Tollroad to the future
Auditor-general Kimi Makwetu and his team have offered the ANC clear explanations for the poor government service delivery that’s eroding voter confidence in the ruling party.
But Makwetu’s solution requires ANC leaders to dismantle a system of political gatekeeping that determines who occupies party and state leadership positions at all levels. This system has become entrenched under President Jacob Zuma and will be an issue in the next two elections, but it’s not in the ANC’s current or aspiring leadership’s interests to challenge it.
The ANC’s recent national general council (NGC) meeting was dominated by introspective discussion about why party membership had dropped by 37% since 2012. Delegates pinpointed corruption and an unskilled state bureaucracy that is unable to stabilise state-owned enterprises and implement policies, especially the flagship National Development Plan, as key problems. Party leaders agreed that this was putting the party in real danger of losing significant ground in next year’s municipal election and the 2019 national election.
These same issues were raised in the previous three NGC meetings. The ANC’s elective conference in Mangaung in 2012 specifically instructed the current party leadership to tackle them fearlessly.
But the NGC, which is a midterm review to assess how the party’s elected leaders have done in implementing their mandate, did not hold any leaders responsible for the state of the party.
Makwetu’s audit reports name poor leadership in government, coupled to a “lack of visible consequences”, as the main reasons for substandard financial management and service delivery.
This point was repeated at all portfolio committees at which the AG explained the financial performance of relevant departments and entities.
But the AG made the boldest point yet about the lack of political will to address financial mismanagement during a briefing on the department of energy’s financial health. A page entitled “Ministerial commitments to address root causes” was left blank to reinforce the lack of response to audit findings from energy minister Tina JoematPettersson.
The department faces several financial challenges, including PetroSA’s R4,2bn deficit, and the AG could not audit the Nuclear Company of SA (Necsa) because the entity has not been able to table a financial report this financial year. Parliament’s energy portfolio committee is expected to hold a meeting behind closed doors to have the reasons for this explained. Necsa has also been embroiled in political battles linked to government’s controversial plans to buy 9 600 MW of nuclear power.
The plan has been shrouded in secrecy as government refuses to reveal its modelling to prove that the procurement is necessary and affordable.
Makwetu regularly warns that a lack of internal controls encourages unauthorised spending (this spending in the public health sector has increased by 442%) and cautions that any deviations from rules governing supply chains make the system vulnerable to fraud and corruption.
State auditors told MPs on parliament’s transport portfolio committee that there were numerous discrepancies in contracts issued by the Passenger Rail Agency of SA. These include an escalation of R8bn in a contract for new trains for Metrorail, noncompliance in awarding a R17,9bn contract to BEE equity partners and inadequate hedging on the entity’s controversial R60bn locomotives contract, which was awarded in contravention of the Public Finance Management Act. The winning bidders for this contract should have been disqualified for a “conflict of interest”.
SA doesn’t lack for legislation to prevent state fraud and corruption. There is a suite of legislation that not only makes it possible to hold accounting officers personally liable for mismanagement and negligence, but prohibits state employees from being a director of a public or private company that conducts business with the state. National treasury has also tightened up state procurement processes, but several ANC MPs who spoke to the Financial Mail agreed that these can be circumvented if “the right people in the system turn a blind eye”.
Many ANC leaders are keen to point out that the suspension of police commissioner Riah Phiyega pending an investigation into her fitness to hold office and the prosecution of the party’s Northern Cape leader, John Block, are signs of Zuma’s intention to clean up the system. But parliament’s watchdog public accounts committee cautions that this is not enough.
The country has yet to see consequences for poor performance becoming a trend among politicians and officials across all levels, especially at municipal and provincial level. This is where financial mismanagement is most worrying and it’s also the level at which the politics of “factional gatekeeping”, raised by Zuma at the NGC, is most visible.
The ANC admits that membership of its branches is being limited by gatekeepers who want to protect their positions of power in the branch and in local or provincial authorities. Position in the ANC offers access to opportunity and money, which means that individuals who control this access have a following on the ground which, in turn, secures leaders in positions higher up in the party and in government.
This reality is set out in research by Alexander Beresford, a specialist in African politics at the University of Leeds’ school of politics and international studies. In a paper he has recently published called “Power, patronage and gatekeeper politics in SA”, he describes the way the ANC operates as a “sordid pyramid scheme”. This, he concludes, has become exaggerated under the Zuma regime.
ANC leaders at Luthuli House admit this is a concern ahead of the municipal government election as their campaign is expected to turn on it. They argue the party will be taking a public and firm stand on members to prove that it is serious, but treading on the wrong toes will jeopardise important networks in the party.