Economics

 

When the Prez, this week past, addressed us on the shortcomings of our public services, he touched on the essence underlying our current dilemma with the implementation of political policy. I grew up with the (British) understanding that the civil service was a politically neutral body of persons who served the public and implemented policy. Policy was determined by politicians/Parliament/the people. Civil servants were therefore trained bureaucrats who carried implementation expertise forward, irrespective of who decided policy. The ideal civil servant was experienced, able to advise on implementation and was a source of advice and continuity, to those who, fleetingly, was in charge.  A look back into British and, interestingly, Chinese, history, shows that it certainly was not easy to become a top civil servant – one had to have a particularly good education and one was trained for years. What has happened in our country is that political loyalists were gifted administrative leadership for which they could not possibly have qualified and furthermore political interference in implementation of policy. The rot in our civil service lies partly in political intervention in a sphere that should be reserved for technocrats/bureaucrats rather than yes-men. The result has been disaster. Politicians prattle on about implementation, but they should not be involved in implementation at all, other than to point the way.

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The cost of saving lives? The great debate on the efficacy of Lockdown is now starting, as the immediacy of infection recedes and the consequences of what was decided upon, is becoming apparent: rallying citizens under the cry of saving lives (really ?) versus the distressing reality of hunger (guaranteed). I have little doubt that the hungry would have chosen risk – but then, those who govern, know what is best (really?).

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Monkey business: on a somewhat lighter note is the unintended consequences of things done. Three out of five of monkeys, making up the strategic monkey reserve (primates used for vaccine testing and the like) in the US, are/were imported from China. A freeze on the export of these has resulted in Uncle Sam being short on test subjects at a very critical time.

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Uncle Sam just cannot avoid involving itself in the politics of others: its latest intervention is leaning on Ethiopia (by way of aid cuts) to influence the outcome of dam management (on a tributary of the Nile) within Ethiopia.

 

Business

 

Zimbabwe is short on many things; electricity and money being only two of these. An investigation into the viability of constructing a hydro-electric power plant in the Batoka Gorge is underway (paid for, presumably, by the World Bank. Undoubtedly such a scheme will help produce more power to the area. It cannot, however, solve the drought-imposed interruptions which will undoubtedly happen again. If the Kariba Dam is not big enough to feed its generators during a drought, neither will the Batoka Gorge, which will hold substantially less water than does Kariba.

As regards money, Zim had pledged to compensate some commercial farmers for lost land (actually just their improvements thereto) to the tune of US$ 3.5bn: this it quite obviously cannot pay, leading it to consider giving (presumably unimproved – would you really invest in that country again?) land to those robbed of it in the first place. This has led to the War Veterans referring to this as a sell-out, saying (and note the order of consultation) “We were not consulted, neither were the spirit mediums who own the land, traditional chiefs and Members of Parliament.”

Jip, Africa is different. What should be realised here is the massive scale of the then dispossessions. But Zim has a problem, it has chosen to compensate only those who were protected by Bilateral Investment Protection and Promotion Agreements; why? How else could you borrow money for your new dam?

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Development and kickstarting the economy: one positive note came from B4SA, which referred to an unprecedented level of cooperation between government, labour, civil society and business. One hopes this goes somewhere as the much-vaunted Public Works and Infrastructure Initiative has not yet produced much tangible work for engineers. One of the latest linked initiatives, the creation of a youth unemployment database, appears to be an exercise in shovelling smoke except insofar as it provides for a district-model of unemployed professionals and artisans.

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Shitzo Santam: on the one hand Santam is fighting business interruption liability tooth and nail (under the shame-induced guise of “getting clarity”) yet has made provision of R1.3bn, should it have to pay. The public backlash against its failure to accept liability for CV19 business interruption compelled it to pay out virtually the equivalent of that sum (R950m) in “relief funds” – which it punts as “helping out”.

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Poisonous politics: our local municipality, Msunduzi, has proudly reduced its VIP protection costs from R80m to R27m per annum, yet still finds itself in difficulty with the Minister. The municipality is broke, but has to fork out protection monies for councillors: why? The fact is that we are not talking about other political parties or criminals trying to kill our local politicos; these worthies need protection against those from their own ranks who are unhappy with decisions taken. Why does this happen in this country – is this a party-specific problem, and dare one ask, confined to a specific region or race? Before I am labelled a racist: would a NW Nama councillor need protection as opposed to a Zulu councillor?

