Minister Khumbudzo Ntshavheni says the government is concerned about the rise in food poisoning incidents. 

• The government wants to audit how many foreign-owned shops are operational in the country.

• It wants to allow traditional leaders to keep a register of foreign nationals present in communities. 

• Lawyers for Human Rights warned the proposal was dangerous because it could fuel xenophobia.

Foreign-owned spaza shops are set to face renewed pressure from the government as traditional leaders and municipalities may soon be expected to conduct audits and keep records of the number of foreign nationals in their communities.

Minister in the Presidency Khumbudzo Ntshavheni said on Monday that Cabinet was concerned about the rise in the number of reports of children being poisoned by consuming allegedly contaminated food from spaza shops, sometimes leading to death.

However, the link between the illness or death of children to food from spaza shops has not yet been proven.

Cabinet`s concerns were qualified during a briefing from a migration workshop, which concluded with outcomes that could spell a contentious time for foreign-owned businesses in townships and rural areas. 

The government wants to introduce `omnibus by-laws` to strengthen the hand of municipalities and traditional leaders in enforcing business by-laws.

It includes the inspection of spaza shops by inspection teams from labour, health, business development and home affairs. 

Another enforcement effort is to audit spaza shops in villages and townships by registering them with municipalities and traditional leaders, Ntshavheni said. 

However, this is being met with extreme concern by human rights groups. 

Lawyers for Human Rights described the announcement as deeply concerning, saying the government was shifting the blame.

Sharon Ekambaram, the head of the refugee and migrants` rights programme at Lawyers for Human Rights, said the proposals were unfairly focused on blaming foreign nationals.

She said it would reinforce the growing hostility against a minority. 

Ekambaram told News24: 

Where is the evidence and proof that all of the people who run spaza shops are undocumented [immigrants] or that they do not have the permits to run these businesses? Once again, this shows that the government`s stance is based on unsubstantiated [assumptions]. The fewer than two million foreign nationals present in our country cannot be the source of the ills we face as a country.

`There should be standards for everyone to comply. It can`t be only for foreign nationals. We can`t have laws that simply target them because that is racist and xenophobic, and goes against our constitutional values. Laws and concerns around the selling of expired food should be a concern for every business, even supermarkets, not just foreign-owned spaza shops.`

Ekambaram added that it was illegal to allow traditional leaders to keep lists of foreigners, and several court judgments had pointed to its illegality. 

She described it as akin to the apartheid government keeping a record of black people during apartheid. 

`It is categorically illegal, and there have been judgments handed down where you can`t even go and close off a community or go door-to-door asking people. It is unconstitutional to do that. The danger of this is that, tomorrow, it will give traditional leaders the same powers to keep an eye on ethnic groups. 

`Our Constitution and the Bill of Rights are very clear on the rights of everyone living in our country. You cannot just keep lists of people,` Ekambaram said. 

Meanwhile, the Congress of Traditional Leaders of SA welcomed the strengthening of traditional leaders` powers.

Its representative, Zolani Mkiva, described the proposals as `progressive`. 

`Traditional leaders have to be at the forefront of ensuring that their people are protected,` Mkiva said. 

On whether such targeted proposals were xenophobic, Mkiva said all businesses must be registered to enable a swift accounting mechanism when there were reports of deaths because of expired food.  

He said: 

All businesses should register, and there is nothing discriminatory about that. If a South African is selling expired food, he is actually selling poison, so all spaza shops must be registered and monitored. The issue of the legality is a subjective notion because, if people are doing wrong things with the idea that the law protects them, that law is wrong. 

An Eastern Cape shop owner told News24 he was worried about all spaza shop owners being tagged as sellers of expired products.

Alex (who would only provide his first name), who is originally from Ethiopia, and has lived in South Africa for nine years, said he had a permit.

He found it unacceptable that some vendors were selling expired goods to consumers.

`I do not sell expired food. I throw away food that is not in good condition. It is not right to sell people expired food. My stock is kept up to date and I have a permit,` Alex said.

He added that he was not against legislation to control food safety, but he was worried about the unintended effects this could have on the movement of foreign nationals. 

In the meantime, the ANC recently echoed the political rhetoric of clamping down on foreign nationals in Gauteng, with the party`s leadership proposing restrictions on how many foreign nationals could be employed at one business in the province. 

ANC Gauteng leaders Panyaza Lesufi and TK Nciza said the party was concerned about unemployment levels in the province, and the proposed restrictions were seen as a move to strengthen the opportunities available to South Africans.

