SAA must be Stabilised, Professionalised and Sold Off

The crisis at South African Airways (SAA) is fast reaching boiling point with debt repayments totaling R6.9 billion due this Saturday, 30 September. Despite this urgent situation, National Treasury has yet to reveal where this enormous amount of money will come from.
Our national carrier has become a bottomless pit into which government continues to pour precious public resources that should be spent on lifting 30 million South Africans out of poverty. It is hard to believe that any government hoping to be re-elected would take money from the poor to subsidize travel for the rich.
SAA’s fortunes will not change if we continue done the current tried, tested and failed path. For almost two decades, the airline has relied on government bailouts and guarantees for its survival. The cumulative total of bailouts since 1999 is R14.4 billion, and National Treasury is currently trying to source another R10 billion for the airline in the next 48 hours. Government has already extended R19.1 billion in guarantees – meaning that nearly R35 billion of ordinary South Africans’ hard-earned money has been dedicated to keeping SAA in ‘business’.
In addition to these bailouts and guarantees, and under the control of Board Chairperson Dudu Myeni, SAA has made a cumulative loss of R15.7 billion over the past five years. The DA has been clear and unwavering in our contention that Ms Myeni is both unfit and unsuitable to be at the helm. It is clear for all to see that this government continues to retain and protect Myeni in her position, in spite of this cash hemorrhage, because of her close political affiliations, including President Zuma himself.
The R10 billion that government is saying SAA needs will only pay off the bank loans of R 6.9 billion due by the 30th of September, the Standard Charted bail out of R2.2 billion at the end of June 2017, and R750 million to pay suppliers who were not fully paid in July and August 2017. The R10 billion will not provide working capital to fund the losses that National Treasury and the latest turn-around plan indicate will continue for the next two years. This requires a further R13 billion in cash injections or what National Treasury euphemistically refer to as “re-capitalization”.
The reality is that SAA is insolvent and bankrupt. It must be stabilized, and sold off as soon as practically possible.
Recovery plans have followed turnaround strategies, all yielding further losses. It is clear that national government is hell-bent on hanging onto the beleaguered airline – no matter the cost to the country and its people. SAA is not a strategic state-owned asset and it plays no role in the developmental agenda of government. On the contrary, over the last two decades it has cost our country dearly and delivered no tangible benefits to ordinary South Africans.
Getting to the bottom of the problem
Despite Finance Minister Malusi Gigaba’s best efforts, rumours of an impending raid on the Public Investment Corporation (PIC) refuse to go away. With just 48 hours to go before the R6.9 billion is due, we still do not know how Minister Gigaba intends to fund the bailout, and where additional funds will be found to pay suppliers.
The PIC, which administers the pensions of teachers, nurses, police officers and other public servants, has confirmed that they were approached for a R6 billion bailout for SAA. That our government would even consider risking pension funds of public servants is deplorable.
Significantly, the PIC has serious reservations about SAA’s suitability for a loan. At the media briefing on the 26th of September, PIC CEO, Dan Matjila, revealed that a due diligence investigation had been conducted into SAA. This report found SAA to be below the minimum investment standards required by the PIC. Matjila conceded that the outcome was “not favourable” in terms of “the minimum requirements of our client mandate”.
The contents of this report may be the clearest indication yet of the true state of SAA and the DA believes the report should be released for public scrutiny. We will therefore be submitting an application in terms of the Promotion of Access to information Act (PAIA) to obtain a copy of the SAA due diligence report conducted by the PIC.
Holding Myeni and Gigaba accountable
The Constitution sets out the basic values and principles of public administration in Section 195, which states that:
Public Administration must be governed by the democratic values and principles enshrined in the Constitution, including … [e]fficient, economic and effective use of resources … The above principles apply to … Public Enterprises.”
The national carrier is deemed a public entity in terms of Schedule 2 of the Public Finance Management Act (No. 1 of 1999) and in terms of the South African Airways Act (No. 5 of 2007). Accordingly, SAA is subject to this section.
Sadly, the management of SAA has become the very antithesis of the requirements set out in the Constitution. It is our belief that Malusi Gigaba and Dudu Myeni, in their respective official capacities, have breached Section 195 of the Constitution by not acting in accordance the principals established therein.
Therefore, the DA will be writing to the Public Protector, Adv. Busisiwe Mkhwebane, requesting an investigation into this matter. Specifically, the Public Protector must investigate the role played by Ms Myeni in the institutional decay and poor governance of SAA, since 2009, and Mr Gigaba in his former and current role as minister of Public Enterprises and Finance, respectively. Myeni and Gigaba’s careers are intimately entwined with SAA’s demise and they must not be allowed to escape accountability.
The way forward for SAA
SAA can be profitable and a company worthy of being called South African. However, immediate and urgent action is required.
The DA’s solution to the SAA crisis would consist of the following interventions:

  • Remove Dudu Myeni from the board entirely and ensure that the board is made up of independent individuals with suitable aviation and business experience;
  • Initiate business rescue proceedings for SAA in terms of Chapter 6 of the Companies Act (No. 71 of 2008). This will temporarily place SAA in the hands of a capable business rescue practitioner charged with returning the entity to a healthy financial position. This will have to include:
    • The removal of political interference both in strategy and in the employment of skilled and experienced management and staff;
    • Aggressively pursuing profitable routes, some of which were foolishly abandoned over recent years;
    • Renegotiating supply contracts, particularly major supplies such as jet fuel on the basis of best price for the required service quality;
    • Adjustments to employee compliment numbers to bring the airline in line with international staffing norms.
  • Release government’s stranglehold over SAA by finding a buyer for SAA immediately. This ought to include an employee share scheme, making a portion of shares available to SAA employees in order to empower them and give them a real stake in the company’s future successes.

These initiatives will not only bring much needed public accountability to the airline’s governance, but will go a long way to making SAA profitable again. We thus call on Minister Gigaba to place SAA under business rescue before the next bailout payment deadline of 30 September.
Conclusion
South Africans cannot continue to fund a defunct and failing national carrier. In truth, the imminent R10 billion bailout will only be a short term solution and will not fix the underlying issues at SAA. It is time for urgent and immediate interventions that seek to stabilize, professionalize and sell off SAA.

Don’t let economic exclusion be the heritage of our children too

The following speech was delivered today by DA Leader, Mmusi Maimane, at the old Johannesburg Stock Exchange (JSE) building in Newtown, Johannesburg. Maimane was joined by DA Gauteng Leader, John Moodey, DA Regional Chairperson, Khume Ramulifho, and DA National Spokesperson, Refiloe Nt’sekhe.
My fellow South Africans
We are blessed to live in one of the most colourful and diverse nations in the world. Our strength lies in this diversity. We are greater than the sum of our parts.
We don’t want to be a homogenous society with uniform views on the world. We don’t want to speak one language, share one culture or practice one religion.
South Africa is like a bright garden, brimming with many different flowers. This is what makes us who we are, and we must celebrate this diversity.
On this Heritage Day, it is wonderful to see all this variety in our society – to see so many people embracing their own history and taking pride in their culture. It truly is a day where we get a glimpse into the worlds of our fellow South Africans.
Given our brutal history, where large sections of society’s culture and traditions were dismissed and oppressed, it is important that we reclaim our heritage. It is important that we say: This is part of who I am, and no one will take it away from me again.
But when we talk about our heritage, we cannot only speak about these unique cultural practices. Because we share a common heritage too. We have inherited something as South Africans that cuts right across race, language, age and religion.
Half a century of Apartheid rule – of the oppression of one race over another – has left us with a shared heritage that is as much a part of our identity as our cultures and our languages. And this shared heritage is the deeply skewed economy from which millions of our people remain excluded.
Our shared heritage is a society where a child’s opportunities in life are still determined by the circumstances of her birth.
We’re gathered here outside a building that has a profound symbolic meaning when it comes to this unjust society of ours. This building used to house the Johannesburg Stock Exchange – an institution that represented the exclusion of black South Africans from the economy.
It stood here as a monument to Apartheid’s biggest weapon: economic dispossession. It said that ownership of the economy was reserved for a minority and that resources were extracted for the benefit of some, not all.
It reminded black South Africans that while their labour was good enough to build the country, they themselves were not deemed good enough to own any of it.
All of this was meant to change after 1994. The political freedom that came with the right to vote was meant to be followed by economic freedom. Because only through full participation in the economy – through jobs and through owning property, businesses and shares – could people consider themselves truly free.
And for a while it looked like this would happen. As people’s daily lives improved and access to education and jobs improved, it seemed as though the promise of economic freedom would become a reality.
But ask most South Africans today, and they will tell you that this promise of economic freedom has faded to the point where it feels like a distant dream. They will tell you that they feel let down and abandoned by their government.
More than two decades into our democracy, the project of building a prosperous and inclusive economy has ground to a halt, because the people entrusted with this project have shifted their attention to other things.
They have turned their attention to ways of helping themselves to the money meant for the people. They have turned their attention to fighting off the factions that threaten their grip on power and wealth. And they have completely forgotten about the people.
The result is growing poverty, growing unemployment and growing anger.
Today, 55% of South Africans live below the poverty line. That’s more than 30 million of our people.
Today, more than 9.3 million South Africans can’t find work, most of whom are under the age of 35.
Today, South Africa has the highest youth unemployment rate in the world.
Today, South Africa has among the highest income inequality in the world.
That is our shared heritage. And it is the duty of each and every one of us to change this – to ensure that this does not become the heritage of our children too.
It is our duty to build an economy that is truly inclusive. Not the fig leaf of ownership that the current BEE model has provided.
Because if you strip away the wealthy cronies who got rich thanks to their ANC connections, you’re not left with a lot of black ownership of our economy. I mean real economic empowerment for ordinary South Africans.
It is our duty to fix our broken education system so that children can leave school confident that they have something to offer the world. We must give them the skills they need to make the most of every opportunity out there.
It is our duty to support and nurture every job-creating business, no matter how big or small. This means making it simpler to run a business and employ people. It also means investing in the sectors with the highest potential for job creation.
It is our duty to unite South Africans around shared values and to fight the scourge of racial nationalism wherever we encounter it. We cannot allow our country to slide back to a place where people are turned against each other because of the colour of their skin.
It is our duty to bridge divides between people; to build roads and transport networks that connect us.
It is our duty to step into each other’s worlds more often and really get to know our fellow countrymen and women. To learn each other’s languages.
And, above all, it is our duty to bring change where it is desperately needed. Each of us has the power of the vote, and with this power comes responsibility. We owe it to our country to use our votes to bring change.
And we owe it to our children to ensure that their heritage is a more just, inclusive country than the South Africa you see today.
A South Africa in which the place where you are born and the colour of your skin are not the things that determine your tomorrow.
A South Africa that no longer has white suburbs and black townships, or a white JSE and black enterprises.
A propserous South Africa that belongs equally to all her people.