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The CV19 storm is abating and politicians (aside from having “learnt lessons” – possibly they were taught lessons in making health services work) rightly point out that we need a more equitable health service. Thus, a return to the NHI: the interesting thing is that, if the urgency and spend thrown at our CV19 programme, had been applied to our existing system, we would have been in a much better place by now. Political will is clearly driven by more by opportunity than a pre-existing need.

 

Property

 

Residential property rental arrears: Moneyweb reports that the residential rental arrears are, on average, above 25% and vacancies are above 11%. Hardest-hit properties at the very bottom and very top ends of the market. If vacancies are at over 11% – where do these tenants go to?

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Rainbow Junction is a proposed mixed-use development North of Pretoria’s central business district and will be built over the next ten years – it promises to contribute 1.8% of Gauteng’s GDP from construction and operations over the next 10 years.

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This is been said before, but the numbers are interesting: Everythingproperty says that single women are now South Africa’s biggest single group of property buyers. Last year 60% of BetterBond applications came from single women. The average price paid by single women for properties is just short of R500k whilst that for married couples, is R600k.

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CV19 delays: almost an aside, is a note in KZN Industrial&Business dealing with the requirement of bodies corporate of sectional schemes, that AGMs should be held within four months of their financial year-ends (and within six months for Homeowners Associations). Many such year-ends would have started on 1 March and undoubtedly would not have been held in time owing to movement and meeting restrictions.

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Imagine a property market (like many overseas) that never grows and is subject to CV19 restraints. South Africa is different; FNB and BetterBond report a rebound in home sales and bond applications – the latter by 52% y-o-y: July and August recorded the highest number of bond applications in the history of the latter. Much of this (70%) is driven by first-time homebuyers: reported on before but still remarkable.

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As estate agent you cannot simply stop practising – you must notify the EAAB. If you don’t, and some years later you wish to re-enter practice as estate agent, you will be fined. This point of departure by the EAAB, has led to a dispute between it and Rebosa, which may well end up in a court case.

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R2m is what it will cost to buy Montenegrin citizenship. This country is set to join the EU in 2025 and this is a cheap rate as such things go. Take a look: https://businesstech.co.za/news/wealth/429920/why-montenegro-is-attracting-south-african-investors/

 

Practice

 

Counter spoliation is a legal remedy which allows a person to forcibly re-take possession of property which is in the process of being taken from them. The City of Cape Town has been interdicted by its High Court from exercising this right in evicting those in the process of illegally occupying land. A YouTube video by Dr Anthea Jeffery, holds this to be tantamount to meddling with our common law. The result will be interesting.

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Does our Constitutional Court have plenary powers to deal with any non-constitutional matter? A recent article in De Rebus by adv. Harms on the topic is worth a read: http://www.derebus.org.za/the-reach-of-the-constitutional-court-piecemeal-litigation-and-the-principle-of-res-judicata/

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The news of the week is that a bunch of practitioners have embarked on an attempt to liquidate the RAF. That entity is, without a shadow of a doubt, insolvent. But, compared to the liquidation of SAA, it would take a brave judge to grant such an order, given the financial reverberations that would result. In theory, claimants might end up with nothing, they being essentially creditors: can you see that happening?

Allied to this initiative is an application that will be heard on 13 October in the Pretoria I Court in which six applicants argue that the appointment of Mr Letsoalo, as CEO of the RAF, is constitutionally invalid. Fun. I have a copy of that application – ask me.

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Hot on the heels of a virtual meeting between Registrars of the various deeds registries and practitioners, will follow a meeting on 9 September between practitioners and the Deputy Minister of Justice, regarding practice problems in Masters’ Offices. Hats off to those driving this initiative (Catherine Gascoigne amongst others) as, verily, the post-lockdown access to those offices is such that dysfunction is rife.

The essential complaint is that one cannot gain access to those offices but must deal via email or the post – which is simply not answered. As an aside: there’s nothing new in this – any letter to the Master, other than those absolutely necessary, is and has in the past, been mostly a waste of time! I gather that CIPC and possibly even the Registrar of Trademarks will be next!

Whoeee! Vat hom!