About 26,000 people have applied for a so-called 888 `golden visa` that grants residency to those investing between $5 and $15 million into Australia

For the agency charged with securing our frontiers and safeguarding social harmony, it`s an annus horribilis like no other. Australia`s controversial Department of Home Affairs is in crisis.

Thanks to dogged reporting by the press, the secretary of Home Affairs, Mike Pezzullo, has been suspended and his conduct is being investigated by Dennis Richardson, the former head of ASIO. Richardson is also examining allegations the department agreed contracts with figures in Nauru suspected of involvement in corruption.

Last month, the former commissioner of Victoria Police, Christine Nixon, found the Home Affairs visa system was being exploited by `criminal syndicates … involved in various serious criminal offending and activities for profit`.

There was some political motivation, but also much truth, when Home Affairs Minister Clare O`Neil recently inveighed passionately against the `rorts and loopholes that have plagued this system`.

A visa program for the super-wealthy

One rort, however, has not received public attention in the ongoing imbroglio, and that was the conception a decade ago of a bizarre and counter-productive visa program targeting the super-wealthy.

Thus far, a staggering 26,000 foreign nationals have been granted permanent access to Australia not because they were a great fit for the community and not because they brought with them much-needed skills or a dose of high culture. They were granted this precious gift simply because they were loaded.

Launched in 2012 by Chris Bowen, we were told the Business Innovation and Investment Visa would usher into the country a new font of working capital. The program required the investment of either $5 million or $15 million or the promise of great entrepreneurship and business activity, and it was branded the 888 Visa.

But rather than `triple fortune` (as the number promises in Chinese numerology), the 888 program was quickly exposed by the Productivity Commission as providing Australia a pitiful return.

All the way back in 2016, it found these significant investor visas may have actually crowded out other providers of venture capital; that, `perversely`, they may have brought people to Australia with `less business acumen` than would otherwise have arrived; and, overall, made a `trivial` impact, accounting for one-fifth of 1 per cent of total foreign investment. Hardly the `boost` Bowen had promised.

Perhaps most galling was the Commission`s discovery that tax concessions available under the program `could amount to the Australian community paying a small group of people to become permanent Australian residents … that is, Australian taxpayers would be effectively subsidising SIV applicants`.

`Golden visas` have been scrapped by most countries

At the time, the government said the introduction of golden visas �` as they`re known in the business �` was prudent; other attractive destinations were themselves seeking to lure the world`s high-rollers with similar schemes.

A decade on, Australia is now one of the few Western countries to still offer such a program.

Elsewhere, they have been terminated not just because they`re inefficient but also because they attract dirty money.

Britain`s golden visa arrangements were scrapped last year as part of a `crackdown on illicit finance and fraud`, in part because it was determined they had provided `opportunities for corrupt elites to access the UK`. Ten high-profile Russians who obtained such visas subsequently appeared on international sanctions lists after the Kremlin`s invasion of Ukraine.

In Portugal, meanwhile, half of all golden visa recipients have come from the 30 nations with the worst reputation for money laundering. Concerns that illicit funds made up a significant portion of the 5.8 billion euros ($9.7 billion) it garnered have now prompted its closure.

In Greece, 3 billion euros in offshore funds poured into real estate via its golden visa scheme (much of it from China), distorting Athens`s property market. One Greek cabinet minister had warned that `a lot of it comes from illegal activities … arms trade, smuggling or trafficking`.

Chinese money flooded Ireland through its special investor visa, now also shuttered. Earlier this year, the Irish police launched an investigation into intelligence that multiple Chinese investors had used the same pot of money to game the visa program.

Analysis from the ABC`s experts

Do 888 visas post a risk?

These risks are not unknown to Australian decision-makers. The same Productivity Commission inquiry included warnings that 888 visas carry with them the `potential for money laundering and other nefarious activities`. Surely similar advice has been provided to the government over the years since.

But we are none the wiser. Since their introduction, there has been almost no public accountability by Home Affairs for the effectiveness of the 888 visas. We have never been told how many were issued, nor to whom until now.

Extracted using Freedom of Information, the raw data is stunning, including the headline figure of 26,000 successful applicants. It shows that from its inception in 2012 until May of this year, more than 20,000 Chinese nationals, including those from Hong Kong and Macau, have been granted golden visas to live in Australia.

A path to Australian citizenship

It`s likely thousands of these visa recipients have since obtained Australian citizenship.

By contrast, the British scheme had granted only 2,500 golden visas to Russians over a 14-year period.

Here, China was by far the greatest source of applications, greatly overshadowing the remaining 6,000 or so that have been granted. Considerable numbers applied from Bangladesh (221), Iran (777), Malaysia (1,049) and Vietnam (1,321).

