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2018’s agents of anti-state capture
If you think President Cyril Ramaphosa had a tough 2018, ousting Jacob Zuma and Tom Moyane, you ain’t seen anything yet
It ain’t over yet, Cyril
If you think President Cyril Ramaphosa had a tough 2018, ousting Jacob Zuma and Tom Moyane, you ain’t seen anything yet.
The billionaire faces a gruelling 2019, which will kick off in the first week in January with a fractious national executive committee meeting in which the ANC is set to finalise its lists of candidates for posts in the legislatures. So far, the list process has been marred by factional fights, with the group aligned to Zuma using it in a bid to claw back power. Insiders in the ANC who support Ramaphosa say the Zuma grouping is trying to pack the lists with its own candidates in a bid to direct the government’s actions from within the various legislatures.
In January, Ramaphosa will deliver the ANC’s anniversary statement in Durban — Zuma’s home base and the only province in which he still enjoys plenty of support. There are fears that Ramaphosa may face a hostile reception, but the party’s provincial executive committee has been working hard to ensure that doesn’t happen.
While it’s true that Ramaphosa has already made a number of vital appointments (such as Shamila Batohi as prosecutions boss), he will face the ultimate test in 2019, when he announces a reconfigured cabinet, after the elections in May.
Ramaphosa will be the face of the ANC’s election campaign. Indications are that his presence has vastly improved the party’s prospects: the ANC has even made inroads into the DA’s power base in the Western Cape, winning two councils from the party in recent by-elections.
But Ramaphosa will have to fight an election while battling to turn a sliding economy around, with a power utility that could prompt all three ratings agencies to downgrade SA to junk status. At the same time, he’ll have to appoint a new SA Revenue Service commissioner (the deadline for hopefuls to submit their CVs is on January 18), while also fixing crises at the Hawks and police.
If all goes well for him, in 2019 Ramaphosa will win a strong mandate from the electorate. It would strengthen his hand as he presides over a fractious ANC harbouring leaders who want to move against him at the party’s next national general council.
Zondo shows how
The long-awaited state capture commission, led by deputy chief justice Raymond Zondo, got under way in August and has heard explosive testimony about the influence the Guptas had over former president Jacob Zuma.
Within the first few weeks, the ANC was moved to claim it "wasn’t on trial", but it was soon clear that the party was indeed in the dock.
The inquiry has placed Zuma and the ANC at the heart of state capture, in part because of what Zuma did and in part because of the party’s inability to stand up to him and his cohorts.
For a start, the commission heard that when the ANC raised concerns about the Guptas’ influence, Zuma said they were his "friends" and the only people who were willing to help his sons Duduzane and Edward when he was persona non grata.
Zondo himself has handled the process meticulously. His questioning was on point as former and current cabinet ministers recounted their experiences.
It places Zondo firmly in line to ascend to the position of chief justice when incumbent Mogoeng Mogoeng moves on.
The chief justice holds office for a maximum of 10 years or until retiring. Mogoeng was appointed by Zuma in 2011, which means his term will come to an end in 2021.
The state capture commission will continue with its public hearings in 2019 and is expected to start dealing with issues around the interference in state-owned enterprises (SOEs), such as Transnet and Eskom, when it reconvenes. Fireworks are likely: the appointment of boards of SOEs was central to state capture.
President Cyril Ramaphosa is expected to testify on behalf of the ANC and will hopefully give the inquiry more insight into the party’s role and why it was difficult to stand up to the man who was leading it.
Witnesses such as former deputy finance minister Mcebisi Jonas and former ANC MP Vytjie Mentor are expected to be cross-examined.
Zondo has on numerous occasions urged more people who have evidence to come forward and give testimony to the commission. Zuma himself has said he will not do so, though the deputy chief justice has asked him to reconsider.
Zondo might just be forced to start issuing subpoenas to those who are either too scared or too implicated to give their side of the story.
Bogeyman of the corrupt
Public enterprises minister Pravin Gordhan has had a busy year of fixing broken corporate governance in the large state-owned entities. But his most demanding challenges lie ahead.
His biggest headaches are what to do about the huge debt hanging over Eskom and how to keep a bankrupt SAA airborne, as the airline is likely to report a loss of more than R5.7bn.
For SAA to survive, Gordhan must convince his more hawkish colleagues in the government to bail it out with another R17bn over the next three months.
The airline cannot claim to have the same status of strategic importance as electricity monopoly Eskom, without which SA has no source of power. But SAA is an unnecessary drain on public finances as its mandate can effectively be fulfilled by dozens of other airline businesses.
SAA employs nearly 11,000 people (mainly Cosatu-affiliated workers) and has turned a profit in only three of the past 11 years. In that time, its losses amounted to R18.1bn. If it is to remain in the skies, Gordhan will have to convince finance minister Tito Mboweni that another dollop of cash would turn SAA into a viable entity this time. It won’t be easy: Mboweni has twice made public his desire to close it down. The last time he did this, in New York in October, it sparked panic in government circles. Gordhan had to visit SAA’s head office to calm the jitters. But he did say: "The SA public is losing patience with SAA and doesn’t think it is viable."
In a speech laden with disclaimers, Gordhan said he believes the airline can survive "if SAA did the right things". Those "right things" are for the airline to eliminate corruption and waste and become more efficient. The problem is that nothing the airline has done in the past 23 years (in which it got more than R24bn in bailouts) shows it can be a good business.
Gordhan’s defining moment will come in March, when R9.2bn of SAA’s maturing bonds must be settled. The airline has already burnt through its latest R5bn bailout and is unable to pay salaries without external assistance.
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The FM has produced its annual 'Newsmakers of the Year' for 2018, which is available as a digital-only e-edition. Download the FM app for either Android or IOS on either your iPad, phone or computer, and read about who scooped the most headlines, who just missed out, who was responsible for the scandal of the year and the deal of the year.
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