Hartley
Cwele ‘welcomes’ constitutional challenge to secrecy bill WHILE opposition parties and civil society ponder the easiest and cheapest way to get the "secrecy bill" sent to the Constitutional Court, State Security Minister Siyabonga Cwele has said he would welcome the bill being tested by the country’s top court. The African National Congress last (ANC) Thursday used its majority to push the bill through. It now needs only the National Assembly’s rubber stamp and President Jacob Zuma’s signature to become law. Lobbyists have argued that the government could use the bill to classify sensitive information, including on controversial issues like Mr Zuma’s Nkandla home. Democratic Alliance (DA) parliamentary leader Lindiwe Mazibuko, chief whip Watty Watson and Alf Lees, a DA member of the National Council of Provinces, told a news conference on Friday they would lobby ANC members in the National Assembly to make further changes to the Protection of State Information Bill. The party’s strategy would include petitioning Mr Zuma to refer the bill to the Constitutional Court and, failing that, to get 134 opposition MPs to sign a petition referring it to the court as provided for in the constitution. The Right2Know campaign has also vowed to fight the bill all the way to the Constitutional Court. Mr Cwele said that since South Africa was a constitutional democracy, "we would welcome such an action as it is provided for by our constitution. There is nothing to fear in this regard." Mr Lees said during deliberations on the bill in the ad hoc committee, the DA pushed for a series of amendments, including: • A public interest defence; A strengthened public interest override; • The removal of clause 1(4) which would allow the bill to trump the Promotion of Access to Information Act; • A sufficiently limited definition of "national security"; • A review of sections pertaining to almost all offences (such as the possession and disclosure of classified information); • The removal of all minimum sentences. The removal of Valuable information; and • The removal of provincial archives."
Mr Lees acknowledged that some important changes were made in the National Council of Provinces, "but these proposals did not go far enough". "The absence of a strengthened public interest defence clause in this bill will endanger whistle-blowers of corruption and wrongdoing. "While it is important to have legislation that seeks to classify some state information, this bill will effectively enable government to hide corruption and other information it deems embarrassing," Mr Lees said. Ms Mazibuko said: "The DA will lobby ANC MPs across the floor and urge them to make the necessary changes to ensure that Parliament is not undermined by passing unconstitutional legislation. It is in these important negotiations that Cosatu must end its hypocrisy and instruct MPs aligned to it in Parliament to assist us in making these vital changes. "If this does not happen and all mechanisms available to us in Parliament have been exhausted, the DA will petition the president under section 79 of the constitution to refer the bill — after it is passed in the National Assembly — to Parliament for reconsideration of its constitutionality. "Should the president abdicate his constitutional responsibilities and sign this problematic bill into law, the DA will, through the Multi Party Forum, lobby MPs from other parties to join our petition to refer the law directly to the Constitutional Court as provided for in section 80 of the constitution." Mr Cwele said the bill had been the subject of discussion on various platforms, and more than 800 amendments were made by the National Council of Provinces committee processing the bill.
