Global South African News Wrap 16 November 2012

Tokyo's tax cuts Absa BEE benefit Motlanthe's failure to launch Insult law will make SA like ZimVavi Unrest can be laid at states door SAs recent labour unrest has been a long time coming De Doorns protests set off political opportunism Zuma will bequeath to ANC era of introversion State spent money on security upgrades, not Zuma home Cosatu keen to learn in Lula moment Strike wave, euro jitters drag rand near R9/$ 'Cops shot the wounded' S&P downgrades Gold Fields rating to junk status Zuma: I pay my way Joemat-Pettersson playing with fire Committee gets more time for secrecy bill Cosatu to take broker ban to Mangaung Ailing Telkom warns of 83% earnings drop Scramble to raise farm wages amid Cape havoc Police recover prized stolen SA artworks War threat in Mozambique No easy way to end xenophobia in SA Lekota may jump ship as COPE faces disappearance Platinum deficit risk as SA unrest cuts output Minister lauds strikers victory in Cape farm protest Competition Commission declines to probe SAA Nkandla, Marikana continue to be focus Master of the art of praising his foe Revolt over low wages Rebel with a cause Tutu wins R8.7m Inquiry given key to arms deal allegations ANC is running scared SA elected to UN body

16 November 2012 Mail and Guardian James Wood, Craig Mckune, Stefaans Brmmer Tokyo's tax cuts Absa BEE benefit Hundreds of thousands of beneficiaries' joy when Absa Bank's Batho Bonke empowerment consortium distributes R2-billion at the end of the month will be tempered by a "tax for Tokyo" a deep cut in their proceeds that, it has emerged, they owe to presidential hopeful Tokyo Sexwale and his partners. There was much fanfare over Batho Bonke's broad-based character when it was announced in 2004. As always the lion's share went to the well connected, but a significant portion was earmarked for community trusts, women's groups and others said to represent more than a million beneficiaries. Sexwale, then in business and now human settlements minister, was the lead promoter. Now, after eight years, the deal is being unwound. Batho Bonke sold most of its Absa shares last month, leaving an estimated R2.2-billion to be distributed to Batho Bonke shareholders on November 28. Of this, about R200-million will flow to Mvelaphanda Holdings, the private investment company of Sexwale and two partners, by dint of its original 20% stake in Batho Bonke, subsequently diluted to about 9.5%. Mvela demand But in the run-up to Batho Bonke's unwinding, many other consortium members were confronted with a Mvela Holdings demand for 25% of their anticipated benefit which on the Mail & Guardian's calculation would have given Sexwale and his partners another R300-million on top of the R200million they were already getting. In a Mvela Holdings statement to the M&G, which it subsequently withdrew, it put the same figure at R200-million. Two sources close to the events have confirmed that Mathews Phosa, a coarchitect of Batho Bonke and now ANC treasurer general, was among those who were particularly upset. Phosa is believed to covet the ANC deputy presidency at Mangaung in opposition to Sexwale. He declined to comment. Mvela Holdings subsequently halved its demand to 12.5% still, by the M&G's calculation, a "tax" of about R150-million on the gain of other Batho Bonke members. The company's withdrawn statement, without being exact, put it at about R90-million. The matter was raised, somewhat obliquely, in Mvelaphanda Group's annual report released at the end of September. Subsequently renamed New Bond Capital, it is a listed entity no longer under the control of Mvela Holdings. It said that "during the current financial reporting period it was determined" that some of the Batho Bonke members owed Mvela Holdings for money lent originally to buy into the consortium.

"These loans are repayable on value realisation of the Batho Bonke shares at the higher of: principal plus interest which would have been earned at a rate of prime plus 5%; or the repayment amount, which is equal to 25% of the value actually realised by the borrower." It added that there was an "indication" that the 25% would be reduced to 12.5%. Unusual terms The reason Phosa and other Batho Bonke members were upset appears to be the unusual terms of the Mvela Holdings loan to consortium members. Absa's 2004 circular detailing the deal stated that R7.3-million of the R146million the consortium needed to buy into Absa had come from Batho Bonke's "initial members" and the balance from Sanlam. Now it turns out that the R7.3-million had come not from all initial members, but from Mvela Holdings and that it had been structured as a loan with highly onerous terms. In a nutshell, others in Batho Bonke had to repay Sexwale and his partners at whichever was the higher of:

The loan plus interest at prime plus 5%. Assuming monthly compounded interest, this would have grown to R28-million repayable to Mvela Holdings today; or An upside of 25% of the value realised by Batho Bonke members. Calculated on the estimated R2.2-billion value realised by Batho Bonke, but of which only a little more than half was encumbered by the loan, it would have given Tokyo and partners about R300-million as repayment for their R7.3-miilion.

Assuming that Absa's share value continued to grow, which it did, the second option was always likely to be the higher of the two. And even with the subsequent reduction in Mvela Holdings's demand to 12.5%, or about R150million or about R90-million on the withdrawn version from the company the repayment remains out of all proportion to the original R7.3-million.

Response from the players Tokyo Sexwale Sexwale's spokesperson: The minister does not comment on operational or other activities of companies he no longer runs. Mvela Holdings The entire deal was developed and implemented with complete transparency. It is, without question, one of the most successful broad-based black economic empowerment deals in South Africa and no amount of nitpicking by the Mail & Guardian will take anything away from that. Batho Bonke We prefer to discuss matters of this nature directly with shareholders, rather than through selectively structured newspaper articles."

Absa The matter relates to Mvela Holdings-Batho Bonke and we ask that you direct your queries to them. Absa was not involved in the funding provided by the initial members in 2004, so is not aware of the terms attaching thereto.

'Unhappiness' One Batho Bonke partner said the size of the demand had caused "a hell of a lot of unhappiness". Arguably, had they realised the full implication of how the loan was structured, members could have sourced their own funding. To illustrate, had the R7.3-million been borrowed at prime, only about R18-million would be owed today. Sexwale placed his interest in Mvela Holdings in a "blind" trust when he reentered government in 2009. Although he still enjoys the benefit of its investments, he and the company say that he no longer participates in its decisions. Sexwale is thought to be the beneficial owner of at least a third of Mvela Holdings, which could give him a whopping R100-million or more from Mvela's own Batho Bonke dividend plus the "tax" on others. Some may regard this dividend as impeccably timed to pave Sexwale's way to Mangaung. Apart from what will accrue to him personally, a raft of others influential enough to make a difference will be approaching the ANC elective conference with newly enhanced bank balances. Batho Bonke was initiated in 2004 by Sexwale, who appointed Leslie Maasdorp, a former department of public enterprises deputy director general, and then-Mvela Resources chief executive Nthobi Angel as co-promoters of the deal. They appointed regional co-ordinators to assemble and lead nine groupings from across South Africa. These, and further broad-based elements, helped to make up what Absa said at the time was "more than 1 175 000" beneficiaries. Influential people Subsequent media reports revealed how a host of influential people politicians, spies, a judge and journalists had been cut in too. Senior ANC politicians such as Phosa were among the regional co-ordinators or dispersed among the sub-groupings, whereas a 2007 City Press article named former spy bosses, Billy Masetlha included: the spouses of former ministers Zola Skweyiya, Penuell Maduna and Thoko Didiza; the mother of Essop and Aziz Pahad, a former minister and deputy minister respectively; KwaZulu-Natal judge president Vuka Tshabalala; and journalists such as the SABC's then-acting political editor Sophie Mokoena.

But therein lies the rub for Sexwale. Whatever goodwill the Batho Bonke payout might have bought for him among potential supporters en route to Mangaung is potentially undermined by resentment at his "tax". 14 November 2012 Mail and Guardian Nickolaus Bauer Motlanthe's failure to launch Even with firm support from the ANC Youth League and the majority of ruling party branches in Gauteng and Limpopo as well as a measure of support from the North West and the Western Cape Motlanthe remains guarded about the likelihood of a challenge to Zuma, and this is hindering his prospects. One month away from the elective conference, Zuma as the incumbent is already showing signs that he expects to be re-elected. Speaking at a rally in the Eastern Cape, Zuma said there would be a "change of gear" post Mangaung in the ANC's approach towards discipline. "There will be a change of gear when we return from Mangaung, because we realise that when you merely talk to a person they take it for granted this organisation is full of idiots," he said. While Zuma's confidence cant be attributed solely to Motlanthes relative absence from the campaign trail, it is certainly helping Zuma and doing his deputy a disservice. Motlanthe has largely been keeping within the ANC tradition of allowing ruling party branches to choose their candidate, rather than canvassing for support. My position is that nobody must try to canvas for themselves in the run-up to elections. It is up to the will of the branches, Motlanthe is quoted as saying in Ebrahim Harvey's biography about him. Campaign by association However, while Motlanthe has done his best to distance himself from electioneering, any signs that he is indeed in the running have been pounced upon. At the beginning of November, Motlanthe shared the platform with three known Zuma detractors ruling party treasurer Matthews Phosa, human settlements minister Tokyo Sexwale and ANC youth league deputy president Ronald Lamola at a rally in the birthplace of ANC struggle icon Oliver Tambo.

It was widely interpreted as the formal beginnings of Motlanthes push for the presidency, after he remarked that ANC members should be able to choose the partys leadership without fear or favour. "There is no doubt about it that we need renewal or we're going south. It [the Mangaung conference] will represent a tipping point, depending on what happens," Motlanthe told supporters. But this was not enough to satisfy the appetite of those in search of change at Mangaung, and a campaign by association developed. Kgalema is a disciplined cadre and we are very comfortable with his strategy and will even help if needed, a ruling party source who requested anonymity but claimed to be at the forefront of the deputy presidents campaign told the Mail & Guardian. Online campaigns In the weeks following that appearance, web and social media campaigns bearing the deputy presidents name began gaining momentum. A website, Forces of Change, calls for a leadership shift at Mangaung, as South Africans do not have confidence in the leadership of President Zuma. It even collates all evidence that is published in the mainstream media that Motlanthe's candidacy for the ANC presidency is not only popular but necessary. Two anonymous Twitter feeds, @Team_Motlanthe and @ANCKgalema, have also emerged. Following the same modus operandi as the website, these accounts promote all causes associated with Motlanthe's candidacy. The @ANCKgalema feed could easily be mistaken for an official account, with posts that claim he is indeed in the running for the ANCs top job. I have decide to accept the nomination of president of the ANC, a statement will be released. Thank you cadres for putting trust in me, reads a tweet from October 14. While this strategy appears to be disingenuous, Motlanthes supporters feel it is a necessary and effective way to deliver victory to him in Mangaung. Juxtaposed with a Zuma campaign (tacit or otherwise) that has seen supporters of the president reportedly storm branch meetings and threaten members with violence, Motlanthes circumspection can be seen as much more refined approach.