What is stark about the data is that so few applications were rejected  at a rate of less than 2 per cent (522).

Last year, The Australian reported that not a single applicant from China for the $5 million investment visa had been rejected based on a character assessment.

I checked if that remained true of the entire 26,000 cohort, and it does. Home Affairs confirmed there has not been a single refusal of a 888 visa application under the good character provisions of the Migration Act.

And here is why. Section 501 provides for the denial or cancellation of a visa for those convicted of a serious crime. But what about the very many applicants who hail from the very many countries including China  where bribery and corruption are significant features of the criminal justice system?

The act says an applicant can be blocked `if the minister reasonably suspects` they have been involved in certain criminal activity, from people smuggling to war crimes.

But that provision  the ability to deny a visa on the basis of reasonable suspicion  is profoundly silent on white-collar crime. It says nothing about money laundering or the proceeds of graft and corruption.

Just consider for a moment how many people, particularly from poor and developing nations, are sufficiently remunerated to be able to drop $15 million on a foreign visa.

Golden visas were most often granted to people from these five countries in 2018.(Supplied: Moelis)

Australia needs to wake up

My FOI also produced the tiniest sliver of insight into how rigorously Home Affairs has policed the program. Of the 26,000 applications, the department has opened only 11 investigations into the good character provision. The first was not launched until the seventh year of the program.

Clare ONeil has said publicly that the scheme is under review. Why it hasn`t been scrapped already is apparently tawdry internal Labor politics; how to do so without bringing a blush to the cheeks of Chris Bowen, now energy minister?

Over the past decade, the currents of dark money that circulate the globe have been, for the first time, exposed. At home, recent inquiries into the casino and gaming industries have revealed how vulnerable we are to industrial-scale money laundering and the criminal enterprises that fuel it.

Australia needs to ask itself: what money comes for free?

Finally, the Constitutional Court has awoken from its slumbers and dealt properly with legal representatives who abuse the court process and are deserving of an adverse costs ruling against them. 

Affairs and others v Lawyers for Human Rights the Constitutional Court, it was held that the Director-General of Home Affairs pay 25% of applicable costs in his personal capacity and that the fees of the minister’s former legal representatives should be disallowed. Leave aside the extraordinary behaviour of the DG who appears to have kept his own minister in the dark.

This column is about lawyers. 

According to the court, the minister’s sometime legal representatives “inexplicably approached the court on an urgent ex parte basis for an order that, pending an application to the Constitutional Court or the enactment of remedial legislation in respect of s34 (1) (b) of the Immigration Act, a High Court order remain valid to the extent that it set aside the provisions that a detainee request that his or her detention be confirmed by a court and be replaced with a provision granting an automatic right that a detention be confirmed, by a detainee appearing in person in court”.

The high court also declared s34 (1)(d) of the Act to be constitutionally invalid to the extent that it provided for an extension of the period of detention without affording the detainee a right to appear in court in person at the time the request was made.

On 29 June 2017, the Constitutional Court confirmed these declarations of invalidity and set a timetable of 24 months for amending legislation to be enacted by Parliament. Significantly, it refused to confirm the high court’s reading of words which would have rendered s34 constitutionally valid pending the attempt by Parliament to so amend the Act. 

True to form, Parliament failed to meet the deadline set by the Constitutional Court. The minister then launched an urgent application to the Constitutional Court to revive that part of the 2017 high court order which had been set aside by the Constitutional Court and which would have left s34 effectively in play. The minister also launched a similar ex parte application before the high court.

The Constitutional Court found that the then legal representatives for the Department of Home Affairs “had inexplicably” approached the high court on an urgent ex parte basis for an order that pending the application of this court or the enactment of fresh legislation envisaged in the 2017 order, s34 should remain operative. They also approached the Constitutional Court on an ex parte basis in an attempt to revive the high court’s 2017 order.

In both cases, they failed to join the applicant, Lawyers for Human Rights. 

They also failed to mention four decisions of the Court that unequivocally held that, while the Court can extend a suspension order before the period of extension expires, it had no power to do so upon the expiry of that date. It also strongly opposed Lawyers for Human Rights’ intervention application by “bizarrely using the inexcusable failure to join LHR by contending that LHR was not party to the proceedings and had no standing to make damning statements”.

The Constitutional Court stated that legal practitioners are “an integral part of our justice system. They must uphold the rule of law diligently and professionally. They owe a high ethical and moral duty to the public in general and in particular to their clients and to the Court.”

