Paul Janisch

The Badly Packed Parachute(s) first gig

It's not clear whether we are Parachute or Parachutes.  Either way it's quite a rude term and I'm not telling you why.  After four years of slog we've actually managed to get it together to have a gig.

The band is made up of five people.  It started with me and Piet and a totally psychotic drummer from Eastern Europe.  Piet and I ditched him and found another drummer called Pieter.  Pieter couldn't commit much, his life was in a lot of turmoil (part of this is expressed in the 3/4 song that we weren't allowed to perform at the gig).  Then we found a drummer called Navs - he couldn't stay with us either.  In the interim we played with a phenomenal vocalist called Mina.  He is such an intense musician but again couldn't commit.  Other vocalists who came and went were Dan, who I had played with in the past - best vocalist I have ever played with, and Paul.  Paul was in the music business and was out most nights of the week. He was staying away from his family so he disappeared.  

Most of the time it was just me and Piet.  I had moved from playing guitar to bass.  One night I didn't want to rehearse but Bevan, the guy who owns our rehearsal studio insisted he'd found us another drummer.  Enter Dave.  A powerhouse is Dave and very keen - which is what Piet and I needed at the time. Piet then brought his friend Johann around to check us out.  He never left and we had a second guitarist and a vocalist.  My friend Jeff is a marvelous musician.  He and I had dabbled in music for years but our musical tastes were too far apart - simply put I like chords and he doesn't. Jeff's current band was on a hiatus and so I asked him to come and experience a large number of chords.  He stayed too. Unfortunately he is in the process of emigrating and so I will be back on bass in a few months.  It's a totally different band when Jeff plays with us - there's a funkiness to him, even though he tends to play Paul McCartney-type basslines (without ever listening to McCartney I must stress).  We have a few months with Jeff and couple of upcoming gigs.  When Jeff goes we will revert back to more of a rock 'n roll band, courtesy of my bass playing.  I'll let you know when and where the next gig is - it'll be our first proper gig.

Here are the Badly Packed Parachutes, first gig. We were called off the stage after four songs - there are still two more to play.

 

Employee Tax Incentive set to be extended. Call me about this, I can sort out almost all of your skills issues

For those of you who aren't aware of the Employee Tax Incentive (ETI) then read on.  Before we go into the nitty gritty of the ETI, I have read that it will be extended beyond February 2019.  It is critical to the success of the YES, which in itself is somewhat dependent on our communist leader, bolshie bob, publishing an amendment that actually encourages companies to make use of it (we sit in hope - history doesn't favour this though).

The ETI is also a very positive incentive for skills development.  We have figured out a way to get almost all the points for skills development using the ETI and for far less financial consideration than bolshie bob's ludicrous 6% of payroll.  Call me and I'll tell you more - remember, all the points for a fraction of the money.

Back to the ETI - courtesy of SARS (the link is above).

Why is there an ETI?

Millions of young South Africans are excluded from participating in economic activity, and as a result suffer disproportionately from unemployment, discouragement and economic marginalisation. High youth unemployment means young people are not gaining the skills or experience needed to drive the economy forward. This lack of skills can have long-term adverse effects on the economy.

In South Africa the current lack of skills and experience as well as perceptions regarding the restrictiveness of labour regulations make some prospective employers reluctant to hire the youth.

As a South African employer, you now have a great opportunity to boost the employment of young work seekers.

What is it?

The ETI is an incentive aimed at encouraging employers to hire young work seekers. It was implemented with effect from 1 January 2014. 

What are the benefits for employers?

The benefits of the ETI are:

• It will reduce the employers cost of hiring young people through a cost-sharing mechanism with government, by allowing you to reduce the amount of  Pay-As-You-Earn (PAYE) you pay while leaving the wage received by the employee unaffected.
• For example, employers who are registered for PAYE, and who employ a person for the full month of February 2014 and earns R2000, will get R1 000 off their monthly PAYE liability (provided that the employee is a qualifying employee based on all the other remaining requirements). For more information on how the ETI works, click here.
• Employers will be able to claim the incentive for a 24 month period for all employees who qualify. Click here for more information.
• The incentive amount differs based on the salary paid to each qualifying employee and whether the qualifying employee was employed after the inception of the ETI programme on 1 October 2013. ETI may only be claimed for a total of 24 qualifying months. Click here for more information.
• This incentive will complement existing government programmes with similar objectives e.g. learnership agreements.
• The aim of the ETI is to facilitate the increased employment of young work seekers.

