My dear friend Tony Webbstock passed away last Wednesday morning, the result of complications from a decades-long battle with diabetes and – one has to say – poor medicine back in the day when diabetes wasn’t as well understood as it is today. Tony was a warrior with a Christian heart, a genius lawyer who put himself at the service of the people vs the banks.

I could hear it in his voice a few weeks back when I last spoke to him. He sounded strained and weak. He succumbed last week after a long fight with his ailing body. He remained his usual chirpy self, defiant and rebellious to the end. Never once was there a hint of victimhood in his voice.

Tony had been an attorney all his professional life, a devout Christian and champion of the small guy. He never once acted for the banks. With his genius and knowledge of the law, he could have made himself a rich man had he put himself at the service of the banks, but he refused this path. As an attorney, he would only ever act against the banks. Many clients he took on without charge. Whether you were from the townships or suburbs, as long as you were being hounded by the banks, Tony was always available on his phone for a consultation.

In an industry crowded with money grubbers and vultures, Tony stood above them all for his principle and his heart. He could not turn away from the misery and suffering that the banks had inflicted upon ordinary people. After the financial crisis of 2008, it became obvious to Tony that the banks were engaged in the biggest crime of the century. Having spread their confetti money across the land in the years leading up to the crisis, they then started foreclosing and vacuuming up of assets of their customers.

It is a well-known fact that South African law firms will seldom, if ever, act for clients against the banks. This is how they have captured the justice system. Tony was a rare exception, and he was brilliant at it. He knew every nook and cranny of banking and consumer law, and surrounded himself with a team that was without equal, including his son Matt, Stephen May and Leonard Benjamin. In case after case, they schooled the banks in the law that they were abusing.

Tony had fascinating insights into modern banking, the accumulation of four decades of legal battles with the banks. He knew their every trick: failing to properly serve summons on their customers to defeat their ability to put up a defence; illegally loading bank and legal charges onto mortgage bonds; arriving in court with recreated documents, claiming the originals were destroyed in a fire; litigating clients into bankruptcy, the final indignity for those who spent their lives in toil and struggle; bringing claims before the High Court when they should be argued in the Magistrates Courts where legal costs are a fraction of the higher court; failure to attach loan agreements to summonses; unlawful selling of credit and other insurance products and then failing to honour these policies; self-dealing by the banks when they repossess properties for a pittance and then on-sell them to insiders…. The list goes on. Tony had seen it all.

He was unique in that he was not motivated by money. His Christian heart had no place for this. From Timothy in the Bible: “The love of money is the root of all evil…” Tony lived this with conviction and passion. In a broken and troubled world, Tony made a difference. Thousands of people were rescued from ruin by his intervention. He was mostly gentle and kind. I say mostly. When confronted with that miserable breed, debt collectors, he summoned up the tiger and disguised his fair nature with rage, as Shakespeare implores us in Henry V:

In peace there’s nothing so becomes a man,

As modest stillness and humility;

But when the blast of war blows in our ears,

Then imitate the action of the tiger:

Stiffen the sinews, conjure up the blood,

Disguise fair nature with hard-favoured rage:

Then lend the eye a terrible aspect.

To hear Tony dispense with debt collectors was a beauty to behold. In battle, this was a guy you wanted in your corner.

The good news is that Tony’s crusade for a fairer world is in good hands. His son Matt, Stephen and Leonard will continue the path that Tony forged. Tony leaves us, his integrity and soul intact, a rare thing to say about any lawyer.

This article first appeared at Acts Online.

SA is over-governed. We have 35 ministers, 37 deputy ministers, and 9 provinces each with their own ministers and administrations. Then there are the 263 municipalities, operating another layer of bureaucracy. Perhaps government should set the pace by scaling back on this boondoggle.

And in case you think this is all well and good, consider that just 49 of the country’s municipalities achieved clean audits in the 2015/16 financial year, according to the Auditor General, Kimi Makwetu.

The AG also reported that Irregular expenditure in municipalities increased by over 50% to R16.81bn, though the figure could be substantially more as a third indicated that the full extent of mis-spending was unknown.

Narius Moloto, president of the Pan African Congress (pictured above right), calls the nine provinces “mini bantustans” and wants to see them scrapped, with the money spent on duplicated administrations spent on job creation and uplifting the poor. The 9 provinces have a combined 430 members of the legislature to look after, not counting their entourages and hangers-on.

The Democratic Alliance (DA) thinks it’s time to scale back on the blue light brigade. “This cabinet is by far one of the biggest in the world with 35 ministers; far bigger than the United States at 15 ministers, Kenya with 18 ministers, and the United Kingdom with 21 ministers,” according to DA spokeswoman Desiree van der Walt.

This year alone, the 35 ministers and 37 deputy ministers are expected to earn R163.5 million, with their ministerial staff (limited to 10 for minister and 6 for deputy ministers) costing a further R1bn.