Those involved in State Capture will be held to account, whether in private sector or government

The following statement was delivered today by Democratic Alliance (DA) Leader, Mmusi Maimane, at a press briefing in Parliament, Cape Town. Maimane was joined by Federal Executive Chairperson, James Selfe, and DA Chief Whip, John Steenhuisen
I want to begin by welcoming yesterday’s decision by ANC Member of Parliament, Dr Makhosi Khoza, to quit the ANC. For many, it is not an easy decision to leave the party of liberation in South Africa. She must congratulated for her bravery and integrity, and we hope the many like her within the ANC come to the same realisation she did: that the ANC is dead, and beyond the point of no return. Dr Khoza summed this up yesterday, when she said:
“If we were to prosecute all known corrupt cases including those implicated in the Gupta e-mails‚ almost 80–90% of the ANC leadership at all levels of government would have to replace their shiny tailored suites and pretty dresses with orange overalls”
It’s time for a new beginning for our nation, and that new beginning lies in a post-ANC South Africa.
Corruption is an oppressive system that operates to destroy work opportunities, and operates against ordinary South Africans at the expense of a few. Whether it is a councillor who accepts a bribe for an EPWP job, or a senior executive at a large corporate firm who unduly wins government contracts – South Africans suffer because of this. Our challenge is to dismantle corruption is all its forms.
Ever since the infamous “Gupta leaks” some months ago, our nation has been knocked with daily revelations and new information pertaining to the intricate web of corruption, extortion, and undue influence exercised by the President, numerous ministers in his cabinet, and the infamous Gupta family.
The emails, and the information uncovered subsequent to that, provides a surfeit of evidence showing that our country has been captured by the President and his ANC government to make themselves and their friends rich – while ordinary South Africans suffer in the plight of unemployment and poverty. It is this state capture and corruption the ANC continues to condone and protect.
However, over the past weeks, the extent of the rot of state capture and grand corruption in our nation has become chillingly apparent. The recent revelations that private sector companies, such as KPMG and McKinsey, allegedly aided Gupta-aligned companies to profit from government contracts drove home the uncomfortable reality that our country has truly been captured in its entirety – and our young democracy is under siege.
As the Democratic Alliance (DA), we maintain that anyone implicated in any form of corruption, collusion or State Capture – in either the public and private sector – must be held accountable and face the consequences of their actions. As such, we have begun tackling this issue head on, in order to ensure those who engage in corruption are brought to book for their actions.
Private Sector
International auditing firm, KPMG, has become embroiled in the state capture saga by allegedly providing technical international tax advice to Gupta-aligned companies and by helping facilitate funds being moved from South Africa to Dubai. The firm assisted with tax avoidance advice as well as the setting up of shell companies, which assisted Gupta-owned Linkway Trading in laundering R30-million in public funds to pay for the family’s 2013 Sun City wedding.
Since these revelations, the wheels of accountability have begun to turn at KPMG, with the forced resignation of at least 7 of its top executives– including the firm’s CEO and COO. Moreover, KPMG has signalled its intention to donate the profits earned to charity, and KPMG International has launched an internal investigation into this matter.
We welcome the fact that those who carried out corrupt work for Gupta-aligned companies are being held accountable for wrongdoing. However, there is still more to do. As such, we call on KPMG to take the following steps:

  • To offer a public explanation as to the details surrounding the KPMG report into the so-called “rogue unit” at SARS, which was used to undermine the South African Revenue Service (SARS). KPMG must clarify how the end product came about, why they failed their own internal quality controls, and whether anyone from SARS interfered in the process;
  • To open its books and make public all its dealings with those involved in state capture, including all Gupta-aligned companies and any government entities;
  • To ensure every individual implicated in any underhand work done for Gupta aligned interests be removed from the firm; and
  • To make public any bonuses or severage packages handed to senior executives following their removal or forced resignation.

I will also be writing to the Governor of the South African Reserve Bank (SARB), Lesetja Kganyago, requesting that he confirm whether senior management at KPMG, or anyone else employed by them, reported any suspicious transactions to the Financial Intelligence Centre (FIC), as they would be obliged to do in terms of Section 29(1)(b) of the FIC Act 38 of 2001.
In addition to KPMG, international consultancy firm, McKinsey, appears to have paved the way for Gupta-linked firm Trillian to make hundreds of millions of rands from Eskom as it sub-contracted 30% of its Eskom work to the Trillian under the guise of ‘supplier development”.
Earlier this week, the DA laid criminal charges of fraud, racketeering and collusion in terms of Section 21 of the Prevention and Combatting of Corrupt Activities Act (PACCA) against McKinsey. We believe there are other avenues that ought to be pursued in addition to these charges. Therefore, I will be writing to the Serious Fraud Office (SFO) in London – where McKinsey’s Headquarters are located – requesting an investigation into the dealings in terms of the UK’s Bribery Act.
The DA will not back down in our pursuit of full accountability in these matters. As was evident in the Bell Pottinger case, those in the private sector who are caught in dodgy dealings with the powerful and the corrupt will be brought to book and face full accountability.
Public Sector
While the private sector has been responsive to these allegations and initiated accountability, when it comes to government, those at the top have thus far gotten away with corruption, collusion and aiding State Capture. In particular, cabinet ministers – including Malusi Gigaba, Lynne Brown, Des Van Rooyen, Mosebenzi Zwane and Faith Muthambi among others – face a litany of  State Capture allegations. Yet to date, not one minister has been held to account.
Section 92 of the constitution is clear: Ministers are accountable collectively and individually to Parliament for the exercise of their powers and performance of their functions. Moreover, section 237 of the constitution provides that constitutional obligations must be performed diligently and without delay.
However, this has not occured and it appears Parliament is in the process of breaching its constitutional obligations again – as the Constitutional Court found it to have done in the infamous Nkandla matter.
I had previously written to the Speaker on 29 May 2017 requesting that a draft resolution be placed on the Order Paper to establish an ad hoc committee to investigate these matters, as this would be the most appropriate way to holistically pursue accountability. This ad hoc committee was never established. Instead, on 20 June 2017, House Chairperson, Mr Frolick tasked the Portfolio Committees of Mineral Resources, Public Enterprises, Transport and Home Affairs with the responsibility of “urgently” probing the allegations of state capture insofar as they concerned those Ministers or departments.
Despite the mandate to probe “urgently”, these committees have proceeded with their work at a snail’s pace. Only the Public Enterprises Committee has appointed an evidence leader and has begun to hold hearings, however their probe is focused solely on Eskom, and excludes other players such as Transnet and Denel. The remaining three committees have achieved nothing in this regard.
Therefore, we are of the view that both the appointment of the four separate committees, instead of a single ad hoc committee, as well as the obfuscation and delays that have characterised the work of these committees constitute a deliberate attempt to undermine the responsibility of the National Assembly to hold the Executive to account. Even if not deliberate, the mere lack of urgency by the committees frustrates the National Assembly’s constitutional mandate.
It is for this reason that I have today written to Ms Baleka Mbete, the Presiding Officer of the National Assembly, requesting that our draft resolution be placed on the Order Paper to establish an ad hoc committee into State Capture by no later than 31 October 2017. The Speaker has now been put on notice and must act without delay. Given this and the seriousness and importance of these matters, we must place on record that if the Speaker does not issue the instruction concerned, we reserve our right to approach a Court for appropriate relief.
Furthermore, we request that the Speaker sees to it that a Disciplinary Committee is established – in terms of Rule 216 of the National Assembly Rules – to consider whether any of the following Ministers have acted in breach of their constitutional duties:

  • Malusi Gigaba
  • Faith Muthambi
  • Des Van Rooyen
  • Lynne Brown
  • Mosebenzi Zwane

Conclusion
We maintain that everyone involved in State Capture – ministers, companies, and any other individuals – be summoned to Parliament to be interrogated and held accountable if found guilty. We need to urgently get to the bottom of State Capture and its corrosive effect on our nation and its people.
As the official opposition, we will continue fighting corruption and State Capture with every possible instrument, because without defeating it, we cannot address our stubborn unemployment rate and we will never achieve economic freedom and equality for all South Africans. Only when we have defeated corruption, can we defeat the social ills prevalent in South Africa.
Ultimately, South Africans have the power to vote out State Capture and corruption at the ballot box in 2019, and choose a new beginning for our country.

