On the back foot

The commission is doing itself no favours by attacking its critics

At a parliamentary committee hearing last week, Competition Commission head Tembinkosi Bonakele lashed out at the “interference” by politicians and “bias” of the media which have been probing the commission’s conduct.

Interrogated by the portfolio committee on economic development, Bonakele grew rattled and appeared to resent questions about the commission’s briefing patterns, expenditure and VIP security.

However, data supplied by the commission in response to a series of parliamentary questions by DA MP Michael Cardo suggests that the commission does indeed have a case to answer.

The first is that one law firm, Ndzabandzaba Attorneys, has raked in R72m from the commission in the three and a half years since January 2015. (The FM previously reported that the firm received R10.5m over 18 months.)

Headed by Anthony Ndzabandzaba, a former section head in the commission’s cartels division, the Bryanston law firm was channelled 31 out of 44 of the cartel cases outsourced by the commission between January 2015 and January 2017 — 70% of all these cases.

The next most favoured of the seven firms consulted during this period was Cheadle Thompson & Haysom, with just five cases (11%).

“The ineluctable conclusion to be drawn from these replies is that Ndzabandzaba Attorneys has made a killing out of the Competition Commission,” says Cardo. “It has benefited significantly and disproportionately … This pattern creates an impression of anti-competitiveness at odds with the competition regulator’s mandate.”

The revelation about payments to Ndzabandzaba comes in the wake of the auditor-general’s recent finding that the commission incurred more than R50m in irregular expenditure by not following proper tender and procurement processes during 2017/2018.

The commission is also severely over budget, having incurred a R69m deficit in 2017/2018 on top of a R78m deficit the previous year. Despite its fragile finances, it spent R1.46m a month on protection services in the 10 months to April 2018, or R14.6m in total. Much of this went on private bodyguards to drive the top four managers in a fleet of luxury vehicles.

The commission says this was after several instances during 2017 where laptops and mobile phones of its staff were stolen — some under what Bonakele describes as “mysterious circumstances”. In any event, the security budget was slashed from R1.46m a month to just R74,660 a month from April this year, though the commission awaits a security assessment by the State Security Agency.

Bonakele accused the media of “bias” for a spate of unflattering articles, including Business Day’s contention that the commission’s calculations regarding industry concentration are inaccurate.

Bonakele also dismissed criticism by unnamed “politicians” (presumably Cardo) of the commission’s handling of the banks’ foreign exchange collusion case and the edible oils case — where the commission received flak from the courts — as “interference on behalf of the respondents”.

Cardo regards Bonakele’s attitude as “deeply unfortunate”. “As an MP, my role is to hold the commission to account,” he says. “The commission has done some laudable work, but I’d have greater faith if my concerns were met with less defensiveness.”