In the ANC you dont stand on a building and scream for people to come follow you. Thats childish and primitive. Youre not even supposed to secretly campaign like Zuma, the source added. And while people are actively canvassing in his name, Thabo Masebe, Motlanthes spokesperson, claims that Motlanthe is not involved in any campaign. Motlanthe 'won't be pushed' The deputy president has never and will never seek election for higher office within the ANC, Thabo Masebe, Motlanthes spokesperson, told the Mail & Guardian. Thats what all ANC members are supposed to be doing and what he will do that wont change. He [Motlanthe] fulfils positions he is requested to by the people of the movement. He wont be pushed into campaigning for one group, he added. Masebe also downplayed the significance of Motlanthe being seen at public events or associated with Zuma detractors. The events youve seen him at are merely ones he attends at the behest of the ANC. The deputy president also cant control who is there and what people he shares the stage with, he said. So with two weeks to go until ANC nominations are formally closed at the end of November, there is certainly no clear sign that Motlanthe is running for or even wants - the ANC presidency. I dont think its fair for him to comment and pre-empt anything. He will leave that type of thing for the ANC membership to decide, Masebe said. This is an issue for those seeking his election. As Mangaung grows nearer, Motlanthe needs to offer some sign of having an appetite for a leadership challenge. And popular as he may be among Zuma detractors, he will need to demonstrate that he deserves the ANC presidency and that he is more than just a default alternative to the current status quo. So far there have been no signs of this, and while he waits, and while others campaign on his behalf, the Zuma camp will continue to gain momentum and can rightly expect re-election for the president come mid-December. 16 November 2012 Cape Times Page 1

BabaloNdenze Insult law will make SA like ZimVavi South African Communist Party (SACP) general secretary Blade Nzimande has called for a law protecting President Jacob Zuma against insults, the Star reported on Thursday. Nzimande was backing a call made by the SACP in KwaZulu-Natal on Monday, for a law protecting the presidency from attacks that were "unfair, and lacking in fact and truth". "People can differ with me and you can insult me as you like, but disrespect, that is not acceptable," the higher education and training minister was quoted as saying. The SACP's comments were made after critics of upgrades at Zuma's rural homestead in Nkandla were labelled racists. In May this year, the ANC and supporters labelled Brett Murray's the Spear artwork, depicting Zuma with his genitals exposed, as degrading and racist towards the president. These suggestions immediately drew the ire of legal experts and opposition parties, who claimed any such law would violate the Constitution. "No such law would have any prospect of success," Dene Smuts, Democratic Alliance spokesperson for justice said. Violation of the Constitution "Free speech is, among many other things, instrumental in ensuring democracy by allowing exposure and discussion of the views and conduct of political leaders." This was echoed by constitutional law expert Pierre de Vos, who said the touted law would not work, as it would be in conflict with the constitutional principle that no one is above the law or more equal than others. But a quick look at various laws around the globe illustrate that even countries regarded to have relatively strong media freedom and acts underpinning freedom of speech have statutes outlawing the insult of elected officials. For instance, France's 1881 law on the freedom of the press prescribes punishments for insult to the president, public officials and foreign dignitaries. Punishment used to include prison terms but reforms of the law in 2000 have seen it limited to fines. However, an insult to the president of France could see you smacked with a 45 000 fine. In Spain the calumny laws prohibit the defamation of public officials or the Spanish royal family and their descendants through insults but can only be

enacted if the said insult is proved to be untrue. Punishments for breaking calumny statutes are also limited to a fine ranging from six to 24 months wages. However, Turkey comes out tops in terms of punishment in Europe for insulting their president. As per article 299 of the Turkish penal code, a person defaming the president shall be imprisoned for a term of one to four years. If the insult in question is made public, the resulting sentence will be increased by one sixth. Harsh penalties Moving to Latin America, countries seen to be developing strong media freedoms still carry harsh penalties for those insulting heads of state of elected officials. Brazil, in spite of intense reforms of press law enacted in 2009, still carries the prospect of a six-month jail sentence or a hefty fine on its statutes if an individual is found guilty of defaming the president or government members. Stranger still are defamation laws in Colombia, where hundreds of reporters are part of a protection programme to shield them from threats of armed groups unhappy with their reportage on the drug trade in that country. In spite of their protection of journalists, anyone proved to have insulted an elected government official will be punished by imprisonment of one to four years and a fine ranging from 10 to 1 000 times the minimum wage in that country. In Asia, laws prohibiting perceived derogatory statements against government officials or royalty are even broader and more stringent. Thailand's 2007 Constitution, for example, states the king is in a position of "revered worship" and shall not be violated under any circumstances. Those found guilty of doing so can expect a 15-year jail sentence. In China, government defamation laws are wide, with anyone found guilty of instigating the subversion of the political power of the state being slapped with a five year prison term. Flogged for insults In the Middle East, penalties become even more archaic. In Iran, anyone convicted of insulting any government leaders will be sentenced for up to 24 months or can opt for a flogging of 74 lashes and a fine. Closer to home, many sub-Saharan countries carry Acts prohibiting the insult or criticism of government officials.

In Zimbabwe, article 33 of criminal law states that anyone found guilty of undermining the authority of or insulting the president will face a fine and/or one year in prison. Rwanda's 2009 media law also outlaws any contempt of the head of state and hands down three month jail terms and/or a fine to anyone found guilty. The same goes for Zambia, where defaming the head of state is a criminal offence that carries a jail sentence of up to three years. Five years of imprisonment and a US$4 000 fine also awaits any individual in Cameroon that is found guilty of insulting the president or the vice-president.

16 November 2012 Business Report Features Page 20 Ann Crotty Unrest can be laid at states door Betty Fortuin, with more sadness and frustration than anger, said: Were not fighting the farmers, we need them, they need us, we must work together but they must see our needs. What if the farmers cannot afford to pay you more? They say they do not make enough money, I point out. I dont believe they cant afford to pay us more, they are rich, said Elsbeth, Bettys friend. I grew up on farms, they always have lots of groceries, they buy so much meat that they have to keep it in the freezer and its old and doesnt have any taste when they eat it. Other evidence of the wealth of farmers is their ability to pay cash for their cars and to send their children to university. Among the farmers in the Hex Valley, there are no signs of the excessive opulence that is so often associated with the lifestyles of executives of JSElisted companies. But for Betty, Elsbeth and the thousands of seasonal workers protesting in the region, wealth is relative and to them the farmers appear rich enough to afford the increase to R150 a day. But there is also an absolute dimension to the situation facing workers who are paid between R69 and R80 a day. The money is too little, we also have to shop at Shoprite and Spar, we have to pay the same price as rich people, there arent cheaper shops for us, Fortuin told Business Report. But is this the problem for farmers who are operating in an environment with such a massive surplus of labour that the market-clearing rate might be lower than R69 a day.

Individual farmers are reluctant to talk to the media and AgriSA, which speaks on their behalf, remains committed to the view that the increasingly violent strike action is not just about pay. Other factors include, among others, a strive for competing unions to get a foothold in agriculture, tension between the work status of Lesotho and Zimbabweans due to a differentiated position by the government in this regard, the mobilising of unemployed and persons unrelated to the issue for political gain and unsatisfactory service delivery by local government structures in the informal sector. This view is repeated by trade union Solidarity, which says that the unrest is not really a strike. It certainly is the case that permanent farm workers, who generally live on the farm and enjoy better conditions than the seasonal workers, are not involved in the unrest except to the extent that they are prevented from working because of intimidation. And there is some evidence of opportunistic politics at play. But to dismiss the unrest as the work of politically motivated vandals is to ensure that next year or the year after we will again be looking at scenes of burning tyres and spent cartridges on barricaded roads. The issue of precisely what the farmers can afford involves a complex interaction of financial factors and labour market considerations. From a financial perspective, what the farmers can afford requires an analysis of the marginal productivity of the seasonal workers. If the income generated for the farmer by the seasonal workers does not exceed R150 a day then no amount of reviewing the minimum wage will secure employment at that level. If it does exceed R150 then protests and government involvement may be one way of otherwise powerless workers securing a greater share of their productivity. The affordability issue should be seen in the context of the farmers selling 4.5kg boxes of grapes to European supermarket chains for around R45 a box. Tesco and Waitrose, which are two of the major UK retailers, are selling grapes at 4.50 (R62.98) a kilogram. This is equivalent to approximately R315 for the box sold by the South African farmer for R45. This years weaker rand may provide some support for local farmers but the buying power of the major European retailers and growing competition from China and South America ensure that local farmers are price takers. The local farmers are also facing steep increases in input costs such as electricity and oil. Just as Betty Fortuin has to pay increasing electricity

charges and her friends in the squatter camp are having to pay much more for their kerosene. But even if it emerged that the marginal productivity of seasonal workers exceeded R150 a day, farmers could argue that market forces dictate that given the huge and in the Hex River Valley growing surplus of labour, they need only pay the rate required to entice an individual to work. In terms of free-market analysis, anything above that level would be tantamount to altruism. For the government, as it considers what can be done to ease the plight of these desperate individuals, the irony is that its own public works programme appears to have set the rate that farmers use as a benchmark for seasonal workers. According to the Western Cape provincial co-ordinating office of the expanded public works programme, the minimum wage is R66.30 a day for unskilled workers. If the farmers are under pressure to increase pay, it is possible that the government will also be forced to increase its pay for public works programmes. This is another one of the many complexities in an extremely fraught situation. In Robertson on Wednesday, Enoch a community-based organiser who seemed determined to restore an element of calm, said he wasnt sure if the economy could afford the R150 demand, but said something had to be done. 16 November 2012 Business Report Opinion & Analysis Page 18 Terry Bell SAs recent labour unrest has been a long time coming There should have been no surprise or outrage expressed by mining companies, agribusiness, and government officials about the recent explosion of strikes and protests on mines and farms. And trade unionists across the board should not have been caught flat-footed by the outbursts of anger that erupted in the North West, Limpopo and now in the Western Cape. That many of these parties expressed surprise is a clear indication that they had been smugly complacent; that some then voiced outrage, along with calls for harsh crackdowns, seems a reflection of gross hypocrisy: no interested party can claim to have been ignorant of the plentiful warnings about what was brewing, especially on the farms and plantations, but also on the mines. There have been reminders throughout the years, not the least of which being Cosatu general secretary Zwelinzima Vavis repeated warning about a ticking time bomb of poverty and unemployment. But most of these warnings were ignored until August last year.

It was in that month that this column noted: The plight of a probable majority of farm workers in South Africa has finally made it onto the main news pages and has led radio and television newscasts. Finally made it was the phrase used because similar complaints, relating to mines as well as farms, along with often well-documented evidence, had been available for 10 years and more. The evidence that last year triggered a minor media storm, along with implied warnings of trouble to come, was contained in a report by the Africa section of Human Rights Watch. The report, entitled Ripe with Abuse: Human rights conditions in South Africas fruit and wine industries, was based on more than 260 interviews and covered 60 farms in the Western Cape. The survey and the interviews were conducted over a nine-month period from September 2010. After a flurry of publicity that raised hopes among farm workers, especially in the Western Cape, nothing changed. But anger grew in the agricultural sector, especially because the Human Rights Watch report had revealed nothing new; it amounted in many ways to a reiteration of complaints lodged over the years by various groups such as the Black Association of the Agricultural Sector. This group and others consistently called on farmers to open the books to reveal whether they were paying a fair wage. The association conducted a two-year survey on 65 farms and also released its results last year. The major complaints listed were not only about pay, but about abuses of the existing labour laws and of rights enshrined in the constitution. Because, as has now become clear as the current strike wave erupted, pay demands are merely the symptom of a much deeper-seated malaise and one that has gone untreated despite the desperate pleas of the working poor, on farms, in forests and mines. At fault are not just mining companies and farm and plantation owners who adopt a cavalier attitude to labour and human rights. Equally guilty are government agencies that do not enforce existing laws and, in the case of farm workers, a department and ministers that establish poverty level minimum wages. However, agricultural unions and human rights groups tend to agree that, while conditions on many farms in the Western Cape are bad, they are perhaps marginally better on average than the conditions endured by many farm workers in regions of Limpopo, the North West and Mpumalanga. And in

the agricultural sector, forestry workers receive the lowest pay and endure the worst conditions. Yet this is a sector in which the government through its holdings in state forests has a direct interest. Like mining and farming, the forestry sector also employs a large number of temporary workers, often hired through labour brokers. In the De Doorns area of the Hex River Valley where the Western Capes Marikana moment erupted, there are as many casual workers, employed mainly during harvest time, as there are permanent workers. And there are also many unemployed men and women and their families desperately hoping for work. Over the years the number of work seekers has grown. Like Marikana, widely seen as the trigger for the current unrest, De Doorns also features shack settlements that have mushroomed in recent years. As more and more hungry and desperate people move to these potential sources of work, squalid conditions and competition for jobs increases. This creates an environment readily exploited by unscrupulous labour brokers and employers. With a surplus of workers desperate for jobs, they are able to drive down already low rates of pay. In the De Doorns area this led to outbreaks of xenophobic violence in 2008 as South African workers turned against migrants from Lesotho and Zimbabwe who they accused of working cheaper. Anger has again burst into the open, although not, this time, aimed at other workers. Farm owners are the target because, the workers complain, many simply flout the labour laws. This has led to a demand repeated over the years: Where are the labour inspectors? This week strikers also asked: Where were the [established] trade unions as the abuses continued? Cosatu is now very much in evidence, but the fact that there has been a high degree of nihilistic anarchy in parts of the Boland this week reveals the absence of established, trade union organisation. However, 11 organisations, including unions, have now come together as the Coalition of Farm Workers to establish some control, at least in the De Doorns area. But as the protests spread it is obvious that there are any number of ticking time bombs. They comprise pent up anger, frustration, bitterness and desperation and when they explode, the results are invariably messy, often ugly but amount, effectively, to demands for fairness and democracy. Obviously, such situations can be taken advantage of, distorted, suppressed or betrayed. But unless the underlying causes are comprehensively dealt with,

the anger and resentment may ebb, but perhaps only into even more lethal wells of bitterness, creating bigger time bombs for the future.