Who qualifies?

• The employer is eligible to claim the ETI if the employer–
• Is registered for Employees’ Tax (PAYE), or must be eligible to register for PAYE (e.g. the employer can't register just to claim ETI, other registration requirements must be met)
• Is not in the national, provincial or local sphere of government
• Is not a public entity listed in Schedule 2 or 3 of the Public Finance Management Act (other than those public entities designated by the Minister of Finance by Notice in the Gazette)
• Is not a municipal entity
• Is not disqualified by the Minister of Finance due to the displacement of an employee or by not meeting the conditions as may be prescribed by the Minister by regulation.

Top Tip: To work out if you are a qualifying employer click here.

How do I determine who is a qualifying employee?

Top Tip: There is no limit to the number of qualifying employees that an employer can hire.

 

An individual is a qualifying employee if he or she–

• Has a valid South African ID, Asylum Seeker permit or an ID issued in terms of the Refugee Act

• Is 18 to 29 years old (please note that the age limit is not applicable if the employee renders services mainly inside a special economic zone (SEZ) to an employer that is operating inside the SEZ

Collateral Damage, business and the mining charter. Guess who draws the last straw (and it is very short indeed)

As defined by Wikipedia

Collateral damage is a general term for deaths, injuries, or other damage inflicted on an unintended target

The chances are that the average reader of this blog could be regarded as collateral damage.  This thought occurred to me when I attended an Afrisake business forum a few months' ago.  My Afrikaans is good, I was somewhat forced to learn it in the army.  I sat through a few of the presentations - all were informative, but there was one that really stood out and that was the one delivered by Frans Cronje (Dr).  I am translating the gist of his speech from Afrikaans and memory.  He described how the national government (read aNc)

is driven at its core not by the Constitution, nor by any of the formal economic policy blueprints it has adopted, but rather by the ideology of the National Democratic Revolution or the NDR

There's a link above to the article that I took this from - the sentiment was reiterated by Cronje at the forum.  He explained 

What, then, are the current ideological/policy goals of the South African government?

• liberate South Africans from the exploitation still implicit in ‘colonialism of a special type’ – and of which Western investment is seen as both a symptom and an extension;
• ‘eliminate apartheid [ie existing] property relations’ through the ‘redistribution of wealth and income’, which implies a need  to reduce or take control of Western interests/assets in South Africa;
• establish an ‘African hegemony’ in political, economic, and social life and so reject and limit Western influence;

The overarching goal is to push forward with the NDR because it:

•  offers the most direct route to a socialist and then communist society.

 Cronje then took us through the mentality of large (big) business.  Big business will do whatever it takes to cosy up to the government.  They might not agree with government privately but it is very unlikely  that they will do so publicly, the only example I can think of is FNB and that didn't go down well - even if they were correct in their approach and remarkably restrained. We would be under a false impression if we thought the big business will come to the aid of the economy if it doesn't serve them.  However they are very vocal when it comes to the Mining Charter.  This has everything to do with the sheer incompetence of wabenzi zwane.  He was so useless that they stopped bothering talking to him, they just litigated.  The Mining Charter has gone through yet another iteration under Mantashe.  And once again, following the NDR, Mantashe has produced a document that the mining community is not interested in implementing. 

Most of the issues revolve around ownership and related concepts.

In a nutshell, the new charter:

• Recognises the "once-empowered, always-empowered" principle, unlike Zwane’s charter. This means companies that did empowerment deals will still get credit for those transactions, even though black investors have since sold out;
• • Raises the requirement for black equity investment from 26% to 30% for existing mines;
• • Requires mines to have a minimum of 50% black directors, and 20% black women directors;
• • Stipulates that mining companies must pay a minimum 1% "trickle dividend" to communities and labour from the sixth year of a mining right;
• • Requires 30% black shareholding for new licences, but stipulates that labour and communities must hold 8% each. Of that 8%, the mine will have to give each group 5% for free. Taken together, that amounts to a 10% "free carry".
• The "free carry" is the most contentious clause. While it commendably seeks to extend wealth beyond the elite to include communities, the Minerals Council SA argues that the "free carry" makes it "uneconomical" to build new mines.

