Standard Bank shareholders defy board in vote for greener disclosure

Written by Ciaran Ryan. Posted in Journalism

They want the bank to adopt a policy on lending to coal operations. From Moneyweb.

Protesters gathered outside Standard Bank’s head office on Thursday calling for shareholders to vote for the resolution, and delivering a message to the entire business sector – get your environmental ducks in a row or it’s going to get noisy. Image: Moneyweb

Protesters gathered outside Standard Bank’s head office on Thursday calling for shareholders to vote for the resolution, and delivering a message to the entire business sector – get your environmental ducks in a row or it’s going to get noisy. Image: Moneyweb

This is almost certainly the future of annual general meetings (AGMs) in SA. Get your environmental ducks in a row or it is going to get noisy.

Protesters were gathered outside Standard Bank’s Simmons Street head office on Thursday calling for shareholders attending the AGM inside to vote for a resolution compelling the bank to adopt and disclose a policy on lending to coal projects.

Image: Moneyweb

Non-governmental organisation Just Share says this is the first time that a South African bank, or any listed company, has faced a shareholder resolution on climate change.

The resolution was proposed by the Raith Foundation and shareholder activist Theo Botha, and supported by Just Share. When asked by Tracey Davies, director of Just Share, why the bank recommended voting against the resolution, CEO Sim Tshabalala said the bank fully supported the Paris Agreement on climate change, and agreed that climate change represented a “clear and present danger”. The bank was embarking on a process of adjusting to the requirements of climate change as it affects its activities, he said, but was compelled to balance this against developmental objectives.

‘Unlocking potential’, or putting millions at risk?

Environmental activist Greer Blizzard of Just Share pointed out that Standard Bank is one of the lead arrangers for a US$2.5 billion loan to support the East Africa Crude Oil Pipeline through Uganda and Tanzania, which the bank claims will unlock East Africa’s potential. However, the oil to be transported through this pipeline will emit more carbon than the whole of Uganda and Tanzania currently does each year.

Thousands of people will be displaced, and the pipeline will run for several hundred kilometres though the Lake Victoria Basin, putting the drinking water of millions at risk.

A coalition of African and international environmental activists recently wrote to the bank urging it not to proceed with financing the project. They point to several studies showing major opportunities for financing renewable energy infrastructure which would meet the region’s energy needs in a clean and rights-compatible manner, which would represent a much less destructive use of the bank’s finances.

“Will the bank agree to meet with local people and listen to their concerns about the East Africa Crude Oil Pipeline?” asked Greer.

CEO agrees to meet with locals

Tshabalala said he would, adding that the bank supported the Task Force on Climate-related Financial Disclosures (TCFD), joining more than 500 organisations around the world committed to improving climate-related disclosures.

The TCFD’s mission is to “develop voluntary, consistent climate-related financial risk disclosures for use by companies in providing information to investors, lenders, insurers, and other stakeholders.”

Some 55% of shareholders voted in favour of the bank adopting and disclosing a policy on lending to coal-fired power plants and coal mines.

“This was a significant result,” said Davies after the vote. “Firstly, for a majority of shareholders to vote in favour of the resolution despite [the] board recommending against it really shows that there is much more awareness and understanding of climate risk among our investment industry than it might appear.”

Greenhouse gas resolution 

A second part to the climate-related resolution would have required the bank to report to shareholders its assessment of the greenhouse gas emissions resulting from its financing portfolio and its exposure to climate change risk in its lending, investing and financing activities. This resolution was defeated, but still managed to swing 38% of shareholders to vote in its favour.

Davies says this was an impressive vote in favour of climate-related disclosures, considering this was the first time it had been tabled. “Generally it takes several years to raise awareness behind climate-related disclosures among shareholders, and this is a far better result than has been obtained in other AGMs around the world when such resolutions were first introduced.

“It is clear we are moving rapidly in the right direction.”

Just Share commended those shareholders who voted in favour of the resolution, including Mergence Investment Managers, Old Mutual and Aeon Investment Management. ”We encourage other shareholders who voted in favour of the resolution to publicly declare that they did so,” says Davies.

“In SA, where we are still so heavily reliant on fossil fuels for energy, climate risk and the transition to a low-carbon economy pose unprecedented risks and opportunities for our society and economy. The financial sector has a crucial role to play in driving this transition and today’s developments prove that institutional investors are starting to demand it do so.

“Banks should already, at the very least, be disclosing the extent to which they are exposing their businesses, shareholders, and the planet to climate risk via their financing of fossil fuels.”

Shareholder resolutions have become one of the most powerful tools for raising awareness about climate change risk, and for forcing the business and financial sectors to take action to mitigate and avoid that risk, says Just Share.

SA’s debt collection practices await investigation

Written by Ciaran Ryan. Posted in Journalism

It’s been four years – and still no hearing. This article first appeared in Moneyweb.

The practice of ‘forum shopping’ sees micro-lenders ‘shopping’ around for courts that will grant them garnishee orders, often in faraway places, knowing full well the borrower will have no chance of putting up a defence. Picture: Moneyweb

The practice of ‘forum shopping’ sees micro-lenders ‘shopping’ around for courts that will grant them garnishee orders, often in faraway places, knowing full well the borrower will have no chance of putting up a defence. Picture: Moneyweb

It’s been four years since Judge Siraj Desai of the Western Cape High Court declared 15 garnishee orders unlawful and invalid and ordered that a much broader investigation into the debt recovery practices of law firm Flemix & Associates be undertaken.

That can has been kicked down the road for the last four years and still no hearing date has been confirmed. In terms of a court order, the Legal Practice Council must conduct a disciplinary hearing into the practices of Flemix. The hope is that this will radically reshape the micro-loan industry in SA, which has been the subject of some damning judgments by the courts.

Read: Landmark court case seeks to stop over-charging by creditors

All this stems from a case brought in 2014 by the University of Stellenbosch Law Clinic on behalf of 15 micro-borrowers against more than a dozen credit providers and their debt collector, Flemix & Associates.

The judgment was a brutal repudiation of micro-lending practices in SA.

Debt collectors were found to be flouting the law in several ways:

  • By obtaining garnishee orders (also called emolument attachment orders or EAOs) in magistrates’ courts far from where the borrowers live and work, a practice known as ‘forum shopping’, which is deemed a denial of access to justice;
  • By failing to conduct proper credit assessments prior to granting loans; and
  • By obtaining dodgy written ‘consent’ forms allowing debt recovery agents to obtain garnishee orders in distant courts.

Garnishee orders are governed by the Magistrates’ Court Act. The act previously allowed a creditor to approach the court and obtain an order for the attachment of a portion of a debtor’s salary, regardless of the size, until the debt is repaid.

Read: Micro-lender puts the banking world to shame

That law has since been changed, placing a maximum of 25% of basic monthly earnings that can be deducted from a debtor’s salary. This brings South Africa into line with other countries such as the US, UK and Germany, which place limits on how much of a borrower’s salary may be deducted in the repayment of debts. This change in the law was made after the Western Cape High Court heard how some borrowers had virtually nothing left at month end after garnishee deductions were made.

