Amending the Executive Members’ Ethics Act Hon Athol Trollip MP November 2011

Contents 1. Background 2. Questionable Deals 3. Summary of proposed amendments to the Executive Members’ Ethics Act 4. Particulars of the proposed amendments 5. Objectives of the proposed amendments 6. Financial implications

1. Background The growing list of President Zuma’s family members and friends who have reportedly benefitted from business deals with the state since he assumed office is cause for serious concern. A 2010 Mail & Guardian report indicated that the combined business interests of President Zuma and 15 adult members of his family accounted for 134 company directorships or memberships of close corporations. Of these, at least 83 were registered in the post-Polokwane-period and are linked to industries in which the state plays a key role, such as mining and telecommunications.

2. Questionable Deals President Zuma’s family and friends have been linked to a number of controversial deals. Some of these include: Khulubuse Zuma – Relationship: Nephew – Deal: Aurora Empowerment Systems/Padmozi – Approximate value: R600 million Mandla Gcaba – Relationship: Nephew – Deal: Durban metro bus – Approximate value: R300 million Nonkululeko Mhlongo – Relationship: Mother of two of President Zuma’s children – Deal: Bucebo General Trading/KwaZulu-Natal legislature – Approximate value: R3.5 million

2. Questionable deals All these deals were done either without tenders or through dubious tendering processes. In some instances, the inexperience of the company linked to a Zuma family member has had a detrimental impact on service delivery and on workers.

3. Summary of proposed amendments to the Act This Private Member’s Bill proposes a number of amendments to be made to the Executive Members’ Ethics Act. These amendments include: Decisions regarding the adjudication of conflicts of interest involving the President, his children and spouses should be made by the Public Protector. Currently, the President is supposed to adjudicate his own conflicts of interest. This is a conflict of interest in itself. That state deals involving the President’s family members should come under specific scrutiny by the Auditor-General to ensure that all tender processes are followed and there are no special favours.

3. Summary of proposed amendments to the Act The Public Protector should adjudicate whether the President has complied with Section 2 of the Executive Ethics Code, which details “general standards” of ethics to which members of the executive must adhere. Currently, the President is supposed to adjudicate whether he has complied with Section 2. Again, this is a conflict of interest in itself. That the President's register of interests be made more easily accessible to the public. Currently, members of the public wishing to view the register have to arrange a viewing with the President’s office. The DA proposes that this system be changed, and that the registry be published on the President’s website.

3. Summary of proposed amendments to the Act The legislative amendments proposed by the DA will, if implemented,. put in place important safeguards to limit the scope for presidential influence-peddling. When it comes to the President and his family, the highest standards of transparency and accountability should apply. The people of South Africa shouldn’t be left guessing whether President Zuma’s family is trading on the President’s name. We should be absolutely sure that they are not.

4. Particulars of the proposed amendments It is proposed that legislation be drafted that will propose the following changes to the Executive Members’ Ethics Act: That the following clause be added at the end of Section 2(d) of the Executive Members’ Ethics Act: “In the case of the financial interests disclosed by the President in terms of paragraph (c), the public portion of the President’s financial disclosure must be available on the Presidency’s website no more than thirty (30) days after the disclosure has been made to the relevant official in the office of the President.”

4. Particulars of the proposed amendments That the following be added as an additional clause [clause (e)] to Section 2 of the Executive Members’ Ethics Act: “Require that gifts and conflicts of interest declared by the President must be adjudicated by the Public Protector.” That the following be added as an additional clause [clause (f)] to Section 2 of the Executive Member’s Ethics Act: “Require that the President must to the satisfaction of the Public Protector meet the criteria outlined in Section 2.1 of the Executive Members’ Ethics Code (“General Standards”), and that in deciding whether the President complied with the provisions of Section 2.1 of the Executive Ethics Code, the Public Protector must take into account the promotion of an open, democratic and accountable government.”

4. Particulars of the proposed amendments That the following be added as an additional clause [clause (g)] to Section 2 of the Executive Member’s Ethics Act: “Require that the Auditor-General takes measures to ensure that state deals involving any of the President’s family are scrutinized to ensure that correct tender procedures have been followed in each case.”

5. Objectives of the proposed legislation President Zuma’s position affords him significant power, which makes his family and friends influential by proxy. The potential for the individuals closest to the President to be favoured in state deals is considerable. The purpose of these amendments is not to target a specific individual, rather it is about ensuring that state resources are allocated on the basis of fair tender procedures, not on the basis of political connections. The DA proposes that amendments be made to the Executive Members’ Ethics Act to ensure that the following broad issues are dealt with: a) That the ease with which the public can assess the President’s declaration of interests is improved. b) That the President’s compliance with the general standards of ethical conduct as outlined in Section 2.1 of the Executive Members’ Ethics Code is adjudicated by the Public Protector, in the same way that all other members of the executive must meet the criteria outlined in Section 2.1 of the Executive Members’ Ethics code to the satisfaction of the President or the Premier, as the case may be.

5. Objectives of the proposed legislation c) That the adjudication of any gifts or conflicts of interest declared by the President are adjudicated by the Public Protector, in the same way that the President or Premier, as the case may be, adjudicates conflicts of interests or gifts declared by members of the executive. d) That state deals involving the President’s family members should come under specific Auditor-General scrutiny to ensure that all tender processes are followed and there are no special favours.

6. Financial implications No significant financial implications stemming from these proposed amendments are foreseen. However, some costs may be incurred by the Public Protector in adjudicating gifts received by the President, the President’s compliance with Section 2.1 of the Executive Ethics Code and potential conflicts of interest. Some costs may also be incurred by the Auditor General should the AG’s office be required to investigate state deals awarded to family members of the President.