Is this value for money? The DA has done some decent homework on this subject and concludes that government should set a good example by cutting back on the number of ministers. What do we need a sports minister for, other than to cheer on our soccer team and complain about race quotas not being met? What does our science and technology minister hope to achieve that the private sector cannot? Then we’ve got higher education and basic education. Why 2 ministries (both rather miserable in their academic achievements)?

That’s just one side of this boondoggle. Public Works doled out R188m on 33 properties in Pretoria and Cape Town for the ministers and deputies, a princely R5,7m per property. Another R48m is to be spent in the current fiscal year for 6 more properties – a cost of R8m per property. The R236m spent on ministerial properties could have built 2,000 RDP houses, says the DA.

Then there’s the travel and entertainment budgets coming in at a shade under R300m this year. But the real shocker is the VIP protection services, costing R1,5bn in the current fiscal year, and close to R5bn over the next 3 years.

The DA says part of the problem lies in the ministerial handbook, which provides rather generous staffing and expense limits on ministers and their deputies.

Previous presidents had smaller cabinets. Nelson Mandela – total cabinet size 50 (28 ministers); Thabo Mbeki – total cabinet size 50 (28 ministers); Kgalema Motlanthe – total cabinet size: 47 (28 ministers); Jacob Zuma/Cyril Ramaphosa – total cabinet size 73 (35 ministers).

Says van der Walt: “If the president is serious about helping National Treasury reign in the runaway budget deficit he will have to cut executive spending by finalising a stricter and more frugal ministerial handbook, as well as cutting the overall size of the cabinet.”

 

This article first appeared at Acts Online.

 

Thank Donald Trump and Bibi Netanyahu for higher oil prices, which spiked from around $40 to nearly $80 a barrel after the US president announced last week he was pulling the US out of the Iran nuclear deal. Israeli prime minister Netanhayu’s signature is all over this. 

Oil prices are now at levels last seen in 2014. The fear is that Iran’s oil exports will suffer as a result of renewed US sanctions, resulting in a worldwide shortfall (even though Iran only accounts for 3% of global oil supply).

What this means for SA is rising fuel prices, a weaker balance of payments and higher interest rates. In other words, more poverty. You can thank Trump and Netanyahu for this outrage.

It looks like our hopes for reaching 2% growth this year can now be put to bed. Clive Eggers, head of Investment Analytics at GTC, says if the oil price continues to climb  – which it will if the US actions against Iran remain in place – and inflationary pressure builds, the SA Reserve Bank may be forced to raise interest rates to stabilise the economy.

South Africa imports its oil primarily from Saudi-Arabia, Nigeria and Angola. Higher oil prices will contract GDP by 0.3%, and could get worse if oil prices continue to rise – which seems likely.

“Trump’s announcement has essentially put the entire Middle East into a state of flux and risked a potential destabilisation of the area. The other signatories to the agreement have – for now – agreed to maintain the status quo and continue with the deal, though American sanctions would make it very difficult for many global companies – including MTN, Airbus, Total and Peugeot – who resumed doing business in Iran after the original nuclear deal was announced, to continue dealing with Iran,” says Eggers.

SA has strong historical ties with Iran, as it first started importing Iranian oil after World War II and has constructed refineries to accommodate Iranian light crude oil. Until 2011, when sanctions were imposed by the US, SA was the third biggest importer of Iranian oil.

Within days of pulling out of the Iran deal, we were treated to visuals of Israeli troops shooting unarmed Palestinian protesters with live bullets, while 50 miles away in Jerusalem Ivanka Trump was cracking open the champagne to inaugurate the new US embassy building, in defiance of Palestinian claims to the city.

SA’s foreign minister Lindiwe Sisulu immediately recalled her ambassador to Israel in condemnation of the killings. The EFF wants the Israeli mission to SA shut down. The DA and the Jewish Board of Deputies “slammed” the ambassador’s recall, but not the killings, which were merely “regretable”. The Daily Maverick reports on the killing of “peaceful” protesters (note the parenthesis, a craven attempt at even-handedness). Other papers spoke of “clashes” between the Palestinians and Israelis. No. There were no clashes. It was a turkey shoot. This could turn out to be Israel’s Amritsar or Sharpeville moment, a slaughter so ugly that the world can no longer look away.

It’s getting hard to make sense of Donald Trump. It looked for a time as if he was Reagan 2.0, a right-wing pro-business president breathing fire and brimstone who miraculously brought an end to the Cold War with Russia.

Trump is nothing like Reagan. Reagan was more gas than propane. He pulled US troops out of Lebanon after a bomb attack on a US army station in that country, and dialled down the kind of crazy rhetoric were are now hearing whenever the subject of Russia comes up. Reagan, though he invaded Grenada for a bit of weekend sport, still managed to make the world a safer place. Trump may sincerely want better relations with Russia, but he is clearly hostage to the crazies in his government who need enemies to keep military spending faucets on maximum.