Realising my dream of building a better South Africa

The following speech was delivered by DA Leader, Mmusi Maimane, on acceptance of the 2017 Avicenna Leadership Award at the Avicenna Leadership Academy in Utrecht, Netherlands. 
Good afternoon ladies and gentlemen and distinguished guests,
I am truly humbled to be here today to receive the Avicenna Leadership Award.
This award is testament to the hard work we, the Democratic Alliance, have been doing for many years now in an effort to restore the democratic project in South Africa.
South Africa’s history is one of competing racial nationalisms. It is a history of the Dutch Settlers who came to the Cape of Good Hope, British Colonialism, Afrikaner Nationalism and now African Nationalism. Ours is a history of a people being marginalised and excluded in the land of their birth.
Europe knows all too well the terrible impact nationalism has when it is taken to its final bloody conclusion. Europe had to fight to defeat the evil of nationalism and to establish, once and for all, the values of tolerance, modernity, inclusiveness, and the rule of the law. Now, 70 years later, nationalism and hate is on the rise again on this continent.
We hope, in the words of a slogan that has become popular once more for obvious reasons, that “love will trump hate”.
My fight in South Africa today is to help write an entirely new chapter for our country, where competing nationalisms do not define the future of young people.
I am a child to two parents who came to Soweto as migrant workers under Apartheid. My mother worked as cashier, in a system that did not recognise her self-worth, and my father worked for a lock-making company. One can’t help but wonder what trajectory they would have had if Apartheid had not pushed them to the excluded fringe of society.
My parents believed that, despite their background, if they worked hard their children could have a better tomorrow. Their devotion made it possible for me to escape the cycle of poverty that still traps so many black South Africans today.
Nothing has undermined our new democracy more than the evil scourge of corruption, which has been underpinned by the grand project of capturing the state for the purposes of personal enrichment.
In developing societies, the state can be a powerful tool for spreading opportunity more fairly and alleviating poverty. But the state can also be used crudely to funnel money to the corrupt, and thereby to further impoverish and punish the poor.
We cannot secure a better future until we crush the evil of corruption in our present. This is why my party has been so devoted to this cause.
It is an honour to be recognised for this work because it confirms that we’re making an impact. And it confirms that this impact is seen and felt far beyond our own borders. We are part of a connected global community and it is important that we have allies.
When South Africans were battling the oppressive Apartheid government in the 1970’s and 1980’s, they leant heavily on the support of allies abroad. We know that the anti-Apartheid movement was strong and vocal in the Netherlands, and we thank you for that.
Today, 23 years into our democracy, we find ourselves face to face with a new, insidious threat that will require a similar level of global solidarity to overcome.
It is time for us to liberate ourselves from the liberators. We must break the cycle of corruption and maladministration before there is nothing left on which to rebuild South Africa.
The party I lead is committed to rebuilding South Africa into a strong and stable democracy with a robust and inclusive economy – a country that not only works for all its people, but also reaffirms its place in Africa and the world. And while we know what a mammoth task this will be, we also know that we have the tools to succeed.
You see, the project of the DA is built around inclusivity. We don’t believe in the divisive rhetoric of failed liberation movements and radical populists. We don’t mobilise people around race and ethnicity.
Instead, we have a set of well-documented values. And our message to voters, to business, to civil society, to opposition parties and even to moral elements within the ruling party is simply this: If you share our key values, then you can be part of this project.
These values are Constitutionalism, the Rule of Law, a belief in an inclusive market economy, zero tolerance for corruption, non-racialism and the building of a capable state. I truly believe that if we succeed in rallying a majority of South Africans around these six values, we will be able to transcend the narrow Nationalism that has dominated our country for so long and build the South Africa we all want to see.
I was asked to speak here today about my dreams and my achievements. Well, this South Africa I’m describing here – growing, prosperous, inclusive, safe and tolerant – that is my dream. And playing a part in bringing about this change in the country I love is the only achievement I’ll ever be interested in.
You can be a part of this effort. Come to South Africa. Invest. Start businesses. Buy our products. A new beginning is coming for South Africa, and when it does, I am asking you to help us achieve our dream.
I hope that, should I ever speak to you again at this forum, it will be to report back on our country’s transition from post-liberation politics to a true democracy with freedom for all our people.
Thank you for this award, on behalf of the people of South Africa.

City-led development is the answer to South Africa’s jobs crisis

The following remarks were made by DA Leader, Mmusi Maimane, at a press conference in Johannesburg. The Leader was joined by the Mayor of Cape Town, Patricia De Lille, the Mayor of Johannesburg, Herman Mashaba, the Mayor of Tshwane, Solly Msimanga, and the Mayor of Nelson Mandela Bay, Athol Trollip.
I met with the mayors of the four DA-led metros of Johannesburg, Tshwane, Cape Town and Nelson Mandela Bay in order to discuss our nation’s current economic crisis and how best DA-led cities can respond to this crisis, ignite economic growth and provide access to jobs in such challenging conditions.
In the meeting, we reflected and discussed DA economic policy and how it translates into city governance; shared best practice between metros; and defined core elements of city-led economic growth and development. Each mayor was given an opportunity to present their successes, challenges, and plans going forward to ignite economic growth.
Moreover, we all agreed on a set of core principles to guide DA-led cities in the economic space. They are as follows:

  • Infrastructure led growth;
  • Zero tolerance for corruption;
  • Fair access to opportunities;
  • Policy certainty and fiscal responsibility;
  • Reducing regulation and red tape;
  • Speeding up ease of doing business;
  • Investing in transport;
  • Investment facilitation including the introduction of incentives;
  • Private sector collaboration;
  • Investment in ICT;
  • Training and educational support through apprenticeships; and
  • Tackling with the legacy of apartheid spatial planning.

