Why the ANC needs the private sector

THE circumstances around Vusi Pikoli’s departure from the audit firm SizweNtsaluba & Gobodo are quite intriguing. They illuminate the contrasting nature of power.

Albeit an instrument capable of transforming society for the better, power can also be perverted by illusions of invincibility.

Pikoli’s hounding out of employment is an encapsulation of power in its fullness, a manifestation of both its virtue and its vice.

You may recall that SizweNtsaluba & Gobodo made history recently when it was awarded the Transnet account for a five-year period. The deal is worth R300 million and is the first of its kind for a black firm.

Historically, only white auditing firms got such lucrative deals. With this one Malusi Gigaba, the suave Minister of Public Enterprises, under whom Transnet falls, has re-defined the face of auditing in SA.

Business has been unkind to black auditors. White firms historically preferred white auditors. Some clients even insisted on white-only audit teams.

The Removal of Thabo Mbeki, Launch of Frank Chikane's Eight Days in September book at Sandton City mall, where he was signing the books. 615 Picture: Matthews Baloyi 3/14/2012

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And because the private sector was predominantly white, black auditors were mostly idle and black firms hardly got any lucrative accounts.

White firms and white auditors prospered and climbed up the corporate ladder, while black firms and black auditors simply got by and wallowed in the misery of racism.

Because they did not bring in any business, black auditors became invisible in white firms.

Bold requests for inclusion in an audit team were met with polite and even friendly – but definite – rejection.

Black auditors were labelled a risk that could chase away a client.

Their inactivity, through no fault of their own, was thrown back in their faces as validation of their incompetence. That was racism in its unkindest form.

But freedom injected kindness into the auditing industry.

Because black folks were now in power, racism was no longer good for business.

Business follows money, most of which lies in the public sector. This opened up opportunities for black auditors as new legislation insisted that black talent be recognised and their expertise utilised. The accompanying growth of black business and professionals in the private sector has widened opportunities even further for black auditors.

It’s still mind-boggling though why it took the government almost 20 years to affirm a historically black auditing firm, but it is nonetheless a highly commendable, epoch-making event.

Black initiatives should be recognised to dispel stereotypes of black inferiority. This is application of power in its virtuous form.

Such resources and influence, unfortunately, also have an enormous capacity to pervert power. No sooner had the government changed the history of auditing than a dark side reared its ugly head. Pikoli was apparently forced out of SizweNtsaluba & Gobodo at the insistence of some faceless officials as a quid pro quo for the lucrative contract. The powers that be have seemingly labelled Pikoli an enemy of the state.

There’s no demonstrable logical end to this abuse of power; it is simply intended to satisfy a vendetta.

Pikoli earned the resentment of politicians over his handling of Jackie Selebi’s arrest and the so-called Browse Mole intelligence report. He went against the wishes of his political superiors. But he was simply doing his job the best way he knew how. And Frene Ginwala, who led a commission to establish his fitness for office, recommended his reinstatement.

There’s no sense in hounding Pikoli out of a job. And this is the second time. Other than satisfying mindless anger, I can’t imagine any possible benefit the government can derive from this.

Rather than making his life miserable, the government should be enticing Pikoli back into public service. He is exactly the kind of bureaucrat the ruling party needs to build a developmental state. He is incorruptible, loyal to the state and has the expertise.

To be sure, this issue extends beyond Pikoli. The state has a unique capacity to act in the most irrational way.

Consider the Public Works Department. Its new minister, Thulas Nxesi, has made bold promises to turn things around. Displaying rare candour for a politician – and in an angry tone that suggests sincerity – Nxesi has issued numerous press releases detailing the extent of the rot in his department.

Among Nxesi’s problems, as he has repeatedly told us, is lack of expertise. Yet his director-general, Siviwe Dongwana, has been suspended for almost two years.

Dongwana is an experienced chartered accountant who was hired by Geoff Doidge.

Doidge and Dongwana initiated the clean-up in the department.

