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Unions fighting to save PIC from state capture

Publish date: 11 October 2017
Issue Number: 208
Diary: Legalbrief Workplace
Category: General

Unionists are stepping up the fight against state capture, demanding to sit on the board of the Public Investment Corporation (PIC) and that criminal charges be laid against Trillian and Eskom. Business Day reports that SA Federation of Trade Unions (Saftu) general secretary Zwelinzima Vavi is taking on Eskom, Trillian and McKinsey, and the Federation of Unions of SA (Fedusa) has weighed in on the upheaval at the PIC. Vavi laid further charges of fraud, theft, corruption and money-laundering against Eskom and Trillian, while Fedusa wrote to Gigaba demanding representation for workers on the PIC board. Saftu and Fedusa are the country’s second- and third-largest union federations.

Full Business Day report

Fedusa said it would consult rival federations over withdrawing an investment mandate the workers' pension fund has with the PIC, one of the continent's largest asset managers, reports Business Report. Dennis George, Fedusa general secretary said they would urgently consult all their structures and other trade union federations, such as Cosatu, over the pension fund concerns. George said the possible withdrawal of the investment mandate was necessary to protect the asset manager against political interference and to protect the pensions and savings of public sector workers.

Full report in Business Report

Finance Minister Malusi Gigaba had earlier asked the board of the PIC and its CE Dan Matjila to conduct a forensic investigation into concerns of irregularities at the state-owned asset manager. According to a Mail & Guardian report, Gigaba has also asked the PIC to provide a list of all the investments it has made, and their beneficiaries, to the National Treasury, which he intends to make public. It comes a week after the board concluded an internal investigation into allegations against Matjila, which cleared him of any wrongdoing. The probe was led by the PIC’s audit unit. Gigaba said that his request was aimed at reassuring pensioners their money was safe. The report says trade unions have been vocal critics of the machinations playing out at the PIC and warned that they would act to protect workers' money.

Full Mail & Guardian report

Deputy President Cyril Ramaphosa has urged union members attending of the SA Democratic Teachers Union’s (Sadtu) national general council to keep a close eye on the PIC, which he said he heard was being looked at ‘with dangerous eyes’. ‘You, as members of the union, must make sure it is protected because it manages your money,’ he is quoted in Business Day as saying. Ramaphosa said that workers had the responsibility to ensure public institutions were not used to achieve the political interests of certain people or to cover up failures. He echoed sentiments expressed by Cosatu and Fedusa that there should be at least two workers’ representatives appointed to the boards of the PIC and other SOEs.

Full Business Day report

Moves are afoot to propose far-reaching amendments to the PIC Act to enhance transparency and strengthen the asset manager’s board. Business Day reports that the initiative comes amid mounting concern that the PIC has become the target of those with an eye on the R1.87trn it has under management. The DA's proposed Bill would put an end to the appointment of the Deputy Finance Minister as the chair of the PIC and provide for a new method for the appointment of the chairperson, in which Parliament would play a significant role. It also provides for the appointment of representatives of the PIC’s major clients, including the GEPF and the UIF, to a 12-person PIC board. Two board members will be executive directors and one a representative of the Treasury. DA spokesperson on finance David Maynier said the proposed Bill built on the party’s campaign to ensure the PIC made public particulars of all 'unlisted investments', which were worth about R45bn.

Full Business Day report