FIRST WORD: Editorials: Edition: July / September 2019


To be great again

SA democracy gets a second chance. It’s not up to Cyril on his own. Key role for private sector.

In the wave of post-elections relief, that President Cyril Ramaphosa has emerged triumphant, the predominant question is whether he can “deliver” on promises made. It’s the wrong question. Instead, the private sector should be preoccupied with asking how it can assist delivery through the intellectual and financial strength at its command.

Retirement funds, for one, have huge capacity with their trillions of rand under management. For far too long they’ve been frustrated by the lack of such ‘bankable’ infrastructure projects as renewable energy and water supplies. Advance them and any argument for prescribed assets evaporates. The unleashing of job creation must accompany the confidence, previously absent, that people’s savings won’t be squandered.

Ramaphosa has a tight window of opportunity, to prevent a return of investor scepticism and quell a regroup of party hacks, for confidence in his administration to be stimulated and belief in a trajectory for economic growth to be entrenched. The one is reliant upon the other, and neither can be effected from within government alone.

Under the Zuma regime, government and the private sector were in an abusive relationship of waste and worse. The advent of Ramaphosa, steeped in the legacy of Nelson Mandela, is marked by a love affair that anticipates proper consummation of food security – are presaged in the proposed Expropriation Bill (TT April-June).

Through-and-through a Mandela man

They’re a far cry for the expectations of populists, impervious to consequences, who’ll continue to test him in the run-up to next year’s meeting of the ANC’s general council. Such noise – as with interference in the independence of the Reserve Bank and non-interference in the structures of Eskom – are being prepared for short shrift.

Policy change requires attitudinal change. Here too the ground is prepared.

The commissions of inquiry into state capture and corruption, as well as the SA Revenue Service, have been accompanied by new appointments respectively to head the National Prosecuting Authority (with a specialist anti-corruption division established) as well as SARS. More than sufficient evidence has seemingly been produced for arrests quickly to follow.

The quicker the better for a change in attitude that overrides the constraints of party factionalism. From what’s been revealed to date, the genie is out of the bottle. From what’s been set up at the NPA and SARS, prosecutorial decisions aren’t for Ramaphosa to take.

Public perceptions are fundamental. Merely a handful of high-profile arrests, for a start, will demonstrate the seriousness of intent to attack societal cancers. The world needs to see, and the locals need to learn, that in SA the era of tolerance for stealing is over. Rhetorical pleas for a turnaround in morality are abetted by a big stick.

Actions by the NPA will necessarily find their way into the public domain, but this is not necessarily so with SARS. Bound by taxpayer confidentiality, its work is usually below the radar. However, tax evasion – such

Needed now is less a new dawn than a reinvigoration of the old, from the early days of democracy, when the towering influence of Mandela inspired the nation with a sense of morality and purpose, of service and vision, of overcoming racial polarisation and galvanising potential for achievement.

All were waylaid in the back-biting and self-seeking that followed. All can be restored, and must be, by a return to the values of Mandela. Ramaphosa is the only hope, not least to draw back into the public sector the calibre of talent which it then attracted; put differently, to uplift the competence while simultaneously to root out the Zuma minions and stymie their capacity for ambush.

Unless he succeeds, SA fails. The choice is binary, as much for government as its citizens, and not to be offered again anytime soon.

Rating agency Moody’s is spot-on with its warning that policy changes must be executed for the disaster of a sovereign-debt downgrade to be averted. But policy changes cannot happen on unilateral action. At the ANC’s end-2017 national conference, just in case Ramaphosa won the election, booby traps were set for him.

To date he has handled them with aplomb. Take land expropriation without compensation. His frequently-repeated assurances – adherence to the Constitution, prevention of land grabs, promotion as non-declaration of income illegally accrued — invites court appearances and criminal penalties. As in the manner that Al Capone was nailed, there’s a potent weapon for SARS to use in the public interest.

The clean-out of corruption by the state, prioritised by Ramaphosa, is a prerequisite for the build-up of confidence. At the same time comes the imperative for private-sector support. How?

Companies still cash-rich are itching for the confidence to deploy resources, with multiplier effects for economic expansion, on the back of business-friendly policy signals. More than this, formal mechanisms are in place.

Prime amongst them is the Financial Sector Code. It commits the supposed institutional moneybags — banks, insurers, asset managers and the rest — to social expenditures on a vast scale. Whereas previously the sector’s contributions might have been viewed as a compliance obligation, to temper government, it can be morphed by fresh circumstances into a platform enthusiastically to partner with government.

Grounded in B-BBEE considerations, the code’s application goes beyond them by escalating the number of participants in the mainstream economy: for instance, through improved access to financial services; acceleration of skills development, and leg-ups for smaller businesses. These give meaning to the “inclusion” objective of a “transformed” landscape.

It’s further underpinned by provisions for the financial education of retirement funds’ members and trustees. They embrace not only routines essential for governance but extends, by an awareness of rights, to the building of a stakeholder democracy.

Resistance to Ramaphosa will come from cadres who’re understandably averse to the prospects of refunding ill-gotten gains, paying tax and going to jail. In the bigger scheme of things, they’re blots methodically to be blotted out.

His battle is less against them than against time, specifically time to get the economy moving. It’s doable, given infusions of positivity, the beleaguered Eskom and a troubled world outlook notwithstanding.

Allan Greenblo,

Editorial Director.