They suspended dodgy leases and initiated investigations. For all that, Doidge was fired and replaced by Gwen Mahlangu, who quickly suspended Dongwana. Mahlangu insisted the department go ahead with the dodgy deals, but Dongwana would have none of it.

Public Protector Thuli Madonsela has since found Mahlangu guilty of improper conduct, for which President Jacob Zuma fired her. The president seems to have mastered the art of firing ministers.

Even when you do a good job, he still fires you. Ask Doidge.

Madonsela commended Dongwana’s behaviour. Yet he remains suspended. Why?

It is even more puzzling to hear Nxesi repeatedly telling us that he needs more qualified staff when he has not lifted the suspension of a highly qualified, innocent DG.

You may recall another case, also involving a chartered accountant, Xolile Ncame, who was a chief financial officer at the Land Bank. Ncame was fired for objecting to improper transactions and spent years fighting the dismissal in court.

Audit firms were uncomfortable hiring him while his dispute with the Land Bank remained unresolved. He had no income and his savings were eaten up by legal fees.

The Land Bank seemed intent on bankrupting him just because he insisted on doing his job.

Pikoli’s case is not rare. It is part of a pattern. The public service prioritises obedience over performance. Excellence attracts punishment, while mediocrity is rewarded.

Yet all sorts of programmes have been launched to entice expertise into the public service. Ministers even go overseas to persuade fellow citizens to return. “You’re needed back home,” they plead.

Power has become schizophrenic. It says one thing but conducts itself quite to the contrary. Yet it still insists that its invitation for expertise should be taken seriously.

Even more perilous than schizophrenic behaviour is the political instability that may result from the ruling party meddling in the private sector.

A thriving and independent private sector is vital for both the party and the country. The private sector widens opportunities for a livelihood. This is especially critical for politicians engaged in a power struggle within a party.

Without the possibility of making a living outside the party, feuding rivals become even more determined to fight to the bitter end.

In such instances, “contestation for political power”, as Joel Netshitenzhe noted in a lecture to a gathering of the Young Communist League, becomes a “matter of life and death”.

Netshitenzhe then posed the question, more to his own colleagues in the leadership than to the young audience: “Is it not in the strategic self-interest of political incumbents that those who depart the party political stage get employment and succeed in the private sector, so they should not feel obliged to invoke phuma singene?”

Actually, the private sector has been a useful outlet for rivals in the ruling party. Think back to the rivalry between Thabo Mbeki and the trio of Cyril Ramaphosa, Tokyo Sexwale and Mathews Phosa. Their political ambitions were tainted by false accusations that they were plotting to undermine Mbeki’s presidency. They didn’t retaliate, but bowed out of active politics for a career in business.

The party was saved from potential instability that could have resulted from their retaliation.

But the present leadership doesn’t seem to appreciate the usefulness of the private sector in entrenching their dominance within the party. How else does one explain the case of the Reverend Frank Chikane, who worked in Mbeki’s office?

He tells us that the ANC leadership has blocked prospects of his getting employment in the private sector. In the process, they have turned him into a lethal opponent.

He has written a book detailing how they removed Mbeki from office. It is not only an unflattering account of the present leadership, or what Chikane calls the “ngoku brigade”, but the book is extremely popular and Chikane is flying all over the country giving talks.

This book, Eight Days in September: The Removal of Thabo Mbeki, is certainly not winning the incumbents any friends.

Imagine if Chikane had been absorbed into the private sector. He probably wouldn’t have had the time to write this book. Business kept Sexwale, Phosa and Ramaphosa busy and their growing bank balances even assuaged their pain.

They never wrote best-sellers to tarnishing Mbeki’s presidency.

Conversely, Chikane not only has the motive but also the time to write the book. They’ve turned him into a lethal opponent whose book has hardened the attitude of some to this leadership. The ANC needs a thriving and independent private sector for its own survival.

n Ndletyana is head of the political economy faculty at the Mapungubwe Institute for Strategic Reflections