He twice ordered the firing of missiles into Syria in the last year over dodgy evidence of chemical attacks by the Syrian military. Netanyahu wants nothing more than to rid the region of Syrian leader Bashar al-Assad. A weakened Syria suits Israel (don’t imagine for a minute Israel will stop at breaking up Syria – it now has Iran squarely in view). Trump then surrounded himself with some of the most reckless pro-war hawks that had been lurking in the shadows of the Obama administration, bringing the world once again to the brink of a superpower war. Russia has warned that it would retaliate should any of its troops in Syria be harmed. “Brinkmanship” has returned as official US policy after a three decade sojourn, though this time could easily spiral out of control.

In his election campaign, Trump promised better relations with Russia, but has since cycled back from this hopeful talk. Russia’s entry to the Syrian conflict has virtually rid the country of jihadis, changing the dynamics of the region.

It was Trump’s predecessor, Obama, who signed off on the Iran nuclear deal, which lifted sanctions on Iran in return for the latter limiting its nuclear activities. Trump always maintained it was a “bad deal” without offering any sound proof. Netanyahu is leading Trump by the nose with his cartoonish exaggerations of the Iran threat. The International Atomic Energy Agency and US intelligence have on numerous occasions confirmed Iran is in compliance with its nuclear obligations.

Remember this the next time you refuel your car, or have to pay higher interest rates on your mortgage bond.

Ciaran Ryan discusses the R60bn court action in the Constitutional Court being brought by more than 225 applicants whose homes were repossessed by the banks and sold at auction for a fraction of their value. They are asking for criminal investigations into banking executives involved in this practice, and for a change in the law to force banks to sell foreclosed properties at market prices.

Listen here:

This article first appeared in Moneyweb.

Fees charged by banks for bounced debit orders range from R5 to R150.

Banks are raking in between R500 million and R800 million a month from bounced debit orders. That’s a sizeable portion of the banks’ non-interest fee income each year for little more than running a piece of computer code.

Fees for bounced debit orders range from R5 for Capitec clients to R150 for Absa and Nedbank clients. The question arises why the fees vary from the reasonable to the ridiculous.

It’s a question bank customers in Australia, New Zealand and the UK started asking several years ago, leading to class action suits against the banks in these countries. The class action suits in the UK and Australia failed because the courts found the fees for bounced debit orders and other charges reasonable if they formed part of a basket of services. SA’s financial regulations are less prescriptive, so the chances of a class action suit succeeding here are much better, according to financial services legal consultant, Leonard Benjamin.

Here’s a case where Nedbank repossessed a Katlehong home for R10. You read that right. Ernest Mashaba and his family have been put through a decade of hell and have been evicted four times, each time re-occupying the house, believing the bank had made a mistake. Here’s the kicker: Ernest Mashaba never missed a payment and has written confirmation that his mortgage loan is fully paid up. His story is little different from that of John Mojaki of Randfontein, who also has written confirmation from Nedbank that his loan is paid up. His house has also been sold behind his back. “The only way they will get me out of here is in a coffin,” says Mojaki.

 
Ernest Mashaba (pictured above with his son Sipho) and his family have been evicted four times from their home in Likole Extension 1 in Katlehong, near Johannesburg. Now they face eviction for the fifth time.

Each time the sheriff and “red ants” arrive to remove their belongings from their home, Mashaba and his family re-occupy the house they say they paid for in blood, sweat and tears.

“The house is mine,” says Mashaba. “I took out a loan with the SA Perm (later acquired by Nedbank) in 1993 and never missed a payment. I have paid for this house in full. So why am I being evicted?”

It’s a question GroundUp put to Nedbank, which replied as follows: “It is worth noting that there is a significant amount of time that has lapsed in these matters. As a result, the process of investigating such matters tends to be complicated and therefore very lengthy.

“We assure you that we take the issues that you have raised very seriously and will do whatever we can to resolve these issues for our clients. It is not in our nor the client’s interest to repossess properties. We also encourage and invite clients to contact us as soon as they experience financial hard times, so we can try to find the best solution for them.”

No-one, it seems, is exactly sure how Mashaba ended up in this position – least of all Mashaba, now retired after spending most of his working life as a security guard at the nearby Knights Hospital. In 1993 he took out a R41,485 loan with SA Perm to acquire his dream house in Katlehong. By all accounts, he diligently paid his loan off by way of a monthly R585 debit order. But in 2006, the sheriff arrived at the house and said it had been sold to a new owner. Some time before this, it seems Nedbank had taken a default judgment against him, though Mashaba never received a summons, nor was he ever shown the alleged judgment. And if he was in arrears, the bank never informed him of this nor of its intention to take legal action against him.

