Tag: Transnet

Freedom Front announces R90 billion claim against Transnet on pensioners’ behalf

A struggle which the Freedom Front Plus (FF Plus) had undertaken for years on behalf of Transnet pensioners for compensation for damages, which members of the pension fund have suffered over the past 20 years due to alleged maladministration of the fund, has now led to the launching of the largest civil claim in South Africa’s legal history against Transnet and the government.

The FF Plus, following numerous enquiries and meetings with Transnet pensioners in the past couple of years, undertook to handle the injustice perpetrated against them politically and legally and would try to resolve it.

The FF Plus has fulfilled the first part of the undertaking, i.e. to take Transnet and the government to court for damages which its pensioners had suffered. A civil claim was instituted on Friday (26 April 2013) at the Pretoria High Court.

What makes the case so historical is underscored by the following:

  1. The claim amounts to nearly R90 billion. It is the largest legal claim in the history of South Africa and naturally also the largest class action;
  2. The extent of the case is clear if it is taken into account that it is a claim worth twice the value of the arms deal;
  3. The claim could break Transnet financially and the mere institution of the claim could lead to a serious downgrading of Transnet’s credit status and most likely that of the state also;
  4. The claim arises from probably the largest alleged fraud which has been committed with a pension fund;
  5. The claim affects 66 000 pensioners and their dependents, of which 62% at present receive less than R2 500 monthly.

The FF Plus will be announcing what the intra-parliamentary strategy will entail in conjunction to the legal strategy, now that legal proceedings have been instituted.

Black business should stop charging double prices to government, says Deputy President Mantashe

Black business should deliver affordable, quality products and services if it wants government contracts, ANC secretary general Gwede Mantashe said on Tuesday.

“As we support black business, black business must bring a commitment of delivery, cost-competitive and quality of items that are procured,” he told analysts and business people in Soweto.

He asked why a government-built school cost a minimum of R20 million to construct, while a private sector-funded school only cost around R5m to R10m.

“Something is wrong with this system of creating layers and layers of business because the primary objective of building a school is made secondary… to creating business beneficiaries.”

He was addressing analysts as part of the African National Congress’s programme to speak to various sectors in South Africa.

Mantashe said the primary outcome of the ANC lekgotla in July was that the government needed to drop the system of tenders.

It needed to move away from giving business to black companies, and then afterwards arguing about quality and cost.

“Don’t undermine this question of people delivering bridges that get eroded with the first rainfall. It can’t continue. It just can’t continue. It is wrong. It is wrong.”

Mantashe suggested that black businesses look to SizweNtsalubaGobodo, South Africa’s largest black auditing firm, as an example of how to succeed.

The company started small, but now handled the entire audit account of parastatal Transnet because of the quality of its work, Mantashe said.

He said the ANC would meet the Black Business Council (BBC) to discuss the strengths and failures of black economic empowerment (BEE) and the role of state procurement in transformation of the economy.

A representative from the BBC had complained that the government’s procurement policy had gone wrong.

Various delegates raised questions about the effectiveness of BEE policies.

Mantashe responded that he had a problem with the idea of BEE.

“I have a serious grievance with BEE… focusing on shareholding with beneficiaries not being operational.”

He said if the beneficiaries of BEE deals were not part of operations, they were not gaining a deeper understanding of the business in order to grow.

“Operational exposure, to me, is more powerful than just ownership…”

Mantashe drew parallels with when the Afrikaners were in power from 1948 to 1994.

“Afrikaner capital, after 40 years in power,… they couldn’t produce a single CEO of mining, not one.”

All CEOs of mining companies up until 1994 were white and English.

“We should not wait for 40 years to produce genuine black CEOs who can run companies.”

He commended Xstrata’s South African CEO Sipho Nkosi for not being a “window-shopping CEO”.

“Sipho Nkosi is not a big shareholder, but he is very operational… he knows mining. To me, that is how we are going to transform the economy.”

When questioned about factions within the ANC, Mantashe said they had been around for years.

“I wish we can have an organisation that has no factions.”

He spoke of a Pan-Africanist faction splitting from the ANC amid “violent polemics” in 1959.

“It was then, it is today, it will be in future,” Mantashe said.

However, he said: “When there are confrontations in an organisation, we always exaggerate them as always a division about to see a split. I think that is a flawed analysis when there are politicians.”

He said the contradictions helped move the party forward.

“The fact that people have different views… actually it sharpens you.”