Drawing on an article by Constitutional Court Judge Owen Rogers writing extra curially, the Constitutional Court noted that in England, ethical rules governing solicitors and barristers explicitly state that it is improper for a legal representative to make a submission which cannot be regarded as properly arguable. Australian jurisprudence similarly suggests that it is improper for a lawyer to present an argument that he or she knew was bound to fail.

In conclusion, the Court held “that the legitimacy of our judicial system, particularly the courts will fall into disrepute if the shockingly poor conduct of litigation as in the present instances is allowed to go unchecked. The egregious and multiplicity of the shortcomings in the conduct of the legal practitioners in the present case warrant an exceptional order.”

That order was to the effect that these legal representatives were not entitled to charge legal fees for the “services” rendered.

There have been many cases in the past which, at least on a reasonable basis (even on the standard of an average LLB student) legal arguments have been advanced that palpably have no merit other than to postpone an inevitable adverse outcome against a litigant.

All too often, arguments in court have been targeted at the press or the public at large rather than at the courts to gain political mileage for a client without any recourse to a justifiable legal argument. To date, the court has failed to mulct legal practitioners who have conducted themselves in this fashion. 

It is significant that the Court has taken this step in this case. It needs to go further in cases in which similar conduct, as described in the judgment based on the ethical responsibility of lawyers and comparative precedent, takes place.

One waits in anticipation for the first time that our apex court will award costs de bonis propriis against a recalcitrant legal practitioner for effectively wasting the time of the court in order to perpetuate an unjustified Stalingrad legal strategy. Or is this precedent as it applied the facts to its order confined to “non-Stalingrad” cases?

The Minister of Home Affairs, Aaron Motsoaledi, and Director-General, Livhuwani Makhode, have agreed to pay part of the legal costs for Lawyers for Human Rights from their own pockets.

This comes after the Constitutional Court on Monday slapped both Motsoaledi and Makhode with personal cost orders in the case involving the rights of undocumented immigrants.

The decision follows Motsoaledi and his department’s failure to revise the Immigration Act in the past six years.

In a statement issued by the department, Motsoaledi said the fees would only be paid as soon as the taxed bill of costs was presented by Lawyers for Human Rights.

He welcomed the finding by the Constitutional Court that he was in the dark about the litigation and the shoddy manner in which it was conducted by the officials and legal representatives.

“The minister has never come across a situation in which officials and legal representatives decide to go to court in his name without his knowledge and any consultation with him.

“As the court found, these were indeed lapses of extraordinary range and gravity,” the statement read.

According to the statement, the minister accepted that he was responsible for the fulfilment of the objectives of the department as well as the actions or failures of all officials serving under him.

He also accepted that his duty was to ensure that the court orders were complied with and that officials under him did not repeat the “comedy of errors” and gross negligence seen in this case.

“The minister will take steps, as he has done before, to ensure an effective supervisory role. The judgment put paid to an erroneous belief that the executive authority should play no role in the everyday management of the affairs of the department.

“To this end, corrective measures will be taken against all officials involved in this saga,” the statement continued.

However, Motsoaledi said that in fulfilment of his Constitutional responsibilities, he would ensure that the fees in the amount of R222,862.60 paid to Mike Bofilatos SC were recovered without any further delay.

He said the legal representatives led by Bofilatos failed in their professional duties by proceeding with litigation without the minister’s knowledge.

Initially, the court order found that sections 34.1(b) and (d) of the Immigration Act were unlawful and unconstitutional. The sections permitted the administrative detention of undocumented foreigners for deportation.

As ordered by the court, the detention period can be extended from 30 days to 90 days or up to 120 days.

However, in 2016, Lawyers for Human Rights (LHR) argued that immigrants were being detained for more than 120 days or longer without trial.

The court order, which was issued in 2017, gave the department and Parliament 24 months to amend the legislation and suspended the invalidity for that period. To date, nothing has changed.

• A large public sector wage hike, disappointing tax revenue and rocketing borrowing costs have hit government finances.

• This will necessitate large budget cuts and shrinking the state, Treasury said in its latest Medium-Term Budget Policy Statement.

• South Africans can also expect a R15 billion tax increase in February next year.

Treasury has been forced to make painful revisions to the latest Medium-Term Budget Policy Statement, which updates government’s spending plans over the next three years, after its expectations in the February Budget turned out to be over-optimistic.

Government now expects to earn almost R57 billion less in taxes than it previously forecast. Much lower commodity prices (due in part to a Chinese demand) hit mining profits, while load shedding, Transnet’s woes and weak local growth also weighed on other tax income. 

Treasury also didn’t fully budget for a 7.5% public sector wage hike, which has added billions to government spending this year. Some 55 000 civil servants now earn more than R1 million a year.

