Publication: Business Day Issued: Date: 2008-08-09 Reporter: Reporter:

Equivocation on Arms Deal Highlights Need for Funding Rules



Business Day

Date 2008-08-09
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If the ANC accepted donations from beneficiaries of state contracts, it cannot fool the electorate by resorting to technicalities

The Presidency’s “categorical denial” that President Thabo Mbeki solicited R30m from a German consortium in return for ensuring that it won the submarine contract in SA’s multibillion-rand arms deal would be more credible if the rest of its response was not so suspiciously disingenuous.

Minister in the Presidency Essop Pahad and Public Enterprises Minister Alec Erwin have placed too much emphasis on Mbeki’s insistence that he neither asked for nor received money from MAN Ferrostaal, as implied in the Sunday Times last weekend.

Pahad insisted that Mbeki “in no way benefited from the arms deal”, while Erwin demanded the newspaper prove the African National Congress (ANC) received money from the consortium. But their carefully chosen words only served to heighten suspicions that all was not right with the arms deal.

The Sunday Times did not accuse Mbeki of benefiting personally from the arms deal. And the absence of definitive proof that the ANC received money from MAN Ferrostaal does not mean it did not happen.

Erwin and Pahad have a history of making misleading statements. Who could forget Erwin’s attempt to absolve the government of responsibility for the power shortages in the Cape two years ago by attributing a stray bolt that shut down the Koeberg nuclear plant to “human instrumentality”?

Pahad’s response to questions over his role in obtaining financing for an approved Mbeki biography raised similar doubts over his relationship with the truth, as did a controversy over the Presidency’s involvement in nominating SABC board members.

It seems the pair are wheeled out whenever a clever answer is required — one guaranteed to offer loopholes later should the whole truth be exposed and further denials become necessary. However, they could not entirely avoid direct questioning on whether they could assure the nation that no money from arms deal bidders has found its way into the ANC’s coffers. Pahad’s reply, “Maybe Alec (Erwin) is a watchmaker, but I’m not. I don’t offer any guarantees,” was calculatedly fatuous, but Erwin’s as good as gave the game away. “What those companies did, in their own right, we cannot be held responsible for,” he said.

Perhaps not. But the ANC can and should be held responsible for decisions it makes, and if that included accepting donations from beneficiaries of the arms deal or any other state contracts, it had better be prepared to explain itself to the electorate.

And it is not good enough to regurgitate the excuse that there is no law in SA preventing such companies from making political donations, or that it does not count as bribery unless the demand for payment forms part of the contract itself — the people of SA are not nearly as stupid as the ANC seems to think.

The government and the ANC have stuck to the line that there is insufficient hard evidence of wrongdoing to justify a judicial inquiry. And the party’s recent internal investigation was clearly motivated more by internecine battles than a desire to establish the truth. ANC president Jacob Zuma has not helped matters by hinting that he will dish the dirt on Mbeki and others in government should he be unable to avoid trial on fraud and corruption charges arising indirectly from the arms deal.

The core of the problem remains the lack of regulations promoting transparency in party funding. The ANC has steadfastly resisted such demands, and it is becoming clear why this is so — who knows how much less corporate funding it might have received had its books been open to scrutiny before the 1999 elections? Clear rules on which sources of party funds are acceptable and which not, would not prevent companies or individuals from trying to buy influence, but it would rid the South African political system of a grey area that all but invites corruption.

With acknowledgements to Business Day.