Let's Think

Good governance suffers from ANC fracturing

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The lack of a single focused vision for South Africa and the ever-escalating infighting in the fast-fracturing ruling ANC alliance are destroying good governance in the country.

The current debacle around new black economic empowerment (BEE) codes has sent shockwaves through the business and investment community.

And, while the country is reeling under the ongoing electricity supply crisis, electricity utility Eskom’s future hangs in the air, suspended between diverging economic models – each being championed by different factions inside the governing alliance. These are but two of the recent high-profile examples bringing home an ugly reality: effective, good governance in South Africa is being seriously undermined by a disturbing disconnect between various components present in the state and the governing regime, caused by internal alliance turf wars.

Each of these factions is fighting tooth and nail to impose their vision and model of South Africa’s social political and economic future.

The result is that in many instances one hand is either oblivious of, or doesn’t care about, what the other is doing. In the process different parts of the same political and state machine are often working against one another.

This is a phenomenon that is present in all three tiers of government, in state departments, state enterprises and the broad public service, and is mirroring divisions inside the ruling party and its governing ‘tripartite alliance’.

Results in practice  

The result of this state of affairs is that there is an absence of a smoothly running government and state sector that operates in unison, ensuring continuity around clearly defined and universally supported policies, principles and objectives. In its place come policy and regulatory uncertainty, confusion, shifting goal posts, haphazardness and an often hostile environment for the business and investment sectors of the economy.

Events surrounding Eskom and the BEE-codes are prime examples, reflecting the tug-of-war around the seemingly paralysed, if not dead, National Development Plan (NDP), which is supposed to be the cornerstone for a ‘developmental state’.

But on a much broader front it also causes service delivery failures and labour relations conflicts at local level. The ‘insider’ culture of factions also contributes to the accumulation of corruption scandals.

BEE-codes as illustration

A closer look at the recent launch of the amended Broad-Based Black Economic Empowerment Codes of Good Practice, which became law on 1 May, clearly illustrates what happens in practice.

Department of Trade and Industry (DTI) stood accused of not having first clarified a number of crucial issues; that some parts of the codes had not been gazetted; that it ignored industry pleas for clarification; and that this state of affairs was caused by policy and regulatory uncertainty as well as confusion and almost panic in the business sector.

Acting trade and industry minister Lindiwe Sisulu had gazetted a ‘Notice of Clarification’, which included a deadline extension that adversely affected companies that had already sought to comply at great costs. She would not have been personally on top of things, being just ‘acting’ minister and might have been the ‘victim’ of some party ‘deployee’ in the department.

The biggest outcry, however, came over a ‘General Notice’ in the Government Gazette of 5 May, effectively destroying BEE points gained from broad-based ‘collective’ schemes in favour of individual black shareholding/ownership retrospectively.

Next, three days later came a departmental ‘Statement on the Recognition of Broad-Based Schemes’, backtracking on some issues and declaring there was no retrospective effect. It also announced the appointment of a task team to “explore the appropriate balance between active (direct) and passive (broad-based schemes) ownership”.

Then on 19 May minister Rob Davies backtracked some more, acknowledging in a briefing to parliament’s trade and industry portfolio committee, that the sudden change in respect of points for broad-based schemes had been inappropriate and that the earlier ‘Clarification Notice’ had been withdrawn, taking things “back to the status quo”.

It appears that, quite clearly, there was a lack of coordination in the processes around the new BEE codes and that the one hand was unaware of what the other was doing. Also, certain policy preferences – a reflection of political/ideological divisions – seem to have been driven initially at the expense of others, with scant regard for the effect on business.

At the same time the DTI has also been plagued by internal conflicts related to alleged corruption, malfunctioning of vital services, and conflicts that led to the loss of key personnel such as the CEO of the Companies and Intellectual Property Commission (CIPC), Astrid Ludin.

Politics behind it all

At the political level much of this is brought about by the ruling alliance’s policy of ‘cadre deployment’, ideological battles within the alliance, factionalism and ineffective leadership. At the administrative level it is caused by loss of institutional memory due to enforced race-based transformation, patronage, corruption, and skills and qualification deficiencies. 

It ties in directly with the gradual breakdown and erosion of the ANC and the tripartite alliance as a ‘broad church’ movement with its ideological diversity and its many, increasingly competitive interest groups/organisations, each with its own agenda and with frequently conflicting policy assumptions and interpretations.

The existing government mechanism that is supposed to ensure smooth, unified and effective performance by government and all its ministries and departments, is the Ministry in the Presidency for Planning, Monitoring and Evaluation. But the present incumbent, Minister Jeff Radebe, is himself caught up in the conflict of interests, albeit at the ideological level, him being at the same time a senior member of the SA Communist Party (SACP) as well as of a supposedly social democratic government and ruling party. Which master does he serve?

Other complicating factors include:

  • Both the SACP and ANC subscribe to the National Democratic Revolution (NDR) as basic guiding programmes, but possibly with some differences of interpretation and emphasis between the SACP’s strong Marxist-Leninist ideological perspective aimed at a full communist revolution and the ANC’s socialist based ‘developmental state’;
  • The fact that the disintegrating Congress of SA Trade Unions (COSATU), plagued by internal battles is simultaneously an alliance partner of the ANC, a partner in government and a labour opponent of government when it so chooses; and
  • The existence of two centres of power – the presidency and cabinet on the one hand, and the ANC secretariat, headed by Secretary General Gwede Mantashe on the other. The latter plays a leading role in policy formulation and cadre deployment, and the former has to implement policy and employ the cadres.

Into this toxic, confusing and paralysing mix is thrown the competing and conflicting agendas of labour and the SACP, making smooth government functioning a near impossibility.

It can only hoped that, starting with the municipal elections next year and followed by the national elections in 2019, the signs of realignment in South Africa’s body politic will come to full fruition to help normalise governance in the country.  

by Stef Terblanche

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