ANC decision-making creates a toxic brew

There is a strange omertà in the ANC that they don’t often spill the beans on how decisions are made. Notice how there are lots of books from analysts on politics, but political autobiography just isn’t a thing in SA.

It took many years, and the Zondo commission, to start to pry out details on state capture. Not the high-level narrative which was already well known, but the intricate details of who said what to whom and when.

During March to June, at the height of the coronavirus crisis, decisions were coming out of the government with seemingly little advice, no public consultation and with glaring contradictions.

When was the last time anyone who used to work in the National Treasury wrote a book? The Treasury seems happy just to pop its head above the swamp twice a year as it hunkers down to protect the institution.

Viewed from afar, economic policy decisions can appear to be chaotic. Closer up, even more so.

The management of the economic cluster in the cabinet is a key example, as is its failure to come up with any decent, cohesive plans given its leadership ’ s tendency to spout easy platitudes.

Why is all this important?

Because we have a problem that infects business and investor confidence, because we have a challenge in understanding the machine.

There are several possible reasons for things happening or not. The first is the technocratic impulse to make the country a better place and solve its problems.

Second, this is then bogged down in a world of left-leaning, state-loving arguments regardless of if there is any money, capacity or ability for the state to deliver.

Third, things are reflected through a lens of vested interests including those of the unions, communist party allies, big business, and through the obsession with the social compact.

Now throw in some egos and a whole lack of state capacity and you begin to see why things are simply stuck in the mud.

The issue for business and investors is what percentage of the problem pie do you assign to each of these buckets?

The president would like us to think it is mostly about capacity. But is that a limiting constraint? If you solved the problem of capacity, would dealing with rent extraction and vested interests still dominate? The issue that is not appreciated is that all these factors are interlinked and co-dependent.

We can apply some important issues to this framework.

If we take the fact that the government has made no fuss about the major step of gazetting a section 34 determination that will allow bid window five of the renewable energy independent power producer procurement programme to open, you must ask why.

There are good people around the president who might understand how important it is to trumpet this.

But then we get stuck at the vested interest and rent extraction stage. It would seem that for so much of policy — spectrum, for example — one cannot trumpet and promote one issue ahead of others.

The same is true for SAA. No sound costed and transparent proposals have been made for why R10.4bn should be provided by the state when it will come from slashing infrastructure budgets.

The technocratic urge has not been there. Then you get a layer of ideology (the state must have an airline) and vested interests with the unions, and the need to stick with ANC resolutions, and you then have the SAA money drain going on and on.

Private sector capacity has been brought into the department of public enterprises to accelerate this crash-landing. But this also shows where this framework breaks down. The ideology, the vested interests, don’t seem to count for enough to explain what ’ s going on. At its heart, is it just fiddling for the sake of it in an ego battle?

The president has clearly picked the department of public enterprises over the Treasury, but on whose advice? Has he asked why SAA is not even really part of a cohesive wider transport policy? Does he then understand the consequences of a forthcoming World Bank loan? Does he know what this means for the public sector wage bill and the court cases around it? How can decisions be taken like this?

All of this breeds uncertainty and is why radical sunlight is needed and much more transparent decisionmaking as well.

As long as decision-making is messy and in private it will remain easy for bad decisions to be made and we will only really know when it is too late.