Disingenuous economics

Today a new paper in the World Bank Research Observer by Banerjee, Hanna, Kreindler and Olken announced that there is “no systematic evidence” to support the view that social transfers discourage work. Under different circumstances I might be pleased by this, since I have long believed that claims about welfare-induced voluntary unemployment are mostly ideology-driven garbage. But I am not happy about this paper.

The reason is that the way in which it is written implies that the ‘welfare-induced laziness’ thesis is something conjured up by policymakers and members of the public from thin air. To quote:

despite these proven gains, policy-makers and even the public at large often express concerns about whether transfer programs discourage work.

The authors position themselves, as economists rigorously assessing evidence, against the puzzlingly misguided ‘policymakers’ and ‘public at large’. From this, one would think that economists do not hold such beliefs and have not contributed to them. But you’d be wrong. In fact, a paper published in the World Bank Economic Review in 2003 by Bertrand, Mullainathan and Miller (BMM) claimed that the South African old age pension led young, black men in pension-receiving households to reduce their labour supply. This had a significant impact in South African policy circles, leading a number of local social scientists to challenge the findings of the paper.

Posel, Fairburn and Lund (2006) argued that BMM didn’t adequately account for migration, which changed the conclusions. When I was a Master’s student at UCT in 2006 I wrote a term paper – using data kindly provided by Posel – arguing, further, that BMM’s result using cross-sectional data couldn’t possibly be robust to household formation dynamics:

The primary aim of this paper is demonstrating that, based on existing evidence, one can make at least as strong a case that the pension influences household formation, as that it affects labour supply.

I referred to the BMM paper as a case of ‘perverse priors’. A different approach to the same point by Ranchod (2006) examined the effect of losing a pensioner and his findings called into question the conclusion about labour supply of young men. Ardington, Case and Hosegood (2009) later used panel data to show that differences between households along with migration could explain the finding, rather than an actual reduction in labour supply. To quote them:

Specifically, we quantify the labor supply responses of prime-aged individuals to changes in the presence of pensioners, using longitudinal data collected in KwaZulu-Natal. Our ability to compare households and individuals before and after pension receipt, and pension loss, allows us to control for a host of unobservable household and individual characteristics that may determine labor market behavior. We find that large cash transfers to elderly South Africans lead to increased employment among prime-aged members of their households, a result that is masked in cross-sectional analysis by differences between pension and non-pension households. Pension receipt also influences where this employment takes place. We find large, significant effects on labor migration upon pension arrival.

So, in the South African case, it was well-regarded, US-based economists publishing in a World Bank journal in 2003 who gave credence to the idea that grant receipt led to idleness. Much effort was expended debunking those claims and preventing them from having harmful effects on progressive social policy. It is, therefore, rather outrageous that in 2017 another set of well-regarded, US-based economists publishing in a World Bank journal can pretend as if this never happened.

In my view, this kind of behaviour is characteristic of the failure of critical self-reflection, and taking of responsibility, in economics as a discipline. And it should serve as a cautionary tale to non-economists and economists alike.

Submission to Parliament on Money Bills Act amendments

The Money Bills Act is the legislation that guides Parliament’s oversight of South Africa’s budget and related legislation. I have written previously on that process. The Act has been up for review for some time, and the finance and appropriations committees have had a number of meetings recently to finalise that process. The result is a draft amendment Bill, which I have attempted to explain in an accessible way.

Further to that article, I submitted written comments and made a presentation based on those this week. The audio, relevant documents and meeting report will appear on the relevant Parliamentary Monitoring Group (PMG) website in due course. Access is restricted though, so here are the slides and written submission.

Unfortunately the very limited time available between the call for comments and the deadline for submission (two weeks) also placed some limits on the depth of the analysis. One issue I neglected to address, which was raised by the opposition in the meeting, is that the current Act emphasises – in clause 15(2) – that the PBO should take its work from committees. That is potentially problematic where committee decisions are ultimately determined by a majority party.