Just how bad is SA’s personal debt problem?

According to credit bureau Kudough, 73% of all household disposable income in SA is spent on debt. Roughly 40% of all credit consumers have at least one account overdue, and 58% of consumers struggle to meet their monthly repayments.

Total credit card and store debt is roughly R18 billion, with the average debt per person at a staggering R70 000.

Still, 70% of applications for credit are declined.

Flemix, a firm of attorneys collecting debts on behalf of several credit providers named as respondents in the Western Cape High Court case, claimed it had in excess of 150 000 active cases on its files with a total book value of more than R1.5 billion. Judge Desai ordered the Law Society of the Northern Provinces to determine whether Flemix and its legal counsel had “breached their ethical duties particularly with regard to forum shopping to secure emolument attachment orders”.

‘Far wider implications’

Stephan van der Merwe, senior attorney at the Law Clinic, says the 2015 judgment by the Western Cape High Court was aimed primarily at the 15 garnishee orders that were found to be unlawful and invalid. “But the court’s finding in this case has far wider implications. The judge said he could not turn away from the plight of tens of thousands of other micro-borrowers who may have been prejudiced by Flemix’s debt collection practices. That is what is to be decided in this hearing.

“This is an important hearing since the outcome will have huge importance for possibly millions of debt-affected individuals around the country.”

Judge Desai found that court clerks were issuing these orders without any evaluation of the individual’s ability to repay, and with no judicial oversight.

More disturbing was the practice of ‘forum shopping’, where micro-lenders ‘shop’ around for courts that will grant them garnishee orders, often at the other end of the country. Garnishee orders obtained in courts far from where the debtor lives or works are invalid.

Shabby practices

The case shone a light on the shabby practices of micro-lenders, who would lend money in Cape Town and run off to the Randburg Magistrates’ Court in Gauteng to obtain a garnishee order, knowing full well the borrower had no chance of putting up a defence. Lenders relied heavily on consent forms purportedly signed by borrowers that gave the credit provider the right to obtain judgment in a far-off court. Desai slapped down the lenders, concluding that these consents were “not given either voluntarily or on an informed basis”.

Flemix argued on behalf of the credit providers that they were not ‘forum shopping’ but exercising their own right to access justice by securing judgments in courts far from where the borrower lived or worked. The Association of Debt Recovery Agents, representing the formal debt collection industry, also defended the practice, for which it was rudely excoriated by the court.

Fifteen applicants in the case asked the court to have their garnishee orders declared invalid on the grounds that they are unconstitutional and were granted without judicial oversight. Flemix argued that the debtors had given written admissions of default on their debts, and consented to have judgment issued against them, even in courts far from where they live.

The court was unimpressed with many of the ‘consent’ forms purportedly signed by borrowers – some clearly forged – and said few debtors would willingly agree to repayments they could not afford. The 15 applicants in the case say they either did not sign the consent forms or that the documents were not explained to them, or that they were signed under pressure. The court heard how debt collectors were not paid if they did not secure written consents from borrowers, providing an incentive to fabricate consent forms with fake witnesses.

Forged consent

The Stellenbosch University Law Clinic case eventually made its way to the Constitutional Court where it was found that some garnishee orders were being obtained on the basis of forged ‘consent’ forms, and loans were being granted without proper credit assessments.

The National Credit Act was being flouted left and right. “The failure to conduct an assessment results in the credit agreement being reckless and unenforceable. If, in any proceedings, it appears to a court that a credit agreement being considered is reckless, the court is obliged to declare that it was a reckless agreement and suspend the agreement’s force and effect,” reads the ConCourt judgment.

Credit providers are required by law to assess the borrower’s ability to repay loans, and this required a detailed examination of their income and expenditure, but the Western Cape court doubted these even existed in the cases presented to it. Credit assessments were perfunctory or non-existent, with borrowers in some instances expected to repay more than half their monthly salaries.

One of the borrowers earned R3 759 a month when she was granted a loan of R7 982, which was to be repaid in six instalments of R1 986 a month. Most of the applicants were farmworkers, cleaners and security guards.

In the US, federal law places a cap on the amount of an employee’s earnings that may be garnished in any one week at only 25% of a debtor’s after-tax income. Germany has a graduated scale of earnings that may be attached depending on how much the borrower earns, while Australia requires borrowers to be left with a minimum of Au$447 a month, a figure that is adjusted regularly.

Six mining groups ask court to approve R5 billion silicosis settlement case

Written by Ciaran Ryan. Posted in Journalism

But some mines will continue to fight class action suit

Photo of molten gold being poured

Six gold mines and lawyers for mineworkers who contracted silicosis or TB have asked the Gauteng High Court to approve their settlement. Photo: Dan Brown via Flickr (CC BY 2.0)

This article sppeared in Groundup and Times Live: Lawyers for thousands of gold miners afflicted by silicosis or tuberculosis lined up on the side of six mining groups this week to ask the Gauteng High Court to approve a R5 billion settlement agreement.

The agreement provides for the payment of benefits worth R5 billion to mineworkers and the dependents of dead mineworkers who contracted silicosis or pulmonary tuberculosis during or after their employment from 1965. The benefits will be paid through the Tshiamiso Trust, which was set up specifically for this purpose.

The settlement agreement is regarded as one of the most complex multi-party class action settlements ever concluded. This is a sequel to the so-called Nkala class action suit brought several years ago by former gold mineworkers seeking compensation against their former employers for illnesses contracted in the course of their work.

Though the six mining companies and the mineworkers have reached agreement on the benefits to be paid, the court will have to assess whether absent mineworkers are adequately protected by the agreement. It is still unknown how many mineworkers or their dependents are entitled to claim, as many of them are scattered across the sub-continent. This will require strict scrutiny by the court.

In 2016 the case was certified as a class action by the Gauteng Local Division of the High Court, and in December 2018 the court certified four classes of claimants: (1) those who contracted silicosis or were exposed to silica dust; (2) the dependents of deceased miners with silicosis; (3) those who contracted tuberculosis; and (4) the dependents of deceased miners who contracted tuberculosis while working at the mines.

Now the court is being asked to approve the R5 billion settlement agreement between legal representatives of the mineworkers and the five mining companies. The mining companies have secured guarantees for the R5 billion claim, though the eventual claim could be higher. Of this, R845 million has been set aside for administering the Tshiamiso Trust, which will accept claims for a period of 12 years, plus one additional year to wrap things up.

Affected mineworkers will be paid out between R70,000 and R500,000 depending which of the four categories of claimants they fall into. Narrowing the claimants into four categories was done to simplify the payment process and reduce administration costs. The lowest potential payout will be R10,000 for historic cases of tuberculosis where the extent of the illness is not known.

Should the court approve the settlement, the class action suit against the five mining companies will be suspended, though will be continued against those companies that chose not to settle. Many of the likely beneficiaries are former migrant workers scattered across southern Africa, requiring the companies to post notices in neighbouring countries advising former mineworkers and their dependents of the potential benefits arising from the settlement.

