Pow­ers of cabi­net min­is­ters are lim­ited

Business Day - - FRONT PAGE - TREVOR MANUEL

There are pro­vi­sions in the con­sti­tu­tion that set out the cabi­net’s re­spon­si­bil­i­ties. Cabi­net mem­bers are col­lec­tively and in­di­vid­u­ally re­spon­si­ble to par­lia­ment for the ex­er­cise of their du­ties and re­spon­si­bil­i­ties, as ar­tic­u­lated by sec­tion 92(2).

For this to hap­pen, it is im­por­tant to recog­nise that the pow­ers and func­tions, to­gether with the ad­min­is­tra­tion of any leg­is­la­tion, are as­signed to min­is­ters by the pres­i­dent, as set out in sec­tion 97.

These may be used to de­ter­mine, for ex­am­ple, whether the ex­er­cise of the “in­ter­min­is­te­rial com­mit­tee on the banks”, led by former min­eral re­sources min­is­ter Mosebenzi Zwane, was ever con­sti­tu­tional. It could be le­git­i­mately ar­gued that, un­less the Banks Act was as­signed to Zwane, his in­ter­ven­tion was a naked abuse of power. The pow­ers of min­is­ters are fet­tered by the pro­vi­sions of our con­sti­tu­tion.

But in the col­umn, “Nene & Co have al­ways traded horses” (Oc­to­ber 9), it is ar­gued, in re­la­tion to pub­lic en­ter­prises min­is­ter Pravin Gord­han, that “on his watch, the cost of Transnet’s Jo­han­nes­burg to Dur­ban pipe­line es­ca­lated from R10bn to R25bn in the space of two years”.

There are quite a few statu­tory and reg­u­la­tory steps that were ig­nored in the col­umn, pre­sum­ably for the pur­pose of pil­lo­ry­ing Gord­han. The Pub­lic Fi­nance Man­age­ment Act reg­u­lates the fi­nan­cial con­duct of all state in­sti­tu­tions. Transnet is listed in the act un­der sched­ule 2, that ef­fec­tively per­mits such an en­tity to man­age its own af­fairs.

Transnet, for ex­am­ple, bor­rows against the strength of its own balance sheet. The board is ac­count­able for Transnet, act­ing un­der the aegis of the direc­tor-gen­eral for pub­lic en­ter­prises. Gord­han was not ever an ac­count­ing of­fi­cer, leg­isla­tively his role as min­is­ter is that of an ex­ec­u­tive author­ity.

If my mem­ory serves me right, at the point of ini­ti­a­tion of the re­con­struc­tion of the Dur­ban-Jo­han­nes­burg mul­ti­fuel pipe­line, no spe­cial gov­ern­ment guar­an­tee needed to be sought. Other ex­ter­nal fac­tors in­ter­vened — the na­tional en­ergy regulator had in­structed that the pipe­line di­am­e­ter be in­creased. This re­sulted in sig­nif­i­cant cost es­ca­la­tions and con­struc­tion de­lays.

Also, in the early stages of the project, there were mas­sive in­creases in global steel prices and the pipe­line project could not es­cape these. I am sure that an eval­u­a­tion of cost es­ca­la­tions on the pipe­line would make an in­ter­est­ing topic for a stu­dent of pub­lic fi­nance.

The is­sue here is that pub­lic ac­count­abil­ity is ac­tu­ally quite ra­tio­nally struc­tured, and the mere fact that par­lia­ment does not ad­e­quately ex­er­cise its author­ity does not al­ter that fact.

The col­umn also equated the cir­cum­stances of the strate­gic arms pro­cure­ment and those of the at­tempted nu­clear trans­ac­tion. It ar­gues that “the os­ten­si­ble le­gal stric­tures that pre­vented Nene from sign­ing off on a nu­clear deal did not de­ter Manuel from adding his sig­na­ture to the strate­gic arms pro­cure­ment”. De­spite the many views at the time, we have a con­sti­tu­tional obli­ga­tion to es­tab­lish a se­cu­rity ser­vice to de­fend our sovereignty. Chap­ter 11 of the con­sti­tu­tion is de­voted to this pur­pose. It stands to rea­son that if we are to have a de­fen­sive ca­pa­bil­ity, that the de­fence force would need to be rea­son­ably equipped.

There was the recog­ni­tion, even be­fore the ad­vent of democ­racy, that SA’s naval de­fence sys­tems were badly ne­glected and that it needed to be re­cap­i­talised. In ad­di­tion, a demo­cratic SA could not be en­tirely de­pen­dent on the Is­raeli De­fence Force for the main­te­nance of its air-de­fence sys­tems through the then al­ready dated Chee­tah squadron.

These mat­ters were the sub­ject of the “First De­fence Re­view” that had been ap­proved by par­lia­ment. Be­yond the par­lia­men­tary ap­proval was the process of ac­qui­si­tion, led by the SA Na­tional De­fence Force, and steered into a spe­cial cabi­net sub­com­mit­tee.

The pro­cesses fol­lowed have been ex­am­ined re­peat­edly and found to be above board. At no time dur­ing these pro­cesses did any cabi­net com­mit­tee or mem­ber (per­haps with the ex­cep­tion of the min­is­ter of de­fence) in­volve them­selves with mat­ters such as the ap­pro­pri­ate mis­sile sys­tems, the electrics on ves­sels, or any such mat­ters of high spe­cial­i­sa­tion.

There was a sep­a­ra­tion into pri­mary and sec­ondary con­tracts — and col­lec­tive cabi­net re­spon­si­bil­ity re­lated only to the pri­mary con­tracts. The min­is­ter of fi­nance had to en­sure that the project was af­ford­able in the medium term and that loan agree­ments were the best SA could raise.

My sig­na­ture was ap­pended to the loan agree­ments that were all law­ful, and re­peat­edly found to be so. Any min­is­ter who would sin­gle-hand­edly seek to usurp the pow­ers of the cabi­net in a process that had al­ready been thor­oughly can­vassed by par­lia­ment in the de­fence re­view would create an un­think­able con­sti­tu­tional cri­sis.

THE CON­STI­TU­TION LIM­ITS THE POW­ERS OF CABI­NET MEM­BERS SUCH AS THE MIN­ERAL RE­SOURCES MIN­IS­TER — UN­LESS THE BANKS ACT IS AS­SIGNED TO HIM OR HER

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