Unfortunately, this point became politicised due to disagreements about whether the current committees had allowed partisan considerations to determine what work requests were sent to the PBO. My view is that regardless of what one thinks about the current situation, it is certainly not hard to envisage a situation in which a hypothetical majority party uses its weight on committees to ensure that potentially inconvenient work is not sent the PBO’s way. That could significantly reduce the usefulness of the Office. The broad point I made in my presentation is that our institutions should be designed to be robust to such scenarios. It is for that reason that I agreed with the suggestion that this clause should be amended, or that the clause allowing work to be taken from individual MPs “subject to capacity” – clause 15(3) – be amended to allow the Director discretion based on importance of the request.

It will be interesting to see the final conclusions reached by MPs in relation to these issues and proposals. Given the calibre of MPs on both the majority party and opposition benches on these committees, I am cautiously optimistic that decisions will be taken in the long-term national interest.

Decolonising the South African economics curriculum

This week I attended the ‘Scholarship of Teaching and Learning (SOTL) in the South‘ conference hosted by the University of Johannesburg, where I presented a paper entitled: “What would an (South) African economics curriculum look like?”. (A project I have gestured at previously when commenting on discussions around UCT’s economics curriculum – here, here – and promised to do a follow-up on).

The paper can be found in the published conference proceedings here [pdf]. The short slide presentation can be downloaded from here [pdf].

The conference itself was interesting and included a number of different perspectives, and opinions, on the question of  ‘decolonisation’. The conclusion I came to was that there are two main aspects to this issue: institutional change and disciplinary change. And in both cases we need to start talking details, because that’s where the really hard work will start and become apparent. In this context, my paper aims to make a contribution in relation to the discipline of economics.

In the end, my discussion of what should go in the curriculum is very limited. One reason is because of the word limit for contributions, but the main reason is that I found there to be many preliminary issues that required fleshing-out first. Some of the more provocative, and important, assertions I make are that:

  • Demographic transformation of faculty is important in its own right, but should not be conflated or confused with substantive transformation of the curriculum
  • Changing content by introducing certain topics is important but need not lead to the imagined outcomes, it depends on the framing of those topics (e.g. North American economic history arguing that slavery was not such a bad thing)
  • The awkward reality that South African academic economics and its institutions is largely characterised by a weak attempt at imitating a lagged, conservative version of the neoclassical mainstream
  • A substantively ‘decolonised’ curriculum would be much more challenging than the standard mainstream curriculum – so concerns about ‘lowering of standards’ are misplaced in that context
  • Our biggest challenge is the massive gulf between what an ideal, decolonised curriculum looks like and what we (African economists) actually have the capacity to do.

Feedback on any and all aspects of the paper are very welcome.

I intend to get into much more detail regarding an ‘ideal curriculum’ in a second paper, hopefully with some collaborators.

 

Edit: here is the stand-alone version of my final paper submitted to the SOTL proceedings.

Statement regarding the Parliamentary Budget Office and recent CCMA award

The Parliamentary Budget Office (PBO) was established to provide Parliament with independent technical advice to support it in exercising oversight of public finances. The importance of this role should be evident given the recent Cabinet reshuffle and ratings agency downgrades, which have raised concerns about public debt, public service pension funds, a prospective nuclear deal and the finances of state-owned enterprises amongst others. These are all matters about which a functioning PBO would be expected to provide credible insight and guidance to Parliamentarians.

There are, however, serious concerns regarding the functioning of the Office. These relate to the content and objectivity of its advice. This became apparent to me shortly after I joined the PBO in 2014. The resulting dynamics in the office led me to resign in 2016, and were also the basis for an unfair labour practice complaint brought against the PBO at the CCMA.