The most vocal critic is AngloGold Ashanti chairperson Sipho Pityana.

South Africa risks driving away new investment and crippling its mining sector if “reckless” new rules are implemented.  The latest Mining Charter, which is aimed at sharing the benefits of the country’s mineral wealth more equally among South Africans, doesn’t provide solutions to the industry’s challenges and will make it difficult for companies to buy and sell assets, Pityana said on Thursday.

 And here's where the collateral damage comes into the picture.  The table below shows the proposed procurement scorecard.

Element Description	Measure	Compliance Target %	Weighting %
Goods Procurement: A minimum of 70% of the total mining goods procurement budget must be spent on South African manufactured goods with a 60%+ local content value must be sourced from compliant manufacturing companies.	Percentage of the total mining goods procurement budget spent on South African manufactured goods by BEE Entrepreneurs.	21%	10%
	Percentage of the total goods procurement budget spent on South African manufactured goods from companies BEE Women Entrepreneurs or Youth owned and controlled company	5%	5%
	Percentage of the total goods procurement spend on South African manufactured goods from BEE compliant companies	44%	5%
Services Procurement: A minimum of 80% of the total spend on services must be sourced from South African based companies.	Percentage of total services budget spent on services from BEE Entrepreneurs	60%	5%
	Percentage of total services budget spent on services from BEE compliant companies	10%	5%
	Percentage of total services budget spent on services from companies who are 51% youth owned and controlled companies or BEE Women Entrepreneurs	10%	10%

 A few definitions.

“BEE Entrepreneur” refers to Black enterprises that are at least 51% owned by black persons in which Black persons hold at least 51% of exercisable voting rights and 51% of economic interest or an organ of State excluding mandated investments;

“BEE compliant company” means a company with a minimum B-BBEE level 4 status in terms of the BBBEE Codes of Good Practice and minimum 26% black ownership;

What this scorecard shows is that 51% black-owned companies will be favoured, and those that don't want to go that route will be able to provide about 55% procurement if they are a level 4 with 26% black ownership.  This section is unlikely to be contested by the mining companies.  In fact they might push up these targets as a compromise if Gwede relaxes the ownership requirements.   This is the collateral damage.  Big business is not going to be concerned about the status of their smaller down-the-line suppliers.  They will push unreasonable targets on them, because it's the line of least resistance.

If the codes that these down-the-line suppliers had to implement were reasonable, fair and had achievable targets then my response would be different.  They are not.

Cronje recognised this and left us with four guidelines that he believed would ensure the survival of small and smaller non-black owned businesses.

1. Don't do business with the government.  They aren't great payers (ask Liviero) and frankly they've made it very clear they don't want to business with you.  I would include all the state owned entities in this equation. (They do love your tax ZARs though)
2. Don't do business with big business. For the above reasons. (Note that they will refer to you as their "valuable clients")
3. Don't over-capitalise
4. Try to expand into foreign markets.

I could be a bit off the mark with this, but if it's not Cronje's wisdom then you can call it mine.

A completely unsubstantiated BBC rumour

They say that without hearsay no rumour is worth spreading.  I was informed by a source that was informed by another source - the latter being directly involved in the process, that the comments on minister davies amendments have been and will be evaluated by a team that includes the BBC.  Not your famous public broadcaster - we are referring to the reportedly insolvent black business council.  

This is a very interesting, if not alarming, fact and if true makes things a lot clearer.  My source tells me that it's the council members who are pushing for the narrow based promotion.  Why?  Well it's about government business.  I get the impression from the BBC's TV channel which is really just a 45 minute awesome awdoz presentation about fronting and how government doesn't live by its own rules (as an aside, my source tells me that the awesome awdoz is not that awesome and is patently not-up-to-the-task).  

