Press "Enter" to skip to content

Just a thin line that keeps SA from going bust

When a top businessman like Johann Rupert states unambiguously to his shareholders that the country is in the dwang and going bust slowly, the riposte is predictable. It’s along the lines: “Of course he would say that. He’s an old, white, wealthy Afrikaner, hankering for the days when his Nationalist Party mates ran things.”

They miss the point that Rupert has over the past 20 years punctiliously tried to reassure international investors that his beloved country is open for business. It is also to miss the point that billionaires are largely indifferent to the inability of the state — any state — to provide what we, the hoi polloi, need to live moderately contented lives.

After all, when you are insulated from grim realities by the alternatives that wealth can instantly procure, public goods such as effective policing, potable water, reliable electricity, a good basic education, and an honest, diligent civil service, are relatively unimportant.

So given the jeers, it is serendipitous that Rupert’s remarks came in the same week that Auditor General Kimi Makwetu released his annual report on the financial probity of SA’s public entities, as well as national and provincial government departments, of which there are a staggering 469 — perhaps the world’s longest gravy train.

The other stunning statistic is that of an annual R1 trillion state budget, close on 7% has been found to be inappropriately spent. Irregular expenditure amounted to R62.7 billion and unauthorised expenditure was R2.6 billion in the 2013/14 financial year.

Perforce, only a fraction of government expenditure is ever audited, so it is likely that the real loss to wastage and corruption is at least double the R65.3 billion that has been identified. Only 119 entities received clean audits and almost half of the irregularities occurred in previous financial years, but were only uncovered now.

As Rupert put it this week, “I’m concerned that we are not prioritising the right things … How can a person not have electricity? How can we create jobs?”

Or as Makwetu put it, voicing his “concern” that the worst offenders were the departments of health, education, human settlements and public works, the ministries that provide the most essential public services: “[They] have largely failed the audit test.”

Or as observed Cedric Frolick, ANC MP who chairs the parliamentary oversight committee, castigating the officials in these failing departments who never face any consequences for their wastage: “It’s a symptom that will ultimately destroy the fibre of certain departments but also the social fibre of our country.”

That’s not too different from how Rupert sees things: “We picked low-hanging fruit for a very long time. Those trees are now starting to empty.”

Makwetu was riled, too, over the R386 million spent by government on outside consultants to ready themselves for audit. These entities all have finance departments but when an audit is due “they are running around trying to find help … because there are accountants [in these departments] who cannot produce financial statements because they do not know how to”.

Or as Rupert put it: “The people who are running the country now were not given proper education. Wherever you look we have got stagnation and really worrying signs.”

Essentially the same sentiments about the importance of education and training were expressed a few weeks back by Advocate Richard Sizani, the acting head of the public service commission, albeit more elegantly: “The aim of affirmative action was never to promote the principle that incompetent persons should be appointed merely because they are black.”

While affirmative action is necessary to redress the imbalances of the past, said Sizani, ‘‘It has never been the position that where there is no qualifying black candidate, you must not appoint an available white candidate … the notion of job reservation as part of affirmative action is not correct. It’s not allowed.”

Mired as we are in a constant drizzle of bad news, it is easy to forget that one of the saving graces of the new South Africa is its robustness. Everyone has a view and most people speak forthrightly, with the exception of swathes of cowed academics and business leaders.

While it is pleasing that Rupert has broken ranks, he does have a certain immunity because of his wealth. Far more encouraging that there still is an echelon of old-school public servants — Makwetu, Sizani and the likes of Public Protector Thuli Madonsela — who despite being vulnerable to ANC browbeating, understand that they have a duty to call it like they see it.

Regarding the SA economy, Rupert also cited Ernest Hemingway’s observation that “a man goes bust gradually and then suddenly”. It is increasingly up to this small corps of admirable men and women, to prevent just that happening.

Follow WSM on Twitter @TheJaundicedEye


  • William Saunderson-Meyer

    This Jaundiced Eye column appears in Weekend Argus, The Citizen, and Independent on Saturday. WSM is also a book reviewer for the Sunday Times and Business Day. Follow @TheJaundicedEye.