These principles guide all DA-led cities, and are already being implemented in various forms.  The mayors also reflected on the urgent need to ensure that parastatals and State Owned Entities (SOEs) fulfil their role as required. Metrorail, Eskom, Transnet, and our ports and harbours are essential to the proper functioning of governments at city level. All mayors committed to engage these SOEs in order to ensure that they do not hinder the development and functioning of our cities.
It is no secret that South Africa faces its worst economic crisis in recent times. Under the ANC-led national government, our country’s future – and the future of the poorest and most vulnerable – is being undermined at every juncture.
Our nation’s unemployment rate is currently at 27.7 % – the highest level since March 2003 – a 14 year high. This leaves a massive 9.3 million South Africans without work. They are joined by over 17 million South Africans who are trapped, dependent on social grants for survival and with little hope of supporting their families, and experiencing true freedom.
Just last week, StatsSA released a new report on poverty in South Africa. According to this report, over 55% of South Africans live in poverty. That’s more than 30 million people, and the graph is heading in the wrong direction.
Our economy has been relegated to junk status, and has entered a formal recession, now offering virtually no hope to the millions of our people left out, and left behind.
The ANC continues to spew out economic mistruths about the jobs crisis in our nation. They continue to blame our problems on “global trends” and external influences”. Yet “global trends” and “external influences” are not affecting fellow emerging economies nor BRICS nations – all of which have lower unemployment rates than South Africa.
Our economic crisis is a home-grown problem, which requires a home-grown solution.
DA-led cities ought to be running lean, efficient administrations that extend all the way to the day-to-day details – answer emails, return phone calls, follow up on complaints. Often dealing with our governments as a small entrepreneur is an endless nightmare of unanswered calls and emails, with endless trips to sort out admin issues. All of this chases away entrepreneurs and makes it more difficult to run a business. I have asked our mayors to set this ambitious goal: let DA-led cities be known for their ease of doing business. Let us be the friendliest, simplest, most conducive places in South Africa to start and run a small business.
What we do in DA-led cities to revive economic activity is going to be key to our country’s future. National government doesn’t speak enough about city-led growth, but I believe this will be the make-or-break factor if we want create job opportunities for the millions of South Africans without work. Yes, national policy is important too, but the scale of employment we require can only be achieved through city-led growth.
In fact, our largest cities already punch way above the national average when it comes to economic activity, and average income in the cities is around 60% higher than in rural areas. This is why people are flocking to our metropolitan centres in large numbers. Instead of urbanisation being a problem to overcome, it is actually key to bringing more people into our economy.
The DA now governs for almost 16 million people, in some form or another. What we do in these metros will have a significant impact on the lives of these people and, ultimately, the lives of all South Africans. And so it is crucial that we go about re-energising our cities in the right way.
I would now like to hand over to each of the mayors to highlight their achievements, successes and plans going forward when it comes to economic growth and job creation.
City of Johannesburg
As the economic hub of South Africa, the City of Johannesburg is in a prime position to address our country’s crippling unemployment crisis. The starting point is to position Johannesburg as a business-friendly city that is open for investment.
In this light, the Mayor’s focus is on making it easier for people to invest in the city through the establishment of one-stop-shops, as well as the investment facilitation desk located in the Mayor’s office.
The City has developed 20 critical “Service Delivery Standards” which relate to planning approvals and service related benchmarks as part of the ‘doing business index’ in South Africa. These are applied across the board to ensure that those who are investing and creating access to jobs in Johannesburg are attracted by the highest of standards. The City now also offers substantial incentives on rates and taxes along transit oriented development corridors.
Infrastructure development is central to city-led economic growth. Johannesburg has thus already allocated close on R10 billion to upgrading existing infrastructure, with a further R3.3 billion allocated for the development of new infrastructure. This development will foster conditions which are conducive for sustainable economic growth and development, creating many more jobs.
In terms of creating an ever-expanding hub of entrepreneurs, the City is expanding the Small, Micro, and Medium Enterprise (SMME) hub network with revised service offering. These will become Opportunity Centres that assist SMMEs to access tenders and provide overall business support, training and mentoring.
The City plans to double the number of SMME hubs from 7 to 14, bringing the total expenditure on SMME hubs to R16 million in the coming financial year. The goal is to have two hubs in each of Johannesburg’s seven regions, where young prospective entrepreneurs can receive support, training and mentoring. The total number of SMMEs supported by these hubs is expected to increase to 1250 per month by June 2018, and 2000 per month by 2021.
It is our view that the economy at all levels must be decentralized.  The City of Johannesburg plans to achieve this in numerous ways. There is currently a plan in the pipeline to revamp informal trader stalls in the inner city, at an estimated R15 million. Moreover, with a total budget of R55.9 billion, the City plans to leverage its supply chain to decentralize the economy by empowering SMMEs by giving them a significantly larger share of city tenders. The City has also allocated R5.2 billion specifically to the economic growth cluster in the next financial year.
Johannesburg has a major issue with spatial inequality as a result of Apartheid. The City has responded by prioritising infrastructure investment in poor communities as well as building a public transport system that makes job opportunities more accessible.
Metrobus operates just under 400 buses carrying over 50 000 passengers daily, some of whom are amongst the poorest residents of our city. The City increased Metrobus’s capacity by 50%, adding 200 new buses to its fleet, providing residents with greater access to transport.
The Inner City is set to be a focal point with large scale investment in high-density mixed use accommodation through construction projects that include artisan training programmes and skills development.
Lastly, the Mayor has launched an ambitious plan to attract private developers to the inner city to alleviate the housing crisis, create access to jobs, and develop skills. The City of Johannesburg is well on its way to achieving its target of 5% economic growth, which will create much needs jobs for the millions of South Africans left out of the economy.
City of Tshwane
In the Capital City, one of the biggest challenges remains the burdensome bureaucratic processes which act as unnecessary red tape which hinders investment, development, and in turn job creation.
In just under a year, the City had made huge strides in reversing this hangover from the previous ANC administration. Since then, the City has approved 256 plans for commercial rights with a total construction value for commercial development of over R10 billion.
A Property Developer Forum will be established within the next month, with a target of ensuring all development planning approval processes to be automated by June 2018 through the use of a real estate module to improve the turnaround time of building plans.
In addition to this, an electronic platform for water and electricity connections will be launched in November this year, which will lead to quicker, more reliable service delivery that attracts much needed investment to the city.
The City will be cutting the cost of doing business by slashing the waiting period for key services, including:
• Cutting the waiting time for construction permits from 169 days to 30 days;
• The waiting period for access electricity will be cut from 104 days to 38 days; and
• Registering property will take a total period of 7 days as opposed to 30 days.
 
In terms of support for SMMEs, by the end of next year the City will have established a comprehensive partnership model between SMMEs and the City through a state-of-the-art blended incubation model – run and administered by a Non-Profit Company. This comprehensive model bridge the divide between city services and SMME needs, and will include skills development initiatives, and graduate and intern programmes.
While the state should not be the creator and supplier of the majority of jobs, the Expanded Public Works Programme (EPWP) plays an important role in creating opportunity in our current economic malaise.  The City will be creating 23 000 EPWP work opportunities over the medium term to alleviate the burden of poverty and ensure people can find work opportunities.
In so doing, a revision of EPWP Policy is to serve before this week’s Tshwane Council meeting to become a pro-skills development initiative and ensure a rotation of beneficiaries for maximum impact by end September 2017.
Attracting investment is the leading driver of growth and job creation at city level. Over the past 11 months, this administration has attracted over R2.3 billion in investment, exceeding its own target. This was enabled by an investor portal that has been established in the office of the Executive Mayor Msimanga which is making headway in fast-tracking strategic investments for the benefit of the city and its people. This highlights that with a clean, competent and service-oriented government, investors flock, leading to job-creating economic growth.
The City is also in the process of establishing 4 regional jobs centres will be operational by the end of June 2018
The development of the Automotive Supplier Park 130 area is well underway, and has five phases of development planned. This Automotive Supplier Park is a manufacturing cluster which houses different technologies, services and service providers, contributing to the sustainability and growth of the South African automotive industry. Infrastructure for the first two phases – approximately 50 ha- has been completed with over 100,000m2 of buildings erected to date.
Under DA-led governance, the Capital City is now open for business.
City of Cape Town
As the Metro that has been under DA-governance for the longest, the City of Cape Town has become the blueprint for city-led growth and development in post-apartheid South Africa. And the facts back this assertion up.
The City remains the top investment destination in the country, attracting over R2.67 billion in the past financial year. Moreover, according to StatsSA, the City of Cape Town has the lowest unemployment level of any city in the entire country. This is not by chance, but by change.
The City’s total infrastructure investment now totals R22 billion, with a further R3 billion spent on repairs and maintenance to existing infrastructure. The City’s target of 20% renewable energy by 2020 – along with its investment in waste-to-energy plants and its court action to force the Energy Minister to allow it to procure electricity from independent producers – are precisely the kind of energy interventions that make it attractive to investors.
Add to this the ambitious MyCiti bus service, with 5 new corridors in the pipeline, the wide-scale rollout of broadband and fibre, the innovative Youth Cafes – where youngsters can prepare CVs, and hunt for jobs – and the extensive red tape reduction programme, and it is little wonder that Cape Town is the country’s most investor-friendly city.
To this date, the City has invested almost R100 million in Wesgro and a number of Special Purpose Vehicles, and in return collectively facilitated over R14.2 billion in investments into Cape Town, creating more than 28 200 direct jobs. These Special Purpose Vehicles include the Cape Information Technology Initiative (CITI), Cape Town Fashion Council (CTFC), Clotex, Cape Craft and Design Institute (CCDI), GreenCape, and Business Process Enabling South Africa (BPeSA WC).
The City has also launched an inaugural Green Bond of R1 billion – the first of its kind in South Africa – and received offers totalling R4.3 billion in response. The Green Bond has been certified by the Climate Bonds Initiative and awarded a GB1 rating. This has attracted the major investment of the GRI Gestamp Wind Steel production facility in the Green Technology Industrial Park in Atlantis, which will create hundreds of new jobs opportunities.
This is supplemented by the launch of Invest Cape Town Brand, positioning Cape Town as a globally competitive business destination, targeting different sectors, including the Green Economy.
The City has also adopted a Transit-Orientated Development (TOD) Strategic Framework to address apartheid spatial planning, urbanisation and the high cost of public transport, and stimulating economic growth. This is best evidenced in the MyCiti transport system, a world-class public transport initiative, which now also offers free transport for unemployed South Africans seeking work – another great way in which barriers to employment are being broken down.
In an age of information and instant communication, ICT is a necessity for a growing city. Cape Town is currently branded as Africa’s Information Technology hub with more than 20 acceleration programmes and more than 25 co-working spaces, where access to information and up to date technology is available. Each acceleration programme supports between 10 and 15 start-ups every year.
The City has also piloted the Investment Incentive Scheme, which has two core functions. Firstly to provide “non-financial incentives”, such as fast-tracking land use and building plan applications; providing biodiversity to manage natural resources efficiently with businesses. And secondly to provide “hard financial incentives”, such as exemption of application fees for land and building plans; waiving development facilitation fees; debt- write off when businesses meet employment targets; and rate rebate and electricity tariff subsidy incentive.
An investment of over R10 million in the Cape Innovation and Technology Institute (CiTi) and funded CapaCiti, a job-readiness programme that has upskilled more than 900 underprivileged youth from low-income areas – with a 96% successful placement rate.
Lastly, in terms of youth empowerment, R5.5 million for has been allocated to external bursaries, R6.7 million for learnerships and R9.9 million for apprenticeships. This is supported by the Mayor’s Job Creation Fund, where R340 million has been allocated to create job opportunities. The City also provides young workers with a stipend whilst they receive their training.
Lastly, there are plans being implemented to supplement the water supply outside of the dam system, to ensure stability of supply in a time of protracted drought. The City is building water resilience by sourcing 100 Ml per day from groundwater extraction, and 50 Ml per day from land-based containers and a desalination barge. Water reuse measures to provide 50 Ml per day from land-based permanent desalination from Cape Town Harbour is also underway, with an addition 200 Ml from marine-based desalination at Cape Town Harbour and Gordon’s Bay.
Cape Town is truly leading the way as the benchmark for long-term city-led economic development in South Africa.
Nelson Mandela Bay
When the DA-led government took control of Nelson Mandela Bay, it was in financially precarious position following decades of ANC corruption and maladministration. The most immediate task was to put in place a system to restore financial stability. After less than a year in government, the City’s Capex rate is at 93%, and boasts a 93.7% revenue collection rate – the best financial position the metro has been in for over 7 years
Thus far, the City has created 4000 new job opportunities, and has committed to provide bursaries to 1800 students – to the total value of R34 million. Moreover 300 young people have already this year gone through learnerships in the City, to ensure that they have the requisite skills to provide them access to better jobs.
The Mayor will also be establishing a dedicated “Jobs Desk” in his office to facilitate the municipal bursary process, and will expand incentives for business to employ first time job seekers – particularly the youth.
Going forward, the City will establish a professional Trade and Investment Promotion entity, focusing particularly on attracting new investments on Nelson Mandela Bay.
The City also plans to revitalize the EPWP programme, in order to focus on skills development that empower beneficiaries to access further employment opportunities. This will include a skills database of all residents who have gone through the EPWP programme so that businesses can access people with relevant skills.
Lastly a localised ‘Ease of Doing Business’ task team will be established to monitor key indicators of business and slash unnecessary regulation and red tape.