16 November 2012 Business Report Opinion & Analysis Page 18 Donwald Pressly De Doorns protests set off political opportunism The cancer of racism has started to infect the foundations of South Africas ruling party. It was just a matter of time that anti-white sentiment expressed by President Jacob Zuma and echoed by Agriculture, Forestry and Fisheries Minister Tina Joemat-Pettersson finally triggered the explosions on the wine and table grape farming areas of the Western Cape. The Western Cape is a DA-ruled province. The farmers, in the main, are white Afrikaners. The so-called farm workers who have been protesting are now being organised by Cosatu, which had found its collective organising pants down at Marikana but now quickly swept in to create maximum chaos. Quickly the ANCs failed mayoral candidate in Cape Town, Tony Ehrenreich, in his capacity as Cosatu regional secretary, fanned the flames of resistance by urging on Monday that it should be stepped up on a national scale. After the national government was embarrassed by this, the coalition of NGOs of which he became struggle chairman on Monday, withdrew the call and pushed for the suspension of hostilities while something was done about the minimum wage sectoral dispensation. The problem is that the bulk of the protesters are not genuine farm workers at all many are Lesotho and Zimbabwean exiles who have fled economic black holes at home to such places as De Doorns. Pieter Dirk Uys, the political satirist, says hypocrisy is the lubricant of politics. There was plenty of it at a media briefing on Wednesday attended by the agriculture minister, Trade and Industry Minister Rob Davies and acting Labour Minister Angie Motshekga, who stood in for Labour Minister Mildred Oliphant who is abroad. Davies, who is MP for Worcester, De Doorns, Ashton and Wolseley, where a worker was shot dead by police on Wednesday, said that he had visited the area a number of times. He had long known it was a flashpoint, but somehow couldnt get the message across to his colleagues. It takes a crisis like this to alert the government that there are problems on the ground. He warbled on about the fact that farm workers didnt feel that they benefited from the industry. Then Davies, who has just been marketing South African products in Brazil, found himself carrying out verbal acrobatics to explain why

he did not support a boycott of wine products called by the ANC in the Eastern Cape. They said they did so in support of raising workers pay to decent levels. The flaw in the argument is that they are not workers. If a little digging was done, one would probably find that many of the farms had good equity ownership systems in place, the bulk of farm workers are housed on farm property in contrast to the mine workers up north and were provided basic health, education services and, in many cases, food by the farmers. Joemat-Pettersson took her cue from the president. She said that there was still a form of colonial apartheid in existence in the Western Cape. Her team of ministers threatened to impose a new minimum wage structure for Western Cape farm workers. That would be illegal, as a wage determination must be implemented nationally. Meanwhile, the president has told tribal chiefs that they should not buy into the legal practices of the white man. At the ANC policy conference in June, he twice spoke about the need to wrench the commanding heights of the economy from the vice-like grip of white males. It is no wonder the country has descended into a crisis restricted to mining and farming at this stage as Joemat-Pettersson put it. 16 November 2012 Business Day Page 15 Anthony Butler Zuma will bequeath to ANC era of introversion SPECULATION about a leadership contest at the 53rd conference of the African National Congress (ANC) has exploded in recent weeks. Reflection about the possibility of policy change remains relatively subdued. This is not altogether surprising. The ANC enforces a sharp separation between policy-making and leadership selection. Policy is collectively owned and leaders are discouraged from advancing personalised positions. ANC policy development also has a time lag. President Jacob Zuma cannot be praised or blamed for the policy and institutional innovations of his ANC presidency because few of them have been his own. It was at the ANC policy conference at Gallagher Estate, Midrand in June 2007, under then president Thabo Mbeki, that ANC activists recommended the creation of a planning commission. Delegates also agreed that parastatals should become instruments of "economic transformation" and that a stateowned mining firm be established.

Other bright ideas of the Zuma leadership such as the reviewing of provinces and the closing of revolving doors between state and business also turn out to be products of the Mbeki era. We can already foresee the broad outlines of Zumas own policy legacy. The recommendations of Junes policy conference will feed into the resolutions adopted at Mangaung next month whether or not Zuma secures a second term. They may then be slowly translated into action. The Zuma era will ultimately be remembered not only for intellectual evasion and conservatism, but also for ANC introversion. Although the June policy conference demanded "radical policies", it firmly rebutted wholesale nationalisation. Even "strategic nationalisation" was barred except when the "balance of evidence" would favour it. The conference mandated the ANCs conservative economic transformation committee to report back (no doubt positively) on its own macroeconomic policy achievements since Polokwane. Only the commission that dealt with education had robust recommendations. It insisted that teachers, principals and education officials should face mandatory competency tests and complained about drunkenness, sexual abuse, and absenteeism in schools. Strong policy here, however, was a reaction against Zumas mollycoddling of teacher unions rather than the fruit of his intellectual leadership. Zuma may also have inspired two further recommendations: for "a comprehensive national security strategy" to "secure national key points" and for a new "national cyber security policy" to prevent the electronic "distribution of harmful and antisocial content". This second proposal would represent a politically troubling extension of current policy, which targets criminal rather than "antisocial" material. The Zuma legacy is likely above all to be defined by the ANCs most profound preoccupation itself. The policy conference demanded a "renewed and more vibrant ANC", and the Mangaung delegates are certain to concur. The next decade will be a "decade of the cadre", in which members will enjoy ideological, academic and moral training in a "comprehensive political school system". Cadres will be subjected to "performance monitoring", "firm and consistent action" will instil discipline, and a thousand integrity commissions will blossom. Inside Luthuli House, an information technology revolution will apparently sweep aside antiquated membership and communications systems. Political funding transparency will oblige wealthy loyalists to donate openly and generously, and fundraising will be restricted to mandated officials. By banning simultaneous membership of more than one constitutional structure, ANC leaders hope to exclude provincial barons from the political centre.

In retrospect, the Mbeki era was defined by its smug moral determination to transform South Africa in order to change the world. The Zuma era is likely to leave behind a more modest policy legacy, defined largely by a belated and increasingly desperate attempt to save the ANC from its own members. 16 November 2012 Business Day Page 4 Wyndham Hartley State spent money on security upgrades, not Zuma home President Jacob Zuma said on Thursday he fully supported all investigations into government spending at his private residence at Nkandla in rural KwaZulu-Natal and promised that if any wrongdoing was uncovered it would be punished. In his most expansive response yet to questions about the estimated R250m being spent on his home, Mr Zuma emphatically denied that any of buildings in his rural compound had been built by the government and insisted that every room in the residence had been paid for by his family. Mr Zuma was responding to MPs during presidential question time in the National Assembly where Democratic Alliance (DA) parliamentary leader Lindiwe Mazibuko had asked if he had stopped all government-funded construction on his home pending the outcome of various investigations. Sceptical opposition MPs kept up the pressure on Mr Zuma, firing a host of follow-up questions after the president followed Public Works Minister Thulas Nxesi in retreating into the explanation of security upgrades being recommended in terms of the National Key Point Act. A clearly emotional Mr Zuma departed from his prepared reply to say that he had been "painted black" and labelled "corrupt" when people did not know all the facts and "my name has been used wrongly and my family undermined, I am aggrieved that a provincial leader went to my house and made my family a laughing stock and I take exception to it". Ms Mazibuko, in a follow-up question, said spending R250m in taxpayers money on security enhancements which included 31 new houses, a bunker and other facilities, was something that she took exception to because this was his private residence. Mr Zuma insisted that he had already contracted construction companies to expand his residence and they were on site when a government team arrived to install security features. The president said that "the government" insisted that bullet-proof windows and the bunker were added to the buildings he had built and paid for.

"My residence in Nkandla has been paid for by the Zuma family. All the buildings and every room we use in that residence, was built by ourselves as a family and not by government. I have never asked government to build a home for me, and it has not done so. "A necessary distinction must therefore be made between work which I have mandated and initiated in my home, as opposed to the security enhancement undertaken by government. "On the basis of a security risk assessment undertaken by a team drawn from the departments of defence and military veterans, police and state security, I was approached to allow security upgrades to be made to my Nkandla residence. "I was advised the security upgrades were indeed necessary in terms of the National Key Points Act 102 of 1980. "Therefore all the security enhancements that have been undertaken by the Department of Public Works at my residence in Nkandla have been part of these security requirements. Any other construction undertaken by government, outside the perimeter of my home, such as the accommodation for government security personnel, are not part of my residence," Mr Zuma said. Asked by DA MP Anchen Dreyer if he would commit to giving details of exactly what the government had paid for and how much, Mr Zuma said he could not be expected to be a bookkeeper. 16 November 2012 Business Day Page 3 Natasha Marrian Cosatu keen to learn in Lula moment THE Congress of South African Trade Unions (Cosatu) is due to have a taste of its "Lula moment" on Saturday when former Brazilian president Luiz Lula da Silva addresses the federations central executive committee in Braamfontein. The "Lula moment" a phrase coined by general secretary Zwelinzima Vavi refers to a radical shift in the economy and in governance, which Cosatu hopes to see during President Jacob Zumas second term as head of both the African National Congress (ANC) and the government. It arises from Mr Lula da Silvas most enduring policies taking off during his second term. But the test for the federation will be whether it can influence the ANC under Mr Zuma to follow the "Lula" example. Mr Vavi said the only input from Cosatus side during Mr Lula da Silvas visit would be to learn.

"Well, we are going to give him a platform, we want to take notes. How did he do it? How did he move from being an unpopular figure with a government ridden by corruption scandals and indecisiveness to massive progress in the second term that has changed the face of Brazilian politics," Mr Vavi said on Thursday. This week Reuters reported that Mr Lula da Silvas former chief of staff Jose Dirceu was sentenced to 10 years in prison for running a congressional votebuying scheme during Mr Lula da Silvas first term. It was described as the biggest political corruption trial in modern Brazilian history. Lyal White, director of the Centre for Dynamic Markets at the Gordon Institute of Business, said many factors were at play in Mr Lula da Silvas perceived success. For starters, many of the "structural forces" were put in place by his predecessor. The political transition from former president Enrique Cardosos government was dramatic ideologically, but policy continuity remained, he said. With this came confidence from the international community for foreign direct investment to flourish. Also, the economy was buoyed by external factors, demand for key Brazilian exports, iron ore and soya, spiked. Mr Lula da Silva had hit a "sweet spot". He could be credited with ushering in an era of greater political maturity in Brazil as evidenced in the corruption trial which was televised live in a country where politicians were previously untouchable. In Mr Vavis secretariat report to the Cosatu congress in September, at which Mr Lula da Silva was initially meant to speak, he described a "revolution" taking place in Brazil. "Strides are being made in reducing poverty, creating decent work, and reducing inequality and unemployment. At the heart of the gains in the labour market, is the consolidation of national minimum wages, and collective bargaining," Mr Vavis report said. Mr White said Mr Lula da Silva a capitalist could also be credited with bringing Brazilian unions into the modern era. The "Lula moment" envisaged by Cosatu is hinged on "decisive political leadership in charting a new path". The federation believes Mr Zuma whom it endorsed for a second term at the helm of the ANC is the leader most likely to bring about this shift. A Cosatu leader, who wished to remain anonymous, said the decision to support Mr Zuma was taken because he was "not opposed to a strong alliance".

Recent strikes in the mining and agriculture sectors have made the call for radical reforms all the more credible. Cosatu would be seeking to influence the ANC through its alliance with the party to bring about these changes. National Union of Metalworkers general secretary Irvin Jim yesterday said Cosatu was set on harnessing the power of workers to bring about these changes. It was planning to issue a Section 77 or strike notice to effect radical economic shifts. The call for a "Lula moment" was endorsed by Cosatus central executive committee last month, when even those sceptical of the approach conceded radical changes were needed, said a leader of an affiliate.