For an insolvent organisation that courts controversy and dubious presidents it certainly punches way above its weight.  This shouldn't surprise any of us.  But what we should be concerned about is their presence on committees that have a direct bearing on the future of our country. If this is true then are they the only organisation that is not related to the DTI or government sitting on this evaluation committee.  More importantly - do they have a legal mandate to sit on this committee.

This will be useful information to get to the bottom of should there be any legal challenges in future.

 

A little Moneyweb exposure. Davies is killing what ever good BEE had the potential to deliver

They pretty much published it verbatim - Ray Mahlaka edited it down to something a lot easier to read, you know what I'm like when I get started on bolshie bob.

South Africa was a battered and bruised country when President Cyril Ramaphosa took over the reins. 

There was an air of immediate optimism after his state of the nation address. It seemed as though his Thuma Mina proposal was going to get the country to work and everyone was going to roll up their sleeves and get involved. Ramaphosa started out by cleaning up aspects of his cabinet and the entities immediately under his control.

Many commentators lamented about the continued employment of dubious cabinet ministers such as Bathabile Dlamini and Malusi Gigaba. Those two ministers have been put in their place, with their ability to destroy society and the economy.

Ramaphosa did however retain one minister in his original portfolio, who has caused an immeasurable amount of harm to the economy: Rob Davies, the Minister of Trade and Industry. I’m not in a position to comment on his broader role as minister, but I have watched him destroy whatever good that a Black Economic Empowerment (BEE) policy had the potential to deliver. 

Davies appears to work on the principle that if it’s not broken then change it and make it more onerous.  The warning signs were there when he amended his BEE codes in 2012, after giving the initial codes a mere five years to succeed. At the time, I thought that this was as a result of certain powerful lobby groups that had the ear of then President Jacob Zuma. It seems as though this was an incorrect sentiment. Davies has continued on this strategy of destruction since the advent of Ramaphosa’s presidency.

You can read the rest here.

Trophy directors - more pearls from Fred Wilson

And I quote verbatim - you can see the original post here.  I don't have Fred Wilson's permission to reproduce this post.  He is the reason I blog and I have yet to come across someone as prolific as Fred.  You'd do well to follow him.

A “trophy” board member is someone with a big name who, in theory brings credibility and connections to your company. They are often out of the world of politics, or a Fortune 500 CEO job, or Wall Street.  Trophy board members are more concerned about their reputations than your company and will often react badly in times of crisis and challenge, which is exactly when you need your board members at your side more than ever.

Trophy board members often miss board meetings, show up unprepared, and frequently don’t take the time and effort to truly understand your business. 

I am a huge fan of independent directors to compliment the founders and investors on a board. The quality of the board is highest when there are more independents on it than investors and founders. Try to get that ratio right on your board as soon as practical.

But don’t put “names” on your board. Put operators, ideally very seasoned operators, who have done everything you want to do, ideally multiple times, and can help you spot the issues before they become problems and spot the opportunities with enough time to go after them.

These ideal board members are often not big names and they usually don’t have big egos. They are solid, steady, and worth their weight in gold. They come in male and female varieties and across the racial and ethnic spectrum too. It is true that it take a bit more work to build a diverse board of operationally focused board members but it is worth it.

But whatever you do, stay away from trophy board members. They rarely help and often hurt.

 Not so easy to do here, there is immense pressure to put high profile people on larger companies' boards.  One day when we have overcome our sensitivity about race and transformation, a case study will be written about the efficacy of the many trophy board members that grace the boards of our larger corporates.  Danisa Baloyi is one example that comes to mind.

TooScared to have a JollyTime - and mandated investments

(A sleezy sax is heard in the background – something like the break in Bob Seger’s “Turn the Page”, which is not a sleezy song at all.  Imagine a black and white film and a voice talking over the sleezy sax)

(Voice over: I should have known that when that dame called me my life was going to change for the impecunious worst.)

Movie opens in a bar in some remote Eastern Cape Holiday resort.

BEE Consultant (who is the hero of this whodunnit even though he’s not a private investigator): Yeah this is BEEConsultantGuy:

Caller: BEEConsultantGuy – this is Ashbleef from JollyTime Financial Services Company.