Nelson Mandela Bay is the leading light in the Eastern Cape when it comes to growth and opportunity, and will continue as such for years to come under DA-led governance.

Conclusion
Make no mistake, there is still much more to do to develop and grow our cities and our nation. There are still millions of South Africans left out of the economy – without a job, and without hope of a better future.
Indeed, we will only be free as a nation when every South African – regardless of race, gender, sexual orientation, or circumstances of birth – has the opportunity to enter the economy and play a meaningful role in the development of our nation.
Amid a dire and crippling national economic environment, DA-led governments will do all in their power to create access to jobs, opportunity and wealth for all – not just the connected few.

Let the Metros run passenger rail services

The following speech was delivered by DA Leader Mmusi Maimane at the Transport and Mobility Summit in Nelson Mandela Bay yesterday evening.
Ladies and gentlemen,
The clock is ticking for our young nation. We have no time to waste. The report on poverty trends released this week by Stats SA paints a bleak picture indeed of the daily lives of South Africans.
According to this report, over 55% of South Africans live in poverty. That’s more than 30 million people, and the graph is heading in the wrong direction.
Economic exclusion and the social ills that go hand-in-hand with this are very much a product of our brutal and unjust past. This is especially true in public transport, because black and coloured South Africans were uprooted and dumped on the distant peripheries of towns and cities.
Efficient, affordable and reliable public transport networks is one very important way of undoing this legacy, and loosening the grip of poverty.
But like in many other areas of public policy, we have not done nearly enough to fight poverty with excellent public transport.
And when I say we, I mean all of us. The temptation is to point fingers at the failings of the ANC government alone, as if that somehow absolves us. We must do what we can with what we have until we are in national government. And right now, the DA governs, in some form, for around 16 million South Africans in metros and municipalities.
Our cities can and should lead the drive for economic development in South Africa. Cities governed by the DA must be the shining example of how efficient, clean and responsive governments can attract investment and create jobs. And importantly, our cities are best placed to build and maintain transport infrastructure.
These things are within our control. We have the power to make a big difference in the lives of many poor South Africans, and with that power comes big responsibility.
In every sphere and level of government, it is our job to reverse the legacy of centuries of colonial rule and decades of Apartheid. If correcting the wrongs of the past is not at the centre of every single thing we do, then we are in the wrong job.
Spatial segregation was at the very heart of Apartheid planning. Unlike many cities across the world where the poor are clustered in and around the city centre, the architects of Apartheid had the exact opposite in mind.
Here, our poorest citizens find themselves pushed to the outskirts of the city, isolated from opportunities. This was a deliberate strategy to keep black South Africans poor and powerless, and it worked.
While most middle-class residents in suburbs have a relatively short and inexpensive commute to their work, poor South Africans in outlying townships find themselves spending up to 40% of their income just to get to work and back.
But it’s not only the cost or the inconvenience of the commute that holds people back. Poor families also suffer because they are robbed of their time together. And this is something middle class South Africans don’t always realise.
For someone living in the suburbs who has to get their children to school before commuting to work, the morning will typically start at around 6am. They will return home in daylight hours, and get to spend quality time with their families before going to bed.
Compare this to the millions of South Africans who set their alarm clocks for 4 in the morning and send their children off to school in the pitch dark before starting on a 2 or 3 hour commute to work.
No one can ever get this stolen time back.
If we want to talk about creating a fair society, where all our people can enjoy the freedom they were promised since the dawn of our democracy, then breaking down the walls of Apartheid spatial planning must be a top priority.
We can do so by integrating communities through affordable housing solutions across all areas of our cities. But we can also do so by connecting people in our outlying communities to opportunities in our cities through better public transport.
Without being in national government, the provision of reliable, affordable transport is one of the best ways we can impact the lives of the people for whom we govern.
Efficient transport drives economic inclusion. It brings people to places of opportunity, and it connects employers with the unemployed.
I am hugely encouraged by the work our new Metro Mayors are doing in Johannesburg, Tshwane and Nelson Mandela Bay in tackling the transport challenges they inherited in these cities.After just a year in office, the changes are already visible.
Already, Mayor Trollip’s administration has begun to integrate Nelson Mandela Bay.
After staggering losses of R2bn to fruitless expenditure in the last 5 years of the ANC government in this Metro, it is hugely encouraging to know that the city will finally get the world class transport system it deserves.
Equally encouraging is news that engagements with PRASA have led to commitments to construct a rail line connecting Motherwell with the CBD. This will see 7.8km of rail and three new stations linking the people of Motherwell to opportunities in the city.
This is a big step forward from the previous Metro government that spent R100m on buses that couldn’t even fit onto the city’s roads.
In Johannesburg, the City has assisted 110 minibus taxi operators in Johannesburg to complete a first-ever course in business and financial management through the Wits School of Governance.
Mayor Mashaba’s administration has also declared war on potholes and broken traffic lights, and these efforts have already made a noticeable difference across the city.
In Tshwane there are plans to expand the A Re Yeng Bus Rapid Transport System as well as to increase the number of people using the Tshwane Bus Service.
Mayor Msimanga’s administration also reviewed bus fares in June in order to make the service more affordable for unemployed residents seeking job opportunities.
In addition to lower fares across all routes, there are also new concessions for scholars, pensioners and people with disabilities.
Just one year in, these DA governments have already had a visible impact on the lives of the people of these cities.
But when it comes to radically altering the way a city’s people move about, you need a little more time. The people of the City of Cape Town, after 11 years under a DA government, are now seeing the benefit of long-term planning by a stable, capable local government when it comes to transport.
The world-class MyCiti bus service already provides a rapid bus service as well as feeder service to thousands of Capetonians in areas such as Blouberg, Melkbosstrand, Khayelitsha, Mitchells Plain and Hout Bay, with routes now also rolling out in Philippi, Nyanga and other poorly serviced parts of the City.
And as the next five corridor routes are completed over the coming years, the Cape Town Metro will become a far more accessible place for all its people.
The design of the MyCiti buses makes Cape Town the only city with disabled-friendly public transport, and this is topped-up with the Dial-A-Ride service for those unable to use mainstream transport.
The new initiative announced by the DA government in Cape Town earlier this year, in which jobseekers will get free rides on the MyCiti network thanks to a subsidy from the City, is another great way in which barriers to employment are being broken down.
But bus routes will only get us so far. To truly unlock the potential of our cities, we must get our people back onto trains in great numbers. Because, when properly run, commuter rail holds the key to connecting the bulk of our people with economic opportunities.
Again, using Cape Town as an example, the deterioration of the Metrorail service has had a profound impact on the City’s ability to move people in and out of town.
Over the past four years, the number of passengers boarding trains daily in Cape Town has dropped by a staggering 43%. Delays, service interruptions and crime have become so commonplace that many commuters have abandoned the trains for good.
And these people all ended up on the roads in taxis, in buses and in cars, making Cape Town South Africa’s most congested city. Every day around 260,000 cars enter the city’s CBD. The roads simply cannot cope with this volume of traffic.
The solution is to allow the City to bring commuter rail into its transport plan by giving it control of the rail networks, the stations and the land on which these lie.
The Metro government is in a far better position than PRASA to get the most out of the city’s rail network and to run it properly. if our Metros ran their own train systems, then voters could hold us accountable for the success or failure to deliver a reliable train service.
It makes no sense that such a vital public service is run by people who are totally unaccountable to the public.
In many ways this is similar to the SAA story, but with trains, not planes. And frankly, the implications for poverty and economic growth are far more profound than with a failing airline.
National government has an opportunity to fix this in their new National Rail Strategy by assigning the management of Metrorail to the City.
So let me issue a sincere call to national government here: let DA-led Metro governments run passenger rail networks in those cities. Give us the opportunity to run an efficient, well-run, accountable passenger train service and I promise you we will not let you down.
You should not see this as a threat, but as an opportunity. If you care about dismantling barriers to economic opportunity and fighting the legacy of Apartheid, then you should be willing to do whatever it takes to deliver a great public transport system. Even if that means giving it to us to deliver.
And I ask all of our Mayors and Mayoral Committee Members responsible for public transport: take forward this request in your engagement with national government. They will take some persuading, but to me, it is a “no brainer”.
Public transport should be delivered by local governments, not by a distant unaccountable state-owned company.
Ladies and gentlemen, when I speak of our cities, I don’t mean the way they look today. I mean the cities of our future.
Rapid urbanisation has already had a dramatic impact on the way we move around our cities, and this trend will increase sharply over the coming decades. We must plan our transport systems for how our cities will look 30 or 40 years from now.
We must think big, and be prepared to invest just as big. A bus system that can barely service the people of Johannesburg today will certainly not cope with the needs of a city of 20 million people a few decades from now.
Let’s explore all the options. Perhaps it is finally time for an underground metro rail for South Africa’s beating economic heart.
Cape Town may have had a ten year head start on the other DA-run metros, but I know that Mayors Mashaba, Msimanga and Trollip are not daunted by the idea of playing catch-up.
I know they lead teams of committed and competent people who care deeply about the plight of poor South Africans. And I know that they can replicate, and even surpass, the transport successes achieved over the past decade in Cape Town.
When we meet again for a summit like this, I hope it will be to discuss our transport plans as national government, and how we can bring freedom, fairness and opportunity to all the people of South Africa.
Thank you.