16 November 2012 Business Day Page 1 Roy Downing Strike wave, euro jitters drag rand near R9/$ THE rand pulled back from the brink of its weakest level against the dollar in more than three years on Thursday but remained under pressure as global growth fears heightened after data showed the eurozone slipped into its second recession in three years. A weaker rand boosts South Africas competitiveness and dollar earnings, but it may spur inflation at a time when the economy is expected to slow because of the strikes spreading across the country. Investors on Thursday fled to safe-haven assets to safeguard their wealth, threatening demand for riskier emerging market assets. The wildcat strikes that spread from the mines to farms in the Western Cape also weighed on the rand, one of the worlds most liquid emerging market currencies. The rand has been on shaky ground since sliding sharply last month to its weakest level since April 2009 as investors dumped local assets on worries about the effect of a wave of illegal strikes. "The backdrop really is an unsupportive one for the rand," 4CAST emerging market analyst Anisha Arora said on Thursday. "And just as we thought labour was taking a turn for the better, we get this fresh uprising (on farms), and that causes panic once again," she said. Figures released by the European Union (EU) yesterday showed the eurozone fell back into recession for the first time in three years as the

deepening sovereign debt crisis in peripheral nations dragged down the core northern economies of the 17-member bloc in the third quarter. Gross domestic product (GDP) in the eurozone shrank 0.1% in June to September, compared with the previous three months, when it fell 0.2%, as the economies of Greece, Italy, Spain, Portugal, Austria and the Netherlands contracted sharply, according to the EUs statistics office. German economic growth slowed in the third quarter, adding to evidence that Europes largest economy is flagging in the crisis. GDP rose 0.2% slower than the 0.3% increase in the second quarter as Germanys manufacturing sector, the engine of the eurozones economic growth, weakened further last month despite growth in exports. Europe is the biggest market for South Africas manufactured goods. "An end to the recession in the eurozone is still out of sight," Commerzbank economist Christoph Weil said in Frankfurt. At 5.40pm, the rand had weakened to R8.93/$ 0.43% less than its previous close of R8.90. "There is not much that can offer support for the rand at the moment," Vunani Capital markets analyst Kuziva Muganiwa said. "The mining and farmland unrest and the recent retail figures have disappointed the rand and we could see the currency moving past R9 against the dollar." The euro rallied to a two-week high against the yen and also rose against the dollar, despite the poor data released on Thursday. Other data this week also highlighted the spillover effects of the debt crisis that has engulfed Europes periphery in September eurozone industrial production fell at the fastest rate in three years, down 2.5% from August. An increasing number of companies have been forced to close their operations in European markets, shedding thousands of jobs, as revenues have collapsed. The eurozone crisis has cost companies $2-trillion in lost revenues globally, according to a recent study by Grant Thornton, which, along with record high unemployment, underscores the long-term damage that is being caused by the crisis, analysts said. The JSE all share fell for a third day on Thursday in line with major stock markets around the globe.

US stocks fell more than 1% on Thursday after President Barack Obama reiterated his call for the wealthy to pay higher taxes, setting the stage for a budget battle with Republicans in Congress. Economists said that, like other emerging market currencies, the rand had been negatively affected by fears about the growing unrest in Europe as strikes and protests against austerity measures spread. Worries about whether US politicians can compromise over the federal budget to avert looming spending cuts and tax increases that could tip the economy into recession also curbed the appetite for perceived riskier currencies on Thursday. Investors are worried that a stalemate in the US could hinder the countrys ability to grow, said Absa Capital economist Mike Keenan. "The US government could cut back on spending and on tax relief. This means people could have less disposable income and this hampers growth," he said. Analysts also ascribed Thursdays fall in the rand to the renewable energy programme. The Department of Energy recently signed contracts worth R100bn for the Independent Power Producer Procurement Programme. "They (the producers) have to enter into forward transactions, which means they have to buy dollars or euros at future rates to protect themselves against rand depreciation," Mr Keenan said.

16 November 2012 The Times Page 4 Amukelani Chauke 'Cops shot the wounded' Mgcneni "Mambush" Noki - Marikana's "man in the green blanket' - was the face of the Lonmin strike three months ago. With a green blanket wrapped around his shoulders, Noki had emerged as one the main leaders of the Rustenburg protests that climaxed in the August 16 shooting of 34 miners. Yesterday, he once again became a focal point, at the Farlam Commission of Inquiry, which is to make a finding on the legality of the police's actions.

This time, however, it was not about his role in the strike but the circumstances of his death. Warrant Officer Patrick Thamae, a police crime scene investigator, testified that he found a "higher concentration" of R5 cartridges next to Noki's body. Thamae, who arrived on the scene at around 4pm - about 20 minutes after the police had opened fire - provided a diagram of what he discovered. "If you look at the sketch, cartridge cases closer to body B [Noki] were in an arc and [the distance of his body from the cartridge cases] ranges from 2.3m to 6.1m." Thamae, however, could not say how far Noki was from the police firing line when he was gunned down. On Wednesday, Bishop Jo Seoka testified that he had received a call from Noki as the police opened fire. Noki said: "Bishop, where are you? We're being killed by the police!" Since August 16, miners, who continued to strike under the leadership of Xolani Ndzuza, have claimed that the police executed Noki and others who were wounded. During his cross-examination, advocate Dali Mpofu - who represents the 270 or so miners who were arrested on August 16 - put it to Thamae that some of the 34 slain were "finished off" while they lay injured on the ground. Advocate Ishmael Semenya, representing the police, accused Mpofu of making "hypothetical" accusations. But Mpofu insisted that he could provide evidence of his claims. Confirming previous allegations, Thamae testified that traditional weapons and dead bodies had been moved around by his colleagues before he began work at the scene. Chilling video footage captured by international news agency al-Jazeera which was shown to the commission - showed protesters armed with sticks, pangas and iron rods moving next to a kraal in an organised way, seeming to charge towards police. Seconds later, gunshots were heard. The al-Jazeera footage showed protesters lying motionless on the ground. Police footage showed protesters covered in dust and blood, some with their brains blown out.

16 November 2012 Business Day Page 1 Allan Seccombe S&P downgrades Gold Fields rating to junk status RATINGS agency Standard & Poors (S&P) on Thursday downgraded Gold Fields credit ratings to junk because of its exposure to South Africa. South Africas sovereign debt rating has been downgraded by S&P and Moodys due to illegal strikes, social tension and regulatory uncertainty. This makes it costlier for the state and companies to raise debt. Gold Fields and AngloGold Ashanti had been placed on credit watch negative status due to the recent wildcat strikes. "We expected this because we had been placed on ratings watch negative," Gold Fields spokesman Sven Lunsche said. "When the country was downgraded we knew we were going to follow." Gold Fields has no immediate plans to raise debt, so its BB+/B, or noninvestment grade rating, is of little consequence. New York-based hedge fund Paulson & Company reduced its investment in Gold Fields in the third quarter, selling 11.5-million American depositary receipts. Paulson now holds 6.5-million American depositary receipts valued at $84m, according to Bloomberg reports. AngloGold will make a presentation to S&P ahead of a decision on its debt. "Weve got a strong balance sheet, a diversified portfolio and two projects coming on stream," said AngloGold investor relations head Stewart Bailey.

16 November 2012 The Times Page 1 Thabo Mokone Zuma: I pay my way An emotional President Jacob Zuma mounted a spirited defence of the controversial renovations to his Nkandla homestead yesterday, berating

politicians and insisting that he had paid for the refurbishment from his own pocket. He said the state had footed the bill only for a security upgrade. A visibly irritated Zuma said he "took exception" to suggestions that the government had built him and his family a home. He had started building his Nkandla residential complex after his original family home was gutted by fire at the height of the political violence in KwaZulu-Natal, he said. "A wrong impression is being given that the government has built a home for me. It is not true; people are speaking without knowing and therefore saying I've spent so much money of the government. I have never done so . It is unfair and I don't want to use harsher words, because you believe that people like me can't build a home," said Zuma. DA parliamentary leader Lindiwe Mazibuko, who had posed the parliamentary question about Nkandla, dismissed Zuma's emotional outburst, saying he was "playing the victim" instead of coming clean on the actual costs. As Zuma tried to quell the controversy around his Nkandla home, it emerged that parliament might be taken to court by opposition parties aggrieved at the ANC preventing a debate in the National Assembly on their proposal for a vote on a motion of no confidence in the president. Zuma told MPs that when he became president he had been advised that his home needed to be secured, at government cost, in line with the requirements of the National Key Points Act. The security upgrade included installation of bullet-proof windows and lifts linking the house to an underground bunker. He said the government had also built several houses outside the family's quarters to accommodate security personnel. Zuma said he was deeply hurt by accusations that the renovations to his home amounted to corruption. "What is shown is my house that I've paid for and there's a lie that it has been built by the government. . my name is being used wrongly, my family is being undermined, even by the very honourable members who don't ask what actually happened. I feel very aggrieved, I must tell you for the first time." Zuma took issue with DA leader Helen Zille for trying to inspect his Nkandla homestead two weeks ago, saying the Western Cape premier had sought to make "a laughing stock" of his family. "You then have leaders of political parties, who don't know whether they are provincial or national, taking trips to . photograph my house and making a laughing stock of my family. I take exception to this."

He said he did not know how the amount reportedly spent on Nkandla had been arrived at. "I don't know where this amount of money went to .... [it] is being piled on me as having used R200-million and therefore [that] I am very corrupt. I take exception [to that] because whoever is going to insist after this explanation [that I spent it] is going to prove to me where have I used this money." Zuma said he supported investigations into cost escalations related to government expenditure on his Nkandla home. The investigation is by the public protector and the auditor-general. He said they were well placed to establish the facts. "I've been convicted, painted black, called the first-class corrupt man, on facts that are not tested; I take exception." But Mazibuko was unmoved by Zuma's outburst. "Thirty-one new buildings, six of which cost R8-million each . is that a security enhancement? R2.3-million for lifts to carry the honourable president [to] his underground bunker . is that security enhancement? Is air-conditioning systems for every one of the houses at a cost of R1.5-million a security enhancement? [Are] a visitors' centre, a gymnasium and guest rooms security enhancements? "The fact that this is the president's private home is something that we take exception to. The government does not have a responsibility to upgrade, at a cost of R250-million, the private home of the honourable president," she said, to loud jeers and heckles from the ANC benches. Zuma quickly brushed aside Mazibuko's questions, saying her statement was premised on information that was not accurate. "The additional houses that are put on my home are only five and that's what I can speak about. She's giving a huge number of houses that I have nothing to do with . I paid for my houses; don't include things that don't belong to me," said Zuma. UDM leader Bantu Holomisa has proposed that parliament send a team of MPs to Nkandla to establish the facts.

15 November 2012 Business day Page 12 Editorial

Joemat-Pettersson playing with fire BY CONGRATULATING farm workers on their "victory" in staging a wildcat strike in the Western Cape, Tina Joemat-Pettersson, and by extension the African National Congress (ANC), are playing a dangerous game that could backfire and set a dangerous precedent. On Tuesday, Ms JoematPettersson met striking farm workers in De Doorns, telling them they would go down in history as the people who "changed agriculture forever". Even more bizarrely, she told the crowd that no farm worker would face criminal or disciplinary charges for taking part in the strike and that she would speak to the National Prosecuting Authority and ensure all cases of intimidation and public violence are withdrawn. One can only surmise that her actions are motivated by a desire to regain control of the events as they unfold and to keep these voters on the side of the ANC. Even so, her actions are opportunistic at best and at worst could lay the foundations for a strategy of destabilisation that could easily spread beyond the Western Cape. Unlike the events at Marikana, where the ANC called for calm, Ms JoematPettersson has stoked the flames by telling strikers they had "won" their strike because they had made the government listen to them. Aside from the fact that Ms Joemat-Pettersson is speaking out of turn minimum wages are determined by Labour Minister Mildred Oliphant she should never encourage illegal strikes. Even if there is scope for a reassessment of sectoral minimum wages, this should be achieved through negotiation or peaceful protest. Setting a precedent that it is acceptable to use violence and intimidation to gain economic and political ends is extremely dangerous. From an economic perspective, encouraging illegal strikes, accusing farmers of intransigence in wage negotiations, and tacitly endorsing the destruction of property will have a lasting effect on profitability and investor confidence in the sector. It is very worrying that she asserts that the government cannot ignore the call of farm workers, yet remains deaf to the death rattle of capital. In a sector vulnerable to external shocks such as drought and currency fluctuations as well as a depressed export market many farmers will be unable to afford to pay workers these higher wages. While table-grape farms in the Hex River Valley have historically made a reasonable profit, most wine farms especially in marginal areas such as Bonnievale and McGregor have struggled to make ends meet. The sad irony in Ms JoematPetterssons assurance to workers that the government understands how important they are to SA is that strike action poses a very real threat to the viability of the sector.