(Voice over: I had had dealings with JollyTime before – they’d call me every year to find the BEE points that didn’t exist in their company, which I had always done.  Ashbleef was someone I had met a few times.  She reported to FoolsRushIn and ChiselHeadTom)

BEE Consultant: What is it that is so important that JollyTime would interrupt my holiday in this remote Eastern Cape Village.

Ashbleef: We have fallen foul of the BEE Commission.

(Voice over: I choked on my beer, I knew of this Commission. Nasty people who were more concerned about racism and ownership than transformation.  We could be in for a rough ride here)

BEE Consultant:  I’ll be on the next plane home.

(Voice over: The next plane was a week away but she didn’t need to know that)

Scene changes to a meeting room in JollyTime’s offices.  BEE Consultant is sitting in front of FoolsRushIn and Ashbleef.

FoolsRushIn: This is not a good situation BEEConsultantGuy.  An ex-employee has told the commission that he never benefited from the staff trust that was used in the latest BEE certificate.

FoolsRushin hands over the Commission’s list of demands.

(BEE Consultant to the camera using the voice over voice:  JollyTime was owned by two entities.  The majority was a listed company on the London Stock Exchange, the balance was owned by a local black company.  I had known about the staff trust but we had never used it for ownership purposes.  I looked at the demands.)

BEE Consultant:  They are presuming you are guilty.  Asking for a list of “measured entities” that you did business with over the last year is an attempt to quantify the level of fronting. 

(BEE Consultant to the camera using the voice over voice again:  Of all the dirty tricks these people use!  This is a presumption of guilt before establishing any facts.  I knew what we were dealing with here.  The question was could we use actual facts to change their pre-conceived presumption of guilt.  I needed more intel)

BEE Consultant: How did this happen?

Ashbleef: There was an employee who was fired.  He went to the CCMA who threw the case out, he then took it to the high court who also threw it out.  Somehow he figured out that he could then take it to the BEE Commission.

(Voice over: It doesn’t take a genius to question why the actual BEE ownership was 20%, yet the certificate showed 24% ownership. “Mandated Investments!” I cursed, loudly.)

FoolsRushIn, visibly concerned: What are you saying?

(BEE Consultant to the camera: Mandated Investment are a permissible exclusion from ownership for listed entities.  Could I set FoolsRushIn’s mind at ease?)

BEE Consultant: We excluded the mandated investments on the London Stock Exchange (LSE).  The BEE codes are not prescriptive about where the entity is listed.  All they say is you may exclude them and they provide “examples” of mandated investments.  It’s a permissible exclusion.  That’s where you get your extra 24%.  I have the supporting documentation for this.

Scene is set at the verification agency.  BEE Consultant sits with Labushane and Breezy at their offices.

Labushane:  TooScared from the Commission wants to know about this BEE certificate we issued. 

BEE Consultant: Yeah I know.  What did you tell him?

(I had to tread carefully here.  Labushane and Breezy were petrified of both SANAS and the Commission.  The last thing they needed was this exposure.)

Breezy: We told him that the certificate was issued under IRBA and that the signatory had shuffled this mortal coil.   He want to know about the trust.

BEE Consultant (spitting the words out): There ain’t no trust.  There never was no trust.  We used the mandated investments exclusion.

Labushane: I’ll call TooScared and tell him about the trust.

Phone rings in a dark office.  The movie is still shot in black and white.

BEE Consultant: Yes!

Labushane: TooScared says he wants to know about this certificate.  He knows there’s no trust.

BEE Consultant: Tell him to ask MortalCoilShuffled!

Labushane: He knows MortaCoilShuffled has shuffled on.  He wants the supporting documentation.

BEE Consultant: Send him this.  It explains the concept of mandated investments and what the mandated investments look like on the LSE.   