On the 26th of April 2017 the CCMA issued the commissioner’s award, which did not find in my favour on the narrow labour issues raised. While I am disappointed with this outcome, it is important to place the case in the broader context of the need for a competent, functional and credible PBO that is beyond reproach. In this regard, the Commissioner held that – as I had testified – the Director of the PBO had indeed offered to provide me with the interview questions for the position, I had declined the offer, and he had lied about this in his testimony (i.e. under oath). This example was only one of a number of issues raised in the process, but on its own raises very serious questions about the functioning and management of the office.

The Act governing the PBO is expected to be reviewed and amended later this year. In that process, the end goal must remain paramount: to build an independent, technically and ethically credible institution that the public and Members of Parliament can rely on for non-partisan analysis of public finance issues that is conducted without fear or favour.

Internationally, similar institutions are expected to maintain the highest standards of objectivity and political neutrality; standards that the South African PBO has failed to demonstrate. Perhaps the most famous international example is the Canadian PBO, which in 2011 produced a costing for parliamentarians of the government’s fighter jet procurement plan that was significantly higher than the estimates the government had published. The Office was attacked by the Prime Minister at the time, but supported by society at large and subsequently vindicated: government eventually acknowledged that the costs were higher than originally stated and the procurement remains on hold. The Canadian example is in marked contrast to the South African PBO’s analysis of the desirability and feasibility of the proposed nuclear energy procurement. The PBO’s report failed to cost the project, or assess its implications for public finances. In a more recent example from Kenya, the country’s PBO raised concerns about omission of a large increase in debt repayments from budget documents.

Since some of the issues raised at the CCMA go to the heart of these expectations, and it is my view that the basis for its finding is deeply and materially flawed, I am considering taking the award on review to the Labour Court. This is an expensive option – the estimated cost is R500,000 or more, and is prohibitive for an individual. However, the basis on which staff are appointed to, and promoted in, PBOs is one of the most critical factors in their success. Combined with the importance of the PBO and the upcoming amendment of its governing legislation, public interest organisations may find this case to be an appropriate mechanism through which to contribute to the establishment of the kind of PBO the country deserves.

Some thoughts on the Finance Minister’s adviser and his critics

The debate around the new Finance Minister Malusi Gigaba’s new adviser, Chris Malikane, has gone beyond the deeply flawed proposals he has made, to claims about his academic credentials and integrity. I want to agree that the proposals are flawed, but that some of the attacks on Malikane are as well. Furthermore, they draw attention to some serious issues in South African academic economics that require mature discussion.

Most of the 8-page ‘manifesto’ published, and extensively publicised in various articles and interviews by Malikane, is not worthy of serious analysis. (Although one effort to take it seriously, by Charles Simkins, is worth reading – as is the more acerbic piece by Richard Poplak). It is primarily a political document and contains no substantive content relating to economic policy and public finance. There’s a crude Marxist analysis of class, and a shopping list of things that should be nationalised and services that should be provided. The only interesting assertion is that the working class should throw their weight behind those black South Africans who have become an elite through corrupt government tenders, rather than through credit-based black empowerment schemes. Like the other assertions, no serious justification is provided. But it certainly explains why Malikane’s radicalism has found favour with Gigaba, whose predecessor appeared to be successfully blocking a range of efforts at tender-related corruption by individuals associated either with the President or the Gupta family. The thinking from Gigaba – a man better known by some for tabloid stories, tailored suits, expensive ties and appearances on Top Billing – may have been that Malikane would provide some solidity to the fig leaf of ‘radical economic transformation’, while Malikane – who has otherwise been quietly exerting influence in left-wing, or trade union movements for some time – clearly thought that his revolutionary moment had arrived.

Some have attempted to defend Malikane on the basis of his academic credentials – to the point of also insisting that his evidently wrong-headed proposals (such as ‘expropriating banks’) cannot be criticised except through detailed academic analysis. At which point it is useful to invoke a phrase attributed to the Italian computer programmer Alberto Brandolini: “The amount of energy needed to refute bullshit is an order of magnitude bigger than to produce it”. Just because the minister’s adviser has published some academic papers on other subjects does not mean we must presume that his manifesto carries additional weight. Indeed, the primary disappointment for many who had  reasonably high opinion of Malikane up to this point is quite how threadbare his analysis and proposals are.

