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CEO actions, voices can stop the Blitzkrieg

Sars book suggests that ratings downgrade may be collateral damage.

South African business leaders are not doing themselves or their country any favours by remaining silent about recent political developments.

Although there have been a few business leaders who have voiced their concerns in public in recent weeks, we need more voices. We need more leaders to ditch the seemingly omnipresent practice of brown-nosing and stand up to publicly condemn the brutal attack on State agencies and the inevitable economic consequences.

I urge all business leaders to read ‘Rogue: The Inside Story of Sars’s Elite Crime-busting Unit’, written by Johann van Loggerenberg and Adrian Lackay.

It is a window into the internal war waging within State agencies and illustrates how virtually every intelligence and law enforcement agency has been captured or destabilised to the point of dysfunction.

The authors also claim that the (very effective) attack on Sars by other organs of the State has its roots in Sars’ investigation into tobacco smuggling and the involvement of politically-connected individuals in this. The book helps the reader to connect the dots in this regard. The only agency that seems to have remained independent is the National Treasury and under the circumstances it is naïve to think that it will remain standing while all other agencies have been captured.

The attack will only intensify.

Make a stand, again

However, all is not lost.

Business leaders have the power to change history. They demonstrated this ability in December last year when Nhlanhla Nene was fired as finance minister. During the days that followed dozens of senior business leaders and banking CEOs, together with a few senior ANC leaders, reacted so decisively that President Jacob Zuma blinked and Pravin Gordhan was reappointed as a concession.

This event also led to the creation of the much-mooted CEO Initiative through which our top business leaders fought side by side with Gordhan to stave off a ratings downgrade. They were successful in round one.

Round two is upon us, but unfortunately it seems as if the initial enthusiasm is waning.

Two CEOs recently remarked over a few drinks that although they still support the initiative, it is clear that government is not as eager to put action to words as the CEOs are.

R1.5 billion SME Fund

The only successful project flowing from the CEO Initiative so far is the recently-announced R1.5 billion SME fund. It is a beginning, but a will not provide the spark for accelerated economic growth. (The new SAA board was selected with the help of the CEO initiative too).

On the contrary, we need aggressive action to address the structural problems of the economy. We need the removal of policy uncertainty, drastic steps to fix State-owned enterprises, aggressive steps to reduce government corruption, deep cuts to the public wage bill and increased accountability of senior officials. Or at the very least, the actual implementation of the National Development Plan, especially the chapters on labour law reform.

In this context a new SME fund is not going to make any difference. It is merely CEOs putting cash on the table to which only around 50% of the participating companies actually contributed.

A ratings downgrade is collateral damage

But back to Van Loggerenberg and Lackay’s account of the war within State agencies. A blitzkrieg is probably a better description for the events leading up to December last year. It was only Nenegate and the emergence of Gordhan that managed to dent the advance.

But Nenegate was only one battle and the war is most definitely still raging. Business leaders must therefore continue the fight with the same vigour as in December last year.

We need more voices. Many more. Sipho Pityana, Neal Froneman and Johann Rupert are lone voices in the wilderness. The voices should also address more than a potential ratings downgrade.

The nature and coordinated nature of the attacks on State agencies such as Sars make any ‘unified’ attempt by Treasury and the CEOs relatively inconsequential, especially in the long-term. It is akin to the Hansie-era of South African cricket where one or two Proteas would play their hearts out to win a game for their country… but the fate of the game had been decided by the captain.

‘Don’t speak out’

I found the closing remarks by President Zuma at the launch of the R1.5 billion SME fund very revealing and ironic: “The meeting [of the Presidential CEO Initiative] appeals to all in our country to refrain from making public utterances that promote a negative narrative about the country which undermine our collective drive to reignite economic growth and jeopardise job creation.” (my emphasis)

This is why we need every voice possible to stand up and put pressure on our political leadership – as we did in December last year.

Tony Leon, former leader of the Democratic Alliance, made a similar plea in an excellent article published in the Sunday Times on September 25. He was however not too optimistic that the business community will heed the call. He wrote: “But don’t hold your breath on business being bold.  While civil society, the political opposition, the media and now the courts have found their voices and postures to counter the misgovernance which is capsizing the ship of State, this does not hold for organised business. It either goes along to get along or simply cannot define its position in the public space,” he wrote.

He needs to be proven wrong.

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The Treasury only has value to the ANC criminals as long as business leaders provide it with a constant stream of tax inflows. In the mindset of the criminal cadre, taxes payed by honest citizens act a motivation for them to take control of the treasury. Taxpayers are complicit in this crime, because we support this criminal organisation called the ANC, financially.

Business leaders should make a stand and refuse to pay over taxes until the ANC government rids itself of the plundering criminals. This will cause a ratings downgrade for sure, but with the ANC in control, a ratings downgrade, and eventual IMF bailout, is inevitable anyway.

Taxpayers should take control and set their demands. We have got all the power. Without our support in the form of taxes, the ANC will implode within weeks. It is time for the next step by big business – stop supporting this government, they are stealing from you!