The price paid by Nedbank for Mashaba’s house at the auction was R10.

The price paid by Nedbank for Mashaba’s house at the auction was R10. You read that right. Nedbank says this is deceptive as it credited Mashaba’s account with the full amount of the loan outstanding. Yet Mashaba continued his monthly repayments, oblivious to the fact that his house had a new owner.

Be that as it may, Mashaba and his family have been put through a decade of hell, waiting for the next visit by the sheriff.

The first eviction was in 2006, when the Mashaba family’s belongings were dumped on the street. As soon as the sheriff left, they moved back as they believed there was a mistake. Their attempts to convince the sheriff that they were up-to-date on their payments fell on deaf ears. Mashaba and his family were evicted a total of four times – in 2006, 2007, 2009 and 2011. In 2015, Absa applied to the South Gauteng High Court for his home to be sold in execution yet again. A study of the deeds register shows that the house has been sold multiple times over the last 11 years. All of this happened behind Mashaba’s back, yet each time the sheriff turned up to evict him, he had to suffer the humiliation of having his possessions thrown onto the street.

In November last year the house went on auction and was sold to an estate agent. Mashaba attended the auction and approached the buyer with documents proving that he had bought and paid for the house in full. The buyer pulled out of the sale. Mashaba remains in his house.

His fight is far from over. The sale in execution order remains in force, so it may end up being auctioned again by the sheriff.

Johannesburg businessman Damon Greville defended himself in the South Gauteng High Court this week against Sasfin Bank, which liquidated his 67 year-old business in 2012 and is now attempting to repossess his house. The judge found “substantive evidence” that the bank’s legal standing was in question after Greville presented evidence of securitisation and “contradictory” accounting by the bank.

Johannesburg businessman Damon Greville, whose 67 year old printing business was liquidated by Sasfin Bank in 2012, was this week gifted a victory in the South Gauteng High Court when his case was referred to trial.

The case is particularly interesting from at least one angle: Sasfin Bank pioneered securitisation in South Africa, and Greville claims that his loan has been securitised, thereby removing the bank’s legal standing to bring any action against him.

In addition to the securitisation argument, Greville says his debt to the bank has already been discharged. After accounting for payments already made from the sale of his company assets at auction, he says the bank now owes him close to R600,000.

The judgment handed down by the court could be a major victory for the “securitisation defence” as it has come to be known. Securitisation is the banks’ practice of bundling loans together and on-selling them to investors, though the banks continue to act as collection agents for the new owners, which is expressly forbidden in terms of Section 78 of the Banks Act.

Once securitisation has occurred, the banks – in theory – lose all legal title to these loans and cannot proceed against borrowers. This has been validated by case law overseas, but the courts in South Africa have tended to give the banks a free pass on this shadowy practice. This latest judgment is therefore a major victory for those arguing the securitisation defence.

Greville represented himself in court, presenting what the judge called “substantive evidence” casting doubt on Sasfin Bank’s legal standing in the matter. Greville provided evidence that his loan with the bank had been securitised, and was now owned by an entity called SA Securitisation Programme (HF) Ltd.

The judge also found discrepancies in Sasfin’s accounting. Greville claims that rather than he owing the bank money, the bank owes him. By his own calculations, the bank now owes him close to R600,000, but is trying to foreclose on his house claiming an outstanding debt of R333,000.

“I feel vindicated that the court found merit in my arguments that the bank had destroyed a viable business employing 24 people, when I provided evidence in court that Sasfin had securitised my loan, which means they don’t have legal standing in the matter. Now the matter must go to trial, which is a victory for me, as it means we can call bank officials to the witness stand and interrogate them.”

Greville adds that Sasfin sold his business’s assets for roughly 20% of their worth, and then tried to foreclose on his house. This was the point when he started to investigate the law and study up on securitisation.

In papers placed before the judge, Greville claimed not only that the bank’s accounting was bogus, but asked for R20 million for restitution and damages for the destruction wrought by the bank’s actions.

“What is heartbreaking is that the business has been around for 67 years, longer than Sasfin Bank. It was a viable and solvent business,” he says.

The Judge found discrepancies in the Certificate of Balance presented by the bank’s lawyers before the court. The bank, having previously liquidated Greville’s business and equipment, had applied to the court to execute on his house.

This judgment reads: “The Applicant (Sasfin) also decided to re-cast its case in its Replying Affidavit, thereby furnishing a new Certificate of Balance, which did not even reflect the name of the Applicant. In doing so, the Applicant went further to amend its Notice of Motion in order to cover the inaccurate calculations of the amount allegedly owed by the Respondents (Greville and Advance Printing). I must point out that although the Applicant in the new case that it makes out with Amended Notice of Motion, seeks to rely on the new Certificate of Balance, the order sought in the Amended Notice of Motion in relation to the date from which interest is to be paid, contradicts what is provided in the said Certificate of Balance.”