Where things are getting messy, however, is in attacks on Malikane’s academic credentials. These in fact open-up a big can of worms regarding the state of South African academic economics. (One reason I have been delayed in writing a comment on the Malikane’s saga is that I had been drafting a conference paper on what ‘decolonisation of the curriculum’ might mean for South African economics).

Understanding Peer Review in Economics

It turns out that the issue of decolonising economics is closely related to some of the misguided aspects of attacks on Malikane. The first, by Stuart Theobald, starts off well enough by noting that Malikane’s published, peer-reviewed work either has relatively little relation to his recent arguments or even – in some cases – seems to contradict those arguments. This is a particularly useful point to make for those who, naively, argue that Malikane’s arguments must be substantive because he has published some academic papers. Where Theobald strays into dangerous territory is in his inferences about Malikane’s integrity and assertions about the wonders of academic peer review.

Theobald’s characterisation of peer review in economics makes me suspect that he has never published anything in the discipline. Very few academics I have come across or read, including Nobel prize winners, have such a rosy view of the peer review process; in practice it is far from the notional ideal of a meritocratic system in which originality and quality are what determine publication. And any problems – of cronyism, bias toward researchers in certain institutions, ideological influences and so forth – are amplified if the basic thrust of your work is critical of, or very different to, the dominant narrative. It does not surprise me that Theobald, given his demographic, views on economic policy and his area of work (banking and finance), might not be able to appreciate this.

Which brings us to the issue of whether Malikane is dishonest for publishing work with conclusions he does not agree with. My short answer: no. It might be inadvisable, and it is something I personally try to avoid doing (at some cost), but the system is structured in such a way that it can self-sabotaging to only publish what you believe rather than what you can do. (Some have suggested that there should be betting markets in which economists show their confidence in their empirical claims by putting money on it). Either you will publish in journals not recognised by your peers, or your career will stall at a junior level – and the associated administration and teaching burdens limiting the very time you need for that ‘against the current’ research that is so good it breaks into the mainstream. When co-authors are involved this is even more difficult. These challenges are essentially what Malikane is gesturing at when he says, quoted by Theobald:

Don’t confuse my academic writing and what I believe to be true…you know the business of publishing is so ideologically poisoned that what is published is not necessarily scientific…we sometimes write in order to simply play in the publishing game…not necessarily because we think what we publish is correct…there is heavy ideological repression in academia…

Theobald paints this as sinister and possibly an “act of intellectual dishonesty”. He softens that with a few acknowledgements that Malikane is basically right, but then returns to a naive notion of academic publishing.

Finally, Theobald makes the important point that we should not try and judge Malikane the person but rather “whether he has good evidence and reasoning for his claims”. Unfortunately, he then goes completely off the rails by saying that: “until [Malikane] publishes them in a way that involves assessment by his peers, we must assume he does not”. Which peers? In what journal? I doubt Malikane would have trouble publishing in the Review of African Political Economy, but would Theobald accept that as adequate? (Leaving aside that he is not an academic economist, so it’s not clear what basis he would use).

Regardless, as an academic economist who has also worked in the public sector, I would never accept a policy claim just because someone had managed to publish a paper on it; the idea that successful peer review in economics shows that a claim is ’right’ is completely misguided, and any economist who advised a minister on that basis should also be fired.

There Are Many Flavours of ‘Bogus Economist’

This usefully brings us to the even more problematic contribution by Co-Pierre Georg. Let me start by saying that I was interested, albeit surprised to see – in Georg’s somewhat crudely-stated concern about ‘white male patriarchs’ – channelling critiques I myself have made in the past of untransformed gerontocracies and academics behaving like rent seekers. I have, also, for some time been politely raising concerns with various role players about such dynamics at an organisation where Georg has been an associate for some time; I hope Georg is as vocal on such matters of principle within his institutions, and even when it is personally inconvenient.