Set out demands, which if not met by a certain time will result in all taxes being paid into trust account, to be released once demands are met. Far more constructive than burning down buildings and property while causing irreversible damage to the economy?

I agree entirely. Whether corporate SA will have the guts to do this remains to be seen, but this really is the last chance saloon. Foolish and dangerous leadership and putting incompetents in charge such as Myeni is such a glaring contempt that the person responsible (no names no pack-drill) should have gone a long time ago.

Then there’s this insufferable twit Motsoeneng. The SABC have the gall to re-appoint him to a senior position despite the courts having said no ways is another indication of their contempt for the law. It was bad enough when he took a considerable time before acquiescing on the Nkandla issue, and then only for a trivial amount. It’s a pity that he and his band of thieves haven’t been arrested and tried, but it may still happen.

When the dust does eventually settle, as it must do if SA is escape being another failed African state, the constitution must be altered so that no one person can be omnipotent. Leaders must also be properly educated if they are to hold positions of power.

What is happening at the moment cannot impress overseas investors. They must really be chuckling about the tragedy we have at the moment.

The Constitution doesn’t need to be altered. It already provides the checks and balances a constitutional democracy requires. Our problem is that too many of us don’t understand the practical applications (even some judges)and act like we used to in the past, often with evil intent. Zuma and his advisors and seemingly everyone in an executive or board position at the SABC are prime examples.

@Ronaldus. The Constitution allows for one person to reign supreme. Zuma could well try to interfere with the system – he’s a megalomaniac. We have an extraordinary situation in SA where one very corrupt and dangerous man wants it all and has absolutely no shame in going about it. When he goes, there could be another Mugabe stepping up to the plate. That is dangerous, so we should be pro-active. Zuma doesn’t give a rat’s a*** for the Constitution. Let’s be safe than sorry.

What makes one think that the IMF will bail SA out?

I consider that withholding taxes is counter-productive, as it harms the necessary things that taxes are intended to be used for. Look at countries like Greece, where tax avoidance is a national sport.

Rather we need to halt the misuse of state revenues, by corrupt officials that find it too easy to access and divert such funds, such as through capture of state entities and irregular procurement tenders.

Absolutely agree!!!
Our pleas for accountability and the responsible use and spending of our tax money falls on deaf ears.
The plundering seems to accelerate instead of slowing down.
Surely we as taxpayers and SME’s should be able to show our displeasure in some way!!! We cannot leave it all to big business. How can we get our views to be heard by government??

Being fake is virtually engrained in our corporate culture.How many people on a daily basis in the office play the political game,
say the “correct” things and refrain from saying the “incorrect” things, laugh at the boss’ stupid jokes if it gets them what they want, work long hours at the office to be seen rather than actually being productive etc? Even when it comes to corporate social responsibility, companies do good things for those who need it, because it affects the bottom line at the end of the day. That’s why so many marriages fail because that is the one place in life where you can’t pretend. People are fake – and that is just a sad fact of life. Those who speak the truth without fear are the vast minority.

Silent Cyril according to Richard Calland never misses an opportunity to miss an opportunity. Seems like his colleagues in the business community – bar a handful – are of the same ilk.

Chilling…………………..all the fault of cancer since Mbeki.

How is it that so many people can be so corrupt so often. It appears to be ingrained in the dna?

Yes, and they have absolutely no shame or remorse about it. Criminal bunch in urgent need of the boot in the backside.

How can we help? We keep on chirping, but we are getting nowhere. The only voice in the wilderness which gets attention is that of Thuli Madonsela. Perhaps a whisper in her ear to say something like what Ryk is saying might urge her to wake up business leaders to make a stand.

Trouble is that she is coming to the end of her tenure. I have major suspicions about her successor. I suspect he will be ANC oriented so told to shut up about any corruption he finds.

Don’t know whether I am being over cynical, but we have all these splinter organization like Crime Stop, Crime Line, and lead SA which in my opinion are ineffectual. The reason I say this is that through any of these agencies or if they walked around with ears and eyes open they would have seen what is happening in the country and would have stopped the president and his marauding cadres from stealing from tax payers and grant recipients.
Maybe it time we had a hash tag to get rid of Zuma – something pithy like Zip Zuma or Zap Zuma or even Pi%% O%% President could be the rally call

No doubt we have to do something – just bitching is not going to stop this madness.
However we must also bear in mind that we have people like: Tina Joemat-Pettersson Minister of Energy
Chairperson Baleka Mbete.
SAA board chairperson Dudu Myeni
Hlaudi Motsoeneng
Mineral Resources Minister Mosebenzi Zwane
amongst others.
But getting rid of Zuma will surely help. Only question is HOW!

Now that nuclear has been postponed for the time being, there should be enough U237 or whatever at Koeberg that can be used to irradiate the energy minister. A few billion quanta of charmed gamma quarks, and she won’t know if she is dead or alive (Heisenberg’s principle)! 🙂

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