Friday, 3 February 2017


The markets have assumed a sort of torpor with the exception of bonds which are leaking a bit. If people are waiting to see what the new US president is going to do next, they should by now appreciate that for the duration of his presidential term he will do what he promised. Even if that now seems rather foolish. Best to simply make investment decisions based on current information – which is that by and large most shares are fully priced!
There’s something deeply ironic about the news that Number One is unhappy with parts of the Financial Intelligence Centre Amendment Bill awaiting his signature. Financial intelligence is not a known strength of our president – just look at the list of rogues he has used for personal and official financial advice in the past. And now he is publicly attacking his own Finance Minister for sticking to the Budget that JZ and the rest of his cabinet drew up and endorsed.
Who knew that there is a National School of Government? It’s been open for about 3 years as part of the government’s praiseworthy efforts to professionalise the public service. Hopefully the curriculum devotes a great deal of time to the subject of where the government gets its money – a piece of knowledge missing from most of the population and far too many politicians. But fewer than 40% of the expected 9000 pupils have attended classes at the school – perhaps the tuck shop is overly concerned with “healthy food” – and so the distinction between public and private funds remains a mystery for most public servants. A consequence of the low enrolment is that the school is short of cash and naturally it too has been over to National Treasury with an upturned hat.
Despite presumably being intimately involved in the preparation of the expenditure wish list for his or her department, ministers still have no difficulty in complaining when Gordhan says “No. It’s not in the Budget.”. He must be a deeply irritated and saddened man not to enjoy his boss’s support and appreciation of his role. But even JZ could not be as foolish as to dismiss his finance minister just days before the 2017 budget speech? Could he?
We have remarked before at the transparency of the government budgetary process. Within minutes of the start of the Finance Minister’s annual budget speech the complete set of documents is available for everyone. Diligent analysts could spend a lifetime exploring and exposing unknown and interesting facts but don’t, because as current events highlight it is not a respected publication and anyway the bond market responds far more sensitively to big picture items like ratings rumours and presidential palavers.
This year the inconvenient difficulty is that the money coming in is rather less than expected, so not even all budgeted spending can be met. This shortfall is mainly a consequence of a very sluggish economy which, to be fair, is not entirely the fault of cabinet and government. There are global issues at work as well
Also clamouring for public dosh are six of the country’s seven kings. Citing the Zulu king’s annual grant of around R650m the others are feeling hard done by with their R1m a year stipend. This gap does seem to be exceptional but apparently, there are many legacy agreements to explain King Goodwill Zwelethini’s large pay check. The B league royals are unconvinced and want to be promoted to the Zulu league. Is it churlish and mean to suggest that none of these payments should be the taxpayer’s responsibility at all?  Surely all seven royal coffers ought to be filled by tribute from loyal and grateful subjects.
We are stuck with this messy and unfriendly (for SA) Super 18 format until 2020. There really is not enough talent or sponsorship money to support 6 teams here in SA. I suppose my attitude will change once the Lions start cleaning up (except for an honourable draw with the Sharks of course). The good news is that it’s another Sevens tournament weekend and the Blitzbokke are a joy to watch. Just as good as a David Miller century!
James Greener
The Day the Music Died Day