The basic assertion of Georg’s article is that people should not trust ‘bogus economists’. Hard to disagree with, but the devil is in the detail. In my draft conference paper on decolonisation, I made some similar critiques of the quality of the local academic economics to those discussed by Georg. Beyond that, though, we are again in swampy terrain. Georg’s assertion basically translates as: ‘people should not trust economists I think are bogus, which obviously doesn’t include me, my co-authors, patrons, friends, etc’. It’s not a new trick, including for fake radicals in economics. In a recent comment an otherwise respected senior scholar in macroeconomics (Paul Romer) published a rather disgraceful attack on various other economists for what he calls ‘mathiness’. Among these was one of the most famous female economists of the 20th century, Joan Robinson, who by virtue of her gender, left-wing views, and being dead, was perhaps an obvious target for Romer. Critiques of excessive or inappropriate use of mathematics in economics are as old as the modern version of the discipline itself. But a close reading of Romer’s critique reveals a petty, self-serving definition of the crime: when economists he doesn’t like use mathematics they are guilty of mathiness, whereas when economists he does like (obviously including himself) use mathematics then it’s done properly. Georg’s argument boils down to a similarly crude skeleton. (Romer, incidentally, was then appointed chief economist at the World Bank – illustrating how dysfunctional economics can be in other places).

Furthermore, Georg peddles a version of how economics can inform policy that is popular with certain types of academic economists, but bears little relation to reality. In this model, people who can write the most complex mathematical equations, estimate the most complex econometric models and get published in high-ranked journals are best-positioned to advise on policy. This might be funny if it were not so misguided and, in its own way, dangerous. There are some individuals who have managed to make the transition from producing cutting-edge academic work (by mainstream standards) to giving good policy advice, but it is the exception rather than the norm. The last thing a finance minister needs is some social incompetent who thinks he can figure-out a policy solution by writing down an equation, running a model or looking for a ‘peer-reviewed solution’. If you need an academic perspective, your adviser talks to a deputy director general who gets someone in the research cluster to do it, or outsources it to an academic like Georg.

Yet Georg goes even further, offering to define for us what a ‘proper academic’ is. But the best he can do in this regard, like Theobald, is to refer to ‘peer review’. I have already made clear that this is a naïve, and in Georg’s case arguably self-serving, use of the notion of peer review. One can tell that Georg, like Theobald, is not exactly familiar with the challenges of swimming against the current. Or, in fact, advising on broad economic policy in the complex South African terrain.

A Necessary Debate

 In some ways, the great tragedy of the Malikane saga is that, in principle, he should have been in a position to be a very good adviser – albeit one with strong left-wing views. While the likes of Theobald and Georg might be good advisors at lower levels of the hierarchy on specific issues relating to banking and finance, Malikane’s broad credentials should have made him a better choice for a general adviser to a minister. Given that, fortunately, it looks like his manifesto will have no impact whatsoever – with various politicians suddenly realising that talking-up radical economic transformation is a bad idea if it means emptying the fiscus you had planned on appropriating – the most harm done is to Malikane himself. But he has also damaged the possibility of more open discussions about economic and fiscal policy, which means that in fact those who should be most angry with him are economists (including myself) who believe such a conversation is sorely needed.

The bigger picture that Theobald and Georg’s misplaced attacks draw attention to is the state of South African academic economics. Some time ago as a student I witnessed the destructive consequences of the failure by some, otherwise very respectable, academics to reconcile tensions within the local discipline. The result, I think, has been for many to bury their heads in the sand and hope for the best. Or, less innocently, to set-up fiefdoms in which they can propagate their own views and agendas without the inconvenience of differing views.

