/ 3 June 2011

Toyi-toying with the economy

When President Jacob Zuma announced his Cabinet there was some curiosity about how economic policy would work.

Previously the national treasury was in the driving seat, but now there would be two new departments that would also be responsible for economic planning.

These were Trevor Manuel’s planning commission and Ebrahim Patel’s economic development department. How would Pravin Gordhan, Trevor Manuel and Ebrahim Patel work together? Who would call the shots and how?

Minister in the presidency Trevor Manuel was quick out of the starting blocks with a green paper intended to outline the direction his commission would take. We are yet to hear more.

Gordhan said he was in charge of macroeconomic policy and has been doing a workmanlike job running the finances of the country. He has been a vocal anticorruption campaigner, announcing this week that his department was taking charge of running the country’s tender system.

He has rightfully won praise for his commitment to making the issuing, processing and management of tenders transparent. All interested parties will be able to check tenders on the web and a list of people who are excluded from applying has been published.

This will make many a tenderpreneur unhappy and undoubtedly give the taxpayer a bigger bang for each buck through improved service delivery.

Patel’s ministry has come to be defined by his decision to lead a campaign of three government departments, his own included, at the competition authorities seeking to impose conditions on Walmart in its proposed deal with Massmart.

The Competition Tribunal ruled this week that the merger could go ahead subject to the conditions that there be no retrenchments for two years, that the union recognition agreement stay in place for three years and that Walmart puts up a R100-million fund to support the manufacturing industry.

As observers have noted, the conditions are largely those that Walmart proposed to the tribunal on the last day of the hearings. They are eminently reasonable, but leave out a key condition which Patel, the departments of trade and industry and agriculture and interested unions wanted; that Walmart commit to increasing the percentage of South African-made goods from the current 34.8% to 50% by 2014.

Patel chose activism over pragmatism in allying himself with this demand. If he believed the 50% requirement was desirable he should have taken it to Cabinet and then Parliament, which would have been asked to pass such a law. Note that, to be constitutional, it would have to apply to all retailers, not just Walmart.

But Patel is not to blame here, Zuma is. He has set up and allowed a fractious economic policy. There is nothing in the Competition Tribunal’s finding that the parties could not have agreed to quietly behind the scenes if the presidency had played the lead role in ensuring that they sing from a single song sheet.

Instead we have had delays, even while the economy has continued to shed jobs. We have also had the unedifying and embarrassing spectacle of Patel undermining investor confidence by choosing to toyi-toyi at the tribunal.

Truth knows no status
The importance of this week’s appeal court judgment lies not only in its vindication of the Mail & Guardian‘s lengthy investigation of the Oilgate stories, but also in ­setting out the importance and constitutional obligations of the public protector’s office.

“The office of the public protector is an important institution. It provides what will often be a last defence against bureaucratic oppression and against corruption and malfeasance in public office that is capable of insidiously destroying the nation. If that institution falters, or finds itself undermined, the nation loses an indispensable constitutional guarantee,” the Supreme Court of Appeal stated this week.

Unfortunately, for a long time this office, under advocate Lawrence Mushwana, abdicated this responsibility and allowed itself to be used by powerful politicians, who were either under investigation or were accused of ­malfeasance, to clear their name.

Oilgate remains a prime example. Mushwana concluded that the M&G had published stories that were factually incorrect, based on incomplete information and were unsubstantiated. The SCA has since ruled that this conclusion was based on little or no investigation at all. Referring to “the state of mind” in which the purported investigation was conducted, the court found that the public protector’s office did not take its work seriously in the first place.

For whatever reason, the public protector displayed deference to the ruling party and senior government officials that was incompatible with the ­requirements of his office.

This was exemplified by a refusal during the investigation to question high- ranking government officials, including the classic reasoning that a “director general of government is a person of high integrity with expert knowledge and his views and opinions cannot be questioned simply because a certain journalist, for reasons of their own, might not believe him”.

As the court explained, truth and deceit know no status or occupation. This should be a lesson to other chapter-nine institutions, which are meant to look after the powerless in society but, instead, have been used to curry favour with the powerful in society.