Vrede Dairy Farm: Guptas and the ANC stole economic opportunity from black South Africans

The following remarks were made today by DA Leader, Mmusi Maimane MP, outside the Hawks Headquarters in Pretoria. Maimane was joined by DA Shadow Minister of Justice, Glynnis Breytenbach MP. The full indictment handed over to the Hawks can be accessed here.
Fellow South Africans,
We are gathered here outside the Hawks Head Office to seek justice for those South Africans – our brothers and sisters – who were robbed of economic opportunity by the ANC and the Guptas.
Today I have in my hand a legal indictment containing over 200 pages of prima facie evidence showing that Minister Zwane and members of the Gupta family, through an intricate web of companies and actors, stole almost R200 million of public funds which ended up paying for a Gupta family wedding at Sun City in 2013.
In a small town named Vrede in the eastern Free State, not further than 250kms from here, a crime was committed and money and opportunity was stolen from the people of Vrede in order to fill the pockets of a small clique of powerful individuals who have captured the government, the President, and the ANC.
The victims of this theft are 80 local community members, who were the intended beneficiaries, who would have become part owners of this project, and who would have had an economic stake in the agricultural sector of our country.
Instead of empowering those who are left out of the economy, black South Africans were used as a front for a calculated scheme of grand corruption and money laundering to benefit the Guptas and their friends in the ANC. Between the Guptas and the ANC government, economic opportunity was stolen from black South Africans.
This is a crime of the most reprehensible nature. And today we are here to ensure those who stole face the full might of the law.
It began back in 2013 when the Free State Provincial Government – under then Agriculture MEC, Mosebeni Zwane – launched what is now referred to as the Vrede Dairy Farm project. This community based project, which targeted over 80 intended local beneficiaries, was a joint private-public project between the Free State Agriculture Department and a successful bidder from the private sector.
The aim was to empower local residents and boost provincial agriculture through the establishment of this large scale dairy, with at least 80 community members having a direct stake in the project. On paper, it was full of promise. However, when Gupta-controlled company, Estina, was handed the tender for this project, it became clear this was a preconceived project designed to fill the pockets of the Guptas.
The project was fraught with irregularities and allegations of corruption from day one. What then transpired was a calculated money laundering scheme through an intricate web of transactions – which saw almost R200 million of public funds diverted from this project and straight into the pockets of the Guptas.
Sadly, the Vrede Dairy Farm project could act as a textbook case study of money laundering, collusion and corruption. Despite this, the Gupta-controlled Estina still sits with almost R200 million of public money while the intended beneficiaries are left penniless.
We are here today to make one thing clear: we will not allow this theft of economic opportunity to fall by the wayside.
Because we know who the bad guys are.
And you know who the bad guys are.
Even the police and the Hawks know who the bad guys are.
They are the Minister of Mineral Resources, Mosebenzi Zwane; they are Atul, Ajay, and Rajesh Gupta; they are the numerous Gupta stooges who work for Gupta-controlled companies such as Oakbay, Linkway and Estina.
The question thus beckons – why has this cut and dry matter not been finalised by the Hawks and referred for prosecution by the NPA?
This indictment delivered today acts as concrete evidence which outlines in detail how this money was stolen from the intended beneficiaries, and provides sufficient evidence to support the criminal charges laid against several members of the Gupta family, their associates, and Minister Zwane last month by DA Shadow Minister of Finance, David Maynier MP. These charges include money laundering, racketeering, assisting another to benefit from the proceeds of unlawful activities, and acquiring, possessing or using the proceeds of unlawful activities in terms of the Prevention of Organized Crime Act 121 of 1998.
We believe that the evidence contained in this indictment, emanating from the tranche of “Gupta email leaks”, is both clear and comprehensive, and sufficient to conclude the investigation into this matter and hand it over to the National Prosecuting Authority (NPA) for prosecution. There is no reason for either the Hawks or the NPA to drag its feet on this matter.
Included in this indictment are documents which reveal the following:

  • Then MEC for Agriculture in the Free State, Mosebenzi Zwane, now Minister of Mineral Resources, was instrumental in persuading the Provincial Government to adopt the dairy project;
  • The project was not put out to public tender;
  • Linkway Trading, a Gupta-controlled company, entered into a consulting contract with Estina, also a Gupta-controlled company to the value of R138 000;
  • Financial records show that over a six-week period between August and September 2013, Estina transferred $8 348 700.00 (R84 million at the then prevailing exchange rate) to the Dubai bank account of Gateway LLC, a Gupta controlled UAE shelf company;
  • This transfer represented the entire amount transferred from the Free State provincial government to Estina for purposes of the Dairy project, to the Gupta controlled account at Standard Chartered Bank in Dubai;
  • The Standard Chartered account was clearly used to launder the money in question, since at least three quarters of the funds in question were almost immediately transferred back to two Gupta-controlled South African companies Linkway Trading and Oakbay Investments;
  • Three months after the wedding, on 31 July 2013 Linkway Trading, a South African-based Gupta-controlled company, presented Accurate, a Gupta-controlled shelf company in the UAE, with a 4 page, itemized invoice for expenses for the “V and A function at Sun City”.
  • A South African National Treasury probe followed the exposure of the malpractices at the dairy farm in the media and Estina was removed from the project, but by then the Provincial Government had paid Estina the amount of R210 million

We believe that this is a cut and dry example of money laundering and corruption. The charges have been laid, the evidence is clear and overwhelming, and now all that’s left to do is move forward with prosecution. It is this unacceptable that the perpetrators of this crime have yet to be charged, and as such, this indictment serves to speed up the wheels of justice to ensure that those who stole the people’s money are prosecuted, and if found guilty by a court of law – are put behind bars.
The DA is unrelenting in our effort to seek true justice for this group of South Africans who are the real victims of the ANC’s State Capture project

President Zuma should declare 16 August Marikana Memorial Day

I have today written to President Jacob Zuma requesting that he declare 16 August a commemorative day to be observed annually in honour of those workers who lost their lives in Marikana on 16 August 2012.
Last week marked the fifth anniversary of the Marikana tragedy, where some 34 mineworkers – brothers, fathers, and sons – were killed by members of the South African Police Service. On the day, South Africans from all walks of life joined together in paying their respects to the fallen heroes of Marikana, calling for justice for the victims, and their families and loved ones.
The Marikana tragedy remains a stain on the collective conscience of our nation. We must mark this day as a commemorative one, where we reflect not just on the injustice of that fateful day, but the injustices which still persist throughout our society.
The President has the power to declare any day to be observed and commemorated, via a proclamation. As such, I implore President Zuma, in the interests of justice and national unity, to use this power and declare this day Marikana Memorial Day.
We are not alone in this call. We are joined by many in society, including political parties and trade unions who also believe this day ought to be declared as such.
The President must honour those who lost their lives so tragically by declaring 16 August Marikana Memorial Day

30.4 million now live in poverty under the ANC, we need a new beginning

Today’s release of a StatsSA report entitled “Poverty trends in South Africa: An examination of absolute poverty from 2006-2015” indicated that since 2011, the number of South Africans living in poverty has risen to an enormous 55.5% of the population, meaning that over 30.4 million South Africans live in poverty under this ANC government.
The report highlights that between 2011 and 2015, poverty actually increased from 53.2% to 55.5%.  There can surely be no greater indictment of any government’s performance than the number of people living in poverty actually rising on their watch. After all, the primary objective of being in government must be to improve the lives of the poor.
Crucially, StatsSA cities a list of factors which have led to this increase in poverty – all of which stem from the ANC’s economic policies that have failed to grow the economy and create work. These include policy uncertainty, low and weak economic growth; continuing high unemployment levels; higher consumer prices, and lower investment levels.
We therefore reiterate our call for South Africans to be given the power to usher in the new beginning our country so urgently needs, by going to an early election. The power ought to be in the hands of the people, not politicians.
What is clear is that under the ANC government, poor South Africans are suffering and have lost hope in this ANC-led government bringing freedom and economic opportunity to those who need it the most. The ANC is no longer the voice of the poor.
It is now even more critical that despite the failures of the ANC at national government, local government must diligently focus on delivery for poor South Africans. Where we govern, the DA will continue to prioritize delivering quality services to the poor.
 

