[Source: Daily Maverick by Ranjeni Munusamy.]
The Hawks’ decision to summon Finance Minister Pravin Gordhan and former South African Revenue Service (SARS) officials to their headquarters for warning statements on Thursday can only mean one thing: the onslaught on the National Treasury has resumed. The outcome of the local government elections has signalled that the window of opportunity for President Jacob Zuma, his allies and his friends to have unfettered control of the state is closing. The ANC is disorientated by the results and reeling after the loss of major metros to the opposition. In this scramble for coherence and atmosphere of unpredictability, dangerous and risky actions are possible.
South Africa was very much in a holding pattern during the local government elections period. Politicians were out on the campaign trail and the country was on autopilot. It was also risky to make any controversial moves that might affect voter sentiment. But now that the elections have passed and the councils have all been established, it is back to business. And in this country, back to business in politics means back to scheming, skulduggery and powermongering.
It should be no big surprise that Finance Minister Pravin Gordhan and former SARS officials Ivan Pillay, Johann van Loggerenberg and Pete Richer have been asked to present themselves to the Hawks headquarters in Pretoria on Thursday. Daily Maverick reported on Tuesday that the four would be receiving warning statements from the Hawks, signalling the intention to charge them and inform them of their rights. The charges relate to the operation of a special investigating unit at SARS, established when Gordhan was the commissioner of the revenue service.
With the Hawks scrambling to find a legal basis to charge Gordhan, the motive behind the investigation appears to be political. The intention appears to be to shove Gordhan out of the way so that the Treasury can be commandeered by politically connected individuals. It was the same agenda that motivated the disastrous removal of Nhlanhla Nene from the finance ministry in December, sending the economy into a tailspin. In May, the Hawks denied they were investigating Gordhan in connection with the SARS unit. They were obviously yanked back so as not to cause turbulence before the elections and prompt a backlash from voters.
As it turned out, the backlash came anyway and the ANC experienced its worst performance at the polls. With the damage already done and the stakes now higher, the Hawks appear to have received the go-ahead to pursue the investigation. But the Hawks investigation is not the only attack on Gordhan. News24 reported on Tuesday night that SARS has appointed accounting firm Grant Thornton to conduct a forensic investigation into IT contracts concluded while Gordhan was at the revenue service.
The urgency to launch a full-scale onslaught on Gordhan could be related to another event that has been pending until after the elections – a Cabinet reshuffle. Gordhan’s position as finance minister appeared to be safe because of all the reassurances the president provided about the Presidency and National Treasury working together to stabilise and grow the economy. It would also be dicey to remove Gordhan from his post before the international ratings agencies make a decision on South Africa’s sovereign ratings in December. So it was expected that there would be a reshuffle, with possibly Mcebisi Jonas removed as deputy finance minister, but that Gordhan would remain finance minister to prevent any further damage to the economy.
But the election results changed the political landscape and sent a strong signal that people’s patience with the ANC is running out. This means the window of opportunity to manipulate the levers of the state and drain resources could be limited. Firing Gordhan using the excuse that he is facing criminal charges and therefore cannot serve in such a key Cabinet position would be a way to seize hold of the Treasury and undo the stringent controls it has placed on spending and tender processes.
Who can stop this happening as Cabinet appointments remain presidential prerogative? The ANC has been so shaken by the results and the loss of major metros and former stronghold municipalities that it has not been able to come up with a coherent response to regain its footing. This has provided further opportunity for the president and his allies to manoeuvre quickly both in the organisation and the state.
The first move was by the ANC Youth League (ANCYL) last week to call for an early ANC national conference to reshuffle the leadership deck. They proposed there should be no contestation for positions, suggesting there should be a slate of leaders agreed to beforehand. The ANCYL also wants the size of ANC national executive committee (NEC) to be reduced. This means that the dominant faction in the ANC, the “premier league”, can remain in charge and select the next set of officials without contestation. If this happens, the faction aligned to Zuma remains in power and in control of the levers of the state. Zuma would also be safe in his position as head of state until his term ends in 2019.
At a media briefing on Tuesday, ANC secretary-general Gwede Mantashe said the idea of an early conference was “not a bad idea” as long as the intention was to unite the organisation.
“We can’t go to a conference because we have done badly and we go fight it out there, smash each other in conference, blood on the floor and we come out of that conference more divided,” Mantashe said.
He also repeated the line that the ANC NEC should take “collective responsibility” for the election results, but acknowledged that negative perceptions around the Nkandla matter had hurt the ANC at the polls. But he said Zuma could not be held responsible.
“You can’t separate the president of an organisation from his organisation. So any negative narrative around the president will actually hurt the organisation. We acknowledge that,” Mantashe said.
Mantashe is by now well aware that the NEC will not take a decision to sanction Zuma. This means that the ANC has to continue to live with the consequences of a disastrous Zuma presidency. It is perhaps this knowledge that makes him amenable to the idea of an early conference, even though it would place a massive logistical burden on his office to arrange the event ahead of time.
With the bulk of the NEC acting as a protection racket around Zuma, it is only the broad membership of the ANC that can overrule the committee. ANC members around the country are furious and disappointed with the elections outcome, and many are feeling the pain of losing council seats in municipalities. Mantashe is not oblivious to this fact and possibly wants to stand back to allow the ANCYL and its backers to have their way, knowing that calling the conference early could seriously backfire on them.
While Mantashe, MPs in Parliament, and elected councillors have to face the public and try to stitch together some coherent messaging about the elections outcome, Zuma has remained behind the scenes. He has not spoken publicly on the election results, the coalitions or the ANC’s losses of the metros. His message to the NEC was that the ANC was still the dominant party and they should not buy into the narrative that they performed badly. This has caused further disorientation when the ANC was trying to come to terms with its losses.
ANC chief whip Jackson Mthembu is one of the few leaders willing to admit: “The losses and setbacks suffered in these elections are self-inflicted”.
Zuma would make no such concession and seems to be impervious to the damage he has caused to his organisation. He appears to be focusing on consolidating his power.
A major development in the past few days was the announcement by Cabinet that a presidential co-ordinating council on state-owned companies would be formed to provide Zuma with “line of sight on strategic decisions and interventions” in the entities. This appeared to give Zuma final say on any actions taken by the inter-ministerial committee chaired by Deputy President Cyril Ramaphosa or the Treasury on the state-owned companies. Attempts by Treasury to rein in South African Airways and Denel have already been thwarted. The new oversight body now provides Zuma with a mechanism to control all interventions from now on.
On Tuesday night, government issued a statement in response to queries about the reforms of the state-owned enterprises. The statement said the presidential co-ordinating council would allow for “better oversight and co-ordination of state-owned companies”.
The election results should have made the ANC more circumspect about its actions and mindful of the fact that political careers are now in danger if their organisation continues to lose ground. There should be more people willing to speak out frankly about the state of the party. For some reason, the conspiracy of silence prevails and Zuma is left to his own devices.
With the elections over, the damage done and the ANC in a state of semi-paralysis, Zuma is capable of unpredictable actions. On top of all his past actions, he has now escaped accountability for the unprecedented losses the ANC has suffered at the polls. He continues to hold his organisation and the country hostage because he knows that with the present balance of power in the ANC, nothing can be done to him. And until something can be done, South Africa remains in choppy waters.
57 700 000 (mid 2018 estimate)
4.0% y/y in January 2019 (CPI) & +4.1 y/y in January 2019 (PPI)
1.4% q/q (4th quarter of 2018)
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