3 December 2012 Business Day Page 5 Linda Ensor
State targets ease of doing business in South Africa THE government has embarked on a number of initiatives aimed at accelerating the ease of doing business, a key factor which multinationals consider when making their investment decisions. The World Bank ranks South Africa 39th out of 185 countries in terms of the ease of doing business, compared to last year’s ranking of 41. The government now wants to see further improvements. The Department of Trade and Industry is involved in two projects to achieve this aim. One intends creating harmonised national norms and standards for licensing of businesses by municipalities. The other entails creating a single registry for the submission of data required by different organs of the state such as the South
African Revenue Service, Statistics South Africa and the Companies and Intellectual Property Commission. The department’s deputy director-general, Zodwa Ntuli, last week said these entities were participating in a task team which included the Presidency and the Treasury. The team is working on a single platform for the submission of data so that once it was submitted to one institution, it could be shared by all. Also, the companies commission has made great strides in overcoming the problems that raised a business outcry last year. The reputations of the commission and its predecessor, the Companies and Intellectual Property Registration Office, have suffered setbacks in the past. The challenges included long delays in finalising company registrations and the fraudulent manipulation of its database to change the ownership and directorships of companies. Speedy company registration is regarded as one of the important factors which determine how a country ranks in terms of ease of doing business. Companies commissioner Astrid Ludin said the turnaround time for online company registration was now between three to five days. If the manual registrations were included, the average period was between 12 and 19 days. With regard to co-operatives, 68% were registered within the stipulated timeframe of 15 days. Ms Ludin said there was high demand for online services, with 66% of all applications for company registrations in the first two quarters being done electronically. This compared with Sweden’s 25%. By April, the commission would be geared up for the fully electronic lodging of intellectual property applications. Ms Ludin said 19 audits had concluded that with regard to turnaround times the commission was performing in line with or even better than the set service delivery standards. New company registrations were expected to exceed 200,000 this year. But Ms Ludin said there were still challenges with the call centre as a result of the lack of capacity to handle high call volumes. Last month, only 30% of calls received were answered.
3 December 2012 Business Day Page 3 Sam Mkokeli
Mangaung may be a repeat of Polokwane INDICATIONS are that the African National Congress (ANC) is headed for a bruising battle at its Mangaung conference in two weeks’ time.
Deputy President Kgalema Motlanthe’s mind is clearly made up. He confidently states that his decision at Mangaung will not be a difficult one, although true to his cryptic and guarded nature he does not say what it will be. The question of his availability to take on President Jacob Zuma for the number one position in the ANC — which would guarantee him the country’s presidency — is still a source of speculation. But to the man himself, this is a matter between him and the electoral commission that is running the election on behalf of the ANC. "It’s not difficult at all; if they ask me that question I will give an answer," he says. Should he stand, his chances of success look rather slim, with Mr Zuma enjoying the support of the provinces that will take the most votes to Mangaung. But whether he will win is probably the last issue on Mr Motlanthe’s mind. There are those who believe that it is still possible to handle an ANC election in the old-fashioned way of not campaigning. Mr Motlanthe is a firm believer in this, as he says the leaders who were elected five years ago have a duty to remain principled in the build-up to Mangaung. However, like former president Thabo Mbeki did in Polokwane, Mr Motlanthe may arrive in Mangaung and realise, if he hasn’t already, that the old-fashioned ANC no longer exists. Votes are bought, and delegates often ditch the mandate of their branches to vote for someone else. Mr Motlanthe has been nominated by one of the ANC’s three leagues and by Gauteng, while Mr Zuma has the nod of five provinces. The other provinces — Limpopo, Western Cape and North West — held chaotic provincial nomination gatherings dominated by factional politics, with no one willing to back down. So tense were the meetings that the Western Cape could not officially nominate a candidate, while the North West and Limpopo have been dominated by allegations of skulduggery. These are provinces where Mr Motlanthe enjoys support, but Mr Zuma’s campaign team has put up a strong fight. The perception of underhand tactics during the nominations indicates the kind of atmosphere Mangaung will be. This environment shows how the ANC is failing to manage the contest. It is Polokwane all over again. The question is whether anyone will readily accept the outcome of the conference as a product of a fair process. Will the winner have credibility? Also, if indeed there is a contest, will the winning group be prepared to work with the losers? The Polokwane conference five years ago saw the winner take all and left deep divisions. Hardly a year after the conference, Mr Mbeki, who lost the battle of Polokwane to Mr Zuma, was instructed by the ANC to stand down as the country’s president. Will the same thing happen to Mr Motlanthe ? His term as South Africa’s deputy president expires in 2014. The indication is that the Zuma camp is prepared for a leadership contest, judging by how they have quickly named Cyril Ramaphosa as a stand-in. In the event Mr Motlanthe stands against Mr Zuma and loses — and is not re-elected as deputy —
