Paul Janisch

A united Fronting

My last dashboard post mentioned that I will try to cuss less on the blog.  However I did get two comments suggesting that it is not as offensive as I may have thought.  Thanks for your comments - I do agree with Richard that it is more of a cry of passion than gratuitous swearing (which I am very adept at).  Nevertheless I will try to cut back on it and like Paddington Bear, save it for very special occasions.

I got a call from Mzwandile Jacks the other day asking me what I thought of the BEE Council criminalising fronting.  My response was similar to any other person - if you can prove fraud then it is already a crime.

In case you don't know what fronting is - it's not actually defined in the codes but in an annexure published a little later.  The definition is

Fronting means a deliberate circumvention or attempted circumvention of the B-BBEE Act and the Codes. Fronting commonly involves reliance on data or claims of compliance based on misrepresentations of facts, whether made by the party claiming compliance or by any other person.

It then goes into a semi-academic analysis of the various instances that fronting should occur.  There are two potential consequences to fronting (according to the code)

• the dti may completely disregard/suspend a measured entity’s B-BBEE scorecard until such time that the entity takes corrective action
• the dti will keep a database of all companies found to be engaged in fronting once all the necessary processes are completed

What must always be borne in mind is that fronting is "circumvention or attempted circumvention of the B-BBEE Act and the Codes".  In other words the very dodgy practices of many mining licence holders cannot ever be viewed as fronting.

What an upsetting thought - I am still disgusted at Sandile Zungu and the ICT mining licence appropriation (he's not alone in this but he is a member of the BEE Council so he is going to take all the flack he deserves).  This activity could not ever be viewed as fronting - but if we are able to prove that the activity was fraudulent and induced ArcelorMittal to award the shareholding to the Ayigobi consortium, then we are onto something.

Perhaps the DMR will consider extending this fronting definition to their own act - after all a company that has no mining history that is awarded a licence under dubious conditions, who then attempts to sell (read extort) that licence to a proper mining company is fronting.  They are deliberately attempting to circumvent the intention and spirit of the MRPDA.

And as a final note - I hereby (in my capacity as a disgusted citizen) call on Jacob Zuma to remove Sandile Zungu from the BEE Advisory Council.  Feel free to join me in this crusade.

I've been asked to curse less in my posts. A fair request.

Without an ANChor

How long will it take for the ultimate ANC-defender (Joey Shaarky) to make some snide racist comment on Facebook.

Much is happening on the ANC front. We have the Mining Industry that is in a complete shambles, such that they have actually placed a moratorium on receiving new applications for prospecting rights.  And then there is the Protection of Information Bill.  This is a total shocker and harks back to the old PW days.  So disgusting is this thought that for the first time big business has actually spoken out about it.   Gareth Ackerman, following in his father's footsteps has also spoken out about it - good on you mate.  As to its constitutionality - Pierre de Vos has a few words to say about that.  In case you don't want to read his post - the answer is NO FUCKING WAY is it constitutional.

And the upshot of these two little incidents.  The Times had this to say

Two questionable mining deals and two proposed measures to curb the media have posed a question mark about how South African President Jacob Zuma’s government has been running the country.
The deals and proposed media curbs in and of themselves may not be hugely significant, but they have triggered a volley of criticism directed at Zuma’s government, suggesting it may suffer from a leadership vacuum where cronyism can thrive.
The risk for investors is that with few safeguards in place, a constrained media and a weak administration, sweetheart deals could increase in the remaining four years of Zuma’s term.

I was chatting to a regular reader of this informative blog yesterday who had sent me a mail about the AMSA/ICT deal.  He told me that he was speaking to a not-insignificant CEO about BEE and the ANC, and this not-insignificant CEO told him that he no longer entertains any consultant who purports to have influence with the decision makers in the ANC.  The reason behind this is very simple - there are a multitude of factions within the ANC and EVERYONE of these is actually running the party!

This makes perfect sense when you think about that stinking ICT deal.  The only way for so called serious players to earn cash out of deals is by going the rent option (IOW - buying mineral rights and selling them on).   No right minded company is going to take a politically connected person as their "partner" when they can't be sure that this person can in fact arrange any business deals with the government.  Sandile Zungu would deny this - he told Bruce Whitfield that they had done a legitimate BEE deal with AMSA and this stands on its own and is not connected to the ICT/Kumba saga.  What rubbish - Zungu's credibility is now seriously in question.

When you look at the ANC as this fractured organisation with 15 different drivers and no clear direction, the Protection of Information Bill suddenly makes a lot more sense.  They need this bill passed into law to reign in the various factions.

I'll tell you a little story a newspaperman told me recently to illustrate this point.  This guy told me that during one week the Star carried a different story on Malema - and all this information came from their neighbour Luthuli House.

With this Bill made into law the factions can go about their nefarious activities and we'd be none the wiser. All we'd ever hear is Jackson Mthembu's pro-ANC drivel.

In other words (and this is from a largely finished song I wrote) - they close the doors to keep the demons in.  Clever hey?