To be fair to economists, similar behaviour happens in a range of other South African academic disciplines. However, besides the fact that this is an unhealthy state of affairs, legitimate calls for transformation and decolonisation (appropriately defined) will only ratchet-up these tensions and it would be best to address them openly and as maturely as we can. The position I have come to is in some ways rather obvious: we need to raise standards, but we also need a wide diversity of views and therefore should be pluralist in our approach to defining who is a competent economist (academic or otherwise). In that context, we would be advised to avoid doing things like accusing a fellow academic of not being a ‘proper economist’ or being ‘intellectually dishonest’, when they have a PhD from a very reputable North American institution, some competent publications, and extensive engagement and knowledge of South African civil society. When the institutional winds change, you may find that the knives are in your own back. These are surely not the kind of dynamics we want to encourage.

Reshuffles, downgrades and South Africa’s public finance drama

The last week has been tumultuous for many South Africans, not least if you are an economist concerned with public finances and the associated political economy dynamics. I had predicted that the President would make another attempt at a finance ministry-targeted reshuffle some time from the end of March onwards. The basis for that prediction was the timing of Parliament’s recess period, as I discuss in greater detail in this article.

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Zapiro: “Shift happens”

The new Minister has been brought in on the back of the President’s (empty) rhetoric about ‘radical economic transformation’ to benefit the majority of poor, black South Africans, but he is known more for his snappy dressing than radicalism; if the FT is correct about his favoured brand, then two of his many ties would equate to the proposed new monthly minimum wage. The combination of supposedly radical rhetoric with personal profligacy is on its own questionable, but there are many more reasons to be concerned.

It was therefore not a great surprise to many analysts when S&P downgraded South Africa’s foreign currency sovereign debt rating to sub-investment grade (‘junk’). After the downgrade by S&P, which I had also expected having paid close attention to presentations at their one-day conference in Johannesburg only a couple of weeks earlier, I provided some commentary with an emphasis on the reasons for the downgrade and possible economics and public finance implications. One of these interviews, with Ayabonga Cawe at PowerFM, is available here. In the first interview I did, on KayaFM, I made a deliberate point of stating that we should not allow anyone to mystify the obvious: that Gordhan has been removed for similar reasons to Nene, implying ‘capture of the state’ (as per the Public Protector’s report). In that context, the new finance minister simply lacks credibility and any statements made about continuity and protecting the fiscus will likely be taken with a pinch of salt.

With the inconvenient oversight of Minister Gordhan removed, the South African Revenue Services announced its final revenue collection figures for 2016/17 in a chummy press conference with the new Minister. This attempted to paint a R30bn revenue undercollection (relative to the revenue forecast in the 2016 Budget) as a success, because it exceeded the 2017 Budget forecast (i.e. the one revised down by R30bn) by R0.0003bn… Unfortunately, many journalists reporting on that event were taken in by the claims of success. I had already dealt with much of this in an article in the Finance Mail. In fact, given concerns about SARS delaying refunds to inflate collection figures, and given inadequate data submitted to Parliament, I have submitted a formal request for more detailed data to SARS and hope to follow-up on that in due course.

Needless to say, the capture of the Finance Ministry makes Parliament’s oversight role even more critical. But as I have argued in some detail (here and here), and ventilated in my CCMA case, the Parliamentary Budget Office is neither equipped, nor inclined, to provide the robust analytical support expected of it under the Money Bills Act (2009). I will have more to say about this in due course.

After the decision by S&P, Fitch has now also downgraded South Africa’s foreign and local currency sovereign debt rating: setting the stage for more dramatic consequences if another agency also downgrades local currency debt to ‘junk’.

These are dangerous times for the South African fiscus, economy and society at large.

Presentation to Parliament’s finance committees

I am now affiliated to the new Public and Environmental Economics Research Centre (PEERC) at the University of Johannesburg, within which I intend to continue putting my public finance and public economics knowledge to good use.