will the dominant group resist the urge to push him out of government office before his term expires? It seems the ANC has tied itself in a knot again. 3 December 2012 Business Day Page 3 Natasha Marrian ANC ‘has no handle on own changes’ WHILE there is room for the modernisation of the African National Congress (ANC), the jury is out on whether there is the will, says Deputy President Kgalema Motlanthe. His comments, expressed in an interview on Friday, come as the party seems to be floundering in achieving its strategic goal of creating a united, democratic, nonracial and nonsexist society. There is a strong push within the ruling party for it to modernise and renew itself. But attempts to reform the party’s internal electoral processes faced resistance at its policy conference in June. The party has also expressed concern about its diminishing support among minority groups after the local government elections in 2009. Mr Motlanthe said the ANC was aware that despite being at the forefront of attempts to transform South African society, the party itself was undergoing a "silent transformation" on which it had "no handle" at all. "The national liberation movement attracted people who were prepared to sacrifice, but a ruling party doesn’t necessarily attract people who are willing to sacrifice, and therein lies the distinction ." The ANC was not making "sufficient inroads" in achieving its goals, which included creating a united, democratic, nonracial, nonsexist and prosperous nation. "We are not succeeding in that regard," Mr Motlanthe said. "There is always the task of democratising South Africa. We are trying, but from time to time we have to be pulled back into line by the judiciary ," he said. The renewal of the ANC means that the party should be at the "forefront" of pushing these goals. "The ANC must present itself as a natural home for all South Africans. "In practice we’ve not been effective in that regard, so comparatively speaking we have in a sense been retreating from there, except that most of these national groups have organised themselves ." The party was engaging with various communities, including the Jewish, Italian, Greek and Portuguese communities, on their concerns about the country.
Mr Motlanthe said the ANC could only count itself as the leader of society if those serving on its national executive committee were outward looking, and belonged to other organisations which were in touch with the rest of society, such as taxi or residents’ associations. "If the only structure you belong to is the ANC and the national executive committee, then you can’t lead society as you’re leading the ANC." An ANC leadership not in touch with society could lead to the relevance of the party diminishing in the eyes of the electorate. Mr Motlanthe said the ANC needed to reach out to the communities so it could have a proper sense of their needs. "If the ANC was to do what it does during election campaigns throughout, then it would be leading society, because it would be getting constant feedback and suggestions from people."
3 December 2012 Business Day Page 2 Bekezela Phakathi Zuma in headlines over ‘perks for brothers’ WITH just less than two weeks to go before the African National Congress (ANC) holds its elective conference in Mangaung, the party is set to dominate political discussion this week. Saturday was the deadline for provinces to nominate candidates and despite some provinces failing to meet the deadline, it appears President Jacob Zuma will receive the required votes to keep his position as party leader. Mr Zuma will also likely feature prominently in political debates this week following allegations at the weekend that taxpayers’ money was used to pay for renovations to the homes of his two brothers. The Sunday Times reported on Sunday that Michael and Joseph Zuma allegedly had supplies by electrical company Voltex delivered to their homes as part of the "prestige project". The information was submitted in court papers filed by Voltex in the High Court in Durban. Democratic Alliance parliamentary leader Lindiwe Mazibuko said on Sunday she would ask Public Protector Thuli Madonsela to "extend her respective investigations into the upgrade of President Zuma’s home at Nkandla, and the spending of R240m on Zumaville, to include the possible improper benefits afforded to members of President Zuma’s family using state resources ". The farming community in the Western Cape is bracing for industrial action on Tuesday after calls by union federation Cosatu on Sunday for farm workers across South Africa to join in. Farm workers in parts of the Western Cape suspended protests over wages and living conditions last month pending a review by December 4. However, last week Labour Minister Mildred Oliphant said the government could not raise the minimum wage before March. Cosatu has called on motorists to shut down Gauteng freeways on Thursday in protest against the government’s e-toll system. Cosatu general secretary Zwelinzima