Estimates place the wine industry as the second-or third-largest source of employment in the Western Cape. However, government policies such as the Extension of Security of Tenure Act have meant that farmers are choosing to employ fewer permanent workers and shift to mechanisation where possible. Given threats by the ANC to make the Western Cape "ungovernable" it is easy to surmise that these protests are politically motivated. Several unions have stepped up in support of the workers call for a minimum wage of R150 a day, but the Congress of South African Trade Unions Western Cape provincial secretary, Tony Ehrenreich, has said trade unions found themselves playing catch-up with workers and that the strikes originated without the involvement of organised labour. While it is not impossible for the strikes to have been organised by the workers themselves, given the level of politicisation now observed and the simmering tensions in the Western Cape, it is now largely irrelevant who was responsible. The ANC needs to step forward and condemn the violent action before it further destabilises the Western Cape and spreads to the rest of the country. 15 November 2012 Business day Page 6 Wyndham Hartley Committee gets more time for secrecy bill WHILE the reversal this week of key amendments to the "secrecy bill" indicated a major victory for State Security Minister Siyabonga Cwele, the life of the committee deliberating on the bill has been extended by two weeks. The bill was to be debated in the National Council of Provinces (NCOP) on Wednesday, but this has been postponed to later this month. When the ad hoc committee on the Protection of State Information Bill met on Tuesday, many of the negotiated changes to the bill were reversed. Among these were that the secrecy bill would trump all other laws with the exception of the constitution itself. The committee had decided that the Promotion of Access to Information Act would prevail over the secrecy act but, at the insistence of Mr Cwele, the African National Congress (ANC) has reversed this. Another reversal at the behest of Mr Cwele was the reintroduction of a maximum five-year prison term for the disclosure of classified information. The partial public interest defence which would protect whistle-blowers and journalists introduced by the NCOP committee is also to be watered down.

Committee chairman Raseriti Tau said the bill would be considered on November 29 so the committee could deliberate further on proposed amendments. But opposition parties have complained that the ANC is trying to steamroll the bill through the council. "The ANC has made controversial amendments and now plans to steamroll the bill through the NCOP", said Alf Lees, a Democratic Alliance member of the NCOP. "Despite previously agreeing to remove the controversial clause 1(4), the ANC has backtracked and will agree to the proposal by the Department of State Security to have this clause reinserted. "This would allow the Secrecy Bill to trump the Promotion of Access to Information Act and would make the secrecy bill the be-all and end-all on whether state information can be accessed". 15 November 2012 Business day Page 3 Natasha Marrian Cosatu to take broker ban to Mangaung THE Congress of South African Trade Unions (Cosatu) is taking its campaign to have labour brokers banned to the African National Congress (ANC) elective conference in Mangaung next month, it said on Thursday. The federation received overwhelming support from ANC delegates at the partys policy conference in June for its opposition to the youth wage subsidy. It now hopes to ride that crest again, but this time to have labour brokers totally banned. The ANC, since the labour minister tabled the Labour Relations Amendment Bill, has been adamant that labour brokers would be regulated, sidestepping calls for an outright ban of the practice. The bill is before the portfolio committee on labour in Parliament, but it is unlikely to be attended to before the end of the year. Cosatu general secretary Zwelinzima Vavi said on Thursday he was "absolutely incensed" that the key legislation, set to help workers across the country, was now delayed. "I am disappointed that we are running out of time at Nedlac (National Economic Development and Labour Council) and a key workers legislation now must wait until 2013." Vavis comments come against the backdrop of workers in the mining and agriculture sectors across the country embarking on wildcat strikes. Their demands relate to pay increases and better working conditions.

The amendment bills provisions on labour brokering were "far better than the status quo" and Mr Vavi had hoped that the legislation would have been passed by now. But it has been subjected to several delays in Parliament. It was submitted to Parliament in March this year, but the first version of the bill was published for public comment as far back as 2010, according to the Department of Labours website. Cosatu president Sdumo Dlamini said yesterday that at the last ANC elective conference in Polokwane the party resolved to prohibit bad labour practices. The Mangaung conference should take that resolution forward and call for an outright ban on labour brokering. Mr Dlamini said Cosatu would be looking to President Jacob Zuma to take the resolution forward. "President Zuma is the president of the ANC and Cosatu has indeed supported that he continues into the second term. "Its safe and okay to get him to lead that responsibility." Andrew Levy, head of labour relations consultancy Andrew Levy Employment, said he did not believe Cosatu would succeed in its push for a total ban on labour brokering. The government would be "sensitive" to further job cuts, given the precarious state of labour relations in SA. The eyes of the world were on the country and it had to tread carefully. The Department of Labours chief director for collective bargaining, Thembinkosi Mkalipi, said the bill was before Parliament. The department shared the doubts that it would be finalised this year. 15 November 2012 Business day Page 1 Thabiso Mochiko Ailing Telkom warns of 83% earnings drop TELKOM on Wednesday moved to stabilise the company by appointing two board members and an executive in its cellphone businesses, but it warned that earnings will drop by as much as 83%. The company is facing severe operational challenges, which were made worse recently when it lost six board members, including its chairman. CEO Nombulelo Moholi has also resigned and is serving notice. The appointment of Jabulane Mabuza and Kholeka Mzondeki brings the number of board members to eight meaning it is sufficiently constituted as required by Telkoms memorandum of association, although it had 14 board members until its annual general meeting last month.

The election of a new chairman may be highly contested by board members, especially those appointed by the government, Telkoms majority shareholder. The government removed four board members at the annual general meeting. It is considering a new strategy for the company and may want a chairman who will ensure its smooth adoption. Telkom on Wednesday warned in an interim trading statement for the six months to September that headline earnings per share will drop by up to 83%. Its share price has fallen almost 10% since Ms Moholis resignation last week. "We welcome the appointment of our new board members and believe that their depth of knowledge, skill and experience will be of great value to Telkom," Ms Moholi said on Wednesday. She added that "while these are challenging times for the company and its people, I am convinced that Telkom will emerge strengthened and able to continue to contribute to the economic growth of the country". Analysts said the company urgently needed a clear strategy so it could begin rebuilding. "While Telkom is a listed entity with private shareholders, the government is the majority shareholder with its own set of socioeconomic priorities to fulfil," Sanlam Private Investments equity analyst Farai Mapfinya said on Wednesday. He said the uncertainty over the companys future was probably the main trigger behind the recent sell-off in its stock. Mr Mapfinya also said that, given its track record, Telkom will probably struggle to find a new CEO. Telkom said on Wednesday that it expected headline earnings per share from continuing operations for the six months to the end of September to be 78%83% lower than the comparative period. Basic earnings per share from continuing operations during the period are expected to be 62%-67% lower than those of the prior period. The company also said that operational performance up to the end of August had been characterised by flat revenue and operating costs that escalated just below inflation. In its initial trading statement issued in September, Telkom said the lower earnings were mainly attributable to an increase in the provision for Competition Commission fines. Telkom was fined R449m for anticompetitive behaviour, but is appealing the ruling.

"The investment community is voting with its shares. There is loss of confidence in the management of the company, with governments continued interference seen as a major negative factor," independent analyst Ian Cruickshanks said on Wednesday. "There has to be a turnaround in government thinking before the share price goes down to the lower basement," he said. Telkom has appointed Attila Vitai, a former Motorola and Vodafone executive, MD of Telkom Mobile, the division which includes 8ta, and Telkom Business Mobile. "I am confident that Attilas vast knowledge and experience of this industry will translate into positive growth in our mobile arm," Ms Moholi said. 15 November 2012 Business day Page 1 Carol Paton Scramble to raise farm wages amid Cape havoc THE government on Wednesday announced an immediate review of minimum wages for all farm workers as part of a deal in which trade unions representing striking Western Cape farm workers agreed to return to work on Thursday. The development came after a day of unprecedented and frequently violent protest action by farm workers in the Western Cape, in which one worker was confirmed dead as a result of police action in Wolseley. Other towns in which protesters clashed with police and public roads were barricaded included: De Doorns, Ceres, Prince Alfred Hamlet, Robertson, Ashton, Bonnievale, Villiersdorp and Piketberg. Amid the chaos, Western Cape Premier Helen Zille warned that the province was "heading for anarchy", and that thousands of jobs could be on the line. The promised wage review will have profound implications for the agricultural sector, for which the labour minister has set a minimum wage of R70 a day. It could also push up food prices and inflation, and have a knock-on effect on other minimum wages. Western Cape farm workers are demanding R150 a day. If they find the new minimum wage, expected to be announced within two weeks, unacceptable, they will resume striking on December 4. At a press briefing in Cape Town on Wednesday, acting labour minister Angie Motshekga Labour Minister Mildred Oliphant is out of the country said a

notice will be published in the Government Gazette within a week "indicating the intention to call all interested parties to comment on the possibility to review the sectoral determination". A notice will also be published announcing the cancellation of the existing wage determination, affecting all agricultural workers. The Employment Conditions Commission, the statutory body which advises the labour minister on minimum wages, was meeting from Wednesday to begin determining a new minimum wage. Employer and worker representatives will have an opportunity to make representations to the commission on appropriate wage levels. There was some uncertainty over whether a single minimum wage for all agricultural sectors will again be set, or whether there will be differentiation according to different provinces products. Congress of South African Trade Unions (Cosatu) Western Cape secretary Tony Ehrenreich is advocating that there should be differentiation within the sector as some products such as the table grapes grown in the De Doorns area where the strike began are more profitable than others. Agriculture, Forestry and Fisheries Minister Tina Joemat-Pettersson said on Wednesday that the commission would have to make recommendations on whether new minimum wages should be set for all provinces, or whether the higher wages would apply only in the Western Cape. However, the cancellation of the existing determination necessarily implies that wages in all provinces be reviewed. Cosatu, which led the brokering of the deal between the government and the strikers, was confident on Wednesday that workers would return to work, despite the strike spreading across towns and farms in the Western Cape over the past two days. Although not initially involved in the labour action, Cosatu and a coalition of independent unions and nongovernmental organisations active on the farms were "invited" by strikers to represent them in the negotiations. Cosatu subsequently assumed a leading role in the action among workers, of whom only 6% are unionised. Co-ordination of the strike across the towns was achieved largely through the relatively small networks of organisations, which spread word by SMS. Mr Ehrenreich said the agreement contained three key elements: an urgent review of the national minimum wage; that no disciplinary action be taken against strikers; and that an interim minimum of R80 apply until the new wage is agreed.

Wednesday was the second day of unprecedented and frequently violent protest action by farm workers in the Western Cape. One worker was confirmed dead as a result of police action in incident in the town of Wolseley. Other towns in which protesters clashed with police and public roads were barricaded yesterday included: De Doorns, Ceres, Prince Alfred Hamlet, Robertson, Ashton, Bonnievale, Villiersdorp and Piketberg. Premier of the Western Cape Premier Helen Ms Zille wrote to President Jacob Zuma on Tuesday, asking him and Ms Oliphant to set a new minimum wage for farm workers. On Wednesday, Ms Zille made a desperate appeal for co-operation to Western Cape African National Congress leader Marius Fransman. "We are heading towards anarchy. Thousands of jobs will be lost and an industry potentially destroyed," she said in an SMS to Mr Fransman. "I am receiving horrific reports of farm worker intimidation. It is essential that we remove politics from this matter and stabilise the situation. I am extremely worried that lives are in danger and that people will retaliate." Presidency spokesman Mac Maharaj said yesterday that Ms Zille could ask for the South African National Defence Forces assistance to quell the violence as Mr Zuma had already authorised its deployment until January to assist with public violence nationwide after the Marikana tragedy in September. Mr Maharaj said Ms Zille had to engage with Ms Oliphant and Defence Minister Nosiviwe Mapisa-Nqakula. "There is no need for the president to micromanage everything. Ms Zille should approach the channels available," he said. Employer body Agri SA said the setting of minimum wages was the sole preserve of government. Agri SA president Johannes Mller said farmers were free to negotiate with workers on pay. "Agri SA has encouraged farmers, where possible, to pay above the minimum wage." Cape Chamber of Commerce president Fred Jacobs said the government should return to "an empirical methodology" rather than "sucking a number out of the sky to determine what should be paid". 14 November 2012 The Times Page 6 Sipho Masombuka Police recover prized stolen SA artworks

The City of Tshwane has confirmed the four paintings recovered in Port Elizabeth yesterday were those stolen from the Pretoria Art Museum on Sunday. Spokesman Pieter de Necker said the museum's curators had analysed the photographs of the paintings sent by Eastern Cape police and confirmed their authenticity. Eastern Cape police spokesman Brigadier Miranda Mills said a member of the K9 Unit received a tip-off from an informer, who told him about the whereabouts of the stolen paintings. The paintings were found intact just after midday in a private cemetery behind the Dutch Reformed Church at Sunridge Park in Port Elizabeth. "The art pieces were left under a bench ... there is no visible damage to the paintings," she said. No one has been arrested in connection with the robbery. The recovered pieces are Irma Stern's 1931 masterpiece Fishing Boats valued at R9-million, Maggie Laubser's 1936 Cat and Petunias valued at R1million, Hugo Naud's Hottentot Chief priced at R300000 - all oils on canvas as well as JH Pierneef's Eland and Bird valued at R45 000, a gouache drawing on paper. But Gerard Sekoto's R7-million Street Scene is still missing. De Necker said this was very interesting for both the municipality and the police. "Sekoto lived here in Eastwood, literally a few metres from [the museum]. Some of his work today is worth millions. We hope whoever tipped off the police on the whereabouts of the other paintings will also lead them to Sekoto's painting," he said. Deputy director for heritage management Ishmael Mbhokodo said Sekoto was honoured with a Master Artist accolade recently. This pushed the prices of his work up, which could be the reason his painting is still missing, said Mbhokodo. Three men, one posing as an arts teacher and the other two as his students, paid a R10 entrance fee and asked for the specific paintings before tying up a staff member at gunpoint. They walked out of the museum with five paintings and fled in a Toyota Avanza, leaving Stern's R12-million Twee Maleier Musikante on the pavement as it did not fit into the car.