Six mining groups are party to the settlement: African Rainbow Minerals, Anglo American SA, AngloGold Ashanti, Gold Fields, Harmony and Sibanye-Stillwater. The mining groups that opted to settle rather than continue fighting through the courts will be protected against any future liability arising from the same claims.

Mining companies that elected not to participate in the settlement are DRD Gold, East Rand Proprietary Mines (ERPM), Randgold and Exploration, Evander Gold, Blyvooruitzicht Gold, Doornfontein Gold, Simmer and Jack Mines and African Rainbow Minerals Gold (not the same as African Rainbow Minerals). Doornfontein and Blyvoorzicht are no longer operating and have since been deregistered.

DRD Gold and ERPM opted not to participate in the settlement agreement, and took issue with the court’s jurisdiction to certify the four classes of claimants, and indicated they would continue to fight the Nkala case in the Supreme Court of Appeal.

The mineworkers are represented by class action pioneer Richard Spoor Inc, Abrahams Kiewitz Inc. and the Legal Resources Centre.

Legal counsel for the mineworkers asked the court to approve the settlement as “fair, reasonable and adequate” on the grounds that it:

  • it provides for a comprehensive system of compensation;
  • it is easily accessible by the mineworkers as well as former mineworkers and their dependants;
  • it will commence payment of compensation within a relatively short period of time, short-circuiting protracted legal action;
  • its structure is designed to be “lawyer free” in that claimants will engage with the Trust directly, making it unnecessary for a portion of the benefits to be paid to external agents.

The Trust will also cover periodic medical examinations for current and former mineworkers at the Medical Bureau for Occupational Diseases as well as medical screening.

Blood on the JSE floor

Written by Ciaran Ryan. Posted in Journalism

Executive departures, forced share sales, cost overruns and weakening retail prospects have hammered selected stocks.

Recent share price drops are not limited to the likes of Old Mutual, Netcare and Sasol. An overall slide in stock values including the Top 40 Tradeable Index and the Health Care Index has investors weary. Picture: Bloomberg

Recent share price drops are not limited to the likes of Old Mutual, Netcare and Sasol. An overall slide in stock values including the Top 40 Tradeable Index and the Health Care Index has investors weary. Picture: Bloomberg

Last week was a shocker for corporate news. Peter Moyo was suspended as CEO of Old Mutual after barely over a year in the job over an apparent conflict of interest relating to his side project, NMT Group, in which Old Mutual was a substantial shareholder. The news spooked the share price, driving it down 12%.

Old Mutual chairman Trevor Manuel explained the suspension as a result of “a material break in trust and confidence” over Moyo’s apparent conflict of interest relating to his role as CEO of Old Mutual and his interest in NMT. Moyo told Reuters there was no wrongdoing on his part, but it is unlikely at this point that he will return to his former position. Chief operating officer Iain Williamson has been named as acting CEO. Manuel has been a stickler for greater accountability and transparency, so he could not be seen to be brushing this one under the carpet, notwithstanding the hit on Old Mutual’s market valuation.

Sasol also took a 27% pummelling last week after announcing a roughly $1 billion cost escalation on its Lake Charles Chemicals Project in the US, which is intended to diversify its sales mix and geographical footprint. The project cost is now nearly 50% more than the original budget. An element of investor fatigue over the ongoing mismanagement and cost overruns at the project are blamed for the sharp drop in share price, which is now at its lowest level in five years.

Netcare’s share price is down 23% after CEO Richard Friedland was forced to sell 10.4 million shares in the group, worth about R200 million, to cover finance costs incurred in their acquisition. The JSE has called for more transparency where directors use their shares as collateral for financial commitments. Netcare is having a rough time with sub-inflation growth in revenue and earnings, and the weak share price performance of the last two years seems to have pushed Friedland into a forced sale to cover his debt.

Tiger Brands is another share taking strain over the last month. The price dropped 18% in May after it was announced that a class action suit had been served on the company over the listeriosis outbreak in 2017 that claimed more than 200 lives. The case for the claimants is being led by class action specialist Richard Spoor, who successfully fought a previous class action suit on behalf of gold miners afflicted by silicosis or tuberculosis. Several mining houses last year conceded defeat and agreed to cough up roughly R5 billion on behalf of several thousand miners.

Tiger Brands informed investors that no specific damages were being sought at this stage. The first part of the case deals with the company’s liability, for which it has product liability insurance “appropriate for a group of its scale”. However, coverage is subject to the terms and limits of the policy, and it remains to be seen whether this will fully cover what may be a massive claim.

Tiger Brands announced last week that its unbundling of Oceana should bump up earnings by more than 20% for the current financial year ending in September. This appears to have done little to entice investors back to the shares, which are worth less than half of what they were at the start of 2018.

All the above share price drops are related to specific events. What is perhaps more worrying is the overall slide in stock values:

  • the Top 40 Tradeable Index is down 8.5% since the beginning of May 2019
  • the Health Care Equipment and Services Index is down 53% since 2016
  • the Health Care Index is down 63% since 2016
  • the Forestry and Paper Index is down 31% since October 2018
  • the Food Producers Index is down 41% since the beginning of 2018

In the platinum sector, Implats and Amplats are down 17% and 22% respectively in the last month after a sharp run-up in platinum group metal prices over the last year. Given the strength of this run, a breather is perhaps overdue.

Implats posted basic earnings of R2.3 billion for the six months to December 2018, reversing a loss of R163 million for the previous period. “While the near-term outlook for platinum remains suppressed, the medium-term outlook has improved. The current strength in both palladium and rhodium fundamentals are expected to persist for the foreseeable future,” said the company in a note accompanying its results.

Aspen and Life Healthcare are two companies taking a beating in what was, until a few years ago, a shining star on the JSE. Life Healthcare is down 17.7% over the last month. The company says its margins have been squeezed by new growth initiatives in SA and abroad, and costs incurred in driving efficiency programmes that will bear fruit later.

Aspen is down 75% since 2016, and recently announced it was reviewing its European and SA pharmaceuticals businesses. It will split the SA business into two units to optimise efficiencies. The future focus will be on emerging markets, and it expects quick results from the launch of women’s health products in the US.

Two other shares taking strain are Mr Price, down 18% in May, and Massmart, down more than 40% since January this year, the result of ongoing attrition in the retail sector. Massmart recently announced operating profit after restructure costs, non-trading items, foreign exchange movements and interest paid may be 60% below the prior period (June 2018: R271m).

Sappi is down 20% over the last month after it announced profits would fall for the year to September due to weak demand and over-supply of stable-fibres supplied by the group to the paper market.

SA’s nuclear reactor shut down – again

Written by Ciaran Ryan. Posted in Journalism

The paperwork, it seems, was not in order. From Moneyweb.