As already noted, I recently published an article on the legislative process that guides the adoption of Budget proposals by Parliament.

And this week, along with my colleague Jugal Mahabir (who has experience at National Treasury and the Financial and Fiscal Commission), we made a short presentation to the finance committees on the fiscal framework and revenue proposals.

The time available (4-5 days between the tabling of the Budget and the submission of public comment) limits the depth and sophistication of the analysis, but with greater preparation this is something I hope to improve on at each successive iteration.

Parliament has the final say on the Budget

Ahead of the Minister of Finance’s Budget Speech tomorrow, I’ve just published a piece in The Conversation, explaining the core components of South Africa’s annual Budget and the fact that Parliament ultimately has the final say on each of these – subject to a public consultation process. The full process is guided by the Money Bills Amendment Procedure and Related Matters Act (2009), which I worked with extensively when I was at the Parliamentary Budget Office.

The conclusion of the article, that Parliament’s oversight may provide some reassurance in the current political context, is less comforting in light of an article published today which reveals that a vacancy has suddenly been created on the standing committee of finance. The last time that happened was when the then ANC whip of the committee, Des Van Rooyen, was notoriously made Minister of Finance for a weekend. It appears likely that Brian Molefe, former CEO of Eskom who is named dozens of times in the Public Protector’s ‘State of Capture’ Report, will be appointed to this vacancy – having been surreptitiously added to the ANC’s list of MPs. And this in turn may be a stepping stone to his appointment to cabinet in a last ditch attempt, by a faction close to the president, to take control of public finances for nefarious ends.

My case against the Parliamentary Budget Office: part II

As noted in a previous post, I am pursuing a case against the Parliamentary Budget Office at the CCMA.  And as also indicated in that post, I am not going to comment on any specific issues relating to the merits of the case, or the process, until the latter is completed. Nevertheless, given that the reporting of the matter has been intermittent and only partially informed, it is useful to recount some further, basic information here.

The most recent component of the hearing (day 5 and 6) took place on the 19th and 20th January, with the intention that the matter be completed on the 20th. Unfortunately that was not possible, for reasons which will become known in due course.

Media presence

More importantly, while the media were initially granted access, the two journalists present were requested to leave shortly after I started my cross-examination of the Director of the Office. The result is that the first two reports (News24 and Business Day) that did appear could effectively only report on 75% of the 5th day of the process and did not report any of the content of the Director’s cross-examination. One article reported the Director’s assertions, but not the testing of these assertions and more substantive issues; resulting in somewhat one-sided coverage.

While the media can only report what they observe, one might expect that the media’s (gentle) ejection from the process would be reported to at least provide readers with some context for the sudden cessation of coverage.

Meanwhile, in another case at the CCMA, the media have continued to be present despite the applicant (Mr Adrian Lackay) testifying to fairly sensitive matters, such as the alleged ‘rogue unit’ at the South African Revenue Services (SARS). Of course, every case is different and commissioners use their discretion to make such determinations. It is worth noting, though, that Lackay’s case led to the breaking of new ground on media access to CCMA arbitration thanks to work by Media24 and amaBhungane. Apparently the Commission has subsequently published rules and guidelines that formalised the position that public access, including media access, is the default. (Though many people, including legal practitioners, remain unaware of this).

Credibility

Naturally, when one raises matters like those that have emerged in this process, attacks on one’s credibility are par for the course. Exposing, directly or indirectly, the abuse of public resources and compromising of appointment processes to positions in public institutions is a sure way of engendering some hostility. In this instance, such attacks have come in blustered form within the process from Parliament’s representatives, statements by the Director (to the media and in testimony) and comments by one former colleague in testimony.

While such behaviour is to be expected, it remains very ill-advised to attack the credibility of someone who is, substantively, more credible than you are… In due course most of the truth about who acted professionally and ethically at the PBO, and who did not, will become known. It will then also become clear that serious action will be required to salvage some credibility for the institution.