According to De Necker, a report on security in all the municipality's museums was submitted to the mayoral committee two months ago. But he complainedthat political decisions took time to be implemented. "We have, however, resolved to improve security," he said. The closed-circuit television system was not operational at the time the thieves struck. De Necker said security would be tightened around the recovered paintings when they made their way back to Pretoria. Curator Dirk Oegema said he was relieved by the recovery but said he was still a bit uneasy with the Sekoto still missing. 14 November 2012 The Times Page 4 Unknown War threat in Mozambique Twenty years after laying down his weapons, Mozambican civil war commander Afonso Dhlakama has said he is willing to provoke a fresh bloodbath and divide the country if the government does not meet his demands. Speaking from his base in the Mozambican bush, where he has gathered several hundred armed supporters, the former anti-communist guerrilla vowed a return to violence if the government did not share the country's wealth and reform the electoral system. "I am training my men up and, if we need to, we will leave here and destroy Mozambique," said Dhlakama, who directed an insurgency against the Frelimo government that resulted in the deaths of a million Mozambicans between 1977 and 1992. Stressing that he wanted a peaceful solution, Dhlakamanevertheless warned that he was not afraid of derailing the country's economic boom. "If it is necessary, we can go backwards. We prefer a poor country than to have people eating from our pot." Mozambican police said yesterday they did not believe Dhlakama would make good on his threat to return the country to war. "Mr Dhlakama is not a child. He is an adult and an adult thinks of the consequences of his actions. That is why we think he will not do anything. He has children and a wife," police spokesman Pedro Cossa said.

"We don't believe he will go to war because he has promised several times that he will not make war, that he wants peace." Clayson Monyela, a spokesman for the Department of International Relations and Cooperation, said: "The Southern African Development Community [ deal with] matters of security in the region. South Africa will deal with the matter within the context of the SADC." Though the Mozambican authorities have played down Dhlakama's threats, the government has sent a riot squad detail to the Gorongosa area, where Dhlakama and his men are holed up. Cossa insisted the detail had been despatched to ensure Dhlakama's safety. Earlier this year the force launched an assault on a group of Renamo militants who had camped outside their former party headquarters in the northern city of Nampula, killing four. Mozambique's civil war ended in 1992, with Dhlakama and Armando Guebuza, now the country's president, agreeing to the Rome General Peace Accords, which paved the way for Mozambique's resources-fuelled growth. Dhlakama has long been disgruntled. He insists that his former Renamo guerillas have had enough of the government's "robbery" of the country's resources. Renamo is still the official opposition, with 51 of the 250 seats in parliament, but its support has dwindled since 1999. 14 November 2012 Business Day Page 5 Trevor Neethling No easy way to end xenophobia in SA THE idea of an early warning system meant to prevent a repeat of the 2008 xenophobic attacks has proved to be an elusive proposition four years since it was first mooted. The thinking was that the government and civil society were reactive in their approach to dealing with violence against foreign nationals and needed a way to identify and deal with potential threats before they happen. The logic was simple enough but proposed systems struggled to get off the ground, with activists citing a lack of resources and political will. However, since mid-2010, the United Nations High Commissioner for Refugees (UNHCR), together with the South African Police Service (SAPS)

have devised an SMS system which allows people affected by violence to notify a central hub, which in turn alerts police. Explaining why even this system has taken about two years to get off the ground, UNHCR spokeswoman Tina Ghelli, says: "In 2008, the focus was on the response to the attacks that happened in May. Thousands were displaced and the government, UNHCR, other UN agencies and the partners were focused on the aftermath and how to reintegrate those affected into the communities. "There were discussions on prevention and early warning with SAPS and ad hoc responses throughout 2009, but the initiative was developed and fell into place by mid 2010." While attacks on foreign nationals continue throughout the country, the UNHCR says the looting of shops has been minimised and violence prevented in many instances, thanks to the system. "Through volunteers and outreach teams, we are able to provide information about potential attacks and then liaise with the police so that appropriate interventions can be made," says Ms Ghelli. According to UNHCR statistics, 500 incidents were verified and referred to SAPS for intervention last year. As a result, the authorities were able to prevent death, injury and loss of property in half of the cases. Even then, the figures were not encouraging. The agency found that the total number of killed people in xenophobic violence last year was 99. One hundred people were seriously injured, while the number of people temporarily displaced was about 1,000. The number of foreign-owned shops temporarily or permanently closed was 120. Gauteng, the Eastern Cape, Limpopo, and the Free State were the worst-affected provinces. Activists, too, have praised the early warning system, saying it has at least given authorities the intelligence to deal with the violence as soon as it breaks. But it is just one cog in the wheel of a system that needs a much more holistic response, many say. Sicelmpilo Shange-Buthane, executive director for the Consortium for Refugees and Migrants in South Africa (CoRMSA), says the challenge would always be a mind-set change. "For me, when I go to communities, I find it is to some extent about understanding the reasons why people migrate, their rights and responsibilities and countrys commitment to refugees or international phenomenon of migration.

"It is also about promoting these cohesive communities so even if I dont know what brought you here as a refugee or migrant, it does not automatically give the right to attack you, kill you or take away from you." Jean-Pierre Misago, a senior researcher at the African Centre for Migration and Society, says the government needs to show more political will to deal with violence against foreigners. "And the evidence is that we have seen a lot of violent acts happening again and in 2012 the numbers are on the increase. Whatever they say, whatever political pronouncements are made, nothing has been done and it is happening in the same places," Mr Misago says. He says the government has to admit that there is a real problem and then pass legislation that outlaws such atrocities. "The people who organise violence are always there. Its not done by the people vandalising the shops or brandishing the machetes on the street. There are people who sit down and prepare and organise," Mr Misago says. "We have also noted a change in the type of xenophobia with increased threats on the livelihood of foreigners such as foreign-owned spaza shops being targeted for closure," says Ms Ghelli. But there is also hope, she points out. "We have also seen increased responses from community members who defend, for example, the local shop owned by the Somali shopkeeper, as they see it is as beneficial to their community."

14 November 2012 Business Day Page 3 Sam Mkokeli Lekota may jump ship as COPE faces disappearance EYES will be on Congress of the People (COPE) leader Mosiuoa Lekota, to see if he will follow in the footsteps of his colleague Nosimo Balindlela, who joined the Democratic Alliance (DA) on Tuesday. Her move was hardly surprising. She was part of the group led by Mr Lekota, which has been agitating for a merger of some sort with the DA. Insiders say a recent COPE parliamentary caucus meeting rejected the idea of a merger. Now that she has crossed, those COPE members who are opposed to the idea of working with the DA expect Mr Lekota to follow suit.

Mr Lekota would be a shoo-in as he is battling to keep COPE afloat. He also shares the DAs vision of realigning the opposition. COPE is on the decline, and it is only wise that its career politicians jump ship while it is still possible. The party is unlikely to get enough votes to regain the 30 seats it has in Parliament, come 2014. DA leader Helen Zille on Tuesday said Ms Balindlelas move was the beginning of the realignment of opposition politics. But the reality is that this is battling to take off. Most minority parties in Parliament are wary of the DA. Some cite ideological differences as the reason for their doubts. But their scepticism may have to do with the fact that leaders of smaller parties get paid more than ordinary MPs and get to run their parties the way they like. No politician wants to be their own boss, and wake up the next day having to report to Ms Zille. They fear the DA will swallow them and bury their partys identity and independence. What they dont realise, however, is that their parties may soon disappear. Ms Balindlela and Mr Lekota may be seeing the future that they are safer in the DA than on their own. The past two elections showed that a two-party system is in the offing. COPE has lost all the momentum it started with, when it gained 1.3-million voters in 2009, making it the third-biggest party after the African National Congress (ANC) and the DA. But thats all history now, as its state of permanently being a party going through internal battles may turn voters away. It takes 50,000 votes to gain a seat in Parliament. Very soon some of the 29 remaining COPE MPs will realise that, and look for new homes, possibly in the DA and the ANC. On the other hand, how the DA lured Ms Balindlela shows its appetite for growth. The traditional DA may have reached a ceiling, having gotten 23% as an aggregate of its 2011 local elections performance. It has set itself a target of 30% votes in 2014, up from the 17% it got in 2009. There appears to be a realisation among the DAs strategists that they can surpass the 30% target if they pull out some magic now, while the ANC is battling with its own infighting. From the days when it had just 1% of the national votes, as the erstwhile Democratic Party, it has grown mainly by merging with other parties: the New National Party and the Independent Democrats.

But its latest suggestion for parties to come together under one roof has been rejected by some smaller parties with United Democratic Movement president Bantu Holomisa the most vocal critic of the plan. His party is in favour of opposition coalitions in which all the member parties will retain their identity. As for the DAs claims that this is the beginning of the realignment of opposition parties what this shows is the inevitable end of COPE, with the DA likely to get some of the spoils. Ms Balindlela is a tireless campaigner, who may take its message to areas the DAs traditional leaders cannot. But she brings baggage in the form of an image of a politician who hops around too much. SAs political systems is still conservative. The idea of politicians changing their tune every four years is not well accepted. 14 November 2012 Business Day Page 1 Allan Seccombe Platinum deficit risk as SA unrest cuts output SOUTH Africas platinum production has fallen to 11-year lows, pushing the global market into a deficit as strikes, safety stoppages and mine closures cut production from the worlds largest supplier, analysts Johnson Matthey said on Tuesday. Anglo American Platinum (Amplats), the worlds biggest producer, lost at least 170,000oz of platinum during an eight-week strike and is struggling to convince workers to return to work. The market for platinum was forecast to slip into a deficit of 400,000oz with disruptions in SA removing 600,000oz from supply this year, said Jonathan Butler, author of Johnson Mattheys 2012 interim review. Platinum from SA would fall this year to 4.25-million ounces from 4.85-million, Mr Butler said. The global market had a 430,000oz surplus last year. The forecast was based on output up to the end of September. But in October and November, Amplats was crippled by wildcat strikes at its Rustenburg and Pilanesberg operations. Johnson Matthey used 50,000oz of lost Amplats production in its calculations, Mr Butler said. The global supply of platinum, which includes output from mines in Russia, North America and Zimbabwe, is at the lowest levels since 2000 at 5.8million ounces, it was 10% below output last year.

