The ANC’s investment arm, Chancellor House, came in for a drubbing during a debate on party political funding hosted by Idasa on Tuesday night.
The DA and UDM, as well as businessman Sipho Pityana who is chair of the Council for Advancement of the South African Constitution, were united in their condemnation of Chancellor House, labelling it unethical and clearly involved in a conflict of interests, while ANC Secretary General Gwede Mantashe argued it was a transparent funding arm of the ruling party.
Although the debate in Cape Town, chaired by Idasa programme manager Judith February, was to centre on the lack of legislation on the private funding of political parties, which meant parties did not have to disclose their private funders and therefore ran the risk of funders influencing policy, Chancellor House quickly became the central bone of contention.
Noting the “toxic impact” money has over power in her introduction, February mentioned Chancellor House and the Arms Deal as two examples of money’s corrupting influence.
ID/DA MP Lance Greyling was quick to slam the ANC’s investment arm, pointing out their 25% shareholding in Hitachi, which was awarded a R39bn contract to supply install boilers at Eskom power stations.
This was unethical and “completely wrong”, said Greyling.
With President Jacob Zuma announcing a massive infrastructure development plan in order to drive economic growth, Greyling said the ruling party was “well set” to benefit from shareholdings in companies that would get the tenders for such work and then get paid with money the government was borrowing in order to fund its infrastructure programme.
While Mantashe said there was nothing illegal in Chancellor House being and ANC funding arm, Greyling countered that it was only legal due to a lack of legislation governing the private funding of political parties, and the drafting of such legislation, he argued, that had been stymied by the ANC whenever he had tried to raise the issue in Parliament since then president Thabo Mbeki said parties should discuss the matter in 2006.
UDM leader Bantu Holomisa pointed out that in the Hitachi deal, the public were paying Eskom for the provision of electricity and Eskom was using that money to pay Hitachi, with party of Hitachi’s profits going to the ruling party through Chancellor House.
This was clearly unethical, he said. “You cannot use a state resource as a cash cow and milk it every day.”
If all other political parties could partner with state institutions to make money, it would be a different matter, he said, but that was “not the case”.
Pityana also argued that the ruling party doing business through Chancellor House with companies that benefited from contracts with the state or with state-owned enterprises, clearly involved a clear conflict of interests and if the ANC insisted on keeping Chancellor House as a party funding arm, it should only invest in companies that had no dealings with the state.
In defending Chancellor House, Mantashe, said it invested “everywhere and anywhere”.
Hitachi was a company that constructed boilers in numerous countries, he said, that they also supplied South Africa was not a reason to not invest in them.
He said Chancellor House invested in mining as well, that mining licences were granted by a state department was not the fault of Chancellor House, he argued.
“Chancellor House is an example of a transparent source of funding,” he said.
He further defended the existence of Chancellor House by saying it was created to close the gap created when donor funding – which had supported the ANC during the struggle – retreating after democracy had been obtained.
The ANC had taken the initiative to create an alternative funding arm, he said.
“That we should not take initiative is saying we should starve ourselves to death and collapse.”
The opposition to Chancellor House by opposition parties was “sour grapes”, he said, as they had not been as resourceful as the ANC.
The ANC needed money, he said, “we have constituencies to service”. – Steve Kretzmann
