Paul Janisch

What is it about the Khanyi deal that makes us feel so uncomfortable?

This is just another deal done by the NEF - one of the many businesses that they have funded over the years. Yet we feel that we've been ripped off. We feel as though the NEF has been making a mockery of its own mandate by empowering another prominent black business person. I went past the shop today, it reminds me of Harrods almost, a high-end Stuttafords. And it apparently is creating over 50 jobs. Yes, a factory in one of the areas that Sipho Hlongwane described this morning would generate perhaps 500 jobs. And this is what we as the public expect the NEF to finance. We've also typecast black entrepreneurs as those who start shoe factories in My Ayliffe. We don't see black people (and god forbid, black women) owning a very exclusive retail shop in a very exclusive retail shopping centre. This is out of stereotype. Our next reaction is to allege that it plays into the hands of the "usual suspects" argument. Not that that this argument is not without merit. Over the last 20 years we've seen the same old faces become disgustingly wealthy with very little effort. We need to squeeze Khanyi into this mould when it's clear that she doesn't fit in it. She just isn't like that. Once we've got our head around that fact we then latch onto the NEF and try and find proof that they have breached their mandate. But there's no evidence of this, their decision to loan the money is sound. Simply put, they've invested in a black women owned business. And there are precious few of those around – just ask Eskom.

The correct perspective is to view Khanyi as a shrewd business woman. She maintains that banks are stingy when it comes to loans – she's right. They're tighter than a duck's arse. She has made use of a fund that will loan her money because she is black. As the NEF explains on its website

The NEF's role is to support Broad-Based Black Economic Empowerment (BB-BEE).

(T)he NEF anticipates future funding and investment requirements to help black individuals, communities and businesses achieve each element of the Codes of Good Practice. These include a focus on preferential procurement, broadening the reach of black equity ownership, transformation in management and staff and preventing the dilution of black shareholding.

The NEF differentiates itself not only with a focused mandate for BB-BEE, but by also assuming a predominantly equity-based risk to maximise the Empowerment Dividend. Reward should balance the risk with the application of sound commercial decisions to support national priorities and government policy such as the Accelerated and Shared Growth Initiative for South Africa (AsgiSA) or targeted investments through the Department of Trade and Industry's (the dti's) Industrial Policy Framework (IPF).

I cannot find any reference on their website that precludes them from loaning money to the already fabulously wealthy. We need to bear in mind too that the loan is not a grant, it's a loan, probably at commercial rates. In simple terms, she's in it for R34m plus interest – that's a lot of money to lose if the business goes down the tubes. Not to mention that between her and her partners they've ploughed in a further R15m. The tickboxes for entrepreneurship have all been checked.

1. Spot a gap in the market
2. Get a business plan
3. Put up your own cash
4. Borrow money from a financial institution
5. Start trading

Every single one of the shops in Hyde Park will have ticked these boxes. Khanyi's problem is that she went to the NEF for funding and now it's in the public domain because the NEF is a government agency. If she had gone to a bank we'd all be applauding this brave black entrepreneur, we'd never have known how much she borrowed and she would have become the toast of Hyde Park. She's unfortunately attracted the wrong kind of publicity because the public wants to be pissed off with the deal – even though on the face of it there is nothing wrong.

Good luck with the shop – I'll never shop there, not because at the back of my mind there is still an element of discomfort about it, but because she's not selling anything that I want to buy.

More Zuma abuse. In keeping with his personality

Beeld reported on Tuesday that 15 Squadron based in Durban received a small amount of flight hours for training, but 300 flight hours for VIP flights. This is apparently used to transport President Jacob Zuma to his Nkandla home over weekends.

As a result, there are no funds budgeted for the helicopters to respond to a disaster along the coast.

Zuma uses his presidential jet to fly to King Shaka International Airport in Durban and then uses two Oryx helicopters to fly 100km from there to Nkandla

via www.news24.com

Just disgusting. Someone once observed that neither Mandela nor Mbeki were ever ridiculed by cartoonists, bloggers etc (although Mbeki certainly deserved it). They commanded respect. Zuma has never done this and so we who care will not spare him from the abuse that he patently attracts.