"Its now apparent that stoppages have run at a fairly high rate into the fourth quarter, so our eventual supply number for 2012 could well be lower than we are forecasting for SA," he said. Mr Butler said that the operating environment for SAs platinum producers had deteriorated this year. There had been a six-week strike at Impala Platinum, a violent strike at Lonmin and there is a continuing wage dispute at Amplats. Aquarius Platinum this year suspended its Marikana and Everest mines. "Even before the unprecedented disruption weve seen in the second half, producers were already considering restructuring their low-margin operations in the light of weak prices and high costs," Mr Butler said. "Some of the wage settlements weve seen subsequently have only added to cost pressures for some of those producers. It seems highly likely over coming months that some operations in SA will come under close scrutiny with the possibility of further closure and consolidation. "This leads us to the view that supplies in 2013 are unlikely to grow significantly from 4.25-million ounces we are forecasting for this year." Johnson Matthey sees liquidity in the platinum market as it digests surpluses in previous years. The relatively muted price reaction to strife in the country and low lease rates the price at which banks or fabricators lend platinum indicated that there was enough metal to satisfy immediate needs. Amplats will release the results of a year-long review of its entire business before the end of the year, and the market is widely anticipating the suspension of loss-making operations. Derek Engelbrecht, Impala Platinums marketing executive, told a conference in Hong Kong on Monday he expected lower output from SA and job cuts as a result of rising costs and a drop in productivity. "We think the market is moving into deficit this year, based on a significant decline in South African supply and a small reduction of jewellery being recycled because of lower prices," he said. "With relatively stable demand, it will push the market into deficit." 14 November 2012 Business Day Page 1 Carol Paton Minister lauds strikers victory in Cape farm protest

AGRICULTURE, Forestry and Fisheries Minister Tina Joemat-Pettersson said she was meeting with President Jacob Zuma last night to get his backing for substantially higher wages for farm workers across the country. She made this promise to striking farm workers at a rally in De Doorns on Tuesday, following a day of unprecedented labour action by Western Cape farm workers. Workers from 14 areas in the province joined protest action yesterday in solidarity with De Doorns strikers, in support of their demand for a minimum wage of R150 a day. In many towns, including Ashton, Robertson, Bonnievale, Ceres, Rawsonville and Wellington, public and farm roads were blocked and police were deployed to keep order. Ms Joemat-Pettersson told workers that talks with employer bodies, including Agri SA and Agri Western Cape in Pretoria on Monday, had failed to yield any offer to increase wages. "Agri SA told us there is no crisis and there is no problem," she said. But Ms Joemat-Pettersson told the workers that they had "won" their strike because they had made the government listen to them. "I will speak to President Zuma on your behalf. I will tell the president that we cannot ignore the call of the farm workers. From there we will go to the labour minister to discuss sectoral determinations." The labour minister would be given two weeks to respond to farm workers on their R150 demand. "Your victory is that you have brought the government to understand you are important in this country. You will go down in the history books as the people who changed agriculture forever," Ms Joemat-Pettersson said. Striking workers, who have been backed by the Congress of South African Trade Unions (Cosatu) and several independent unions since they began their wildcat strike last week, argue that agricultural minimum wages should be differentiated by sector as some products such as table grapes are more profitable than others. Cosatu Western Cape provincial secretary Tony Ehrenreich told De Doorns workers on Tuesday that if Mr Zuma indicated that he would back the "fixing of your problems", they could return to work on Wednesday. However, if in two weeks time Mr Zuma and the labour minister did not "give you what you need", the strike should resume. Toyi-toying and shouting struggle slogans, Ms Joemat-Pettersson blamed the farmers intransigence on the Democratic Alliance (DA), which she claimed was trying to create an "apartheid colonial state" in the Western Cape.

She said the government would ensure that no farm worker would face criminal or disciplinary charges for their participation in the strike. "We will speak to the National Prosecuting Authority and the police minister to ensure that all cases of intimidation and public violence are withdrawn." There was a sense of panic among farmers on Tuesday. Agri Western Cape spokeswoman Porchia Adams said there had been reports of "isolated incidents in different regions". "Some of it is aggressive, some of it is extremely aggressive," she said. DA agriculture spokesman Pieter van Dalen said the party visited De Doorns farms on Tuesday and was "shocked to witness a full-blown intimidation campaign being waged by Cosatu" against farm workers who were reluctant to strike. "So-called organisers were standing on street corners and telling workers that their houses will be burnt or their wives would be raped if they go to work. This threat was carried out on Monday night when a farm workers house was burnt. "It is clear that these strikes are politically motivated. They are simply the latest instalment in the African National Congresss campaign to make the Western Cape ungovernable, known as Project Reclaim." 12 November 2012 Business Day Page 1 Amanda Visser Competition Commission declines to probe SAA THE Competition Commission says it does not have any evidence that the Treasurys R5bn guarantee for South African Airways (SAA) amounts to anticompetitive conduct, and has therefore decided not to investigate its distorting effect on the industry. The airline industry is facing enormous pressures, which could lead to the development of a new regulatory environment. Several low-cost carriers have gone under in recent years while SAA has been propped up by taxpayers. The Democratic Alliance (DA) asked the Competition Commission in August to probe unfair competition and anticompetitive behaviour by state carriers following the R5bn lifeline. The commissions head of advocacy and stakeholder relations, Trudi Makhaya, said on Sunday that the DAs request would be turned down as the Competition Act did not have "state aid provisions" similar to those of the

European Union (EU). The European Commission directorate-general for competition could investigate how government subsidies of companies affected competition in the region. "In the EU that (state subsidies) is important because the aim of competition policy is to unify the market, and if some governments are sponsoring their companies at the expense of foreign companies, integration will not happen," Ms Makhaya said. Questions raised about the effect of the R5bn lifeline to SAA on competition were an issue, but this was not something that could be addressed through SAs competition law, she said. However, the Competition Commission was planning "advocacy research" into the aviation market to help decision makers understand how policy changes could increase competition. The Department of Transport had policies on the way that the airline industry should be run, and this was where "something could be done", Ms Makhaya said. The DA alleged that SAA was engaged in predatory pricing which was destroying the airline industry at the expense of taxpayers and consumers. "Given that 10 out of 11 private airlines launched since 1991 have had to shut down, whilst SAA soldiers on despite recording persistent losses, the DA firmly believes that the state-backed carrier is in contravention of the Competition Act," said DA public enterprises spokeswoman Natasha Michael. "The bottom line is that domestic airlines simply cannot compete fairly with their state-funded counterparts." Ms Makhaya maintained that there was not enough evidence to initiate an investigation, and said the DAs suggestion that the commission should search SAAs premises for evidence of anticompetitive behaviour was not sufficient reason to ask the courts for a search warrant. "If we do not have evidence, it does not mean we have the right to raid a company. You still need to have a reasonable suspicion why you want to raid a company to get a search warrant, and in this case we just do not have that." Comair CEO Erik Venter said the recent demise of 1time was evidence enough of unfair competition. "Just in terms of the pricing they (SAA subsidiary Mango) put into the market, everyone had to price down to that level to stay competitive, despite the fares being economically unviable," Mr Venter said last week.

Ms Makhaya said that if SAA was using its state funding to engage in predatory pricing through low-cost carrier Mango, that would constitute conduct that could be prosecuted. "We do not have any evidence that the subsidy is used to engage in anticompetitive conduct, and Public Enterprises has denied that the subsidy is used to prop up Mango," she said. Mango CEO Nico Bezuidenhout said the wholly owned subsidiary of SAA had made losses of R132m since its inception in 2006 and that it had only received a once-off capitalisation of R300m from its parent company. He said Mangos losses had to be seen in the context of a global economic crisis and rising fuel costs which have hit airlines throughout the world and seen many of them fold. Mr Venter accused Mango of offering "economically unviable" fares which do not cover costs. However, Mr Bezuidenhout rejected this, and said Mango was the most efficient low-cost carrier in SA, which was the explanation for its success rather than the fact that it was owned by the state. "Allegations are made that we are breaching the law, circumventing the Competition Act, and insinuations have been made that the company has lost R500m all of which are designed to cause commercial harm," he said. Mr Venter insisted that Mango benefited unfairly from crosssubsidisation by SAA in various forms for example, preferential terms of its aircraft leases and a relationship with SAAs maintenance arm, SAA Technical. Mr Bezuidenhout said that all these relationships had been submitted to the Competition Commission for an opinion and had been approved. 12 November 2012 Business Day Page 2 Karl Gernetzky Nkandla, Marikana continue to be focus CONTROVERSY surrounding the multimillion-rand construction project at President Jacob Zumas private residence will continue this week, as Mr Zuma faces questions from the opposition in Parliament. City Press on Sunday provided a fresh twist to the allegations, with construction experts reportedly questioning the cost of the upgrades at Nkandla. They suggested that the amount of R248m was grossly inflated. Another piece focused on the efforts of a private businessman to build a

R1.5bn "Jacob Zuma highway" that would link the presidents hometown with the northern parts of KwaZulu-Natal. Proceedings at the Farlam commission into the deaths of mineworkers at the Lonmin mine in Marikana are also due to dominate headlines once again when they resume on Wednesday. The commission was last week split up into two phases, with the first being to simply try to establish the facts about events which led to the deaths of mineworkers. When it reconvenes, the first civilian witnesses to the massacre may take the stand to give their own accounts on how events unfolded on August 18. On Tuesday, the National Council of Provinces will deliberate on the amendments to the controversial Protection of State Information Bill. This will be followed on Wednesday by a briefing from the Department of Justice and Constitutional Development on the same bill. While civil society has maintained that the amendments to the secrecy bill" should offer additional protection to whistle-blowers, State Security Minister Siyabonga Cwele has warned that the proposed amendments could see the bill conflict with the Promotion of Access to Information Act. On Thursday, Democratic Alliance (DA) parliamentary leader Lindiwe Mazibuko will ask Mr Zuma if Public Works Minister Thulas Nxesi was instructed to stop construction at Nkandla pending the outcome of an investigation by Public Protector Thuli Madonsela into the expenditure, and if the minister was not instructed, why. The DA maintains that the public deserves clarity about the project because of the size of the bill being footed by taxpayers. The government has responded by citing security considerations, while both the African National Congress (ANC) and the Presidency have maintained that the DA is trying to score political points. ANC branches continue nominations ahead of the partys electoral conference next month. Lobbying for positions is expected to intensify as the process reaches its conclusion at the end of the month. Speculation continues on whether Deputy President Kgalema Motlanthe will make himself available to challenge the partys presidency. The ANC is seized with the challenge to ensure the legitimacy of the nomination processes in the hotly contested branches and regions. The DA will also continue with preparations for its own electoral conference that starts next week. 12 November 2012 Business Day

Page 3 Sam Mkokeli Master of the art of praising his foe LIKE all good politicians, President Jacob Zuma has mastered the art of signalling left and then going right. Thats essentially the art of saying or doing what you dont mean or performing with conviction an otherwise awkward task. That is how Mr Zuma appeared as he delivered a lecture in honour of his predecessor, Thabo Mbeki, on Friday confident and sincere. But, there is always a "but". Mr Mbeki was the main person who did not want Mr Zuma to become African National Congress (ANC) president. He was happy for Mr Zuma to have become deputy, but he would not readily hand over to Mr Zuma the presidential baton of a party he and his parents had worked hard to build. Mr Mbeki stood for a third term as head of the party in a failed attempt to block Mr Zuma succeeding him. He had fired Mr Zuma as his deputy in 2005 on the strength of an erroneously interpreted judgment that linked Mr Zuma to a corrupt relationship with his financial adviser Schabir Shaik. But how Mr Mbeki tried everything to suppress Mr Zumas rise was conveniently absent in the presidents speech on Friday. It was a case of having come to praise Mr Mbeki, instead of having come to bury him. Praise him he did. Talking about Mr Mbeki was not going to be a difficult task for Mr Zuma, for two reasons. First, they are contemporaries having both been born in 1942 and worked together in exile, especially during the 1980s, before the unbanning of the ANC. Together with Aziz Pahad and Joe Nhlanhla, Mr Mbeki and Mr Zuma were assigned by then-president Oliver Tambo to begin exploratory talks with the apartheid government in England and Switzerland. Second, Mr Zuma has a profound ability to present a straight face as he utters words with an ironic ring. An example is when he professes his governments focus on corruption, commitment to the rule of law and a free media all aspects where he personally scores low points for leadership. Going to Aliwal North on Friday, on the Eastern Cape and Free State border, Mr Zuma was under the spotlight, with critics watching with keen interest what he would say. Mr Mbekis mother Epainette had asked the day before what the point of honouring the former president was, when the ANC had humiliated him by hounding him out of office. But Mr Zuma had exactly the answer for that, when he praised Mr Mbeki for having accepted his 2008 recall with dignity.