(Voice over, sleezy sax picks up the tune: The Commission wants their scalp and will publicise whatever they want and when they want.  Sure I spoke to TooScared a few times.  I like him, but he's in no hurry to submit the final report.  The BEE scorecard in question has long expired and no damage has been done. We could only hope that they would accept the opinion and possibly make a ruling.  My job is to interpret the BEE codes and provide the supporting documentation.  I write opinions that support my interpretations.  It’s the rule of the game.  I have learned that you run it past the verification agency first.   But if you are looking for information on the LSE then you should go to Office for National Statistics.  Easy to navigate and the information is all there.  That’s why you should exclude international mandated investments)

The movie ends with Metallica playing Bob Seger's "Turn the Page"

Black opinions matter, especially when it comes to BEE

There are a number of black commentators who are not in favour of bolshie bob's new amendments.  I spoke about Andile Khumalo's article in the Sunday Times a few months ago. We now have an opinion in one of oddball's publications written by Karabo Mashugane.  I don't read surve's newspapers or online publication at all.  However I have a rather old Google Words search for BEE and this article came up.  Mashugane comes from a small business perspective, his concern is that the promotion of large businesses to higher BEE levels because of their black ownership will have an impact on smaller business.  He laments both the instant promotion and the fact that the new proposed amendments allow for all significantly black owned businesses to become enterprise and supplier development beneficiaries irrespective of size.  He very correctly observes that

Enhanced recognition has been roundly criticised for sending empowerment back to pre-2007, when BEE consisted of issuing shares to the politically connected and not much more. The amendment gives the impression that black people, no matter how successful, carry no responsibility for empowering their less fortunate countrymen and contributing to job creation and economic growth.  Black ownership, even if only on paper, now carries a very high prize and offers a hassle-free existence for all corporates. It frees them from having to bother with employment equity, skills development, preferential procurement, SME development and socio-economic development.

He writes persuasively and has most certainly considered his position.  He posits

All these changes taken together appear to signal a renewed focus on ownership of companies, almost to the exclusion of all other elements. A lot of us are wondering if the dti is suffering from battle fatigue and giving up on the broad-based part of black economic empowerment. There is another perspective, though. Perhaps the dti decided to retract enhanced recognition because of the backlash it received. Maybe the second additional changes are being offered as an alternative solution.  Allowing corporates to multiply their procurement spend with black-owned businesses by “a factor of 2” on their scorecards gives the black-owned businesses a competitive edge, which makes it unnecessary to exempt them from compliance with B-BBEE.

 Mashugane seems to be of the opinion that the immediate promotion for certain levels of black ownership,irrespective of turnover, is not going to fly.  I get the impression that this was another poorly thought out amendment that was hastily drafted.  I think that his opinion should be read - it makes a strong case for the development of smaller black businesses.  He concludes with this paragraph

Black ownership alone should not be enough to get preferential market access. They should be required to meet a B-BBEE compliance threshold, say level 4, to qualify for the “factor of 2” clause. Policymakers must discourage a culture of free rides or unearned entitlements, especially for beneficiaries of B-BBEE.

And then most pertinently

All things considered, I feel compelled to venture one more wish: that the dti will explain to South Africans exactly what they are thinking and doing as they engage with the public on the Gazettes.

Exactly - we'd all love to know.  At the moment there is not enough of an economy to support the most basic of elements.

 

Bermudan black economic empowerment - pick me to come and consult to you

This is something I was not aware of.  You can read more here. For those who want a summary, here it is

“Black males experienced the largest decrease in median income of 13 per cent, $7,281, followed by black females at 12 per cent, corresponding to $6,569. The income levels of white males exceeded those of black males by 70 per cent and were 17 per cent higher than the income level of white females.”

Mr Commissiong said the 2016 Census also highlighted that a programme was needed that would lead to black economic empowerment “in a real way”. He said the Government’s new Code of Practice for Project Management and Procurement marked an “historic milestone”.

He added: “Last fiscal year for example, our government spent $150 million on goods and services locally. Most of that spending went to white-dominated companies.” But he added that the affirmative-action policy, in which the Government pledged to use its purchasing power to promote equality of opportunity with regard to disability, gender or race, could “play a significant role in reducing racial disparity around the procurement span”.

Mr Commissiong then said

an educational campaign would be created to ensure everyone “is up to speed and educated about these opportunities and what it will take to take advantage of them”.

Allow me to introduce myself Mr Commissiong - I know a lot about this subject and would love to volunteer my services to you and your government.  I've watched a potentially powerful empowerment policy disintegrate into a farce.

Pierre de Vos on moyane. Mpofull up with this

Is dali mpofu as great as he makes out to be?  Perhaps the litmus test has arrived with his taking tomuch moyoney to steal as a client.  Or perhaps he has another strategy.  I read today that he has taken a great deal of exception to Pierre de Vos's recent blog post on this issue.