A long road ahead

It is widely-accepted that independent fiscal institutions like parliamentary budget offices need to be beyond reproach:

the core values that IFIs both promote and operate under – independence, non-partisanship, transparency, and accountability – while demonstrating technical competence and producing relevant work of the highest quality that stands up to public scrutiny and informs the public debate (OECD Principles)

Unfortunately, it would appear that there is a long, difficult road ahead to achieve this in South Africa.

My case against the Parliamentary Budget Office

It is now (as of this week) a matter of public record that I am pursuing a public interest-related labour law case against the Parliamentary Budget Office. The arbitration hearing at the Commission for Conciliation, Mediation and Arbitration (CCMA) began, in fact, on the 19th of September. Unfortunately, no media were present to hear the beginning of the case. That included my introductory statements and extensive arguments on the legislated independence of the Parliamentary Budget Office (PBO) from the Parliament administration, as well as the labour law and public interest aspects of the case (first day), and my testimony under oath (second day).

The matter then continued for a further two days on the 14th and 15th November. This began with my cross-examination by the PBO’s representative, and then continued with my calling of witnesses.

As I indicated in the hearing, I expected that the witnesses I called would be hostile but was guided by a CCMA award in which the commissioner noted that a party cannot fail to subpoena a relevant witness merely because they expect the witness to be hostile “as this can only be determined when the witness is giving testimony”. Unfortunately, despite the apparently hostile statements by witnesses referred to in various of the articles below, not one of the witnesses was declared hostile and I was therefore unable to cross-examine them.

I will refrain from commenting on the substantive details of the case at this stage, though I will certainly do so at some point after it is completed. For now I would just note a few interesting snippets from the articles produced by the Media24 journalist in attendance. (There are some important legal points that were not reported, and some errors in the articles, but I will not comment on those either at this stage).

1. Note on media access at the CCMA

Media24 requested access to the hearing. Parliament’s representative objected and I argued in favour. I specifically argued that the recent ruling in the KZN High Court allowing media into the Nkandla disciplinary cases indicated the extent to which public interest must inform such decisions. CCMA arbitration hearings must surely be more open than internal disciplinary hearings. As it transpired, the CCMA takes the view that arbitration hearings are open by default unless there are reasons to decide otherwise.

2. Some of the issues

Muller told the commission that while no one had ever approached him to do academic work, others were asked.

Others in the office were favoured because they had helped do political work, including write speeches, which were not part of the office’s mandate.

He accused the unit’s director, Mohammed Jahed, of instructing staff to do such work and even boasting about it. If Jahed denied it, he would be lying under oath, Muller said.

3. How do emails go missing in an institution like Parliament?

All emails from 2015 had been deleted, she said. This would be because her mailbox was full, she said, as other colleagues could also not find old emails.

She did not know if they were deleted because of Muller’s case, she told CCMA commissioner Madeleine Loyson.

[It was noted in the hearing, however, that Parliament’s email policy states that:

8.5 Storing, archiving and deleting e-mail messages

a) Official email messages must be archived after 30 days of receipt and all other e-mail must be deleted from the inbox/outbox after 24 days of receipt.]

4. What constitutes acceptable assistance to MPs?

Ellse explained that all he had done was give tutelage to some MPs in issues relating to tax and other areas in which he was interested.

He had been asked by the PBO’s director to have a look at questions from Van Rooyen and provide guidance if he had time.

After reading the questions, he said, he had then decided to explain a related concept to Van Rooyen.

5. Is considering the performance of internal candidates unfair when making appointments to senior technical positions in the public service?

Gabier told the commission that including internal candidates’ performance scores would have prejudiced external applicants.

As things stand, the hearing will proceed on the 19th of January 2017. The cross-examination of Ms Gabier will continue, followed by the testimony of the Director of the PBO and his cross-examination.