News and Finance

South Africa will set up a commission after elections this month to oversee all ministries including the National Treasury, which became a “Frankenstein” bullying other departments, a senior official of the ruling African National Congress said.

The commission will coordinate the implementation of government programs as well as spending and budgets, “how they are being handled from top to bottom,” said Mathews Phosa, the ANC’s treasurer general.

“It is going to create a lot of pressure on all departments, including treasury,” Phosa said yesterday in an interview at the ANC’s headquarters in Johannesburg, South Africa’s commercial capital. “You won’t have treasury standing there like a Frankenstein barking at other departments.”

Labor unions, the South African Communist Party and the ANC’s youth wing, which backed the rise of Jacob Zuma to oust former President Thabo Mbeki as the ANC’s leader, have urged Finance Minister Trevor Manuel to boost spending on poverty eradication programs, food subsidies and income grants to the poor.

Zuma is the ANC’s presidential candidate for the April 22 elections.

Manuel may be a candidate to head the new commission, said William Gumede, the author of “Thabo Mbeki and The Battle for the Soul of the ANC.”

While Manuel faces opposition from labor and communist supporters of the ANC, Gumede said, he placed fourth on the ANC’s list of 100 nominees for the 400-seat National Assembly.

‘Credibility’

“In terms of credibility, everyone doubts Zuma’s economic management skills, so he needs a guy like Trevor Manuel,” Gumede said today in an interview in Johannesburg.

The rand traded at 9.2101 to the dollar as of 1:37 p.m. Johannesburg time compared with 9.1780 late yesterday.

The president is elected by parliament and with polls showing the ANC winning more than 60 percent of the vote, Zuma is overwhelmingly favored to become president. Zuma took control of the ANC in December 2007 when he ousted Mbeki as party leader.

“Given the perception that the new administration will tilt left investors could be concerned that the moves will reduce the power of the treasury and lead to more profligate spending,” Mike Davies, a London-based analyst at Eurasia Group, said in a note to clients quick faxless payday loan.

Resist

The treasury “did wrong things,” Phosa said. “Now we must bring it into line with other departments and harmonize.”

The treasury won’t comment on the remarks, Thoraya Pandy, a spokeswoman for the department, said today.

The treasury is likely to resist any attempts by the commission to influence the budget and the commission may only have the power to make recommendations, Davies said.

Under Manuel the South African economy expanded for 40 consecutive quarters until the third quarter of last year and in the 2005/2006 financial year the country attained its first budget surplus since at least the 1960s.

The treasury has “worked exceedingly well,” Colen Garrow, an economist at Brait SA in Johannesburg, said in an interview. “In hindsight” it could be seen as a mistake if it is tampered with.

Many South Africans feel the administration of Mbeki, who was forced to quit as president in September, failed to make progress on issues such as crime, education and health, Phosa said.

‘Rise Against Us’

“There is an issue of implementation,” he said. “The great majority of our people feel that we are running short there, we are not implementing our good policies.”

Boosting development in the rural areas will be a particular focus of the new administration, he said.

“The issue of rural development has been ignored in the past and we want to focus on that, and by saying that we are not saying we are going to be leftists or communists or socialists,” Phosa said. “We don’t want to leave the majority of people out of the process of liberation, because they will rise against us in the future if we do that.”

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