Economic transformation in South Africa

Lecture delivered by Mmusi Maimane, DA Leader, at the Wits University School of Governance on 17 August 2017, hosted in collaboration with the University of Pretoria’s Centre for the Study of Governance Innovation (GovInn).
Programme Director, Prince Mashele
Director of the University of Pretoria’s Centre for the Study of Governance Innova-tion, Professor Lorenzo Fioramonti;
Director of the Wits University School of Governance,
Ladies and Gentlemen,
I stand before you to deliver this Lecture on economic transformation under the im-mense pressure, of what Lyndon Johnson called “the fierce urgency of now”.
In the DA we have been spending sleepless nights thinking about what to do to stop South Africa’s economic decline, to give hope to millions of our people who lan-guish in poverty and unemployment.
Recent political developments in our country have worsened the parlous state of our economy. Corruption, state capture and the disintegration of the ANC have com-bined to reduce South Africa to a junk status.
Both local and international investors have lost confidence in the ability of our country’s corrupt leadership to grow and manage the economy well. That things are falling apart everybody can see.
Even ordinary South Africans no longer see the state as an instrument of their devel-opment. It is obvious that the state is being used to enrich a few politically connected friends and families.
When things are so bad, South Africans look to the second largest political party, the DA, for solutions.
As infighting, corruption and factionalism continue to tear the ANC apart, I am mind-ful that millions of South Africans expect my party to offer hope. The weight of his-tory is on our shoulders.
South Africans expect from the DA a credible leadership with a clear vision and concrete ideas on how to turn our country from despair to inspiration.
At a time like this, there is no room for politicians to play semantic games with pre-tentious and woolly slogans like radical economic transformation – slogans that are tantalising but without practical meaning.
The South African economic situation is dire. More than nine million people are without jobs. About half of our young people are not working. The gap between the rich and the poor continues to widen.
The growth in the number of citizens who receive social grants cannot be sustained by an economy that is in decline. Neither can the state continue to expand the size of the bureaucracy, acting as the “employer of last resort”. Even the provision of quali-ty services cannot be guaranteed by a state with dwindling resources. For the provi-sion of such public goods needs revenue from a thriving economy.
Ladies and Gentlemen,
When the situation is so bad, we have no luxury to deliver lectures on transfor-mation as if transformation is a stand-alone item outside the wider crisis of the economy.
Hoping to reap the fruits of transformation from a collapsing economy is like expect-ing milk from a dying cow. We must save the cow for all of us to get milk. The econ-omy must grow for us all to get our fair share.
What, then, is South Africa’s economic crisis?
Ours is a crisis of confidence, and a crisis of production. As we ponder the future, the questions that arise are:
– How will South Africa regain the confidence of a global market that increasingly sees us with wary and sceptical eyes?
– How will we build a meaningful relationship of partnership between business and government in South Africa, so that entrepreneurs feel confident to invest, build and create here?
– And what will South Africa produce and sell to the rest of the world?
The historic backbone of our economy, mining, is in serious decline. Hoping for the return of the diamond or gold rush of the late 19th century is a pipedream.
Even demand for other mineral resources – such as platinum, iron ore, etc. – fluctu-ates in response to the vicissitudes of international trade. Our vast wealth of coal re-serves offers no hope in a world seeking to reduce dependence of fossil fuels.
South Africa’s manufacturing base, built over the years on the back of cheap elec-tricity and steel, is also in decline. The truth is simple: if we cannot manufacture things, we will have nothing to sell to others in the world.
The growth of the services sector has not and shall not mitigate our economy’s crisis of production. Sustainable jobs can be created only if our economy produces value-added products for both domestic and international consumption.
In response to our country’s economic crisis, the ideas proffered by the DA’s politi-cal opponents are either sterile or destructive. They range from a suicidal dalliance with nationalisation to a blind faith in redistributive consumerism.
We in the DA think differently. We offer better ideas to build a growing economy that is both innovative and inclusive. Only a healthy tree can bear the fruits of eco-nomic transformation. A dead tree can only provide wood, not fruits.
Addressing historic injustices
The historic distribution of socio-economic privileges along racial lines continues to impose a heavy burden on South Africa’s contemporary politics.
For centuries, black people in South Africa were victims of race-based laws meant to keep them on the lower rung of the economic ladder. In addition to missed opportu-nities after 1994, the general socio-economic underdevelopment of black people in our country today can be accounted for chiefly on the basis of race-based colonial and apartheid policies.
The DA is deeply troubled by this great historic injustice. We are determined to ad-dress the situation by levelling the playing field to ensure that history does not con-tinue to undermine the economic potential of the vast majority of South Africans.
We recognise it as an anomaly that the distribution of wealth, opportunity and skills remains skewed along the same discriminatory racial lines established under apart-heid. Left uncorrected, this state of affairs will be used by opportunists to further di-vide our nation.
The DA believes that economic transformation is most effectively achieved by mul-tiplying poor black people’s access to income generating activities that can provide routes out of poverty and into the middle class.
We believe that the economy must play a critical role in uniting – not dividing – our people. This is the principle that informs our perspective on economic transfor-mation.
The uniqueness of our policy on transformation is in the DA’s emphasis on growth. A wealth redistribution model that is not accompanied by interventions to grow the economy is bound to fail.
However, having read Professor Fioramonti’s book Wellbeing Economy, I must say something about his insightful criticism of a purist focus on growth alone. The DA’s ultimate objective is not only to maximise economic growth, but to maximise the wellbeing of all citizens. Every citizen, regardless of race, should have access to the opportunities and benefits that a growing economy provides.
And when I say economic growth, I say that in the full awareness that GDP is not an ideal measurement for economic inclusion. That’s why we take very seriously a va-riety of other indicators of societal wellbeing, such as measures for inequality, pov-erty and unemployment.
But I do believe that for South Africa to pull millions out of poverty, we need more job-creating economic activity.
The experience of the past two decades confirms the soundness of our policy per-spective. Alongside growing unemployment, the Black Economic Empowerment (BEE) model of the past has produced a few black millionaires who have set up no businesses of scale to employ ordinary South Africans.
That BEE as has been implemented is unsustainable is obvious. The DA believes in unlocking real economic opportunities for black people, by implementing an em-powerment model that will extend access to economic opportunities for far wider than a tiny group of politically connected black individuals.
And this is an imperative that does not only benefit black South Africans. Our coun-try can only thrive over the long term with a strong, broad and powerful middle class. No country of 60 million people can sustainably thrive with a comparatively tiny middle class.
This is the shared objective that both black and white South Africans have. We truly are all in this together.
As an aside, leaders in our society can’t just retain the leadership of one race, a narrow racial constituency. In South Africa, all of us who claim to lead are obligated to lead for everyone.
It is the most cynical and easiest path of bad leaders to simply retreat with their con-stituencies into the same racial lagers as defined for us by colonialism and apartheid.
It is much more difficult, but essential for our shared future, for us to build bridges and bring people together.
Under a DA-led government, black entrepreneurs who seek financial support from the state and its finance institutions will have to show that they will produce actual goods or services, and that they will create real jobs. If they have brilliant ideas, the an enabling will be there to assist them to convert their ideas into concrete produc-tive projects.
We cannot continue to enrich a tiny group of connected few who neither contribute to economic growth nor create jobs.
Tragically, the capture of black economic empowerment to empower the elite has actually locked out many black businesses — because tenders and deals only go to the well connected cronies. Ordinary black entrepreneurs are left out in the cold.
This must be done in a manner that does not give cover to forces that are opposed to transformation. I must make it abundantly clear: Expanding economic opportunities to black South Africans is a national imperative. There is no way out of it.
Black South Africans need an economy to protect. It must be as outrageous to any race when someone states that when the Rand falls, “we will pick it up”.
The DA supports share schemes in the private sector that give wealth to workers and make them partners and part owners of businesses.
Instead of channelling money into the pockets of a few cronies who add no value to a company, it makes sense for the workers who produce wealth to benefit, and for them to be represented in decision-making structures and processes of companies. This model has been tried and tested in countries like Germany. It is about time that we experiment with it more seriously here in South Africa.
It is DA policy for the South African economy to be a facilitator of racial integration rather than being a source of division. This is a national imperative towards which all patriotic citizens must strive.
We have an objective to move our current nationalist orientation towards a citizens’ orientation.
Nationalism has been the orientation of South African politics for hundreds of years – most recently through the National party and now the African National Congress. This must be a critical change, for a post nationalist era in South Africa, for the first time ever.
In a nutshell, these are the elements that constitute the DA’s policy on black eco-nomic empowerment. Our strategic objective is racial harmony and nation building. It is not punitive redistribution. That is why our model is growth-centred.
Our economic model
In the current period of global economic upheaval, confusion drives economic dis-course. The erstwhile champions of globalisation – the U.S. and Western Europe – are showing signs that they now doubt their commitment to free-market economics. This is a cul-de-sac that the world has been down before. It is a dead end.
The eco-nomic nationalism of “America first” may make for good slogans, but it makes for poorer people, with lower wages, paying higher prices. There needs to be a resurgence of faith in open markets and greater global integra-tion. India are pioneering this now – showing the world that the “glorious isolation-ism” of the 20th century is neither feasible nor glorious.