 

I hope this finds you well

If you do not remove this article which I find defamatory,insulting & possibly racist from any public space in which you have published it plus any references to it on your timeline & any other platform by 12h00 expect legal action

Thanks https://t.co/XkQ98uCpn3

— Dali Mpofu (@AdvDali_Mpofu) July 4, 2018

It would be wrong to not publish the whole opinion on this blog purely to preserve the text (and to show our esteemed legal mind that Tom Eaton speaks the truth).

 

Gosh, you really do learn something every day. I thought that when lawyers demanded retractions they sent private emails or letters, because doing it on Twitter would obviously just look like cheap political grandstanding. Consider me schooled. https://t.co/6I3CeXghsY

— Tom Eaton (@TomEatonSA) July 4, 2018

Here's the complete article.  Taken from the prof's blog and the Daily Maverick (used without permission but unlike Yonela Diko, I credit my sources)

ATTACKS ON SARS COMMISSION HAVE NO LEGAL BASIS, MUST BE POLITICALLY MOTIVATED

From a legal perspective, the attempts by former SARS Commissioner Tom Moyane and his legal representative Dali Mpofu to paint the SARS Commission of Inquiry as “grossly unfair” to Moyane, and the demand that the Commission cease its work, are rather odd as the arguments have no valid legal basis and are based on false claims. But – while unethical – it may make sense from a political perspective to try and create an impression in the minds of ordinary people (and governing party leaders) not knowledgeable about the law, that the Commission is biased against Moyane.

A Commission of Inquiry is not a court of law. Neither is it a tribunal that can make binding findings against any individual. In terms of our law, the President has the power to appoint a Commission of Inquiry on any topic of public importance and to decide on its terms of reference.

The Commission then gathers evidence in an inquisitorial manner, which means it gathers information on its own steam, and also invites interested individuals to make submissions to it. Anyone can approach the Commission with information, so it would be absurd for any person to argue that he or she was not given the opportunity to present his or her perspective on the range of issues being investigated.

Ideally the aim is to get as much information as possible to assist the Commission to write a thorough report that will assist the President to make informed policy decisions on the issue investigated. The findings and recommendations are not binding. The President, at his or her discretion, can do with the findings and recommendations as he or she sees fit.

At its best, a Commission of Inquiry is a process aimed at assisting the President and his or her government to make informed policy decisions about a specific matter, assisted by the well informed and knowledgeable findings and recommendations of the Commission. A Commission of Inquiry is a policy enhancing tool. The President has a wide discretion on who to appoint to serve on the Commission. Because a Commission of Inquiry is policy oriented, it makes no legal sense to argue that a Commission of Enquiry is grossly unfair to a particular individual.

While its findings and recommendations can be reviewed and set aside by a court of law if these are irrational, it is a legal nonsense to attack the Commission because it allegedly favours a certain policy perspective. It is the President’s prerogative to appoint people whose views he or she trust to assist him or her to make policy decisions.

Moreover, the President appoints the Commission of Inquiry and the Commission has the legal duty to do its job in accordance with the terms of reference provided by the President. Only the President can change its terms of reference, withdraw its mandate, or change any of the personnel serving on it.

To ask the Commission to cease its activities and for one of its participants to recuse himself (as advocate Dali Mpofu did last week) therefore makes no legal sense as the Commission does not have the power to do any of these things. It is like someone approaching me and demanding that I score the winning goal in the Soccer World Cup final. It is sadly not something I am entitled to do or will ever be able to do.

This process is very different from the accusatorial process followed in court and tribunal proceedings where different parties present evidence in an accusatorial process. In court proceedings accusations are made by one party against another and the person being accused then gets the opportunity to try and rebut those accusations. In such proceedings the court or tribunal will make a finding against one or more of the parties who were part of the accusatorial process.

In this regard, the SARS Commission is no different from the many other Commissions appointed over the years. As the chairperson of the Commission made clear, at the outset he invited all interested parties to make submissions to the Commission. The Commission then looks at the written submissions and if it so wishes (but there is no duty to do so) it can call some of those who made submissions to give oral evidence to the Commission.

