ANC mine grab claims
Julian Rademeyer, Jacques Pauw and Andrew Trench
Johannesburg - The ANC’s controversial investment and fundraising front, Chancellor House, has secured a lucrative stake in the scramble for South Africa’s mineral wealth – a move critics slate as a shocking conflict of interest.
City Press has established that over the past six years, Chancellor House Mineral Resources – a subsidiary of Chancellor House Holdings – has netted rights to carry out prospecting at 560 sites in Northern Cape, North West and Mpumalanga.
Applications to prospect at a further 400 sites are still under consideration by the department of mineral resources (DMR).
Investigations also reveal that key members of the party’s national executive committee (NEC), including treasurer-general Mathews Phosa, deputy ministers Ebrahim Ebrahim and Ayanda Dlodlo, National Assembly Speaker Max Sisulu, former spy boss Billy Masetlha, businessman Cyril Ramaphosa and ambassador to Italy, Thenjiwe Mtintso, all have direct interests in mining companies.
Details of the prospecting interests are included in a 1.5-million-entry DMR database of mineral rights and now show for the first time the location and scale of the ruling party’s prospecting interests.
The revelations come as a furious debate rages over the potential nationalisation of mines and in the week that the ANC announced it would appoint two senior researchers and a project manager “to investigate successful models that could be considered on the role of the state in mining”.
Chancellor House Holdings chief executive Mamatho Netsianda last week refused to discuss the company’s mining interests and prospecting rights. “I’m not interested in discussing it with you,” said Netsianda, a former deputy secretary of defence.
Peter Leon, a mining-law expert and chairperson of the International Bar Association’s mining-law committee, said it was “very problematic that the state has awarded prospecting rights to the investment arm of the ANC”.
Leon said: “The state should not provide Chancellor House or the ruling party with business opportunities. It is unethical, it is a conflict of interest and is nothing else but favouritism.
“There should be a clear separation between state and business and, in this instance, it is getting blurred.”
According to Leon, the allocation of prospecting rights to Chancellor House created an “unlevel playing field” and Chancellor House “has a clear advantage over other companies trying to get these rights”.
ANC spokesperson Brian Sokutu said: “Chancellor House is a duly incorporated business which has been formed in compliance with the Companies Act and has every right to trade like any other company.
“There is nothing legally stopping Chancellor House from having an investment in any business,” he said. Sokutu added that there was nothing wrong with senior NEC members having interests in mining.
He said: “Where there could be a problem is if somebody holds a senior public service position or that of a minister or deputy minister.
“There is no conflict at all. We have rules and regulations in this country and ethics to follow. We don’t think people need to fear anything.”
Dr Koos Pretorius, a mining expert and director of the Federation for a Sustainable Environment, is investigating the allocation of prospecting rights to Chancellor House.
“It seems as though, once again, the DMR has just bulldozed the whole process and granted prospecting rights without properly consulting land owners, and interested and affected parties,” Pretorius said.
The 2002 Mineral and Petroleum Resources Development Act states that affected parties should be notified of the intention to prospect and should be consulted about the process.
Pretorius said it was problematic that “Chancellor House – and therefore in effect the ruling party – has been granted prospecting rights”.
“This should never have happened. It is a free-for-all with everybody trying to get prospecting rights, whether they know how to mine or not,” he said.
Frans Baleni, general secretary of the influential National Union of Mineworkers, said that while he was not opposed to the ruling party or members of its executive having interests in mining, he was concerned that “you could get connected people who might not add value to the industry and who are there to make money and compromise basic things like human rights and labour law”.
Baleni asked: “The issue is fair play; did they get it like any other person?”
ANC Youth League spokesperson Floyd Shivambu was dismissive when asked about the potential conflict of interest, saying he found the questions “stupid”. He did not see how Chancellor House’s interests and those of senior NEC members would affect debate in the party over mine nationalisation.
The Democratic Alliance’s shadow minister for mining, advocate Hendrik Schmidt, said the ANC “should not be linked to any possible benefits from transformation issues”.
He said: “They benefited from the electricity crisis in view of their involvement and ownership in Chancellor House and Hitachi SA.
“What the ANC has done is ride on the back of transformation, indirectly to the detriment of the people they are supposed to be serving.”