finance committee chair Yunus Carrim. Picture: GCIS
finance committee chair Yunus Carrim. Picture: GCIS

An amendment bill that strengthens the accountability, transparency and corporate governance of the Public Investment Corporation (PIC) was adopted by the National Assembly on Tuesday. 

This was despite four opposition parties decrying its provision that the deputy finance minister — or, alternatively, another deputy minister from the economic cluster — be chair of the PIC board.

The PIC Amendment bill has now been referred to the National Council of Provinces.

The PIC is Africa’s largest investment manager with R2-trillion in assets that it manages on behalf of the Government Employees Pension Fund (GEPF) and other social security funds, such as the Unemployment Insurance Fund (UIF) and the Compensation Fund.

The DA, African Christian Democratic Party (ACDP), the UDM and the COPE argued that having a deputy minister as chair of the PIC board would open the way for political interference.

UDM MP Nqabayomzi Kwankwa strongly opposed any member of the executive chairing the PIC.

Chair of parliament’s finance committee Yunus Carrim said the provision is justified in that the fiscus has ultimate responsibility for the GEPF. However, the provision is counter-balanced by the fact that the PIC would be accountable to parliament for its decisions and would also have trade union representatives on its board to oversee the deputy minister.

Carrim insists the bill is a transitional measure and that another bill will probably be submitted by the executive later on the basis of the commission of inquiry into the PIC, which is underway under the chair of retired judge Lex Mpati. The inquiry is looking into, among other things, the PIC's R4,,3bn investment in Ayo Technology Solutions.

The PIC has been rocked by allegations of suspect investments,  including in Ayo, over the past year. These led to the recent mass resignation of the board, including its chair, deputy finance minister, Mondli Gungubele.

The DA’s proposal is for parliament to recommend the candidates for chair of the PIC board to the finance minister. DA finance spokesperson Alf Lees stressed that the chair of the PIC board should not be a political figure.

Lees also raised a concern during the debate over the investment guidelines in the bill, which would require the PIC to look at investing in projects that furthered economic development, job creation and transformation.

He believes this is like a Trojan Horse to the introduction of prescribed assets for all financial institutions the ANC has indicated that it wants investigated.