This amounts to a searing indictment of the case the bank presented to the court.

The battle is not yet over for Greville, who is asking the court to award him R20 million in damages for what he claims were reckless and unlawful actions taken by the bank that resulted in the closure of his business. The case should provide legal fodder for thousands of other South Africans under the threat of the banks’ knives.

The facts of the case are this: in 2008 Greville asked Sasfin to finance the purchase of a building to accommodate his expanding business, and the bank agreed. According to Greville’s papers before the court, Sasfin decided it would rather take its security on the plant and machinery of his business, Advance Printing, in preference to registering a bond over the factory property. It then seems the bank changed its mind and took out bonds on both the plant and machinery, and the factory building.

The finance agreement for the purchase of the building had suddenly turned into a lease for equipment, which was previously owned unencumbered by Advance Printing. This, says Greville, makes the loan agreement defective.

By 2011 the credit crunch was reaching its peak, and Nedbank withdrew Advance Printing’s overdraft facility. The business fell three months into arrears with its Sasfin debt. A meeting with Sasfin Bank seemed in order to resolve the matter. It seemed the only way out was to sell the factory building and plant so the bank could recover its money. So far, so good.

At this meeting Greville asked whether his loan had been securitised and, after a pregnant pause and much humming and hawing, he left none the wiser. He says he was then put under pressure to sign an irrevocable power of attorney authorising the bank to sell the property at auction “at a reasonable market related price,” and a reserve price of R1,75 million was agreed in writing and emailed through to the bank. In February 2012 Greville says he received an offer for R1,9 million for the building, which he rejected as too low.

Just a couple of months earlier a similar building directly across the road had been sold for R2.5 million.

On 6 October 2012 Greville was advised by Alon Berman of Sasfin Bank that the property would be sold for R1.6 million. Greville immediately protested, and fired off a letter to the bank revoking his power of attorney. The bank ignored this and went ahead with the sale anyway.

The factory equipment was also put up for auction. One item, a Fuji 65IIP printing machine was sold for R35,000 when Greville had a buyer lined up prepared to pay R120,000.

After liquidating his business and selling of his assets, the bank still claimed an amount of R348,000 from Greville and approached the court for an execution order on his house, “when in all likelihood they were aware that they (Sasfin) were in fact indebted to respondents in the amount of R383 625. Included in the applicant’s Notice of Motion they inadvertently inserted a Certificate of Balance in the name of the South African Securitisation Programme (HF) Ltd., giving prima facie and unrefuted evidence that the loan agreement had indeed been securitised,” according to papers before the judge this week.

The bank later tried to have this piece of evidence withdrawn. This, says Greville, is clear evidence that Sasfin no longer has legal title to his loan, because it has been on-sold to SA Securitisation Programme (HF) Ltd.

“On being challenged in the respondents’ Responding Affidavit, the applicant changed their claim to R333 131 and sought to withdraw and replace their incriminating Certificate of Balance.”

Greville says in his papers that as it is “impossible for the applicant to restore the respondents to their positions prior to the applicants fraudulent action, i.e. to reconstitute Advance Printing Company and put it back in business, and to re-employ the staff who lost their jobs, and to make up lost income.” He is seeking restitution and costs of R20 million, plus further damages.

Despite the recent Supreme Court of Appeal victory for government over its plans to introduce e-tolls, the matter seems likely to go before the Constitutional Court. If this fails, mass civil disobedience will sink this ship, writes Ciaran Ryan 

Spare a thought for Nazir Alli, CEO of SA National Roads Agency, whose job it is to sell the South African public on the wondrous benefits of e-tolls.

The Supreme Court of Appeal (SCA) this week just tossed out the case launched by Opposition to Urban Tolling Alliance (OUTA) challenging the legality of the tolls, but Alli’s problems are just beginning. The Freedom Front has indicated it will challenge the SCA decision in the Constitutional Court, and OUTA will decide next week what action it plans to take.

At the very least, mass civil disobedience seems certain. OUTA says it may choose to defend any motorist who is charged for non-payment of the tolls. If SANRAL loses just one case, it is game over for e-tolls.

Not in 20 years has the South African government faced such committed opposition to a policy plan. The ANC voted in lockstep – and in complete disregard for the near universal opposition to this blighted plan – when it recently hammered through Transport Laws and Related Matters Amendment Bill, paving the for e-tolling. A few days later, OUTA lost its case to have e-tolling declared unlawful in the Supreme Court of Appeal.

Not a great week for the people of South Africa.

Still, there was Nazir Alli claiming the opposition to e-tolling is exaggerated, and that the SCA concurred with SANRAL’s claim that it had acted within the law.