The shutdown is costing an estimated R3.5m a day in lost sales and resulting in unnecessary deaths due to the non-availability of life-saving medicine. Picture: Matthew Lloyd, Bloomberg

The shutdown is costing an estimated R3.5m a day in lost sales and resulting in unnecessary deaths due to the non-availability of life-saving medicine. Picture: Matthew Lloyd, Bloomberg

The Pretoria nuclear medicine production unit NTP Radioisotopes, part of the state-owned Nuclear Energy Company of SA (Necsa), has been out of operation since February.

This is the third time in two years that the Safari-1 reactor has been shut down. Not because there was radiation leakage or anything as frightening as that, but because the safety paperwork was not in order.

The shutdown is costing NTP an estimated R3.5 million a day in lost sales, and – according to one person close to the company – unnecessary deaths due to the non-availability of life-saving medicine. This has also wrecked the financials of one of the few state-owned companies that had consistently made profits and won clean audits.

The reason for the shutdown? Precisely the same one given for shutting down the reactor in 2017 and 2018. This time energy minister Jeff Radebe cannot blame the board members he suspended late last year.

Technical explanation

In response to questions from Moneyweb, NTP replied: “During a production cycle in February 2019, NTP’s internal monitoring systems detected instantaneous pressure variations as monitored by the sensors in the plant. While these happen within seconds and are corrected and balanced by the plant’s ventilation system, they still require further investigation in terms of NTP’s SOPs [standard operating procedures]. Further, it is important for NTP to make sure that issues such as these are corrected at the time they take place, and before large customer production runs are in progress.”

Last year Radebe suspended three members of the Necsa board on various charges, one of which was the undue delays in restarting the Safari-1 reactor at Pelindaba, which produces world-leading nuclear isotopes used in the treatment of cancer. The three board members were then chairman Kelvin Kemm, CEO Phumzile Tshelane and chief financial officer Pamela Bosman.

Read: Suspended nuclear company execs smell rat over adverse audit

City Press reported at the weekend that Tshelane was about to be fired after going through an internal disciplinary process. One of the reported grounds for his dismissal was the signing of a non-binding agreement with Russian nuclear company Rosatom to develop modular nuclear reactors, which the charge sheet claimed would conflict with an agreement already in pace with the Australian Nuclear Science and Technology Organisation (Ansto).

Ministerial interference

This is denied by the suspended board members. Says Kemm: “The agreement with the Russians was floated with the previous minister of energy, and with Radebe when he became energy minister, but he sat on this for months and never gave us an answer one way or the other. It is a non-binding agreement that in fact does not need ministerial approval, so here we have another case – one of many involving state-owned companies – of ministers interfering in the running of their boards. I hope President Ramaphosa bears this in mind as he prepares his new cabinet.”

Tshelane says he intends to challenge his dismissal because of the irregular process followed. “I subsequently received notice of my dismissal. I am convinced that the dismissal is unjust and premature and I will be appealing the Necsa ruling,” he says.

Read: Axed Necsa board blames resistance of ‘privatisation by stealth’ for dismissal

The suspended board members say they are fall guys for a governance crisis, orchestrated by the minister, whose real ambition is to sell the nuclear facility to a US company, Lantheus Medical Imaging (LMI). If true, this would put decades of hard-won nuclear secrets in foreign hands, and infuriate the trade union movement since this would amount to privatisation of a key national asset.

Some see NTP as a pawn in a nuclear geopolitical game involving the US and Russia.

Tina Eboka remains MD of NTP despite being suspended and replaced by Tshelane last year after the first reactor shutdown. Kemm says the minister ordered that she be reinstated, overriding a Necsa board decision.

“We pointed out to the minister that we had determined the faults which had occurred under the management of Eboka and that remedial action had been implemented and that we were due to restart in days,” says Kemm. “I also pointed out that CEO Tshelane was doing exactly what good governance required and that I supported his decisions. I said that it was not correct for the minister to instruct the CEO how to run the operations. The minister then told the media that I was defiant.”

NTP’s full response to questions from Moneyweb:

NTP’s isotope production facilities were shut down between November 2017 and February 2018, and again from May 2018 to November 2018.

Because of the extended period of disuse and other work done to return the plant to its original operating specifications (following some interim changes that were made during 2018), it is essential that operations are conducted within the strict limits, guidelines and standard operating procedures (SOPs) to ensure safe operations for personnel, the environment, and the product, as determined by various licences and registrations as well as NTP’s own SOPs.

All operating and technical specifications are closely monitored by NTP production managers and the Nuclear Facility Manager (NFM), who reports to the NTP board and communicates to the National Nuclear Regulator (NNR) through various reports. The NTP NFM works closely with Necsa Licencing since Necsa is the licence holder of the NTP radiochemical facility.

During a production cycle in February 2019, NTP’s internal monitoring systems detected instantaneous pressure variations as monitored by the sensors in the plant. While these happen within seconds and are corrected and balanced by the plant’s ventilation system, they still require further investigation in terms of NTP’s SOPs. Further, it is important for NTP to make sure that issues such as these are corrected at the time they take place, and before large customer production runs are in progress. 

NTP adheres to world-class nuclear facility and isotope production standards, and always endeavours to manage and operate a safe plant for the safety of its personnel, the environment, and infrastructure, as well as product quality. This facility has been run safely since it was commissioned in the 1960s and has been compliant with all relevant safety regulations as they have been introduced over the years.

In accordance with the facility licence and our operating protocol, isotope production was temporarily halted in order to complete an internal investigation to identify the causes of these deviations, and also to remedy the identified issues. The investigation has been completed and remedial actions have been implemented, in line with our prescribed processes. In accordance with our SOPs, any technical or procedural updates have to go through rigorous change control protocols and safety assessments, as well as training all production personnel on any changes made. Once NTP has submitted its report on the investigation and corrective actions to the NNR, production will resume.  

Companies planning to go off the grid

Written by Ciaran Ryan. Posted in Journalism

Anglo Platinum, Sibanye-Stillwater, Makro and the City of Joburg are loosening their ties to Eskom. This article first appeared in Moneyweb.

The solar installation at Makro Carnival on the East Rand was created to generate 60-80% of the store’s energy needs during the day. Companies are however urged to take sound independent advice before plunging into self-generation solutions. Picture: Supplied

Forward-thinking businesses in SA are now starting to confront life without Eskom by putting plans in place to generate their own energy.

Anglo Platinum and Sibanye-Stillwater are two high profile companies at an advanced stage of planning for solar plants to generate their own electricity. The City of Joburg wants to cement a deal with Harith-owned Kelvin Power Station to purchase power as a way to prevent load shedding, which has done incalculable harm to businesses in the city.

Other companies are further advanced in their plans to reduce their dependence on Eskom power. In 2016 Makro erected solar panels on the roof of its Makro Carnival store on the East Rand to generate 60-80% of its energy needs during the day, equivalent to 30% of the store’s annual energy needs. Many smaller businesses have invested hundreds of thousands of rands in generators to serve as back-up power sources in the event of outages.

