Send PIC Amendment Bill back to parliament – DA to Ramaphosa

The Democratic Alliance (DA) called for President Cyril Ramaphosa to send the “flawed” Public Investment Corporation (PIC) Amendment Bill back to parliament.

“In its current form, the Bill will not address the governance crisis at the state asset manager as explained in the damning Mpati Report which was released on Thursday,” DA MP Alf Lees said in a statement on Friday.

Lees said the Mpati Commission concluded in its report that the failure to take reasonable steps before investment decisions were made, was partly a result of the board and the executive’s poor decision-making processes, which disregarded PIC policies and its standard operating procedures.

“It is therefore clear that the appointment of board members and the executive needs to be transparent and subject to due diligence by parliament.

“The commision report specifically states that the deputy minister of finance should not be the PIC chairperson,” the MP said.

Lees further said the bill gives Minister of Finance Tito Mboweni “extensive powers”, which included designating the deputy minister of finance or any deputy minister in the economics cluster to be the chairperson of the board.

Lees also said the minister can appoint members of the board in consultation with Cabinet, which compromises PIC’s independence.

“This severely compromises the independence of the PIC and erodes the ability of the organisation to make rational investment decisions, insulated from any political pressure,” he said.

The MP said the bill has some “vague clauses” that allow anyone who wants to use PIC money for purposes other than productive investments.

“For example, one clause says ‘the corporation, must as far as possible, seek to invest to be in line with the Republic’s development objectives’.

“It not impossible to deduce that ‘development objectives’ can be anything from using PIC funds to bail out Eskom or buy overpriced assets such as Sekunjalo companies,” Lees said.

He said the findings of the PIC Commission had laid bare the governance challenges that led to the plunder of state pensioner funds.

“If Ramaphosa is to sign the PIC Bill in its current form, he will not only go against the commission, but will also expose PIC money to further abuse,” Lees concluded.

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