16 Nov 2006: ISS Today: Things We Should Not Get Used To in South Africa

16 November 2006: Things We Should Not Get Used To in South Africa

ISS Research on Party Political Funding in South Africa sounds an alarm.

Punch-drunk. Have South African’s become blasé about corruption in our midst? Could the political scandals that have made news-headlines in the past few months be a justifiable excuse: Yengeni goes to jail, Shaik goes to jail, Kebbles political links revealed, Malatsi is sentenced, Zuma is charged, Travelgate MP’s are sentenced while Oilgate is unresolved. This is beside the litany of allegations of corruption involving members of the civil service and the ever-present hand of corporate SA that greases palms where necessary. Although corruption is by no means systemic in a country that has developed sound laws and institutions to tackle the issue, the real danger is that we start to accept this as the way things work – business as usual. Thereby numbing us to outrage and effectively allowing the rich to continue stealing from the poor. It’s a vicious cycle that if unchecked could end up consuming our society. 

Perhaps this is why the media’s focus on the farcical – witness the intense debate in the past few days as to whether Toni Yengeni drank Czech beer from a bottle while on weekend parole. It is possible that corruption allegations have been turned into a series of soap operas by the media and opposition alike allowing us to lose touch with what is taking place in the wings – there is an intense battle raging to ensure that the power of money does not trump democratic politics in South Africa. One of the most striking examples of this must be revelation in the past few days of the existence of Chancellor House – an alleged ANC front company - following the release of research commissioned by the ISS Corruption & Governance Programme in collaboration with Idasa. Researchers Vicki Robinson and Stefaans Brummer were tasked with finding some of the sources of private funding and they, aided by a number of well-placed sources, stumbled upon the existence of the Chancellor House Trust. Chancellor House may well come to represent a defining scandal in contemporary politics that could overshadow the Oilgate affair. Named after offices that housed the legal firm of liberation struggle icons Mandela and Sisulu in the 1950’s, the Trust appears to have been established to beneficiate the ANC treasury and the research suggests that it consists of a group of companies that report to ANC Treasury-General Mendi Msimang.

Chancellor House has over the past few years managed to notch up impressive investments in the energy, mining, engineering, information technology and logistics sectors. However, its crowning achievement must surely be the prospecting rights it was awarded to one of the world’s largest untapped Manganese fields in the Kalahari. Manganese is a strategic metal used to produce steel. The Department of Minerals and Energy affairs awarded the rights to Chancellor House as part of a consortium with the Russian Renova Group of companies headed up by Russian Viktor Vekselberg – an oligarch, who is one of the top 50 richest men in the world and has had a number of brushes with the law in the past.  This all appears above board, however the concern is that ruling party may well have been both player and referee in this deal – undermining the constitutional requirements for a fair and transparent procurement process.

Questions therefore arise as to whether Chancellor House would have benefited from this potentially hugely lucrative contract if it did not have party political credentials? This must have crossed the mind of other BEE companies that lost out in the bid, including Dirleton Minerals and Energy that has as one of its principals respected businessperson and ANC member Zwelakhe Sisulu. In many ways the awarding of this tender may therefore not only constitute the blurring of the lines between party and state but also undermine the important redistributive role that BEE is required to play if we are to genuinely transform and grow the economy.

Chancellor House seems to present proof that South Africans, collectively, need to draw a line in the sand that says until here and no further. We cannot allow the interests of party, state and business to gently merge, as was the case during apartheid. We only need to glance back at the corrupt tenure of PW Botha and his racist crony capitalists to remind ourselves of the need to tackle this issue head on. There are plenty of examples that show that this mixture can have all sorts of intended consequences. In the USA this is exemplified in the support by big oil and arms companies for the Bush administration prior to the invasion of Iraq. In neighbouring Zimbabwe the emergence of companies owned by ZANU-PF in the late 1980’s was the beginning of what some commentators have called the ‘Zanufication’ of key sectors of the economy.

However, the Zimbabwean experience is also instructive in other ways, as it suggests that many leaders in the party were in fact unaware that the party had stretched its tentacles into the economy.  Questions soon began to arise as to whether this was intended to benefit the party or the individuals who controlled these corporate interests. This practice can ultimately be the undoing of internal party democracy as new centres of power are created around strong men and women who hold the parties purse strings. They in turn dole out patronage to others and the centre of democratic power in the party is discreetly hollowed out in the process. It is therefore important not to regard party funding scandals as evidence of a political party acting in unison. On the contrary party members and voters are likely to be kept in the dark when it comes to the names of foreign or local donors who have written cheques in favour of the party treasury. The ISS research suggests that Democratic Alliance MP’s are by way of example not given access to the full list of donors – evidence that power and information are entrusted to others in the party.

Regulating the disclosure of private funding to political parties is crucial if we are to re-establish the link between citizens and those we elect into office – and equally between party membership and leadership. Ultimately this will help ensure that politics is representative of the needs of the majority of people as opposed to the current trend towards disconnection between rulers and the ruled. This is perhaps the very reason that we witness the rise of political corruption in democracies across the globe. The resulting voter cynicism only further undermines the sustainability of the democratic project and entrenches ownership in the hands of the powerful and wealthy.

In the interim we need to avoid fatigue and ensure that we do not normalise scandal to the extent that the Chancellor House issue has gone unreported by many in the media. Tough questions need to be asked by the media, civil society and branch members of political parties when we see the interests of politics, the state and business conflating.  This is an imperative if we are to collectively prosper as citizens of a modern ‘secular’ African state. This is a vision that Mandela and Sisulu shared while struggling for justice from the original Chancellor House over fifty years ago.

Hennie van Vuuren, Corruption and Governance Programme, ISS Cape Town