Lynne Brown inquiry snag
The attempt by former public enterprises minister Lynne Brown to clear her name through cross-examining witnesses at the Commission of Inquiry into State Capture has hit a major snag.
Deputy Chief Justice Raymond Zondo, the commission chair, has dismissed Brown’s application for the right to cross-examine former deputy finance minister Mcebisi Jonas.
In his testimony last month, Jonas said Ajay Gupta bragged about controlling Brown and that she was protected by his family.
This was relayed to Jonas by Ajay at the Gupta family compound in Saxonwold, north of Johannesburg, in October 2015, where he was allegedly offered a R600 million bribe to become finance minister in 2015, replacing Nhlanhla Nene.
According to Jonas, Ajay boasted that his family worked with Brown, who was public enterprises minister between 2014 and 2018 and was the custodian of state-owned enterprises (SOEs).
Brown has viewed Jonas’ testimony as implicating her in scathing allegations of state capture, corruption, and fraud.
Zondo dismissed Brown’s application on the basis that she had not put her own version of events, which would either confirm or deny Jonas’s allegations.
Advocate Simmy Lebala, for Brown, admitted that “no way in specific terms” has Brown denied what Jonas has said.
Brown believed that some of the commission’s terms of reference refer to her as a former member of the executive, meaning SOEs were “under my auspices”, which automatically implicates her in allegations of state capture.
Lebala said Jonas’ statement might imply that “the Guptas work with her [Brown] when she discharges her executive functions; the Guptas work with her when she initiates legislation; and the Guptas work with her when she gives directions to the SOEs”. But Zondo was not convinced. He said if Brown wanted to help the commission, she must still give her version of events.
The dismissal of Brown’s application to cross-examine witnesses adds to a growing list of the dismissals of similar applications.
The commission is lining up heavyweights from the public sector to testify. Finance Minister Nhlanhla Nene and Public Enterprises Minister Pravin Gordhan are set to testify on October 3 and 10 respectively. Former public enterprises minister Barbara Hogan will appear on October 15.
The SA Reserve Bank (Sarb) now forecasts this year’s growth to average 0.7%, down from 1.2% in July. Sarb left its benchmark repo rate on hold at 6.5% yesterday in a tight call, with Governor Lesetja Kganyago striking a more hawkish note than at the last rate meeting in July.
Its rate decision was closely watched after emerging market peers Turkey and Russia raised their main lending rates recently.
Four members of the monetary policy committee (MPC) voted for no change in rates; three voted for a 25 basis points increase.
The central bank had to weigh data showing that the economy entered recession in the second quarter against risks to its inflation forecasts from the rand.
A rate increase would have dealt a further blow to SA’s sputtering economy, which President Cyril Ramaphosa is trying to revive after a decade of stagnation.
is the benchmark repo rate, which remains unchanged.
“The committee continues to be of the view that current challenges facing the economy are primarily structural in nature and cannot be solved by monetary policy alone,” Kganyago said.
He said the inflation outlook had deteriorated due to the weaker rand and high oil prices. “At current levels, Sarb’s model assesses the rand to be undervalued.”
The rand barely changed after yesterday’s decision, as all bar one of the 26 economists surveyed had predicted that Sarb would leave the repo rate unchanged.
The following are highlights from Kganyago’s comments:
Inflation
“Since the previous meeting of the MPC, risks to the inflation outlook have continued to materialise and the inflation outlook has deteriorated in response to domestic and external developments.
“Despite remaining with the inflation target range throughout the forecast period, the Sarb’s