Mankind is passing through an ironic epoch in history – a time when China, a coun-try that used to hoist the flag for socialism, is now the most enthusiastic evangelist of globalisation and its engine of market economics that delivers stunning improve-ments in the basic quality of life of the poor.
In a chaotic time like this, it is tempting for political parties to question the correct-ness of their long-cherished ideals, and go with the wind. The DA shall not be blown by the gusty winds of international economic nationalism and their domestic variant of nationalisation and crony capitalism in Marxist garb.
History has proven that nationalisation throttles the creative and productive capaci-ties of people. It does not free the human spirit. It actually ends in disaster. One need only look at the tragedy of Venezuela today.
There are no indications that socialism in Russia will rise again from its grave, or that China will any time soon revert to the stagnant socialist days of Chairman Mao.
On the other hand, almost all market economies that have experienced serious down-turns have been able to get out of the hole – even if it takes long.
Imperfect as it has proven to be, the inclusive market economy remains the most ag-ile and resilient way of improving the lives of the poor over time.
What is needed is a regulatory system that will tame destructive greed, and facilitate a fairer access to the opportunities that humans require to build a better life. This is why I find Professor Fioramonti’s book on Well-being Economy interesting.
The idea of well-being as an organising economic principle calls for open-mindedness.
Professor Fioramonti does concede that, “There is little hope for a country that em-braces wellbeing as its political objective to succeed in a world dominated by the growth mantra.” This, unfortunately, is the world we currently live in.
We stand ready to modify our ideas to deal with the peculiarities of South Africa’s economic situation. Even as we from time to time take tactical detours, the strategic ideal of creating a society where all shall have equal opportunities remains our ideo-logical guiding light.
Once the playing field has been levelled, there shall be no need for race-based spe-cial provisions. There shall be equal opportunities for all – black and white.
The role of state-owned companies
The debate on the extent of state’s role in the economy remains central to the politi-cal debate in our country today.
Our position is that there is a critical, facilitative role for some state-run companies in the South African economy, but that many of the state monopolies play no posi-tive role at all any more and actually only impoverish people with corruption and monopoly pricing.
Ours is not a dogmatic position on the matter. Our flexible approach allows for openness in dealing with each state-owned company on its own merit. Those that add no demonstrable value, abuse their monopoly positions to fleece the public, or where services could be much more efficiently delivered by the private sector, should be disposed of.
I must point out that the DA is not satisfied with the state of state-owned companies in South Africa today. Many of them have been crippled by corruption, maladmin-istration and financial mismanagement.
The DA has a clear set of solutions to these problems. We have a zero-tolerance for corruption. When we take over power, we will immediately unleash law enforcement agencies to drain corruption out of all state-owned companies. Every corrupt official shall go to jail.
The introduction of private investors as even minority shareholders in some state-owned companies would go a long way to stabilise both governance and financial management. Private capital will not sit back and watch its financial interests being ruined by maladministration.
The DA does not support the constant bailing-out of state-owned companies that are mismanaged by politically-connected officials. When we are in power, we will pro-fessionalise the governance of all state-owned companies. There shall be no political deployees in management structures or on boards of directors. Only technically qualified South Africans will manage state-owned enterprises.
The crippling mismanagement that have been going on in these companies shall be halted the first day a DA-led government steps into national office.
De-concentrating the economy
The South African economy is highly concentrated. Too few companies control vast economic sectors. Every formal sector of the economy is dominated by a handful of companies. As John Stuart Mill correctly observes,
Where competitors are so few, they always end by agreeing not to compete. They may run a race of cheapness to ruin a new candidate…
The economic history of South Africa is littered with too many examples of this – from the early days of the Randlords in mining to our contemporary times of price-fixing in the construction of stadia for the 2010 Fifa Soccer Wold Cup.
High concentration throttles the spirit of entrepreneurship by implanting in the mind of society the prohibitive attitude that it is a waste of time to come up with new ideas in an economy that is controlled by an exclusive club of plutocrats and cronies.
This is precisely the negative attitude the DA seeks to reverse. We support the strengthening of South Africa’s competition regime, to punish and root out anti-competitive conduct in business.
One of the most ill-informed criticisms of the DA, among a crowded field, is that the DA is somehow the party of “big business”. The DA is a liberal party in true sense of the word: we stand opposed to power concentrations wherever they occur – in big business, in big labour, and in big government. If anything, it is the ANC, like the Na-tionalists before it, that cozy up to big business in the ultimate “mutually corrupt re-lationship”. Power is where power goes.
Enterprise development
The story of the humble origins of modern information and technology giants such as Microsoft, Apple or Facebook is well-known. These global corporate giants were first incubated in the minds of ordinary men, before they were hatched out into prac-tical initiatives. Over time, they were nursed to become big, well-known companies. Such is the power of the small guy in a market economy.
Trends elsewhere in the world, particularly in such fast-growing regions as South East Asia, suggest that the future of the world economy is in small businesses.
We live in a world where knowledge is getting more and more diffused, so that ordi-nary men and women are able to come up with simple ideas that end up manifesting the bigness of humble visions. The point of enterprise development is to facilitate the translation of ideas into companies and products.
A society that hopes to be in the top league of economic innovators is one whose state institutions are designed to stand ready to assist private citizens who come up with brilliant small ideas to turn them into big economic projects.
Creative citizens must know where to go to give their ideas wings to fly. The DA be-lieves that, to unlock South Africa’s economic potential, we must invest heavily in enterprise development.
Education and skills development
A properly designed and well-functioning national system of education ought to do two things: (1) sharpen the appetite of citizens to seek more knowledge, and (2) equip citizens with the technical know-how to participate actively in the economic activities of society.
The former is an essential ingredient for personal development and self-fulfilment. It engenders a critical spirit in a democracy. The production of goods and services de-pends on the latter.
Whether or not the youth who go through South Africa’s system of education re-enter society as voracious seekers of knowledge is hard to tell. What is clear from international studies is that, compared to her peer countries, South Africa’s level of entrepreneurship is low.
That South Africa’s system of education is currently not supplying the economy with much-needed skills is a commonplace. Our ranking of 138th in global maths educa-tion shows that our country’s system of skills production is deficient where it mat-ters most.
Various sectors of the economy are in desperate need of engineers and a whole range of artisans. The failure to supply the economy with such critical skills is linked to the country’s poor performance in mathematics and science.
The Trends in International Mathematics and Science Study (TIMSS) shows that South Africa is not in the category of top performing East Asian countries like Hong Kong, South Korea and Japan.
For our country to undergo an economic turnaround, we must jack up the perfor-mance of our children in mathematics and science. There is no other way. And in-deed there is no shortcut. It is a source of great frustration to me that our children are so often told in school that they “are not good at maths” and should consider giving it up. It is true that some people are born more able to compute numbers than others – but everyone can and should learn the basics of mathematics, because it is the uni-versal language on which our world is built, and in which new ideas are written.
In a nutshell, South Africa’s system of education is in serious crisis. It is at the same time a crisis of quality, a crisis of quantity, and a crisis of funding. Barring a handful of former Model C and private schools, the bulk of our country’s public schools need urgent interventions by a new government that is serious about fixing the cur-rently dysfunctional system of basic education. The DA is already pioneering, with exciting results, Charter Schools that allow a partnership between public and private sectors to deliver much improved education to the poor.
The types of artisanal skills that the economy is hungry for necessitate that our country must strike a good balance between the production of university-trained theoreticians and technicians who can create and fix things.
A core proposal that I have made before, and wish to make again, is a one year na-tional programme for all qualifying matriculants who wish to learn skills and gain some basic work experience – a matric plus!
The heads of our educated citizens must brim with ideas that assist society to solve practical problems. The DA’s approach to education and training centres around the production of knowledge that frees the mind and prepares the individual to partici-pate actively in the production of goods and services.
Ladies and Gentlemen,
A corrupt and incompetent state is a disaster for the economy. A democratic state that is accountable and has the leadership and technical capacities to direct devel-opment can be an engine for wealth and job creation. It is the latter that the DA is working towards.
It is important to spell out our vision succinctly. The DA believes that South Africa needs three important ingredients: (1) a visionary and coherent politics; (2) a skilled and knowledge-loving population; and (3) an ever-modernising, competitive econo-my that creates jobs for all. This can be done only through the facilitative role of an accountable and technically capable democratic state with a modern outlook. The DA’s politics is driven precisely by the quest for this noble ideal.
Our view is that transformation is a component of the economy, which is why we do not deal with it as if it is an isolated phenomenon. We place it at the centre of the whole economy – a growing economy that creates jobs.
We believe that the implementation of the economic programme I have outlined to-night can and will benefit all South Africans – black and white. We are more than ready to debate with whoever claims to have better ideas. The DA is a listening par-ty. We are always ready to experiment with new ideas that work.
Thank you very much for lending me your ears.