‘No plan’ from government

In his state of the city address last month, Joburg mayor Herman Mashaba said load shedding would be a reality in the coming years, and the national government had not come up with a plan to solve it. Though Eskom has attempted to block the city from sourcing electricity directly from Kelvin Power Station, Mashaba said he was looking at legal options as well as a direct approach to Kelvin over the prospect of securing a supply contract.

Kelvin has a 600 megawatt (MW) capacity, but is currently producing just 200MW, and even that will be shut down within the next two to three years. One of the options being explored is the installation of gas turbines from about 2023 onwards to ramp up output to the original design capacity of 600MW, pending the availability of a reliable gas supply. This is still just a fraction of Joburg’s total electricity consumption, but sufficient to prevent most of the outages experienced by businesses over the last six months.

The City of Joburg’s 2018 financial results show a 6% drop in electricity sales. Though some of this was due to outages, there is also evidence of businesses switching to alternative energy sources, according to Ratings Afrika’s latest Municipal Financial Sustainability Index (MFSI) for 2018.

Read: Municipal sector faces collapse – Ratings Afrika

Des Muller, MD of energy advisory group NuEnergy Developments, says there is a direct correlation between SA’s declining economic growth and the commencement of electricity blackouts starting in 2007.

“Stable and sufficient electricity supply is a precondition for any growing economy, and there is plenty evidence from around the world that those countries that can guarantee reliable power at a good price are those countries that grow the fastest,” he says. He warns that South Africa’s electricity challenges will remain in the foreseeable future and companies need to be prepared, but urges taking sound independent advice before plunging into self-generation solutions.

Aluminium businesses have already left SA

In 2012 Eskom paid energy-guzzling aluminium smelters to shut down furnaces so it could redirect power for use elsewhere in the economy. This has driven energy-intensive businesses to other countries in the Far East where power supply is stable and affordable.

As part of its medium- to long-term energy management strategy, Sibanye-Stillwater is pursuing the first 50MW phase of its solar photovoltaic (PV) project to be built on a site strategically placed between the Driefontein and Kloof mining complexes on the West Rand. “The project, originally envisioned in 2014, represents a partial solution to securing an alternative electricity supply, representing approximately 3% of our total electrical energy requirements in SA, and enables the power generated to be fed directly into the mine’s electrical reticulation while reducing our overall electricity expenditure and carbon footprint,” says the group’s head of investor relations, James Wellsted.

“We cannot disclose costs of the plant or the cost of the electricity through the PPA [power purchase agreement], however, we can state that solar PV power offers a cost-effective alternative to Eskom already.”

Sibanye-Stillwater ran a competitive tender process to appoint a developer to build, own and operate the project, and sell power back to the mining group through a PPA. This approach has a minimal upfront capital requirement for Sibanye-Stillwater and allows capital to be prioritised for core mining projects. The tender was successfully concluded in 2017, suggesting a significant forecasted return to Sibanye-Stillwater over the course of the agreement. Although several regulatory delays (including policy uncertainty and contracting issues relating to Eskom) were experienced in 2018, resolutions are expected to be reached in 2019. A decision to proceed with the PPA will then be made.

AngloPlat still to make final decision

Though Anglo Platinum has yet to make a final investment decision, it is exploring a 167 gigawatt hour (GWh) per annum solar PV plant at Mogalakwena, representing roughly 21% of its annual 777 GWh consumption.

Anglo Platinum says it wants to optimise the value of its overall portfolio, including improved energy management and planning for future energy sustainability in response to rising cost pressures in the mining sector. Efficiency measures have been implemented since 2013; however, this is not enough to counter the projected cost increases and the requirement for sustainable energy.

In 2017 the mining group started formalising its alternative energy strategy by transitioning to sustainable energy sources that reduce carbon emissions and provide predictable cost and energy efficiency.

Anglo Platinum is considering one of two options for the project development: the IPP option, or to self-build, own and operate.

These projects require a generation licence from the National Energy Regulator of South Africa (Nersa) and exemption from the minister of energy.

The mining group says it is currently negotiating land sites, host-community participation and Mining Charter 2018 compliance.

Based on current progress, the solar generation plant should be operational by mid-2021.

The Bus King of Africa

Written by Ciaran Ryan. Posted in Journalism

The IDC is taking a R2bn bet on Pat Nodada of Busmark.

Busmark CEO Pat Nodada, the man behind smart factories, tough buses and 24-hour support even in outlying areas. Picture: Supplied

Busmark CEO Pat Nodada, the man behind smart factories, tough buses and 24-hour support even in outlying areas. Picture: Ciaran Ryan

This article first appeared in Moneyweb.

The man being called the Bus King of Africa is a 42-year-old chartered accountant.

Having conquered the South African bus market, Busmark CEO Pat Nodada is now partnering with the Industrial Development Corporation (IDC) to build bus factories across Africa, starting with Zimbabwe, Kenya, Nigeria and Ghana.

It’s a bold move that will increase Busmark’s monthly output from 100 to 500 buses over the next five years. The IDC is taking a R2 billion bet that Nodada can pull this off by replicating the same formula that turned Busmark into the dominant bus maker in SA, with an estimated 40% of the local and 20% of the Zimbabwean market.

Nodada bought into the company a decade ago, retooled its Randfontein factory to supply city transporters such as Metrobus and MyCiti and promptly won a contract to supply the Gautrain fleet. That fleet is now being retired and replaced with a new one – again supplied by Busmark.

Big-brands busmaker

Busmark is a second-tier original equipment manufacturer (OEM) supplying buses to first tier OEMs such as Mercedes, Volvo, Scania and Real African Works. The engines and powertrains are imported, but everything else is made locally.

The Randfontein factory turns out 100 units a month, with the capacity to produce double this, and recently added battery-powered and hydrogen fuel cell buses to its production capability. This, says Nodada, is where the future lies.

“One of the big challenges we had to overcome was to reduce the weight of the batteries so that we could carry more passengers, and we managed to do this by making design improvements with the help of the CSIR and several local universities.”

The battery-powered bus – which is now in development and will be in action around Joburg as part of the Gautrain fleet pilot – can achieve a range of 150km before recharging. The hydrogen-powered bus is likewise attracting interest from city transport fleets under pressure to reduce their carbon footprints. Though the buses cost more than diesel ones, they are far cheaper to maintain (with just five moving parts as opposed to nearly 2 000 for diesel engines). 

Output up threefold in 10 years

Busmark’s output has shot up threefold since Nodada bought the company a decade ago, the result of a decision to diversify away from commuter to luxury city buses.

You won’t hear much about Busmark because its buses carry the OEM branding like Mercedes, Man and Volvo, but the buses boast a local content of 90% with the engines and powertrains coming from abroad. The company is 75% owned by the Nodada family, putting it beyond the prying eyes of the public, with the rest held by staff and management. 

This month 30 buses left the Randfontein factory destined for Kenya, part of an order for 90 units. The buses are designed in SA to withstand the most tortured roads, with rubber undercarriages and reinforced suspension. 

