ICYMI 💥 After the Bell: Did the DA inadvertently touch the ANC on its studio?

For those who are unfamiliar with the term “Don’t touch me on my studio”, it goes back quite a way to 2010 during a now-infamous on-air confrontation between a  former AWB member, Andrè Visagie and the show’s host Chris Maroleng on the news programme Africa 360°.

During the live broadcast, the discussion got heated, and Visagie became confrontational with political analyst, Lebogang Pheko. Maroleng intervened, at which point Visagie appeared to turn on him, and it was at that moment that Maroleng uttered the now-iconic line: “Don’t touch me on my studio!” What he meant was “don’t get physical in my studio” or something like that, but in the moment of tension he misspoke and a famous meme was born.

I guess today it means something like, “Don’t touch me on my particularly sensitive spot”, which gives rise to my suspicion that the Budget 2025 negotiations collapsed because the DA was seeking something particularly sensitive. What was it? A little recent history is needed here. 

The public record of what was negotiated between the DA and the ANC has not been widely disclosed. There were hints here and there, but generally very little was disclosed by either party during the few weeks of talks. 

But now that the negotiations are over and have failed, we know a lot more. I managed to ease a document from quite late in the negotiations process out of the hands of someone on the DA side who was not personally involved in the discussions. And it’s very revealing in many different ways. 

Claims are just bunk

The first thing it shows is that the ANC’s claims that the DA was “lying”, “negotiating in bad faith” and was “arrogant” are just bunk. As you can see here, the document specifically says the DA is not seeking “a tactical win” from the negotiations: 

“It is important to emphasize that the DA is not looking for a tactical ‘win’ on the budget. What we require is a strategic partnership with the ANC in the GNU to take South Africa into a more prosperous future.”

Second, it explicitly recognises that the ANC is more popular than the DA and specifically said the DA does not expect a disproportionate amount of power. This completely contradicts the ANC’s repeated and widespread claim that the DA was “arrogant”, made after the discussions had failed.

“We accept that the ANC has almost twice as much support as the DA, and so we do not expect a disproportion [sic] amount of power, but we do expect our fair share and we are willing to enter a partnership in which both parties work collectively to take South Africa forward.”

But it does specify that it is seeking a growth budget and requires some measures to ensure this happens, and the DA was putting on the table a big concession from its side: it would vote in favour of a VAT increase, which has been the ANC’s primary aim in the budget process. These are the three requirements:

“That is why we cannot support an increase in VAT in budget 2025 unless we implement three measures, without which our fiscal position won’t improve:

1. A series of growth reforms and accelerated implementation that can drive faster-than-projected growth.
2. A spending review that finds between R50bn and R100bn in recurring revenue.
3. An agreement that the tax burden should decrease over 2 years.”

Then follows a whole range of suggestions, many of which the ANC seemed in favour of, one of which has since been actioned. These include accelerated energy reform, speedier digital transformation, increased private sector investment in infrastructure, regulatory reform in the information and ITC sector, and reviewing the Public Procurement Act, just to name but a few. The parties seemed to generally agree on these measures, which are all very sensible. 

What is important to note is that nowhere in the document does the DA require that the ANC renege on the three pieces of growth-depressing legislation the ANC has smashed into active legislation against the wishes of its GNU partners. This was widely thought to be the case, which founded the widespread notion in the press that the DA had “overplayed its hand” and was demanding things the ANC could never agree to. 

Flagrant contradiction

But, as it happens, late in the day, the ANC dumped its negotiations with the DA, and decided to go behind the back of its GNU partners and negotiate a deal with the parties outside the GNU, flagrantly contradicting its signed agreement with GNU parties. The result was that two parties who claimed they did not want to be part of the GNU, Herman Mashaba’s ActionSA and Mmusi Maimane’s Build One South Africa (Bosa), both voted in favour of the Budget, agreeing to violate their stated promise to their constituents. 

Both parties claimed they had won an agreement that there would be no increase in VAT or bracket creep, but ultimately when the Budget Review process was voted on, it contained no such undertaking, but simply an undertaking to look at ways to avoid a tax increase. 

So, what went wrong? My theory is that the problem is this seemingly boring part of the agreement.  

“To achieve this, a comprehensive spending review be undertaken as a joint initiative of the Presidency and National Treasury under Operation Vulindlela, with support from the Department of Planning, Monitoring and Evaluation. A Technical Task Team will be established, reporting to a Steering Committee chaired by the President and including the Minister of Planning, Monitoring and Evaluation, as well as the Minister of Public Service and Administration. The terms of reference for the review will be approved by Cabinet.”   (My emphasis).

Basically, what this means is that DA ministers will be part of the spending review mentioned above. As I understand, the DA initially wanted to be in charge of the spending review, but later softened its position after the ANC NEC objected. And why is that so bad?

Simply what we learn from this process is that the one thing the ANC does not want is any oversight of spending cuts. And the reason for that is that the party is heavily factionalised and the biggest and most powerful faction is what we might call the “tenderpreneur faction”. 

When the ANC calls the DA “arrogant”, what it means is that the DA does not trust the ANC’s cadres to be solely in charge of spending cuts. But given that the ANC has shown absolutely no political will to bring careless, wilful overspending under control, is the DA wrong on that point? 

I don’t think so. DM

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