Consider the following: in October 2007, barely a year after the Gauteng Freeway Improvement Project (GFIP) was conceived, SANRAL took out expensive advertisements in national newspapers inviting comment from the public, as it is required to do by law. It got a total of 28 responses. SANRAL could then claim that it had adequately canvassed comment from the public and so fulfilled its legal obligations in this regard. This in a country of more than 50 million people is somehow deemed by SANRAL to be adequate public consultation.

With that box now ticked, by 2010 it had moved on to the implementation phase, erecting 45 e-toll gantries across Gauteng, all in preparation for the April 2011 launch. Opposition to e-tolls was by now in full cry, led by OUTA, but supported by opposition parties, Cosatu, the ANC Youth League, business and civic organisations. The April 2011 launch date came and went. In fact, five launch dates have since come and gone. Now government is promising to launch before Christmas this year and as of this week, the freeway tariffs have started appearing on billboards across Gauteng.

In June of this year, the Presidential Commission for the Review of State-Owned Entities recommended that “funding for social infrastructure, including roads, should rely less on the user pays mechanism (ie. e-tolls) and more on taxation.”

In other words, the government’s plans to proceed with e-tolls contradicts its own policies.

As OUTA has pointed out, had government slapped a 9 cents a litre surcharge onto the fuel levy in 2006 when GFIP was first floated, this – together with the R5,7 billion allocated by Treasury to the project in 2012 – would have covered the entire R17,1 billion cost of the freeway upgrades, and there would be no collection costs.

OUTA further points out that roughly 30% of the e-tolling maintenance and operational costs will go to collection. Specifically, the European group Kapsch (what a great name) that owns the majority interest in the e-toll company, has said it will earn R670 million a year from the project.

The basis of OUTA’s case is as follows:

• that SANRAL had clearly failed to conduct a meaningful public participation process before it decided to declare Gauteng’s freeways toll roads. The three million or so members of Gauteng’s road using public were not properly informed of SANRAL’s plans nor given the opportunity to participate in the decision at all, as is required by the SANRAL Act;
• the Minister of Transport failed to properly consider the exorbitant costs of e-tolling that would be borne by the public when approving SANRAL’s plans to declare Gauteng’s freeways toll roads. The very person who had to safe-guard the public from an overly expensive scheme did not properly consider the expense of the collection process;
• the enforcement of e-tolling would be practically impossible because of the sheer numbers of users of the GFIP. Gauteng’s courts and law enforcement system would be unable to deal with thousands of expected defaulters per month.
• that the levying and collection of e-toll is a scheme that had not been introduced according to the law, and would violate the constitutional right of road users not to be arbitrarily deprived of property.
• Last year OUTA launched a case in the North Gauteng High Court, which astonishingly decided that  the public consultation conducted by SANRAL prior to 2008 had been adequate. The Court failed to deliberate on the alleged unlawfulness of e-tolling. The matter was then taken on appeal.

“Astoundingly, the SCA in its judgment responded by refusing to consider and decide on the unlawfulness of e-tolling,” said OUTA in a statement issued today.  “Instead, the SCA decided the appeal largely on the technical basis that there has been too long a delay in challenging e-tolling. The property challenge was also dealt with on the basis that it was defeated by delay. In short, the SCA has said it is too late, and has closed its eyes to the fact that e-tolling may be unlawful.”

The government and SANRAL have interpreted the SCA judgment as affirmation that SANRAL’s public consultation was adequate. OUTA says the judgment makes no such claim. Road users still have no clarity on the lawfulness of e-tolling. Therefore, “it remains open to any citizen to lawfully decide not to pay e-tolls and defend his/her prosecution for failure to pay e-tolls on the basis that the toll declarations and the approval by the Minister of Transport of e-tolling was unlawful,” says OUTA.

“This we must stress, is a very positive implication of the SCA judgment for the rights of individuals.”

Perhaps the main argument against e-tolling is that it will bankrupt itself due to the administration costs of chasing up tens of thousands of unpaid bills each month. On this basis alone, it seems doomed.

OUTA has a couple of avenues open to it. It could take the matter to the Constitutional Court, but is seriously short of funds. Or it could defend a motorist charged for non-payment of e-tolls, or encourage a campaign of civil disobedience.

Either way, the e-toll saga is far from over.

View at source.

In 1990 John Kane-Berman of the SA Institute of Race Relations wrote a book called The Silent Revolution in which he detailed the extent to which apartheid was crumbling under its own weight. All former president FW de Klerk did was legitimise facts on the ground.

It was, Kane-Berman declared, a “silent revolution” where race and other laws were simply ignored. A culture of disobedience had taken root that no amount of enforcement could deracinate.

This is what happens when market forces collide with tyranny. What brought down apartheid was disobedience on a massive scale. “Ordinary people simply ignored the pass laws not because they deliberately sought to defy them but because they were seeking better economic opportunities in the towns,” says Kane-Berman. Disobedience, and fiscal bankruptcy, eventually sank apartheid.