This is a prelude to the opening of a new bus assembly plant in Nairobi later this year in a joint venture with Mercedes Toyota Tsuscho that will turn out 20 units a month. A similar-sized factory will open up in Harare in July this year. A much larger factory with the capacity to churn out 250 units a month will open in Nigeria next year, followed by a fourth factory in Ghana by 2022. Smart factories are also in the works for Port Elizabeth and Durban.

Robotics and AI

Even more impressive is the plan to consolidate the scattered Randfontein plants into a single ‘smart’ factory within the next year, where robotics and artificial intelligence will churn out a new generation of SA-made buses conforming to the highest standards in the world.

Busmark is already compliant with SA, ISO and European quality standards, but Nodada is particularly proud of the fact that the company is regarded as a world leader in battery and hydrogen fuel-cell powered buses, but with a twist – these buses are built for some of the most testing roads in the world.

“We guarantee a 15-year life for any bus that comes out of our factories, regardless of where the buses are required to operate,” says Nodada.

“And we offer 24-hour support, which can be a challenge when you have a breakdown in rural Zimbabwe – but we can do it. We have had to modify our buses to withstand some of the worst roads in the world.”

What’s next once Busmark has taken the East and West African markets?

“That’s a discussion for another day,” says Nodada. “For now, our hands are pretty full with six new factories to open in the next three years. We are investing in the very latest technologies and our new factories will reflect this.

“The bus market in Africa is huge, and the push from bus operators is for more durable buses with lower operating costs. That is where we are focusing our energies: making it more profitable for bus operators across the continent. And we know how to do this.”

Afriforum fights to prevent banning of old SA flag

Written by Ciaran Ryan. Posted in Journalism

The Nelson Mandela Foundation and Afriforum are opposing each other in the Johannesburg Equality Court. From Groundup.

Photo of people in military clothing burning old SA flag

MK veterans burn an old South African flag in November 2017 following the #BlackMonday protestsby farmers against farm murders. Archive photo: Nomfundo Xolo

The Nelson Mandela Foundation is asking the Equality Court in Johannesburg to declare the display of the old South African flag hate speech and harassment under the Equality Act. The case is likely to set the boundaries between constitutionally-protected free speech, however offensive to some, and hate speech. Opposing the action is Afriforum, a group set up in 2006 to promote the protection of Afrikaner culture.

The background to the case is that on 30 October 2017 nationwide protests, in which Afriforum played a leading role, were held to protest over attacks on farmers. The protests were named #BlackMonday. It is disputed to what extent old South African flags were displayed at the protests.

In a press release following the protests, the Nelson Mandela Foundation decried the display of the old flag as indicative of support among some protesters for the old apartheid system.

Was the old flag displayed prominently?

On social media, photos of protesters carrying the old flag were circulated, but at least some of these photos were fake or for a different event. In an SABC2 debate the following week, Afriforum’s CEO Kallie Kriel dismissed reports of the old flag being displayed as fake news. The mayor of Midvaal in Gauteng, however, claimed he had seen them. Two Groundup reporters covered part of the Cape Town protest and did not witness conspicuous displays of the old flag.

Kriel said that Afriforum discourages its members from displaying the flag as it offends people, but that it should not be banned. Banning the old flag would be the same as banning communist symbols, which Kriel considered offensive, as communism, he asserts, was a crime against humanity.

The Promotion of Equality and Prevention of Unfair Discrimination Act, also known as the Equality Act, defines hate speech as showing a clear intention to be hurtful, incite harm and promote hatred. All three conditions must be present for hate speech to exist. This does not include genuine engagement in artistic creativity, academic and scientific inquiry and fair and accurate reporting in the public interest.

Farmers demonstrate against farm murders at Cape Town Stadium in the #BlackMonday protests in October 2017. Archive photo: Ashraf Hendricks

Mandela Foundation’s arguments

The Foundation’s CEO Sello Hatang affidavit says he was personally offended by the display as it recalled instances of racial abuse from his youth. “Gratuitous displays of the old flag, which serve no genuine journalistic, academic or artistic purpose in the public interest, are not about remembering but about forgetting our painful past. They do nothing to advance social justice, national unity and human dignity; quite the opposite. They cannot be protected by our Constitution, or defended in the name of tolerance, reconciliation and all of the values underlying the Constitution.”

On its website, the Foundation states that Germany has passed laws criminalising gratuitous displays of Nazi symbols, as they signify only oppression, hatred and the Holocaust. But the Foundation says it is is not pressing for criminalisation of gratuitous displays of apartheid symbols. “Instead we are using law to discourage their use.” The Foundation says that the Promotion of Equality and Prevention of Unfair Discrimination Act of 2000 empowers Equality Courts to order remedies such as an apology, community service, or sensitivity training.

Johannesburg Pride, representing the LGBT community, has joined as a friend of the court, and argues that the apartheid regime oppressed people not only on grounds of race but sexual orientation.

Displaying the old flag “demeans, humiliates, and creates a hostile and intimidating environment toward members of the LGBT+ community who were also victims of apartheid and its legacy,” says Khuresha Ally, director of Johannesburg Pride.

Afriforum’s arguments

Afriforum says the Foundation’s court case, if successful, would be an attack on free speech. Deposing for Afriforum, deputy CEO Ernst Roets says the organisation has no particular love for the old flag and what it represents. “In the exceptionally rare instance that anyone participating in one of our events brings an old flag with them, we ask them to put it away.”

However, a wide-reaching ban on the flag, such as that sought by the Foundation, would be “an unconstitutional infringement of the right to freedom of expression.”

Freedom of speech is the pre-eminent freedom guaranteed under the Constitution, argues Roets: “Freedom of expression is the cornerstone of a functioning democratic state. It gives people the opportunity to be exposed to differing viewpoints to make informed and legitimate decisions about their political lives.

“If citizens are under the impression that the ideas they are exposed to have gone through a filtering process to remove all inappropriate forms of expression, then they are less likely to be critical of the material that they consume. Societies that allow for a broad selection of opinions create an environment that strengthens people’s analytical skills and trains them to question the views that are presented to them.”

Afriforum also argues that ideas that are suppressed can later result in violence.

Banning displays of the old flag is inappropriate as those displaying it may have different intentions, argues Roets, who presents evidence of Sharpeville residents burning the new South African flag to protest Human Rights Day commemorations being moved from Sharpeville to Soweto. “By way of analogy, it may be thought that anyone who burnt the new flag was motivated by hatred towards black South Africans and a desire to reinstitute apartheid,” says Roets.

He adds that displaying the old flag is not hate speech, nor does it amount to a call for action or an incitement to cause harm.

Roets then turns on ANC and SA Communist Party symbolism, recounting atrocities committed by its foot soldiers against South Africans. If the old SA flag is banned, a precedent is set for the banning of the ANC or SACP flags, or indeed the British Union, on the grounds that they may be distressful to victims of violence committed under these banners.

Roets dismisses the claim that the old flag represents harassment, which “must amount to a torment that is persistent and repetitive”. The best remedy for offensive speech is counter-dialogue.