Mr Zuma said: "What defined him most as a loyal cadre of the organisation and true patriot was his conduct during the difficult and devastating period of his recall from office. He accepted the decision of the ANC NEC (national executive committee). Like a true statesman, he put the country first above personal considerations. He stepped aside in a dignified manner, allowing a smooth transition to take place in government to the presidency of Comrade Kgalema Motlanthe." Mr Zuma did himself a huge favour by touching on this part of Mr Mbekis biography. Otherwise the lecture would have been hollow. But it was puzzling how he left out the events before the Polokwane conference in 2007 when they took each other on. Even more intriguing is how Mr Zuma did not mention his own suffering when Mr Mbeki fired him as deputy president of SA. Mr Mbeki had tried to push Mr Zuma out of his post of ANC deputy president, but this was rejected by ANC branch delegates at the 2005 national general council. Had the delegates not revolted, Mr Zuma would certainly have been history. But Mr Zuma, being the cunning politician that he is, is well aware of who his enemy is with only a month to go to the Mangaung conference. That enemy is not Mr Mbeki, who four years ago he described as a "dead snake" that comrades should stop beating. The ANC has held 11 lectures for all its past presidents. What is left is a lecture to honour Mr Zuma to be held in the Free State next month. The question on many lips now is who will deliver the Zuma lecture? Will the ANC give the task to Mr Motlanthe, the deputy president? That would be a killer move, placing Mr Motlanthe in an awkward corner as he would have to speak in honour of the man he may contest for the ANC presidency in Mangaung. The past 11 lectures gave Mr Zuma a platform that became a campaign tool ahead of Mangaung. Most of the lectures were hardly noteworthy. He was criticised for botching Nelson Mandelas in July by delivering what sounded and read like the bare facts, gravely lacking interpretation and insight. The lectures were an opportunity for the ANC to connect with its supporters, to market and entrench the 100-year-old brand. But too often they turned into a Zuma affair. Every month, Mr Zuma was guaranteed an ANC platform and a carefully screened audience to these invitation-only lectures. But Mr Mbekis absence at the function of his own honouring his office said he was away on legitimate business shows he does not take such events seriously. There may well be far more important things for the man who was named the African of the year on Friday, than being present when being showered with praises.

12 November 2012 The Times Page 1 TJ Strydom and Quinton Mtyala Revolt over low wages Thousands of Anglo Platinum mineworkers say they would "rather die" than return to work today. The workers have been striking for eight weeks over wages. Last week, Amplats tabled a once-off R4500 payment offerif workers returned to work today. It said the offer, which would cost the mining company more than R2-billion, would be retracted should workers fail to report for duty this morning. Last month, the company fired 12000 workers who went on an illegal work stoppage at its Rustenburg mines. Evans Ramokga, who represents the striking workers, said yesterday that no one would go back to work today and that the strike would continue. "We're not happy with some of the conditions on offer, such as final warnings and threats of disciplinary action against dismissed workers.'' Striking miners are demanding a basicR16000-a-month salary, a demand mine bosses said would be difficult to afford. They said it could also lead to layoffs. Last week, Amplats offered incentives that included a once-off hardship payment of R2000. But the workers turned them down, saying management should match the 22% salary increase granted by Lonmin in August. The Lonmin deal came after a standoff that ended with police killing 34 miners. Amplats' parent company, Anglo American, last week placed four of its Rustenburg mines "under review", a move seen as a possible closure of the mines. The mining sector has in recent months been rocked by violent wildcat strikes that led to killings and destruction of infrastructure. With a deal secured in the gold sector, the platinum mines remain on the boil. Trade union federation Cosatu warned that the Western Cape farmworkers strike could spread to other areas if a wage agreement was not reached soon. It's Western Cape secretary, Tony Ehrenreich, said the government and farmers would have to adjust the minimum wage of farm workers.

The farmworkers are demanding R150-a-day wage, but negotiations between them, labour unions and Minister of Agriculture Tina Joemat-Petterssen to resolve the violent pay dispute remain deadlocked. At the weekend, Agri-Western Cape said it had no mandate to negotiate on behalf of the farmers. But its spokesman, Porchia Adams, insisted the average of R71 a day the workers were currently being paid was above the national minimum wage. Farmers had earlier agreed to pay their workers R80 a day but this was rejected. Tomorrow, Joemat-Petterssen will meet national farming bodies and the Department of Labour to possibly revise the minimum wages for farmworkers. The workers are also demanding free basic electricity and an end to illegal evictions, employment of illegal immigrants and the use of labour brokers. Joemat-Petterssen's spokes- man, Palesa Mokomele, said the minister was hopeful a breakthrough would be reached after last week's violent protests that led to the N1 being barricaded, shops looted and non-striking workers attacked. Moneyweb reported last week that experts at a meeting of the SA Savings Institute agreed that, should the country's wider unsecured market destabilise, it would be as a result of over-indebtedness in the lower income segment. Many economists expect the Reserve Bank to increase interest rates next year, which would squeeze those with debt even further. The prices of electricity and fuel have risen sharply as Eskom rolled out tariff increases and crude oil has rallied. Basic foodstuffs such as maize have become more expensive following a drought in the US. Low-income earners are hit hardest by such increases as they spend a large portion of their income on food and transport. Farmworkers are among these low-income earners. 12 November 2012 The Times Page 2 Andile Ndlovu Rebel with a cause Tutu wins R8.7m

Whether protesting against former British prime minister Tony Blair's visit to South Africa, or criticising national government, Archbishop Desmond Tutu has rarely shied away from controversy. His insistence on "rocking the boat" earned him an R8.7-million Special Award from the Mo Ibrahim Foundation. The foundation announced in October that the award, which Tutu finally collected at the weekend, was a once-off. Legendary singer - and an activist in her own right - Angelique Kidjo presented Tutu with the award, saying of him: "With infectious humour but also steely resolve, Archbishop Tutu has worked tirelessly to promote peace, human rights and to champion the oppressed. "He continues to show himself to be the scourge of injustice, ready to rock the boat if necessary and speak out against those political leaders who he believes have let down their citizens and wider world. "For throughout his life, he has shown himself unafraid 'to speak truth to power', which is why he was such a worthy recipient of this Special Award this evening." In his acceptance speech, Tutu thanked, among others, his wife Leah, his mother Aletta, and Trevor Huddleston, the man who visited him regularly while he was a 14-year-old tuberculosis patient. The Mo Ibrahim Foundation's annual governance weekend this year focused on youth and Tutu said : "Young people really are dreamers. They dream of a better kind of world. They dream that we can make poverty history. "And they were at the forefront of the Arab Spring. ''Don't be affected by the cynicism of 'oldies' like us. Go ahead and dream of a different kind of world - you, young people, are our hope." Tutu is an active spokesman for Girls Not Brides, a movement aimed at ending child marriages. He vehemently opposed Blair's visit on the basis of the former leader's role in the war on Iraq.

12 November 2012 The Times Page 2 Graeme Hosken Inquiry given key to arms deal allegations

Confidential reports containing detailed information about people involved in the controversial multi-billion rand arms deal have been uncovered. The existence of the reports was revealed at a closed meeting in Pretoria on Saturday of former Scorpions investigators and members of the Seriti Commission of Inquiry. The inquiry was set up by President Jacob Zuma to establish the truth behind the claims of fraud and corruption that have dogged the 1999 deal for more than a decade. At the meeting, at the Sheraton Hotel, were former Scorpions investigators, specialist auditors and accountants, and top anti-corruption lawyers. The lawyers included advocates Billy Downer, Gerda Ferreira and Johan du Plooy. The three were instrumental in the successful prosecution of Zuma's former financial adviser, Schabir Shaik. The information received on Saturday is said to show that earlier investigations into the arms deal were deliberately stonewalled, allegedly to protect high-ranking government officials. A commission insider yesterday said that those at the meeting had provided important information. "This meeting was invaluable. The commission's investigators were provided with the key needed to expose the corruption. It is the missing piece in a puzzle," he said. He said the key was a number of reports "buried" deep inside four shipping containers. "When the commission's investigators took over from the Hawks, they were given shipping containers [containing] documents which had been in the possession of the Hawks. "Once [the containers were] opened, investigators were confronted with millions of documents relating to the inside workings of the deal. "The problem was that nothing was indexed, numbered or filed properly," he said. He said it was a paper mountain, that, without Saturday's meeting, could not be climbed. "No one knew where to start ... a lot of the information could not be formed into the much-needed paper trail.

"These reports put everything together. They will be the nail in the coffin for a lot of government officials, international defence companies, and foreign and local businessmen," he said. Asked if the way in which the commission had been given information was an attempt to thwart it, the insider said it was not clear. "But, with this information, it will make sifting through these documents a lot easier." He said that those who attended the meeting - who no longer work for lawenforcement agencies - were able to make full disclosures because they were not restricted by confidentiality agreements. "Everything is now being carefully documented to ensure that nothing is 'lost' or accidentally disappears," said the insider. Commission spokesman William Baloyi said "the meeting was of value" but refused to disclose the content of discussions. The commission meets today to plan its next moves. 12 November 2012 The Times Page 8 Justice Malala ANC is running scared In the late 1980s, as the apartheid state collapsed under the weight of its own rot and the ANC prepared itself for freedom, a member of the party's constitutional committee submitted a paper for an internal seminar on culture. The paper was by Albie Sachs, who later became a Constitutional Court judge and a celebrated author. Towards the end of the paper, he made one of the most moving declarations I have ever read about what it meant, then, to be a member of the ANC. He wrote: "We think we are the best (and we are), that is why we are in the ANC. We work hard to persuade the people of our country that we are the best (and we are succeeding). But this does not require us to force our views down the throats of others. "On the contrary, we exercise true leadership by being non-hegemonic, by selflessly trying to create the widest unity of the oppressed and to encourage all forces of change, by showing the people that we are fighting not to impose a view upon them but to give them the right to choose the kind of society they want and the kind of government they want.

"We are not afraid of the ballot box, of open debate, of opposition. "One fine day we will even have our Ian Smith equivalents protesting and grumbling about every change being made and looking back with nostalgia to the good old days of apartheid, but we will take them on at the hustings. In conditions of freedom, we have no doubt who will win, and if we should forfeit the trust of the people, then we deserve to lose." In 1990, when ANC leaders started trickling back into the country to negotiate openly about the democratisation of our country, I went to a meeting at the University of the Witwatersrand. The meeting was meant to brief United Democratic Front activists about progress in negotiations. The two leaders sent to do the briefing were Mathews Phosa, now the ANC treasurer-general, and Penuell Maduna, who later became justice minister. It was a joy to be at that meeting. The two were challenged by the many activists there, who voiced concerns about the possibility of the ANC accepting a "sweetheart deal" from President FW de Klerk's National Party. Phosa and Maduna debated, parried and thrust, attacked and defended their positions. They were not afraid. They were not afraid because they believed in the nobility of their struggle, the robustness of their strategy and tactics, and the logic of their arguments. And so it was that Nelson Mandela, two weeks before the historic 1994 election, stood before de Klerk and debated with him. Mandela was not afraid of debating with de Klerk. History, logic, belief in the ANC's own ideas and positions - they were all backing him up. Several times this week, Sachs's moving description of the ANC came, uninvited, to my mind. It came to me as I listened to presidential spokesman Mac Maharaj accusing DA leader Helen Zille of racism because she referred to President Jacob Zuma's taxpayer-funded Nkandla palace as a "compound". Racism? Is this w hat the ANC has been reduced to? When looting takes place in front of our eyes, the only argument the presidential spokesman can make is that this is racism? It was the same with Public Works Minister Thulas Nxesi a few weeks ago when he suggested that criticism of this kind of spending showed a lack of understanding of "African" values and lifestyles. Fear of ideas, of debate, has become a trend in the ANC now. In October, Congress of the People leader Mosiuoa Lekota was thrown out of parliament because he, quite rightly, asked why Zuma was defying a Supreme Court of Appeal order to hand over the spy tapes that let him off 700 charges of corruption. Why was he thrown out?

Is it because Zuma's defiance of the Supreme Court cannot stand the harsh light of a debate in parliament? The ANC at its best was an organisation of ideas, led by men and women of principle who never shied away from propagating, challenging or defending those ideas. It was not about individuals. Yet, over the past decade, slowly but surely, it has become an organisation scared to debate and defend its ideas. Instead, the party is regressing into some sort of tribal clan, led by a chief whose word is law. The likes of Maharaj, Nxesi, the paranoid Blade Nzimande and others in the ANC exist to protect this patriarchal leader from proper scrutiny. The ANC has sadly declined to become an organisation bowing before a tribal leader, afraid of ideas and scrutiny, fearful of debate. It is a shell of its glorious former self.

12 November 2012 The Times Page 8 Sapa SA elected to UN body South Africa has been elected to the UN Economic and Social Council, the International Relations Department said yesterday. "South Africa finishes its two-year non-renewable, non-permanent membership of the Security Council on December 31 and immediately assumes membership of the Economic and Social Council on January 1," the department said. South Africa last served on the council in 2006. Responsible for economic and social development, it is one of the principal organs of the UN, alongside the Security Council and the General Assembly. "It is significant that South Africa will be a member of this critical organ of the UN at the time that the target date [2015] for the achievement of the Millennium Development Goals is fast approaching," the department said. The council includes commissions on population and sustainable development, crime prevention, science and technology, and the status of women. South Africa will promote Africa's interests.