Setback for Zwane on Mining Charter

The ANC has extended an olive branch to the mining sector, cutting Mineral Resources Minister Mosebenzi Zwane down to size as the battle over the contentious Mining Charter continues to simmer.

The party is scrambling to arrest the continued slide in the economy, spending yet another three-day lekgotla focusing on stimulating growth and efforts to reverse SA’s descent into subinvestment grade terrain.

It has endorsed Finance Minister Malusi Gigaba’s 14point plan to boost economic growth, a blueprint that also pushes for the partial privatisation of state-owned enterprises, which the ANC had until now largely rejected as an option.

Zwane recently dealt another major blow to the economy, releasing the third version of the Mining Charter after very little consultation — if any. This angered the industry, a major player in the economy, and resulted in legal action against the department.

On Monday, ANC secretarygeneral Gwede Mantashe said the mining sector had to be viewed for its long-term potential contribution to the economy and dealt with “holistically”.

This was about looking beyond the mining charter, although the importance of transformation in the sector should not be “de-emphasised”.

“We must deal with the industry … not in a way that appears to be punitive. Mining is not a short-term sector … it is a long-term sector … we must create an environment for that industry to perform,” Mantashe said, speaking to journalists after the lekgotla.

He said part of this approach would be to finalise the charter as well as the Mineral Petroleum and Resources Development Act. The ANC’s policy conference also agreed that sections of the charter had to be reworked.

Mantashe was specifically asked whether this undermined the mineral resources minister.

“No, it reinforces him, that when a deployee takes charge of a particular portfolio, it’s not a personal domain, it’s an ANC issue,” he said.

“If you commit mistakes, those mistakes come back here [the ANC] running, so we are not undermining minister Zwane, we are helping him appreciate the fact that we should do things in a particular way that does not affect the economy negatively, that is our responsibility.”

Zwane has been implicated in the Gupta e-mails for his proximity to the family and the manner in which he assisted the

family to acquire Optimum’s Tegeta mine.

The lekgotla endorsed Gigaba’s growth-stimulation plan, which has been criticised for providing “nothing new” in boosting growth. Mantashe said Gigaba’s initiative was not meant to be new. Rather, it was intended to build on and accelerate the nine-point plan, which was already in place.

“The plan is intended to reduce government’s contingent liabilities by reorganising recapitalisation and government guarantees. It proposes a number of broad reforms, including developing a framework for private sector participation.” He said the ANC had to tackle business and consumer confidence. It was critical that business and the government worked together; business was not in the business of welfare and “investors are not doing us a favour by investing” in SA.

“Our biggest challenge remains the economy, where growth has deteriorated and growth in GDP per capita has also declined. Unemployment has risen to a 14-year-high at 27.7%, with the overall effect of these economic challenges being a loss of both business and consumer confidence.”

He conceded that perhaps the party’s resolution on corruption was weak. “Strong words will not defeat corruption.”

The lekgotla agreed that the government should introduce measures that should come into effect in 2018 on fee-free higher education. This includes fully subsidised grants for academically qualifying poor students whose families earn less than R150,000 a year.

The outcomes of the lekgotla will be discussed and refined at a cabinet lekgotla starting on Tuesday and will feed into Gigaba’s medium-term budget policy statement in October. This was the final lekgotla presided over by the current national executive committee led by Jacob Zuma, whose term as party president ends in December.