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In the tariff of suggested conveyancing fees, item 1.12 of the General Notes, provides for a fee for certificates, requested by one conveyancer on request from another. For years bonding attorneys have piggy-backed on transferring attorneys, asking them to certify all manner of things which I believe the bonding attorneys should be responsible for. I recently sent a fee note to a leading Pietermaritzburg practice for providing such a certificate, at their request. An indignant response was followed by stunned silence. Fun.

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It often happens that bonds are held by entities which have been de-registered. The standard remedy is to obtain a court order, which is expensive and time-consuming. Allen West has come out with an interesting and novel argument to the effect that the assets of a deregistered company are bona vacantia and vest in the state. Why not apply to the Treasury for such cancellation? I can provide you with his article on request – alternatively, ask him yourself: allen.west@tcpta.co.za

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I have often seen parties backdate contracts, powers of attorney and the like, especially when they have stuffed up. What is the effect of backdating a contract? Is such a contract valid and, if not, why not? After all, contracting parties are free to do as they please within the boundaries of what is proper? I hold a TSAR article by prof Lubbe on the topic – ask me for a copy.

 

Comment

 

Not guilty until found so by a court? I have, in the past, repeatedly commented upon the ANC seeing itself as the government. In its response to widespread public indignation on fielding tainted politicians in leading roles, it seeks to cleanse itself of its perceived tolerance of self-enrichment by having its integrity commission examine our leaders for lapses of judgement. This is a no-win approach: if an official, so investigated, steps down, the inevitable conclusion will be drawn that he is guilty before being charged. If officials, presumed to be tainted, do not step down and are not prosecuted, they and the ANC will never escape the suspicion that the investigation was not rigorous or objective. The commission itself admits that it does not have the technical expertise to conduct such investigations. The state does – the difficulty is that the sheer scale of corruption has overwhelmed our prosecuting authority and there is a justified perception that leading politicians will never face the music, for one reason or another. This development bears watching; a farce if you are a cynic and, if an optimist, a great start.

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Violence: above are comments on internecine political violence necessitating security details for even third tier (minor) politicos. We have a murder rate of just short of sixty persons per day. Where else does this happen (except in Mexico!) and for what reasons would one want to have a go at a city councillor? The fact is that we live in a violent society and, our citizens are tiring of this. Street lore is that many mobile professionals leave because of this – who wants to live under constant threat of hijack, break-ins and such? The result is a distressing loss of expertise and money invested in education and training. What has never been explained to me is why our country is this prone to violence. We prohibit driving under the influence and hold awareness campaigns to prevent road deaths, but we never seem to get around to seriously asking what can be done to reduce violence in general in this country.

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This week past I signed up an exiled Ethiopian professor and his PhD spouse, both of whom who had left their homeland for fear of reprisals: what intrigued me was his sense of loss at the passing of an ancient, structured society, that held its roots dear, in favour of a socialist society which was clearly not governed properly on the passing of Haile Selassie. The result was destruction of the past in favour of a new present. This is a recurring refrain in civil life. An unjust regime is ditched in favour of one thought to be better; the problem, of course, is that those who have never had the opportunity of governing, cannot; if only by virtue of inexperience. I cannot but identify with his experience:, an enclave of Afrikaners had farmed in then Rhodesia; their tongue was reminiscent of Afrikaans as it had been spoken in the south 50 years before and they had clung to their heritage via churches and a school. I was part of that society, and it has vanished as if it had never been.

 

Quotables

 

“The smartest side to take in a bidding war is the losing side.”

Warren Buffett (ex BM)

 

Lighten up

 

Be careful what you wish for: a month ago an Australian newspaper ran an article on a stripper who was destined to jump out of a cake at a bachelor party. The cake was delivered by mistake to the cafeteria of an old-age home in Perth. When busty Boom Boom Baker turned on the boom-boom box and burst out of the cake, two of the old folks had fatal heart attacks and six required treatment for a range of complaints ranging from palpitations, nausea, overexcitement (I had not known that there was such a condition) and shock. Reportedly a handful of wrinkly men were not offended and had to be frogmarched from the cafeteria by staff. Oh yes, I nearly forgot, the legal angle is whether one could charge the delivery man for culpable homicide; after all, the negligent delivery of a surprise stripper, armed with a boom boom box, to a retirement home, must result in foreseeable loss? Anyway, what a way to go!

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I confess to having had some difficulty in finding a PC, gender neutral … cake-jumping cartoon…

 

Author: Dr Daan Steenkamp

 


 

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