A blogger's lament

Courtesy of Fred Wilson 

A critical element of the rule of law is that there should be certainty about what the law is and what it requires, both procedurally and substantively

IN HIS keynote address at the Sunday Times Literary Awards last month, Judge Edwin Cameron expressed the view that judges generally "take certain fundamentals for granted". Among those mentioned are "the vital significance of the rule of law and the supremacy of the constitution". A critical element of the rule of law is that there should be certainty about what the law is and what it requires, both procedurally and substantively. This involves consistent conduct by those in positions of authority, a uniform interpretation of the provisions of laws and a respect for precedents that are set in decisions made in cases of similar nature. 

Courtesy of BDLive.

This is the legal principle that I was looking for in my post on SANAS arbitrariness.  We cannot just assume that it's only SANAS that is going to be affected by these (undocumented) proclamations.  It is going to have an effect on IRBA, who will now need to go out of their way to ensure that their policies are more transparent.  I would imagine that they are continuously updating and modifying them as SANAS becomes more reckless.

State takeover of lottery only ‘if justifiable’ | New bids are due in a few months.

The government would only take over the running of the national lottery if it believed that private sector operators were failing to realise "national objectives", Department of Trade and Industry officials said on Tuesday.

The reassurance was given to members of Parliament’s trade and industry portfolio committee following public concern that the state might under certain conditions be able to take over the running of the lottery.

The national lottery is a vital social institution which so far has allocated about R16bn to social, artistic, cultural, sport and charitable causes.

Government wants to broaden its mandate to include "national objectives" such as job creation, school building or national disasters to allow the National Lotteries Board to proactively distribute funds for these purposes and not simply distribute money in response to applications, as has been the case in the past.

via www.bdlive.co.za

Those who are bidding to run the lottery are going to have to put up a very persuasive argument on a socio-economic development level. I've done many of these types of applications including PPPs, BEE plans and the like.

The blue light brigands and how their survival could be threatened

The first time I ever saw a motorcade was in Harare in the nineties. That geriatric retard Mugabe (it is illegal to insult this moron in Zimbabwe – but not here, so I'm making the most of it) was apparently on his way from his residence to the ZANU-PF headquarters. This was a very extreme motorcade, two bakkies with armed soldiers, three limos a number of motorcycles. The cops pushed everyone out of the road and this failed terrorist went by. At least we don't have those here in SA. But we do have blue-light brigands who hog the fast lane on the highway going at speeds that my old Jeep could only ever wish to achieve down a mineshaft. On the way to Bela-Bela last week I saw a 6.5litre Mercedes and two huge BMWs travelling somewhere, with lights ablaze.

Where is this story going then? Well, cars like those are quite partial to fuel and their appetite becomes more voracious when they operate at high speeds. Not that fuel is ever a problem for these arrogant ANC (or ANC-aligned) incompetents. But perhaps it might become so. This headline caught my eye this morning.

THE Department of Energy is considering ways of speeding up black economic empowerment in the petroleum sector, especially downstream, or retail, as it is still largely untransformed, it emerged during an energy portfolio committee meeting on Wednesday.

They are playing a little coy at the moment but are "proposing a charter for the sector, to use licensing to effect transformation, audit transformation in the retail sector and enforce laws." Why, it's because "78% of petroleum products are sold by retailers that are white-owned and 22% by those that are Indian."

Among the challenges preventing black entrants to the sector include the lack of capacity to negotiate and manage contracts, that business education is not included in franchise negotiations, financial constraints such as high guarantees are required and the margins for retailers are low.

So the Department of Energy is contemplating allocating licences on the basis of blackness. You'll notice that this report seems to lump Indians with the poor old whites. Therefore, black can only mean African.  And so the degrees of blackness become more entrenched.