And then there are a number of smokescreens that they use to point the transformation blame straight back at business.  One of these is the Manyi-ite institution known as the Commission for Employment Equity.  The new chair seems to have stolen all of jungle's moves.  Mpho Nkeli, alleges extreme racism across the board and is going to ensure that there are numerical quotas in each business.  And with dire consequences if these target are not met - in other words transformation at gun point.

It is now so patently obvious that the ANC really has no clue, has run out of interesting ideas and excuses and so now needs to almost go the Zanu-route to ensure that the smokescreen is maintained.

I am heartened by business speaking out about this stuff.  The time has come for the government to govern and deliver - why on earth should we as the private sector continuously take the blame and fund their dubious activities.

 

 

 

Peter Bruce's Thick end of the Wedge

A proper blogger comments on stuff and writes thought provoking articles for its readership etc.  Today I choose to post Peter Bruce's "Thick end of the Wedge" in its entirety.  I do this because I think Prez-for-Less Zuma is fucking up royally left, right and centre and he is threatening many of the freedoms that our constitution guarantees us.  Bob Moogabe did the same to Zimbabwe, amending their constitution liberally to allow him to maintain control - hence the Zimbabwe land grabs are legal.  He only did this once he was properly threatened - we cannot allow Zuma and the ANC to do this to South Africa.

WITH his party divided and rudderless on almost every issue of consequence it is little wonder, I suppose, that President Jacob Zuma  came out firing from every possible barrel this weekend about the media — it is about the only thing everyone at the ANC General Council in Durban next month will agree on.

Zuma, and the party elders around him, have very little choice but to try to muzzle the media. The government is battling to deliver even the most basic services to the poor, it has squandered the money it had for land reform and it has no coherent policies in place to make the economy grow and to create the jobs it claims it is dedicated to.

At the same time, as last week’s disgraceful ArcelorMittal “black empowerment” deal demonstrated (if more demonstration were needed), Zuma’s family and local and foreign cronies are feasting for all they are worth at the expense of the very people, the poor, he claims to be trying to help. Who wouldn’t want to cover all that up, especially from the poor?

Judging by the invective being hurled at the press by both Zuma and the ANC chaff around him, nothing less than a lickspittle press will do. As I have said before — do your worst. The consequences will be for the ANC and, tragically, the poor to bear. For us in the media, it’ll at least be a relief to stop pretending the ANC is a modern political party committed to running an open and democratic country, because it isn’t.

Here’s the President in his weekly online newsletter: “Can a guardian be a proper guardian when it does not reflect the society it claims to protect and represent?”

I’m not sure I understand the question but I’ll do him the courtesy of trying to reply. Sir, no-one is forced to buy Business Day, nor the Sunday Times nor any other newspaper. The only media we all have to pay for is the SABC which is controlled by, um, you.

Editors don’t claim to represent society in any way. That’s not how newspapers work. If they did they’d fail. But we do try to represent the people who choose to read us.

They feel threatened by poverty, for instance, which is why we keep them in touch with your progress.

You say you’re not sure whether we are qualified to judge government. Maybe, but we can count — people doing nothing, shanties spreading, hospital deaths, matric pass rates. That sort of thing. You’re not doing well

We must be very concerned

Actually we need to be a little more than a little concerned.  This ArcelorMittal-ICT thing could be the face of how business is going to be conducted in the future.  I am so sickened by the rent(boy) nature of this fuck-up that I am not going to go out of my way to post too many hyperlinks.

I have been reading Jenny Cargill's book over the last few days.  This is no Vuyo Jack book with the word black spelled Black.  No this is a book about her experiences as a consultant in the BEE world - and none of them demonstrate any faith in the process.  The most alarming chapter is that on the mining charter and the DMR.  She talks at length about the rent activities of many BEE parties.  What this means is that they go off and get the necessary licences and then sell them to proper mining companies.  In the case of the ICT-AMSA deal this is R800m.  And this is rife.

On top of it all the new beneficiaries of this deal are mates and family of our illustrious president.  And what really fucking gets me is that Sandile Zungu is one of the beneficiaries.  Money for jam is how he describes it.  Too fucking right - a little bit of lodging, a signature here and there and maybe even a little hijacking (not that we'll ever be able to prove this).  I don't actually mind that he is huge buddies with our leader, but I do mind that he is on the BEE council.  And he has announced that SA corporates .  are unpatriotic.  You actually have to read the opening paragraph of this article.

Sandile Zungu, Executive Chairman of Zungu Investments Company and member of President Zuma's newly established BBBEE Council, says that SA's corporates are unpatriotic because they are not prepared to implement BEE in a meaningful way. This, he cautions, will have dire consequences for the country in the longer term.

We now have a very good idea of the stuff that this platitude-spouting "businessman" is made of. He's now a co-conspirator in these dire consequences. Credibility in tatters

My recommendation is that if you are black go off and get yourself a bunch of licences (everybody else is doing it) and flog them to the nearest mining house - afterall this is the way it is done.

All this is being done on your presidency Jacob - let's hope that you don't make Verwoerd and Mugabe look like little angels.

Is there any point to the mining charter at all?

Gone fishing til the '11th

Literally.  I'm off to Kariba for a week to fish and read and play an incredible amount of guitar.  I'm back on the 11th of August.