The Federation of Unions of South Africa (Fedusa) has accused Finance Minister Malusi Gigaba of launching a “fresh assault” on the Public Investment Corporation (PIC) and its chief executive, Dan Matjila.
This comes after Gigaba’s announcement on Friday that he had written to Matjila and the corporation’s board asking for its list of beneficiaries and investments within two weeks. He also wants a forensic investigation into “any concerns of irregularities” at the state-owned PIC.
Fedusa general secretary Dennis George said in a strongly worded statement on Saturday that there was a “relentless and concerted campaign to destabilise the PIC” and to find reason to change its leadership.
“We must remind South Africa that Gigaba has been one of the central architects of the state capture project since November 2010, when he was appointed minister of public enterprises. In this portfolio, Gigaba was instrumental in the systematic removal of competent, independent boards of [state-owned enterprises] in their entirety, and replacing board members with Gupta-linked directors, who operationalised the wholesale looting of our state-owned enterprises (SOE). The most prominent examples of this repurposing of SOE boards are Transnet, Eskom and Denel,” said George.
He said that if Gigaba’s decision to institute a forensic investigation was based on genuine intentions it would not be generalised, “open-ended”, “vague” and “indefinite.” It would have clear terms of reference, specific allegations, time frames of these irregularities and refer to specific suspected irregular transactions.
The PIC controls R1.67 trillion of Government Employees’ Pension Fund (GEPF), making it the richest asset manager on the continent and therefore an attractive gold mine for the cash-strapped government.
Matjila woes continue
Matjila has recently come under pressure from the PIC board and from government, allegedly over his refusal to allow the corporation’s funds to be used to bail out failing SOEs. There have even been attempts to subject him to a disciplinary hearing over claims that he influenced the extension of finance to a business owned by a female associate. He has denied the claims and internal investigations have failed to come up with supporting evidence.
Three special board meetings, chaired by Deputy Finance Minister Sfiso Buthelezi, in the past three weeks to deal with Matjila saw him survive all three attempts to oust him.
Fedusa said it would consult its affiliates and lobby Cosatu and the National Council of Trade Unions (Nactu) about reviewing or withdrawing the GEPF’s investment mandate from the PIC and handing it over to a private sector asset manager.
Fedusa is also among the unions that have demanded representation on the PIC board in order to have a direct say in how the monies are used and to prevent it being raided at will.
“The proposal to review and possibly withdraw this investment mandate is in no way a vote of no confidence in the PIC or its leadership. It is part of our efforts to protect the asset manager against unwarranted political interference by Gigaba and to protect the pensions and savings of public sector workers and beneficiaries against looting. We accept that this is an extreme measure, however, we believe that if we fail to act now, the pension savings of our members will be plundered with impunity,” said George.
He charged that Gigaba’s actions fitted a pattern dating back to his previous ministerial portfolios at public enterprises and home affairs.
“His modus operandi as a Cabinet minister is clear: secure control over state wealth by chronically weakening the governance and operational structures of targeted institutions, weed out skilled professionals, shake down regulations to the advantage of ulterior forces, and then secure loyal governance and decision-making structures to operationalise his plan,” claimed George.
The Fedusa boss warned that because of the PIC’s influence as the biggest institutional investor on the Johannesburg Stock Exchange, destabilising it would have “far-reaching consequences for our economy.”
On Friday, Gigaba’s spokesperson Mayihlome Tshwete was quoted saying there was nothing to fear from the minister’s actions.