Vavi wants people to park their cars near an e-toll gantry all day to show the government where power rests. Also worth watching this week will be the Farlam commission of inquiry, which will be in session for only two days. Lonmin lawyers on Friday accused the Association of Mineworkers and Construction Union president Joseph Mathunjwa of using the tense standoff between management and striking miners at its Marikana mine in August to leverage bargaining rights. The Land Bank is in the public domain again with details of the state’s charge sheet, which allegedly details how former CEO Phil Mohlahlane looted R32.5m. The debate around the secrecy bill will likely continue this week. Last week, ANC MPs on the National Council of Provinces ad hoc committee handling the bill adopted the controversial legislation, despite resistance from opposition parties. Parliament winds down this week before recess. On Tuesday Eskom will brief the economic development select committee on its multiyear tariff application to the National Energy Regulator of South Africa. 3 December 2012 Business Day Page 2 Linda Ensor South Africa ‘must be part of Agoa for sake of neighbours’ SOUTH Africa needed to continue to benefit from the Africa Growth and Opportunity Act (Agoa) not only for its own sake, but also for that of neighbouring African countries, which supplied South African manufacturers exporting to the US, head of the Western Cape Growth Organisation (Wesgro) Nils Flatten said on Friday. Agoa was introduced into law in the US in 2000 to give African exporters tariff and quota-free access to the US market. The act expires in 2015 and Mr Flatten said there were rumblings in the US Senate and Congress that South Africa, as a middle-income country, should be excluded from the act because its economy was too large and too sophisticated. But this view ignored the integration of the Southern African market and the close links between the economies of the different countries, he said. South Africa could not be excised without affecting other African economies, said Mr Flatten, who was speaking on Friday at a business function with the US trade delegation led by US undersecretary of commerce for international trade Francisco Sanchez. Removing South Africa from the Agoa system would damage interregional trade, which was still at quite a low level in Southern Africa. The motor and motor components industries in particular would be hurt by South Africa’s exclusion — South Africa exports the left-hand drive Mercedes Benz to the US and sources some of the materials for their manufacture from neighbouring African states, Mr Flatten said.
He also believed that South Africa could achieve a lot more in terms of its exports to the US. The US government has committed itself to enhancing its economic ties with Africa and US acting secretary of commerce Rebecca Blank launched the Doing Business in Africa campaign while in Johannesburg last week to help US businesses take up export and investment opportunities on the continent. Mr Sanchez told the business gathering that since the launch of Agoa in 2000, USAfrica trade had been "transformed". He said that the US government believed there was even more growth potential in what was a very dynamic and fast-growing market. Last year total US-SA trade amounted to $16.7bn, up from $13.9bn in 2010, while two-way trade with sub-Saharan Africa totalled $95bn, a 16% increase over 2010. President Barack Obama reaffirmed the US interest in Africa when he issued the US Strategy toward sub-Saharan Africa in June. Among other things, the strategy committed the US government to working with Congress to extend the preferences under Agoa beyond 2015 and those under the Generalised System of Preferences beyond next year. Mr Sanchez was leading a delegation of US business people in the energy, transport, infrastructure, agriculture equipment and water sectors in South Africa.
3 December 2012 Business Day Page 1 Natasha Marrian
ANC showdown could be fresh start for Motlanthe — or a return to the past DEPUTY President Kgalema Motlanthe says he is happy to take direction from those he leads, even if this takes him full circle and he is nominated and loses out at Mangaung. If that happens he could even find himself teaching those at the beginning of their political careers in the Congress of South African Students (Cosas). He gives a quick response when asked if he has ever contemplated professional life after the ANC — a not-too-distant possibility after the campaign to see him at the party’s helm suffered a setback during provincial nomination conferences last week. The ANC’s largest provinces, the Eastern Cape and KwaZulu-Natal, nominated President Jacob Zuma to return as leader when the party holds its electoral conference this month in Mangaung. This could leave Mr Motlanthe out in the cold. His name has been dropped as deputy leader on Mr Zuma’s ticket and replaced with businessman Cyril Ramaphosa.
"I know exactly what I will do. I will go and work with the Congress of South African Students, " Mr Motlanthe said in an interview on Friday. Political education is close to his heart and he believes he could make a "wonderful contribution" to that body. "By belonging to Cosas and being active in Cosas, (students) carry the burden of ensuring they perform better than all other students who are not in Cosas. If there are activists in Cosas and they do poorly academically, then they would be cited as examples as to why others should not be in Cosas," he said. Expelled ANC Youth League president Julius Malema cut his political teeth in Cosas. The student body has also voiced its preference for Mr Zuma to lead the ANC. Mr Motlanthe said he was "privileged" to be asked to lead the ANC by some if its branches. Briefly the president of South Africa when Thabo Mbeki was recalled, Mr Motlanthe scoffed at suggestions of harbouring presidential ambitions at the ANC’s previous national electoral conference in Polokwane, where he joked that he would prefer to assist in coaching Bafana Bafana. At the time he was quoted as saying his trademark goatee had steadily turned grey during his time in the ANC. Mr Motlanthe’s name has been at the centre of the campaign for change in the party, but he refuses to be drawn, saying the branches should decide on their leaders. If not chosen, he has opted for educating Cosas over coaching soccer this time around. "(Gordon) Igesund has the (Bafana Bafana coach) post now. I can be his talent scout and go watch matches in rural areas."
3 December 2012 Business Day Page 1 Sam Mkokeli and Natasha Marrian
Motlanthe rejects ‘deals’ to secure top job at Mangaung KGALEMA Motlanthe has ruled out any "deals" to secure himself a leadership position at the African National Congress (ANC) conference in Mangaung, but his " principled" stance could see him lose out in the jockeying to lead the party for the next five years. With President Jacob Zuma almost certain to be returned as ANC president, enjoying the support of at least five provinces and two ANC leagues, the deputy presidency has now emerged as the focus of fierce contestation. The frontrunner, businessman Cyril Ramaphosa, has the support of powerful provinces, but Mr Motlanthe’s nomination by Gauteng and the ANC Youth League means he will also have significant backing at Mangaung should he accept a nomination.
In a wide-ranging interview with Business Day on Friday, Mr Motlanthe played his cards close to his chest and emphasised party principles. He said he would not be part of pre-conference wheeling and dealing, as that took power away from the branches, which should be allowed to express their will without interference. He has, however, downplayed the significance of his name coming up in provincial nomination gatherings, saying the process so far was merely an expression of a preference and did not constitute an official nomination. He said he would answer the question of his availability when it was put to him by the electoral commission, but it was not a "difficult" decision. While Mr Motlanthe’s intentions may remain obscure for now, he is in no doubt that Mangaung, as he said recently, represents a "tipping point" for the ANC and its allies for whom he had pointed criticism. This ranged from taking issue with the ANC allies’ compromised elections procedures, which saw incumbents returned to office without facing electoral contests, to the party’s fading nonracial credentials, its diminishing appeal across the board in South Africa, and a "growing intolerance" within the alliance. The ANC needed to come up with policies and implementation plans, coupled with a "well-balanced" team of leaders not driven by the need for job security in its approach to leadership. His call for renewal contrasts starkly with the standpoint of Mr Zuma, who on Sunday insisted there should be "good reasons" for changing the leadership. Speaking in KwaZulu-Natal on Sunday, Mr Zuma said those who wanted change should explain what was wrong within the ANC and what the reforms could be. Mr Motlanthe criticised how ANC allies have handled their elections, where leadership teams were returned through consensus, thus avoiding elections. A leader who was elected in an environment of pre-conference dealing was bound to be beholden to the power brokers, he said. This year’s elections within the Congress of South African Trade Unions (Cosatu) and the South African Communist Party (SACP ) were the result of pre-conference arrangements. Mr Motlanthe warned that the trend could play itself out in Mangaung too. Cosatu leaders recently said they wanted to talk Mr Motlanthe out of standing against Mr Zuma for the party’s leadership. "They are perfectly within their rights to offer me such advice — but they should also give me advice as to how I can give effect to such advice in terms of the ANC procedures," he said. Mr Motlanthe disapproved of the SACP’s handling of its elections, as part of a broader loss of appetite for elections. "The fact that you hear noises from time to time saying ‘you mustn’t stand, you mustn’t do this’ and so on — there is no appetite for elections. Elections in an
organisation are an instrument for strengthening an organisation, not weakening it — but that’s only when it works and people accept it," he said. "At (the SACP) conference now the central committee consists of 62 members and all nine provinces nominated the same 62, which means there was no need for elections. That influence played itself out at the Cosatu conference. It is that same influence that is going to play itself out in the ANC at Mangaung." Mr Motlanthe said he would not be part of such arrangements as the branches must not be interfered with. "I don’t want to lead an organisation where I have no sense of what the members think of me — and by arrangement. I would never do that. Once it’s interfered with, if I offer them sweeteners or jobs, I would never actually know whether they have confidence in me or not." Branch delegates were not "messengers or conduits" and needed to be given room to play their role, Mr Motlanthe said. He also warned that the ANC risked losing its relevance due to inward-looking leadership, while the whole tripartite alliance faced stagnation because of growing intolerance. "I don’t think the alliance is about to split at all — but there are signs that indicate a measure of intolerance." He said t he different components needed diverse views. "Once there is a monopoly, even in the realm of ideas, that can only lead to stagnation. We are beginning to see that in Cosatu — that’s a federation that consists of independent trade unions and those affiliates have to be boiling cauldrons of debate." Mr Motlanthe was also critical of the SACP’s contribution to the alliance, saying it no longer dealt with cadreship development as it once did. "The SACP’s contribution in the radicalisation of the national liberation movement, the ANC included, has always been in training cadreship — (it) always paid attention to cadre development. I don’t know whether the party now does that." The ANC was losing its grip on nonracialism and no longer saw itself as a leader of a nonracial society, he said. The ANC’s reliance on its majority in Parliament — instead of the power of its argument — was one of the factors that would compromise its relevance, he warned. For example, the ANC caucus initially pushed back a recent opposition-led move to debate a motion of no confidence in Mr Zuma. The ANC could end up alienating minorities if it "doesn’t pay attention to the arguments, but simply relies on numbers". "When that happens, all other sections of South Africa’s population … who believe, ‘in this forum we will be outnumbered by those people’ … hear one message and that is that they stand no chance … so as the ruling party if you do that you undermine the other task of uniting people." He said there was "no need whatsoever" for the matter of the no-confidence motion to end up in court.
3 December 2012 The Times Page 4 Sapa Nkandla: Lindiwe won't let up
Public Protector Thuli Madonsela will be asked to investigate whether President Jacob Zuma's family improperly benefited from the upgrading of his home in Nkandla. DA parliamentary leader Lindiwe Mazibuko said yesterday that she would ask Madonsela to extend her investigation of Zuma's home to "include the possible improper benefits afforded to members of Zuma's family using state resources". The Sunday Times reported that taxpayers' money was allegedly used to pay for renovations to the homes of Zuma's two brothers. It was alleged in the report that supplies from electrical company Voltex were delivered to the homes of Michael and Joseph Zuma as part of the "prestige project". This information was reportedly submitted to the Durban High Court in papers filed by Voltex, which was trying to recoup R545249 it claimed it was owed by building contractor Pamela Mfeka. She was allegedly awarded a R47.6-million contract by the Public Works department to construct six buildings at Nkandla. "Using public funds for the unjustifiable benefit of an individual is not only grossly unethical but a clear violation of the Executive Members' Ethics Act," said Mazibuko. City Press reported yesterday that Public Works Minister Thulas Nxesi had admitted that the security upgrading of Zuma's home was over budget. "It is clear in this case that people went over the budget," Nxesi reportedly told Kaya FM host John Perlman on Thursday. He reportedly said a Public Works investigation of the upgrading would be finished next week, and that the findings would be made public. Nxesi told Perlman it was "very clear" that the prices charged for the upgrading were "questionable". He blamed the building industry and said it was "likely you will be exploited". He said the public had the right to be upset about the cost of the upgrading reportedly about R250-million - but should give his department a chance to investigate. Zuma told parliament last month that the government was paying to upgrade the security at his home but he had taken out a bond to pay for the rest of the upgrading.
3 December 2012 The Times Page 1 Dominic Mahlangu, Thando Mgaga and Amukelani Chauke
Back-room huddle to save Motlanthe Senior ANC leaders were yesterday working furiously to pull off a "rescue plan" that would let Deputy President Kgalema Motlanthe keep his position as one of the top six in the party. President Jacob Zuma received the most provincial nominations to lead the ANC. But party leaders said yesterday that Motlanthe, who is yet to endorse a campaign to challenge Zuma, will be asked not to accept a nomination for the presidency. Party members close to both Motlanthe and Zuma said a plan was needed to stop the party imploding. "The winner-takes-all mentality should be avoided at all costs. "We have seen what happened in Polokwane when we refused to make compromises, and today we are still managing that damage," said one. Though the Motlanthe campaign failed to gain sufficient votes, there were plans to safeguard his position as ANC deputy president. A Zuma lobbyist said there was still time for Motlanthe to be saved - provided the ANC members believed in him - and the party kept united. It all depended on what Motlanthe did in the 10 days before the party's elective conference opened in Mangaung. "Remember, Cyril Ramaphosa is just a stop-gap measure [as a nominee for the deputy presidency]. We don't harbour evil against the deputy president," the Zuma lobbyist said. Since the ANC opened the leadership race in October, it has been beset by controversy, disruptions and violence. Though some provinces are yet to finalise their nominations, Zuma's second-term presidential bid received a major boost early yesterday when he was nominated by a majority of the branches in Eastern Cape. Other provinces that have nominated him are KwaZuluNatal, Mpumalanga, the Free State and Northern Cape. Motlanthe has the support of most of the Gauteng branches. Zuma also has the backing of the Umkhonto weSizwe Military Veterans' Association and of the ANC Women's League.
Motlanthe won the youth league's nomination. The North West ANC was scheduled to hold its nomination conference in Rustenburg yesterday after faction fighting led leaders to hold parallel conferences on Friday. One faction, led by provincial chairman Supra Mahumapelo - a staunch Zuma supporter - held a nomination conference at Haartbeesport Dam. Motlanthe-backer Kabelo Mataboge, the provincial secretary, convened a meeting in Mafikeng. After the party's national executive committee intervened, the groups agreed to hold one conference. Voting was expected to be concluded by late last night. The efforts to unite the party follow the warning of Cosatu general secretary Zwelinzima Vavi that the exclusion of Motlanthe from the ANC leadership would polarise the party. But while senior party leaders scrambled to pull together a deal, Zuma downplayed the rivalry between him and Motlanthe, saying ANC members were merely exercising their democratic right. Speaking to journalists in KwaZulu-Natal yesterday, Zuma said the much-debated showdown might not happen. "ANC members have the right to make preferences; that [Zuma and Motlanthe] contest comes in the context of democracy if it is there. At the moment, nobody knows whether it is there or not. But, if it comes, it is part of the democratic processes of the ANC," Zuma said. SACP general secretary Blade Nzimande urged the ANC yesterday to use Mangaung to restore the party. "We would like to see a leadership that is committed to driving radical transformation. We do not want a leadership of tenderpreneurs and we are unapologetic about that," Nzimande told an SACP committee meeting on the East Rand. Political analyst Ebrahim Fakir said the ANC should, instead of looking for ways to retain Motlanthe, consider making leadership and policy decisions that would benefit South Africa instead of the party. "There is still hope that he can be nominated as deputy president from the floor provided there is 25% support from delegates. "Why should they be striking a deal? That is the trouble. Someone has to be asking the question. Are these guys interested in rehabilitating the ANC, because the ANC is in trouble? "They have to exercise their minds on what is good for the country, what is good for society, not necessarily what is good for the ANC," Fakir said.