When the regulatory over-burden becomes intolerable, people will ignore laws that inhibit their ability to survive. There are signs this is happening again. The culture of disobedience that the ANC so successfully implemented to make the country ungovernable in the apartheid years may come back to haunt it. For a start, take a look at electricity: it is reckoned that 10% of South Africa’s electricity generation – equivalent to 3,600 megawatts, or one full-blown coal-fired power station – is lost to non-payment or theft. That totals about R5,3 billion a year.

Then there is trade union group Cosatu’s call for civil disobedience should the SA National Roads Agency proceed with e-tolling in Gauteng. On this it has the backing of more than 10 civil society groups, including the SA Council of Bishops. The Democratic Alliance, too, has slammed the planned introduction of e-tolls. This is a litmus test for government – should it lose this battle, ordinary citizens will scent blood and demand cheaper petrol, electricity, phone charges, to name a few. The only way to give people cheaper anything is to free up these markets. What’s unique about the e-toll battle is that the opposition is highly organised, and it helped that Cosatu led from the front. If government loses this battle, it is on a hiding to nothing. Consumer activists will pounce on any number of grievances, from bank to fuel and call charges. It could get messy.

The culture of disobedience that sank apartheid has resurfaced in other ways. South Africa lost more work days to strike action in 2011 than any other country in the world, bar Canada, and the figure was likely topped by last year’s strike action. In 2010, 20,6 million days were lost to strike action, in which one million workers participated in 74 strikes. Many of these strikes were unprotected, or illegal (in terms of the Labour Relations Act). It is not known how many workers in these unprotected strikes lost their jobs, but probably not many. So, in the area of labour law, disobedience pays.

The informal sector is often seen as a convenient tax dodge by the Treasury. It has been suspected for years that small tax-paying businesses often liquidate and then re-surface as informal sector enterprises, operating below the tax radar. Hence, business liquidation stats – as indicative of the country’s economic health – are probably useless. The fact that they are falling does not necessarily suggest an economic recovery is underway, merely that the laundering of toxic credit from the system has run its course for the time being.

Then there’s the perennial headline “Tax evasion costs South Africa billions.” It gets trotted out every year whenever a new amendment to the Income Tax Act aimed at plugging loopholes is introduced. Finance minister and former SARS boss Pravin Gordhan, in 2011, lamented that in most countries, including South Africa, tax administrators were 10 years behind tax planners. So what we get is ever more complex tax codes on which tax planners have a 10 year head start. SA Revenue Services has taken to the airwaves with some emotional feel-good stories that shows our tax money is being put to good use, which at least softens the threats it standardly issues at those it feels are not paying their fair due.

For the truly big figures, you have to look at what fraud and corruption is costing the country: R100 billion a year, according to the Open Democracy Advice Centre in 2011. According to Business Day, the Public Service Commission recently published findings showing that financial misconduct in the public service had grown from R100 million in 2008/9 to R346 million in 2009/10 and soared to R932 million in 2010/1. The Public Service Commission estimates that financial misconduct in 2011/12 could exceed R1 billion. Yet, only 19% of officials found guilty of financial misconduct were discharged from the public service. The majority of perpetrators remain in their positions and often continue to commit financial misconduct, according to the report. So in the public sector, disobedience pays.

Not that fraud and corruption can be compared to protests against e-tolls, but it it is illustrative of a growing culture of disrespect for the law.

One need only look at recent history to understand the power of civil disobedience, which is nothing more than an expression of elemental market forces. The pass laws, for a start, had been ignored in many parts of the country since the 1970s. Hillbrow in Johannesburg by 1985 was widely acknowledged to be the most racially integrated precinct in the country. Landlords overlooked the Group Areas Act and rented properties to blacks, who were by then defying racial prohibitions by pouring into the cities in search of work.

Bantu education was another pillar of apartheid that crumbled under the weight of market forces. Wealthy blacks, in defiance of the laws of the time, had their children admitted to the best schools in the country. In some schools, 60% of the students in the 1970s were non-white. Schools openly defied the government, which threatened to withdraw registration of the offending schools. But its bark was worse than its bite. Eventually it introduced permits to replace blanket prohibition on the integration of private schools.

In fact, every pillar of the apartheid edifice had started to atrophy long before racial separation was abandoned as official government policy in the early 1990s.

The Influx Control Act was intended to keep blacks out of white areas. Recognising that such a law could not be enforced by mere edict, the National Party layered its imperial vanity with a host of race-based laws, such as the Natives (Prohibition of Interdicts) Act, the Natives Resettlement Act, the Population Registration Act, the Promotion of Bantu Self-government Act – all intended to strip blacks of citizenship and deprive them of recourse to the courts.