The #BlackMonday protests were sparked by the murder of Western Cape farmer Joubert Conradie. Roets says the subsequent reporting on the protests ignored the farm murders and focused instead on the claims that some protesters carried old flags.

He argues that the Nelson Mandela Foundation is dismissive of farm murders. There were 357 incidents recorded in 2016/7 with 553 victims of whom 74 were murdered. “The notion that the #BlackMonday marches were only concerned with violence against white farmers is outrageous. All violence, regardless of the race of the victims or the perpetrators is unconscionable,” says Roets.

Former Sasol Coal miners claim more than R80 million for coal-related illnesses

Written by Ciaran Ryan. Posted in Journalism

Photo of South Gauteng High Court

Former miners at Sasol Coal are taking the company to the Johannesburg High Court to get compensation for the lung diseases they allege they contracted because of their work environment. Archive photo: Ashraf Hendricks

This article first appeared in Groundup.

Twenty-two former underground miners are claiming more than R80 million in damages from Sasol Coal after they contracted serious lung and other diseases as a result of years of inhaling coal dust while working in underground coal mines.

They are arguing that Sasol Coal was negligent in failing to take adequate care to maintain healthy working conditions underground, in violation of several health and safety laws. Even if it was not negligent, the miners say the company bears the liability of their ill-health and loss of income for being unable to work.

The miners are represented by Richard Spoor, the attorney who last year reached a R5-billion settlement with seven gold mining companies for miners afflicted with silicosis contracted after years of breathing silica dust in underground mines.

In papers before the Johannesburg High Court, 12 of the miners say they were dismissed from employment because they contracted lung-related illnesses which made them unable to continue working. They are claiming for the loss of income, aggravated by their inability to find alternative work due to age, illness, low educational levels and lack of qualifications. The largest individual claim is R10.2 million, and the smallest is just under R1 million.

“The plaintiffs have suffered permanent physical impairment. Such impairment includes shortness of breath, generalised weakness, chronic chest discomfort, tiredness and disturbed sleep,” states the miners’ particulars of claim before the court.

One of the principle hazards to which they were exposed was noxious coal dust that cause lung diseases such as Coal Workers’ Pneumoconiosis (CWP) and Chronic Pulmonary Disease (COPD). These diseases can lead to respiratory symptoms such as a persistent cough and shortness of breath, resulting in a reduced ability to perform physical tasks. These can eventually develop into Progressive Massive Fibrosis (PMF), which reduces life expectancy. If coal miners with CWP or COPD are further exposed to coal dust, the severity of the disease is likely to increase.

The miners argue that Sasol Coal should have known of these health hazards, and through dust sampling and measurement should have been aware of the quantities of coal dust to which miners were exposed. Routine medical surveillance, if undertaken, would have established whether miners were at risk from the levels of dust in the underground mines.

Sasol denies liability

In its reply, Sasol argues that the matter has prescribed – meaning it is now too late to bring before the court. The Prescription Act requires such matters to be brought within three years of the alleged offence. Summons was served on the company in April 2015, more than three years after most of the miners had left Sasol’s employ.

Sasol’s court papers show several of the miners were dismissed for illegal strike action, and some had received medical compensation once their conditions had been diagnosed. One of the miners has since passed away. In other cases, workers’ medical conditions were deemed not severe enough for compensation. Some of the miners had previously worked at other mines, which may have aggravated their medical conditions. In other cases, Sasol denies the miners suffered from any lung disease, and no occupational diseases were diagnosed, so no benefits were paid out on their dismissal.

Sasol also questions some of the medical assumptions on which the miners base their claim, adding that CWP seldom causes significant disability. It also denies that COPD is developed by everyone who breathes coal dust.

The company argues that it provided proper mine ventilation to reduce dust particles to acceptable levels, and all workers were given adequate protective gear. To reduce the risk to miners’ health, remote-controlled mine machinery was employed, allowing operators to control the machines from a safe distance. It further argues that the miners have not been able to identify any act or omission that caused their injuries, and that the company took reasonable measures to address and reduce the risk of harmful exposure to dust on its mines.

Sasol also argues that in the event of dust hazards, the miners themselves would have been negligent in not noticing, avoiding and reporting the hazard (to which the miners reply that the harmful dust is invisible to the eye, and therefore almost impossible to detect). Should the court find Sasol Coal guilty of negligence, the corresponding negligence of the miners should reduce the amount of damages to be paid, says Sasol.

The Mine Health and Safety Act (MHSA) sets out the health and safety obligations on mine operators, who are expected to provide a work environment that is safe and does not pose a risk to workers’ health. Mines are also required to periodically measure the health dangers and investigate every serious illness so that the causes can be isolated and mitigated. It is also claimed that the company failed to properly ventilate the mines.

The miners argue that Sasol violated mining legislation by failing to ensure its mines were safe and healthy.

Expert medical reports show several of the miners on pain medication for lung-related complaints and other diseases. The reports suggest dust masks were available only some of the time while working underground.

The Sasol mines named in the court papers are Bosjesspruit, Brandspruit, Middelbult, Syferfontein, Twistdraai and Sigma.

The case is about to enter the pre-trial stage where the opposing parties will narrow down the areas of dispute. If settlement is not reached before then, the matter will likely go on trial in 2020.

Protests grow over defamation suits against environmentalists

Written by Ciaran Ryan. Posted in Journalism

Lawsuits can keep activists out of commission by forcing them to focus on the court case, but often backfire by drawing even more attention to an issue – as Australian mining company MRC is discovering. Picture: Shutterstock

Lawsuits can keep activists out of commission by forcing them to focus on the court case, but often backfire by drawing even more attention to an issue – as Australian mining company MRC is discovering. Picture: Shutterstock

This article first appeared in Moneyweb.

Environmental activists are headed to court next month in a bitter defamation suit brought last year by Australian mining company MRC, which is planning to mine titanium sands at Xolobeni on the Wild Coast.

The case involving three of the six environmentalists who are being sued for defamation by MRC and its CEO Mark Caruso is a curtain raiser to the main hearing and is intended to discover documents the environmentalists say they need to properly defend themselves.

Other environmental and civil groups are rallying around the environmentalists, claiming the court actions are nothing but ‘Slapp’ suits (Strategic Litigations Against Public Participation) intended to silence legitimate criticism of the company and its environmental practices.

“Around the world, Slapp suits are used by companies, particularly in the mining and energy sectors, to intimidate environmental defenders, in an effort to suppress debate about the negative impacts of their operations on local communities and in relation to environmental degradation,” says Leanne Govindsamy, head of corporate accountability and transparency at the Centre for Environmental Rights (CER). Two of CER’s attorneys have been sued by MRC and Caruso for defamation over criticisms made of MRC’s environmental practices.

Read: Defamation suits fly over mining controversies

Earlier this month CER and several other civil bodies – including groundWork, Earthjustice and Human Rights Watch – released a report highlighting threats against activists in the form of harassment, intimidation, violence and the use of Slapp suits.

