BLSA CALLS FOR A JUDICIAL COMMISSION OF INQUIRY INTO STATE CAPTURE:

BLSA Encourages the President and ANC NEC to do the Right Thing

22 May 2017

South Africa needs an independent judicial commission of inquiry to restore confidence in our economy, our democracy and the future of our country. The toxic cloud hanging over the Office of the President is eroding the legitimacy of our government and hurting investor confidence. Unless this crisis is urgently stemmed we will see increasing poverty and inequality.

These concerns are shared by political parties and members of the African National Congress (ANC); members of the ANC tripartite alliance, the Congress of South African Trade Unions (Cosatu) and the South African Communist Party (SACP); and also by civil society, including most recently the South African Council of Churches (SACC).

Business Leadership South Africa (BLSA) concurs that for the well-being of all the people in our country, this cloud of suspicion must be removed. Over the weekend, BLSA publicly joined (SACC)., the ANC Secretary General and Deputy President, the SACP and other members of civil society in calling for an independent commission of inquiry in to state capture.

We are aware that the President has taken the Public Protector’s report on court review questioning the recommendation to institute a judicial commission of inquiry as “outsourcing” the functions of the office of the Public Protector. We also note that the Constitution obliges the President to act in the best interests of the country. We therefore urge President Jacob Zuma to put the interests of the country first and to once and for all remove the devastating allegations of state capture by instituting an independent judicial commission of inquiry.

BLSA also raised these points at a meeting with the President and ANC leadership on 28 April. We noted the severity of the allegations and “observations” laid out in the Public Protector’s report. BLSA urged the President to convene a full and public airing of the evidence in a process conducted by an independent judicial commission of enquiry. The reason is that evidence of activities, if true, pose a risk to both constitutional government and the stewardship of the economy.

South Africa is already suffering consequences from this crisis of confidence in the legitimacy of government. The recent credit downgrades, which were in part triggered by concerns of corruption, particularly at State Owned Enterprises such as Eskom, are hurting the economy. The Governor of the Reserve Bank recently pointed out that: “When you lose your investment grade rating, your government is going to pay more to raise debt and when your government does that your banks are going to pay more to raise debt and they will pass those costs to businesses and households.” Already, large employers have indicated that they have had to put investments on hold. This will further impact jobs negatively.

Given that the outcome of the judicial commission of inquiry may have repercussions for the President, BLSA believes it is also necessary for the President to seek and follow the advice of the Chief Justice on two important issues: the terms of reference for the commission and the choice of judge to head the commission.

Furthermore, BLSA is concerned that individuals implicated in the report, until cleared of wrongdoing, should assume no new positions of public trust. We reiterate our position condemning the reappointment of Brian Molefe as CEO of Eskom and call on government to use its powers as Eskom’s shareholder to reverse this decision immediately and to replace the existing Board.

Our democratic state institutions at all levels have been hollowed out and the Constitution is continuously being subverted. Our economy is stagnating and we risk decline, with devastating social consequences. Our economy also excludes millions of South Africans who can’t find work, the level of inequality is unacceptably high, many of our people live in abject poverty and we have not succeeded in deracialising the economy.

Organised business participated in the SACP-Convened National Imbizo held in Boksburg over the weekend. BLSA and Business Unity South Africa (BUSA) presented the following proposed resolutions to the Imbizo:

- Reject what is happening to our democracy and not to allow the present situation to become “the new normal”;

- Mobilise a broad civil society alliance against State Capture;

- Call for the immediate appointment of a credible, independent judicial commission of enquiry into all aspects of the State of Capture Report;

- No further work is done with respect to the nuclear programme until there is an updated, least-cost IRP16, which is affordable and broadly accepted by all stakeholders;

- Call for the dissolution of the Eskom Board, the appointment of a new credible, respected and non-partisan board led by an experienced chairperson, and the appointment of a new CEO and executive management. Although Eskom is the top priority, this process must be quickly followed by resolving the governance, management and financial challenges of SAA, Denel and the SABC;

- Seek an agreement on how SA can achieve sustained levels of higher economic growth whilst distributing the benefits amongst all South Africans, as quickly as possible eradicating unemployment, poverty and racial and gender income inequality

BLSA endorsed the SACP-Convened National Imbizo Declaration, which highlights that they will maintain a broad network of parties committed to the defence of our constitutional democracy.

BLSA encourages the ANC National Executive Committee (NEC), which is meeting on Friday, to heed the calls from business and civil society. We cannot continue to ignore the Public Protector’s report. For the wellbeing of our democracy and our economy, we call on the NEC to bring appropriate pressure to bear on the President to investigate the findings of the report.

Statement issued by BLSA, 22 May 2017