Rob Rose Editor: Financial Mail
Minister Nkosazana Dlamini Zuma. Picture: Freddy Mavunda
Minister Nkosazana Dlamini Zuma. Picture: Freddy Mavunda

“The Cape’s wine farms are like ghost towns right now,” says Francois Rossouw, the head of nonprofit farmer network Southern African Agri Initiative (Saai), which will lock horns with Nkosazana Dlamini Zuma in court on August 18 over the alcohol ban.

“It’s eerie: until recently, these farms were bustling with international tourists. Now, there’s no-one there. At this stage, about 90% of the family-owned farms face total ruin.”

Saai is representing about 120 family-owned wine farms, including names you’ll know: Rust en Vrede, Meerlust, Fairview, Bouchard Finlayson, La Motte and Leopard’s Leap.

Many were struggling before Covid-19; President Cyril Ramaphosa’s ban on alcohol sales (for a second time) on July 12 tipped them over the brink. “About 350,000 livelihoods are under threat, if you think of the restaurants on the farms, and the accommodation they provide.”

Yet this is a point which Dlamini Zuma doesn’t seem to consider in the 349 pages she filed in court last week, laying out the evidence used in deciding on the ban.

On Friday, Rossouw’s organisation filed a 170-page response, pointing out the yawning holes in Dlamini Zuma’s argument.

In his affidavit, Rossouw doesn’t pull punches. Dlamini Zuma, he says, made “serious mistakes of fact”; took the decision to ban alcohol “based on unsound scientific data and hearsay”; didn’t listen to what the public had to say; and failed to consider “less restrictive means”.

In particular, he says, the co-operative governance & traditional affairs minister laid out a case of the “harm of alcohol in general”, rather than the implications for SA’s Covid-19 pandemic. “It is not the time to push an agenda against alcohol usage,” says Rossouw.

This lawsuit is just one of many the government is fighting against industries desperately trying to stay afloat amid one of the harshest lockdowns in the world.

To be clear, no other country has implemented a blanket tobacco ban and hardly anyone has banned booze. For a month, Sri Lanka tried it, as did parts of India, and one state in Greenland. Oh, and Lesotho and Eswatini. But few other democracies would have dared.

For a sense of what this has done to SA’s revenue, read this Bloomberg article. It points out that the R82bn in lost tax revenue for the first 3½ months of the fiscal year exceeds the amount SA borrowed from the International Monetary Fund (IMF) and African Development Bank.

While the lockdown has eviscerated the economy, it has done wonders for three niches: booze and tobacco smugglers; those selling shelf companies to ANC-linked tenderpreneurs (and Ace Magashule’s family); and lawyers defending the ruling party’s lockdown rules.

It is why The Washington Post described SA’s lockdown as one of the most “drastic” interventions in the world, which has spawned a thriving network of illicit booze peddlers. “It is truly shocking how much money people are willing to part with for alcohol,” one seller named ‘Peter’ told the newspaper.

But Dlamini Zuma, in her affidavit, ignores the illicit sales. Instead, she devotes plenty of space to how, after alcohol was first banned in March, hospital trauma cases plunged.

Rossouw says this reasoning is flawed. “One cannot merely attribute the entire reduction in trauma cases to alcohol usage. During level 5, the bulk of South Africans were confined to their homes and very few cars were allowed to be on the roads,” he says.

Would you, for example, argue that the drop in hijackings during the lockdown is also a consequence of the booze ban?

It was a point made in The Washington Post by investment banker Motheo Landane who said: “I’m like, no, the real reason for those declines in numbers is due to the fact there are less people on the roads.”

Now, it is clear the alcohol ban certainly has reduced trauma accidents in hospitals. But Dlamini Zuma fails to disaggregate the numbers sufficiently to show this intervention in people’s lives — banning alcohol — is justified by the specific evidence.

‘Constitutionally unsound’

Interestingly, Dlamini Zuma claimed that she did consider “less stringent” measures — she just chose not to implement them. “Experience has shown that less restrictions imposed during level 3, when Covid-19 cases were comparatively lower, were not as effective … as an outright temporary prohibition,” she says.

The wine industry, which contributes R40bn to SA’s GDP and employs 300,000 people, has been counting the cost of her decision.

Even though provinces like the Western Cape aren’t seeing a spike in new infections, Dlamini Zuma argues it won’t be practical to implement province-by-province restrictions.

But Rossouw replies that the constitution itself creates a system where alcohol sales are regulated on a provincial basis. “The minister and her alleged experts were thus clearly ignorant of the constitution and the structure imposed therein, or chose to ignore it. And this is another reason why the impugned regulations are constitutionally unsound,” he says.

Also, while Dlamini Zuma says she threw the industry a bone by allowing wine exports, the farmers say this is scant help.

Jean Engelbrecht, MD of Rust en Vrede, says Dlamini Zuma’s argument is premised on a “misunderstanding of the wine export industry”.

Exports were banned during the initial lockdown, which led to foreign customers cancelling orders. For example, says Engelbrecht, 100 Swedish state-owned stores cancelled their orders with his farm.

“Lost sales and lost [shelf] space cannot be won back in a normal business cycle and will remain lost for many years to come,” he says.

The upshot: of 174 people who worked at Rust en Vrede before the lockdown, 108 are now out of work.

‘Least restrictive measures’

It’s not only the economics that don’t support the government’s case, it’s the cognitive dissonance in bending over backwards to support the taxi industry by letting it carry full loads of passengers while sacrificing the wine industry.

Dlamini Zuma will also struggle to uphold the ban, given that the doctors themselves are now arguing the ban should be lifted.

On Friday, SA Medical Research Council president Prof Glenda Gray said on BDTV: “We have achieved what we needed — and now we need to address other issues. We have achieved the lives, now we need to look at livelihoods.”

On the same show, Prof Charles Parry, whose work was cited by Dlamini Zuma as justification for the ban, agreed. “We now need to start looking at planning for lifting the temporary ban on alcohol sales,” he said.

What’s remarkable about Dlamini Zuma’s court papers is that many of the studies she cites aren’t even that helpful to her.

For example, the Southern African Alcohol Policy Alliance lobbied Dlamini Zuma for “stricter controls” over alcohol — but it didn’t ask for a complete ban. Another group of 78 academics also called for better control, but said “none of the interventions are intended to restrict responsible alcohol use and social drinking”.

Dlamini Zuma would do well to go and read the judgment by judge Hans Fabricius, early on in the lockdown, when he took the army and police to task for the killing of Collins Khosa.

The population, said Fabricius, must be able to trust the government to impose rational rules. “These should intrude upon the rights of people (and their businesses) either not at all, or if they do, or justifiably must, the least restrictive measures must be sought,” he said.

Dlamini Zuma, by her own admission, didn’t do that. But as much as the sceptics might argue differently, SA isn’t a command-and-control dictatorship. Which is why her alcohol rules won’t hold much longer.

This is a roundup of the best Covid-19 news from the web, brought to you in today’s FM lockdown newsletter. To subscribe, for free, click here.

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