“Judging from the response to the report, including the response to the report’s findings around the Slapp suits brought by MRC, the company is likely to find itself facing a wall of opposition from other civil society groups which resist the notion of censorship over issues that are in the public interest,” says Govindsamy.

Activists harassed

The Human Rights Defenders report says activists are frequently harassed by companies seeking court orders to prevent protests, filing vexatious lawsuits and seeking financial penalties. Slapp suits are a growing trend around the world, prompting calls for anti-Slapp legislation such as exists in some US states.

MCR does not enter this contest with a clean slate. Its subsidiary Mineral Sands Resources was fined R1.25 million for environmental transgressions at its Tormin operations on the west coast, a fine many consider woefully inadequate relative to the damage caused.

The chances of getting rich off defamation suits in SA are not good, reckons human rights lawyer Advocate Mark Oppenheimer. The top award for defamation in SA was R50 000 plus costs to former head of the Independent Police Investigation Directorate Robert McBride, who successfully sued The Citizen in 2011 over its claims that he was an unrepentant murderer for the Magoo Bar bombings in Durban in the 1980s. This award was the result of several articles in The Citizen that the Constitutional Court found to be malicious and defamatory.

One of those being sued by MRC and Caruso is environmental lawyer Cormac Cullinan. Both Cullinan and Caruso were on a Cape Talk radio show discussing the Xolobeni mining story, when Cullinan suggested that pro-mining representatives of the local community had been bought off, and that forged names were used in support of the pro-mining lobby.

Diversionary tactic 

“Caruso had the opportunity to defend his position on the radio show, but chose instead to bring a lawsuit,” says Cullinan. “One of the effects of these cases is to keep you out of commission while you spend time defending a court case. My statements were fair comment and I don’t think MRC’s case has any merit.”

What seems to have irked environmentalists in relation to MRC is the visit last week by mining minister Gwede Mantashe to its Tormin operations in the Western Cape. In a letter to the minister, CER executive director Melissa Fourie wrote: “Attempts to silence criticism and debate on matters of public interest are the most egregious forms of attack on constitutional rights and undermine not only the rights of those who are sued but undermines constitutional freedoms, which are central to democracy and civil society’s ability to advance transparency and accountability.”

One of the defendants in a separate case brought by MRC is social worker John GI Clarke, who denies defaming the company, but also appears to have doubled down on his criticism of MRC and Caruso. He faces 19 claims totalling more than R5.5 million, a figure that seems to keep growing each time he opens his mouth. But Clarke shows no signs of going anywhere quietly.

He has been highly critical of the way MRC and Caruso went about trying to secure mining rights in Xolobeni, apparently against the wishes of many people living in the area.

“All I have simply done is what social workers are obliged to do, in terms of our professional code of practice,” says Clarke.

Doubling down

“As part of the discovery process I have given Caruso’s lawyers enough evidence, without disclosing my confidantes of course, to cause him even more anxiety. That perhaps explains why [they are] now doubling down on me by increasing the quantum of damages Caruso is claiming. He started with seven claims totalling R2.25 million, then doubled that to 18 claims totalling R5 million and then again, adding another 10% on that by suing me for statements I made in another recent article,” Clarke told Moneyweb.

In Caruso’s affidavit before the Cape High Court, he lists the 19 instances of alleged defamation by Clarke. One of them is an interview Clarke gave to the Daily Maverick in which he is claimed to implicate MRC in the murder of Pondoland community activist Sikhosiphi ‘Bazooka’ Rhadebe in 2016 – a claim which, it must be said, MRC has always denied and Clarke says he never made.

The offending sentence could with a stretch be interpreted this way, but is so grammatically mangled as to make hardly any sense at all.

Caruso supplies the passage that he says defamed him:

“‘The key issue is whether human rights trump mining rights,’ said John Clarke, a social worker and Daily Maverick contributor, who has been working closely with the community. The area, which was the site of the Pondoland revolt, is fiercely resistant to being told from the outside what to do,” said Clarke, and after MRC continues to try for a mining licence the killing of Rhadebe he said it shows it’s trying to increase the pressure on those in its way.”

For this sentence, MRC and Caruso are claiming R500 000 from Clarke. In reply, Clarke says the offending sentence is not a direct quote and makes no logical or grammatical sense. It must be read in the broader context of growing hostility between pro and anti-mining activists in the area.

Rhadebe’s killing was a tragedy that gutted the local community, especially as the killers were never found.

Mining licence ‘supported’ by the dead?

Clarke also claimed that some of the local residents’ signatures presented by MRC in support of its mining licence showing “prior, free and informed consent” were forged and included many who had died. Clarke added that Caruso had attempted to hide this fact. Caruso’s affidavit says this statement wrongly suggests criminality on his part. For this statement by Clarke, Caruso is claiming another R500 000. There are 17 other claims against Clarke alone.

MRC and Caruso are also claiming R1 million from community activist Mzamo Dlamini, R1 million from Cullinan and R250 000 each from CER lawyers Christine Redell and Tracey Davies, and community activist Davine Cloete. The CER lawyers were sued for comments they made during a presentation at the University of Cape Town claiming poor environmental practices by the company’s Tormin project. All are defending the claims.

Are Slapp suits effective in silencing criticism? Govindsamy says they are intended to promote self-censorship and place a huge financial burden on those forced to defend them. “However, civil society organisations in South Africa are committed to defending the right to freedom of expression, particularly around issues which are in the public interest and we are committed to ensuring that activists are not silenced through the use of Slapp suits, especially bearing in mind the integral role which freedom of expression has played in our nascent democracy.”

The ‘Streisand effect’

Slapp suits very often backfire on the plaintiffs by rallying support for the defendants. This is known as the ‘Streisand effect’, where attempts to silence free speech end up drawing even more attention to the issue. It is named after US performer Barbara Streisand’s attempts to have a picture of her house removed from a public collection of California coastal images. Her attempt to avoid public scrutiny had the opposite effect once it became known.

There is a push for anti-Slapp legislation in several US states, making it easier for judges to dismiss cases deemed to be attempts to silence criticism. The most frequent targets for these suits are civil society and environmental groups, and the press. 

Former finance minister Trevor Manuel has reportedly filed a suit against the Economic Freedom Fighters (EFF) for claiming the appointment of Sars Commissioner Edward Kieswetter was irregular. Manuel was part of the recruitment selection panel, and the EFF claimed he was related to Kieswetter and that the two had close business ties. Manuel demanded a retraction, calling the claims racist and libellous. The EFF appears to be sticking to its guns, saying it will defend any action brought by Manuel.

Many worthy stories are buried without having to go this far. PR agencies are sometimes able to do it with charm offensives. Sometimes all it takes is a phone call. In the opening section of Gangster State, author Pieter-Louis Myburgh recalls receiving a phone call from Ace Magashule, ANC secretary-general and the subject of the book, trying to fish for information on what Myburgh was planning to write about. That didn’t stop Myburgh, but it did stop a Free State reporter who received a similar call, says Myburgh.