All told, it required more than 50 pieces of legislation to deal with the separation of the races, and nine more anti-terrorist and security laws to suppress rebellion. All this was quite a hefty burden on the treasury, and that’s before counting the billions of rands spent on creating self-governing homelands.

For all that, hundreds of thousands of blacks poured into Johannesburg, Cape Town and Durban. Throughout the 1970s and 1980s, the police were ordered to burn down illegal shanties and deport the inhabitants. The Riekert Commission was set up in the late 1970s to debate the wisdom of continuing with pass laws. Its final report in 1979 decided the pass laws should stay, but relaxed some controls on blacks already in the cities, while tightening restrictions on anyone else planning to move to the towns. The Urban Foundation mobilised the business community to lobby government not for relaxation of influx control, but its complete abolition. This was, says Kane-Berman, “probably the most successful business achievement in the dismantling of apartheid that South Africa has yet seen.”

It was the quiet, non-confrontational nature of this disobedience that allowed the government to turn a blind eye. A campaign of defiance intended to challenge the government’s hold on power might well have prompted a more aggressive response.

There are many who celebrate South Africa’s culture of disobedience, since it exposes the limits of government and creates a new morality that eventually translates into law or, better still, the abolition of laws that achieve the exact opposite of what they promise, as Simon Watson of the Ludwig Von Mises Institute SA recently pointed out. Disobedience occurs when government flagrantly violates market forces and the will of people to operate in a free and voluntary manner.

Original article here.

UN Secretary General Ban Ki-moon has criticised NSA whistleblower Ed Snowden for “misuse” of government data.

Excuse me?

What about the galactic-scale misuse of private data by the US National Security Agency (NSA) where Snowden recently worked?

South Africans should realise by now that all of their emails and potentially other electronic communications reside on a giant server somewhere in the US for possible scrutiny at a later stage. Try as you might to live an honourable life, that angry and ill-conceived email you wrote five years ago to a former boss or ex-wife could be dredged up some time in the future to paint you in a particularly unflattering light. South Africans should also realise that our own intelligence agencies standardly break the law by snooping without warrants, as the Mail and Guardian reported.

Some congressmen in the US are calling for Snowden’s arrest for treason, while Mr Apprentice himself, Donald Trump, thinks he should be assassinated. Even more shocking is the response from US media outlets, more concerned with investigating Snowden’s personal life than the staggering revelations of government abuse he has disclosed to the world (and, by all accounts, will continue to do).

Recently,  Spain, Portugal and France prevented over-flight of a plane carrying Bolivian president Evo Morales on the grounds that it was believed to be also carrying Snowden, which it was not. These same countries were quite happy to allow suspected “terrorists” to be renditioned (for torture) over their air space by the CIA, but not the president of a peaceful nation.

The surveillance state is terrified. It will not go down without a fight. A principle of investigative journalism: he who protests the loudest has most to hide. Bear that in mind next time you hear shrill defence of the surveillance state. Where is the evidence that any of this mass snooping has made us any safer, other than pompous assurances from self-serving intelligence apparatchiks? Civil libertarians have long arued that the state amplifies fears over terror and crime to arrogate unto itself greater and more draconian powers. Hence, the “war on terror,” “war on drugs,” “war on poverty.” Unwinnable wars, all of them, but unarguably noble and saleable to the gullible. To win these wars, the state needs access to our emails and phone calls. It needs to know where we live and where we bank, hence the ridiculous RICA and FICA laws.

But surely if you have done nothing wrong you have nothing to fear? That’s the standard argument of politicians and bureaucrats who sup at the trough of trashed civil liberties. The answer to that is: what about the presumption of innocence, embodied in common law for centuries? There is indeed a war going on here, but not the one we’re told. That war is between liberty and tyranny, between ruler and ruled.  It manifests itself in many ways, such as surveillance cameras, FICA, RICA, ID documents. We accept these encroachments as if they are normal, believing they somehow serve our interests.

What about the crime-fighting surveillance cameras in Johannesburg and Cape Town, or those placed in residential developments? That’s a matter for residents to decide, and on the face of it does not constitute an invasion of privacy. Grabbing your emails without permission certainly does. That’s private property, protected by the Constitution.

It’s time to turn the surveillance apparatus on those in power. These, after all, are public servants we employ and they have forfeited their right to privacy by acceptance of office. We have not.

Section 14 of the Bill of Rights entrenches the right to privacy:

“Everyone has the right to privacy, which includes the right not to have :
a) their person or home searched;
b) their property searched;
c) their possessions seized; or
d) the privacy of their communications infringed.

Remember this any time you hear a politician or political lackey defend the right to snoop on your emails and phone calls, or to prevent disclosure of their misbehaviour. I’m all in favour of the press being accountable, of the Press Ombud, defamation laws and other remedies for those who have been wronged. The problem is the law is used aggressively by those in power to silence exposure of their wrong-doing.

Continues at source.