Johannesburg – President Cyril Ramaphosa signing into law amendments to the Public Investment Corporation (PIC) Act has sparked a succession debate over who will be the next chairperson of Africa’s biggest asset manager.
Finance Minister Tito Mboweni is expected to appoint a new PIC board in earnest, after a two-year protracted battle over the PIC Amendment Bill, which was set to bring greater transparency to the investment decisions of the stateowned institution.
In terms of the new act, Mboweni must, in consultation with cabinet, appoint 10 non-executive members and three executives – including the chief executive officer – to the board of the asset enterprise, which manages over R2-trillion on behalf of the Government Employees Pension Fund (GEPF) and the Unemployment Insurance Fund, among other.
The law states: “The minister must designate the deputy minister of finance, or in consultation with cabinet, any other deputy minister in the economic cluster, as the chairperson of the board. The minister must, when appointing the board, have due regard to the nominations submitted to him or her by depositors…”
Former Nedbank chairperson Reuel Khoza has been leading the PIC board since the Mpati Commission into the PIC found that the appointment of a deputy minister as chairperson of the asset manager caused considerable instability at the institution.
The new law places Deputy Finance Minister David Masondo as a front runner to become the chairperson of the institution.
Other deputy ministers in the economic cluster in the running – if Ramaphosa does not reshuffle his cabinet before the appointment – include Phumulo Masualle (public enterprise minister), Nokuzola Capa (small business development) and Boitumelo Moloi (labour and employment).
Economic development deputy ministers Fikile Majola and Nomalungelo Gina are also in the running. Mugwena Maluleke, whose union Sadtu is a major depositor in PIC via the GEPF, expressed confidence in Mboweni’s ability to appoint a suitable candidate to succeed Khoza.
“I don’t have a problem with a deputy minister who is going to be appointed now, because he is going to be appointed by a minister who has integrity. Mboweni has integrity and clearly in his own judgement he cannot appoint a thief.”
Maluleke, who sits in the current interim board, said that Masondo was suitably qualified for the post.
Business Unity SA said the position should remain within the Treasury.
“The PIC is managing the public sector pension funds, takes investment decisions related to its portfolio. We believe that those sorts of activities should be closer to the Department of Finance than any other department because if they [other departments] don’t manage the investment appropriately, it has serious fiscal challenges for the country,” Busa CEO Cas Coovadia said.
“But having s aid that, we think that it would be more appropriate to have an independent chair, but with a very clear criteria on what capacity and what expertise the chair needs.”
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