Concerns about South Africa’s economic and fiscal outlook  along with its greylisting, its controversial relationship with Russia and much higher interest rates across the world  have pushed higher the cost of government borrowing. Investors are now demanding much higher interest rates from SA: government’s weighted cost of borrowing has increased from 8.3% in February to 9.5% in October.

This has increased debt service costs by R52 billion above the budgeted amount. Out of every R5 collected in tax, R1 is now being paid to lenders. Government is now spending more on paying debt that on basic education or on health. Debt-services costs are expected to grow by almost 9% per year.

Government debt is now expected to peak at almost 78% of GDP  from a previous forecast of 73% by 2025/26  and grew at a much faster pace than in most emerging markets.

In response, the medium-term budget set out a number of interventions: 

Tax hike ahead

Treasury is budgeting for a R15 billion tax increase in the February Budget. It has not yet been confirmed what shape it will take - whether it will be a VAT or income tax hike (or a combination), for example. 

Spending cuts

Treasury has already cut budgets for housing and other services in this year, and has warned that government budget spending may be reduced by more than R120 billion over the next two years.  

Spending increases on social development (+2.6%), health (+3.1%), and learning and culture (+3.5%) will be below inflation in this period.  

In the civil service, some positions will be frozen and head counts in `non-critical areas` will be reduced, Treasury officials told News24. 

Big plans to shrink the state

In line with President Cyril Ramaphosa’s pledge in the State of the Nation address earlier this year, government departments and agencies will be reduced and merged, Treasury said, while `outdated and unproductive programmes` will be cut. 

More details will be announced at the February Budget.

New rules and a new Treasury agency for private investment

Treasury announced that it will change regulations and municipal legislation to make it easier for private companies and international finance institutions to invest in South African infrastructure projects, also on a local level. Private investment in electricity transmission infrastructure and upgrades to railway lines, among other projects, will be fast-tracked, said Finance Minister Enoch Godongwana.

The details will be announced in February, but officials say the changes will make it simpler for large international funders, like the so-called BRICS Bank, to allocate money for specific, ring-fenced projects. New mechanisms through which private-sector investors and multilateral institutions can co-invest with government for selected infrastructure projects will be created.

A new support agency will also be established in Treasury to manage a pipeline of projects. 

R350 grant lives on

The Covid-19 social relief of distress grant will be extended for another year until March 2025 at a cost of R34 billion, `while government considers social security policy reforms and a funding model`, Treasury said. It also announced that social grants will see inflation-linked increases in 2024/25 and 2025/26.

Stricter Eskom debt relief 

In February, Treasury announced that it will grant Eskom debt relief of R254 billion over the next two years, subject to certain conditions. But it has now decided to take a stricter liner on the arrangement, converting the loan from interest free to interest bearing `to better reflect the cost of this arrangement`.

New legislation, tabled on Wednesday, also stipulates that the minister of finance may reduce the amount of debt relief available to Eskom if it doesn’t meet conditions. 

Godongwana highlighted that one of these conditions, that Eskom still has to meet, is the sale of its finance company, which funded employee home loans.

Hard line on Transnet

In the next week, Transnet must repay R7 billion in loans to creditors. It doesn’t have the money, but Treasury is not going to provide any guarantees. Instead, it wants Transnet to come to an agreement with its creditors on its own.

While Transnet itself has indicated that it wants some R100 billion in debt relief and funding from Treasury, Godongwana told journalists that:

We are not closing the door (on Transnet), but even if we open it, it is not that wide open. 

No allocation for the NHI

There is no mention of new funding allocated for the National Health Insurance Programme but money will be shifted away from the existing NHI grant to cover oncology services. 

`If the national health insurance policy is implemented, then spending on public health could increase from about 4% of GDP in 2022/23 to 6% of GDP by 2040/41. This increase may require additional spending or revenue measures to ensure sustainability,` Treasury said in the Medium-Term Budget Policy Statement.

Fiscal anchors and debt ceiling

More than a decade ago Treasury introduced a ceiling on how much government can spend in a year. But this ceiling was not binding  and deficits and debt continued to grow. Treasury says additional rules will be introduced to provide an anchor for fiscal sustainability. Details will be provided in the 2024 Budget.

Progress with greylisting 

Godongwana said that the Financial Action Task Force (FATF) noted last week that South Africa has addressed 15 of the 20 technical deficiencies in its legal framework. `However, there is also a significant amount of work that must still be done, particularly with regard to the investigation and prosecution of complex money laundering cases and terror financing, the identification of informal mechanisms for remitting money around the world, and the recovery of the proceeds from crime and corruption.`

Government expects to address all the deficiencies identified by FATF by early 2025