CAPE TOWN - There is always a fear that the Public Investment Corporation (PIC), which manages R1.9trillion on behalf of a number of clients including, most importantly, the Government Employees Pension Fund (GEPF), is vulnerable to being “captured” by powerful public or private interest groups in South Africa.
That is why we have campaigned hard over the past couple of years for greater transparency at the PIC.
The campaign culminated in the decision by the PIC chief executive, Dr Dan Matjila, to disclose information about investments in its “unlisted portfolio”, which were valued at R44.6billion, for the first time in 2016.
The fact that the information was made public was significant because we were able to scrutinise the 250 investments in the “unlisted portfolio” for the first time, and the expectation that the information would be disclosed in the future would disincentivise “rent seekers” with political influence from trying to raid the PIC.
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Reforms needed
Former deputy finance minister Mcebisi Jonas and the PIC chief executive were courageous and deserved full credit for opening up the PIC.
It should never have been allowed to withhold information on any investments from Parliament.
The campaign for greater transparency paid off, however, it now needs to be complemented with a comprehensive set of reforms aimed at strengthening good governance and transparency.
We need to ensure that, as far as possible, the PIC is “firewalled” from being captured by powerful public or private interest groups in South Africa.
That is why I submitted a copy of a private members’ bill, entitled the Public Investment Corporation Amendment Bill (B-2018), to National Assembly Speaker Baleka Mbete for tabling in Parliament.
The amendment bill aims to promote good governance and transparency at
the PIC.
Like any other piece of legislation introduced by a member, the bill was submitted in terms of Section 73(2) of the constitution, read together with National Assembly Rule 276 (2), following publication in the Government Gazette (number 41215) on October 31 last year, and will now be processed like any other piece of legislation in terms of National Assembly Rule 276 (3) in Parliament.
Amendments proposed
To strengthen good governance and transparency at the PIC, the proposed piece of legislation suggests a number of amendments to the Public Investment Corporation Act (number 23 of 2004) to ensure, most importantly, that the chairperson of the PIC will be appointed by the minister on the recommendation of the National Assembly and will have the necessary expertise, qualifications and good character as required by the Financial Advisory
and Intermediary Services Act (number 37 of 2002);
The board of the PIC will include representatives of registered trade unions, whose members will form the majority of the members of the GEPF.
All directives, including any updates of the “Strategic intent statement by
the minister of finance to the public in-
vestment corporation SOC Ltd for the reporting period 2015-2016”, will be tabled in Parliament.
All regulations relating to the PIC will also have to be tabled in Parliament; and a report reflecting all investments, whether listed or unlisted, be tabled in an annual report and published on the website of the PIC.
We are sure that if the Public Investment Corporation Amendment Bill were to become law it would go a long way to ensuring that the PIC is “firewalled” from being captured by powerful public or private interest groups in the country.
We look forward to deliberating on submissions from interested parties, including political parties, trade unions and other stakeholders during the legislative process, which we hope will sharpen the Public Investment Corporation Amendment Bill and strengthen good governance and transparency at the PIC.
DA MP David Maynier is his party’s spokesperson on finance and a member of the Standing Committee on Finance in the National Assembly.
The views expressed in this article are not necissarily those of the Independent Group.
- BUSINESS REPORT