Mr Moyane (or anyone who supports him – whether they worked at SARS or not) therefore has an open invitation to make submissions to the Commission. The chairperson of the Commission has also stated that if Mr Moyane requested to give oral evidence, this will be arranged. For some inexplicable reason Mr Moyane has refused to do so.

In other words, given the opportunity to provide his perspective on the matters being investigated by the Commission, Mr Moyane declined, instead falsely arguing that the Commission was grossly unfair (partly because he was not given the opportunity to give his perspective) and demanding the impossible – namelv that the Commission stop doing what the President has instructed it to do, an instruction the Commission has a legal duty to comply with.

In the absence of any other reasonable explanation, it will be difficult not to conclude that Mr Moyane is not keen to provide his perspective on the issues being considered by the Commission. Mr Moyane’s lawyer advanced a reason of sorts for this reluctance to provide the Commission with his perspective, namely that he is facing a disciplinary tribunal and that the Commission amounts to him being subjected to “double jeopardy”.

Legally, this is an odd claim. “Double jeopardy” is a procedural defence that prevents an accused person from being tried again on the same (or similar) charges and on the same facts, following a valid acquittal or conviction. A Commission of Inquiry can never subject any person to “double jeopardy” as it is a policy enhancing inquisitorial process and not an accusatorial “trial” that can make binding findings on the guilt or innocence of any individual. As the Commission is not a criminal trial (nor a disciplinary tribunal), the principle of double jeopardy does not apply.

Furthermore, to claim, as Dali Mpofu did last week, that Mr Moyane was not given an opportunity to make submissions to the Commission is therefore false. Why advocate Mpofu would make this claim when he must know that it is not true, is not immediately clear.

From the above it must be clear that from a legal and factual perspective the claims advanced on behalf of Mr Moyane by advocate Mpofu regarding the Commission makes little sense. (It is also unethical for an advocate knowingly to make false submissions on behalf of his or her client.)

But perhaps there is a political reason for this strategy. While Mr Moyane and his lawyers must know that they have no legal leg to stand on, their aim might be political and not legal.

The reason for this may lie in the very fact that Commissions of Inquiry are appointed by the President and are supposed to be policy enhancing tools to assist the executive to do its job properly. But as we all know, Commissions are pliable and serve the interests of the President who appoints them. They often do not only serve a policy enhancing purpose, but also a more overt political purpose.

Presidents often appoint Commissions of Inquiry not only (or even not primarily) to assist them to make good policy decisions. Presidents also sometimes appoint Commissions of Inquiry to manage a difficult political situation.

Sometimes the President appoints a Commission of Inquiry because he or she wants to be seen to do something about an issue which has led to a public outcry, but he or she does not really want to do anything about it.

That is why President Zuma appointed the Marikana Commission and the Arms Deal Commission. He knew that he could decide on the terms of reference, he could choose the personnel, and in the event of the Commission making findings or recommendations that he did not like, he could ignore these – all while the public was given the impression that something was being done.

In other cases, a President may need political cover to make decisions that would be difficult to sell to his or her own party or to the public. I suspect this is why President Cyril Ramaphosa appointed the SARS Commission. Perhaps he wanted to take action against those who captured SARS, but he knew that this was not universally supported within the leadership of his own party.

If this is correct, the rather ham-handed attempts (from a legal perspective at least) to discredit the SARS Commission makes perfect sense. Those who have lots to fear if SARS is rejuvenated (or who gets financial support for themselves or for their political parties from people who have lots to fear from a robust SARS) would obviously wish to discredit the SARS Commission to make it politically more difficult for the President to act on its recommendations, assuming that those recommendations – if acted on – will enhance the ability of SARS to go after large corporate interests and wealthy politically connected individuals.

If the public (or at least some gullible leaders within the governing party) could be convinced that the SARS Commission was somehow unfair or tainted in any way, the President would find it more difficult to use whatever findings the Commission produce, to make sweeping changes to SARS.

It is for this reason that I would not be surprised if the legally unsustainable claims made against the Commission are not being made to achieve a legal end, but rather to achieve a political end. It would be interesting to see how many people fall for this ruse.

SHARE: