When news of Minister of Defence Mosiuoa Lekota’s business interests first broke last week, a spirited debate ensued in the Mail & Guardian’s leader conference where we determine our editorials: should Cabinet ministers be allowed business interests?
One would have thought that such a group of socially minded lefties would cry: of course ministers should not, and especially not Terror, of whom we are particularly fond.
But a far more textured discussion has mirrored the debate likely to unfold as revelations of ministerial money-making come forth.
On the one hand, there is a purist argument that the spheres of public office and of private interest should not be adjoined. Once a minister gets involved in business — as several are — this dilutes their raison d’Ãªtre, which is to make and execute policy in the public interest. If a minister is or was also a shareholder, as Lekota is of BZL Petroleum, and a director, as he is or was of the Landzicht winery, then this public mission will blur. Lekota is not alone of course.
Not only does the Cabinet member take time off from official duties to attend board meetings (as Lekota did), but the bigger concern is of how policy direction and government decision (say, about the granting of tenders — the government spends R180-billion a year) will be influenced not by what is in the public interest, but by what is good for business.
Besides, say those of us against a South African Cabinet Pty Ltd, we pay our ministers well, they do not need to moonlight. Ministers will earn a salary of R746 000 this year, excluding perks like housing and free travel.
The United States is, of course, the largest symbol of what happens when corporate concerns trump public ones. There, the business lobby has been formally institutionalised and it has come to fundamentally sculpt Democrat and Republican policy.
In popular anti-Iraq war discourse, that was a battle fought as much for the American multinational access to the Iraqi oilfields as it was about toppling the Baa’thist regime of Saddam Hussein. The lines have blurred so much in the US that National Security Adviser Condoleezza Rice has an oil tanker named after her. The “L” in BZL Petroleum stands for Lekota. There is a long way to go before our politics are as corrupted by corporatism as the US’s are, but the lines must be drawn now or the writing is on the tanker.
The purist argument lost out in 1994 and a system that attempted to limit the business interests of politicians was put in place. The counter-argument is that while ministerial salaries may sound like a lot, the incumbents could easily triple if not quadruple their earnings in the private sector.
So Parliament established its register of members’ interests, which also covers Cabinet members. Any benefit of R350 or more must be recorded as shares and other financial interests (including the number, nature, nominal value and name of the company it was received from).
In addition, public representatives must also disclose remunerated employment outside Parliament; directorships; partnerships; consultancies and retainerships. Lekota’s failure to disclose highlights a failing in the declaration system.
The registrar of members’ interests, Fazela Mohamed, works with only an assistant. The declaration system is not audited or checked — in other words, it is a document of conscience alone.
Even an unsophisticated observer is able to see that it has also become a document of rote alone; many MPs (of all political persuasions) and other Cabinet members are less than rigorous in their declarations because the ethics committee that oversees the register is not making it as useful a check on conflicting interests as it should be. Another set of compliance problems afflicts the Executive Members Ethics Act, which sets out a similar set of disclosure regulations to the parliamentary register of members’ interests. It too can be regularly breached because it is not properly policed and not sufficiently detailed on the level of declaration.
The Lekota imbroglio should provoke a debate on how effective these are, especially as the stampede by business to get politicians around their boardrooms is growing apace.
Cabinet ministers, provincial members of executive councils, MPs and senior civil servants are attractive to business because they offer insight into policy, a heads-up into what’s coming, networks to new power, as well as to tender business.
Politicians and senior civil servants are undeniable boardroom assets, as the brain drain from Parliament and public service to the private sector is showing. There is no ideological argument to be made against this flow because one of the benefits of freedom is to choose a life either in private or public life, but surely it should be a case of “either”, not both?
Not so, felt a large body of opinion in our meeting. To rule out other interests for ministers and others is also too prescriptive and could be seen as an infringement of the rights of association. It would also mean, some argued, that only dross would in time be attracted to public life.
What should be encouraged is a revolving door where there is a healthy movement of talent between the public and private spheres. But the revolving door needs to be well-regulated, as well as well-oiled.
The fates of former transport minister Mac Maharaj and the late defence minister Joe Modise, who both allegedly favoured businesses with which they were associated in tender contracts under their ministerial authority, show why.
The country also urgently needs to set in stone a “cooling-off period” for public representatives.
A cooling-off period is like a restraint of trade agreement where, for example, Lekota would be precluded from working in defence should he choose a business life instead. Without such an instrument in place, the temptation to set oneself up while in office is too great.
The revolving door could, in time, swing the other way — where private sector luminaries might be drawn to public life. Often the failures of execution of good government policy occur because the civil service lacks management skills.
The ability to get a grant from the Treasury to the pockets of poor people or to ensure that the protections for domestic workers unfold seamlessly require such skills.
If, for example, businessman Cyril Ramaphosa wants to make a come-back to politics, a separate set of checks and balances needs to be regulated.
In Britain, ministers’ private interests laws say appointed ministers should put investments into a “blind trust” — a step Wiseman Khuzwayo took when appointed executive director of the New Partnership for Africa’s Development secretariat. A blind trust is one in which the minister is not informed of changes in investments or of the state of the portfolio, but is fully entitled to both the capital and income generated.
If moonlighting is unlikely to bite the dust it must be much more tightly regulated.
Additional reporting by Jaspreet Kindra