But that's not really the issue here, the issue is that the granting of licences on the basis of race (read African) could limit the number of potential retailers. Which means that there will fewer petrol pumps available and people will not be able to travel. This will have to have an impact on the blue lighters who will also have to queue for hours to get petrol. Perhaps this argument is a little extreme but we've seen with mining licences that current licence holders are continuously under threat to have those licences revoked. Who says that they might make African-ness a requirement to current licence holders.

If there is an argument that empowerment has failed, such a policy would add fuel to the fire (oops that is a pun isn't it).

Malema - courtesy of Gareth van Onselen

"Malema is no more able to discuss communism meaningfully than he is to master woodwork"

Read the rest here

 

 

 

A little more on the SANAS decree on calculating ownership etc

Something was omitted from the last post on SANAS.  The client that stirred up this little hornets' nest (what an apt saying) had black ownership for 11 and half months of their measurement period which ended in December 2012.  If the verification agency had come in February then they would have considered the ownership but they can't in May.  Is this not just completely ridiculous - what does 3 months' difference make?  

If this is a "law" then it needs to made public and not communicated via SANAS-accredited verification agencies.  And it can't just come from SANAS, it has to come from notice gazetted by Rob!  The fairness of this defies analysis - but yet I do for some reason.

SANAS Insanity - perhaps indifference

Not everyone thinks that EmpowerDex should be called names rude or otherwise and so with cap in hand I apologise.  I did speak to the drafter of that email that I referred to in that post. He was very sympathetic to my plight but I knew there was nothing he could do about it - this is SANAS' decree and they can't risk losing their licence.  He said he had other issues with SANAS but they won't entertain these - it almost seems like that each one of the SANAS evaluators have their own rules and policies and those are what stick.  Certainty - certainly not.  And he laughed when I suggested I phone SANAS.

He did say something very interesting though - he had raised this SANAS issue with the DTI and the DTI said that they aren't going to do anything about it and that the new codes will deal with all these issues.  This concerns me.

Are these new codes going to be gazetted without us having a chance to comment on them.  The prevailing opinion is that the last version of the codes were unworkable.  What our EmpowerDex friend suggested is that the new codes will cover everything.  If you're not seeing the problem yet then I must explain it.  The DTI cannot publish two pages of text without them being devoid of basic English grammar,  spelling or logic.  If they are going to publish comprehensive codes then you bet the farm that Rob will not have read them, nor checked them for logic and they are going to be a complete mess.  And apparently they are going to be gazetted wholesale and become our problem because the DTI will not be in a position to provide us with any guidance - well they haven't up until now and why should they do so in future.

The second thing that is concerning, if these rumours about the gazetting are true, is that Rob must think that we as the public are complete idiots.  And that we will just do as he says - even though he knows, we know that he doesn't know what he's doing.  And this is not an unreasonable conclusion, it happens within the ANC government all the time - you'd do well to read Sipho Hlongwane's article in yesterday's BDLive about the classification of the Nkandla report. He writes

It is now apparently up to Nxesi to explain what is going on. In truth, however, there is hardly anything for him to explain. We can see that we are being taken for fools. The DA may not intend for the issue to become the protocol for classification, but the puppeteers behind this fiasco would very much like us to focus on this distraction at the expense of the real questions: did the president know that public funds were being misappropriated to upgrade his home?

There is a precedent here and I can't see that Rob is going to deviate from this.  But there are no codes yet and this is just speculation.  And as usual I hope that I am wrong.

 

National Lotteries Board starts whittling down potential operators | Business | BDlive

In the first stage of elimination, companies that did not attend a compulsory two-day briefing session in Johannesburg last week were automatically disqualified from bidding.

More than 70 people representing the companies eyeing the seven-year, R40bn contract attended the briefings.

via www.bdlive.co.za

It's too late if you didn't make the briefing. It's not clear from this article as to how many bidders there will be.

Again - I believe that I am very qualified to assist any one bidder in this process. Call me to find out why.