The part of the Public Protector report on SARS investigative unit is clearly irrational

It is a truth universally acknowledged that, for many South Africans, neither the accurate facts nor the correct legal analysis matters in the vicious fight between Public Protector, Busisiwe Mkhwebane, and Public Enterprises Minister, Pravin Gordhan. Many are either “with” Mkwhebane or “with” Gordhan, regardless of what the facts or the law might say. But for some of us the facts and the law do matter. So, it is time to delve into some aspects of the Public Protector’s latest report which made serious findings against Gordhan and imposed drastic remedial action requiring the President to act against Gordhan.

The first thing to note about Public Protector Busisiwe Mkhwebane’s report against Pravin Gordhan is that it cleverly attempts to speed up his political demise by requiring remedial action to be taken against him within 30 days. The report asserts that the remedial action imposed by the Public Protector is binding (which is correct) unless a court order directs otherwise (which is in dispute). The (binding) report now contains an indirect instruction that the remedial action must be implemented unless a court order is obtained to interdict the implementation.

This report therefore differs from the previous report on Pravin Gordhan as the report itself now contains an instruction that remedial action cannot be ignored while the court considers a review of the report. As a review will never be completed within 30 days this means that those who wish to stop the implementation of the remedial action will have to obtain an urgent interdict against the implementation of the remedial action. I assume this is the course that will be taken by Minister Gordhan.

But once the interdict is granted, the more important legal question will become whether the report (or parts of it) is irrational and should be reviewed and set aside. This process of challenging the report is not an appeal, so the court is not asked to decide whether the Public Protector got it right. Instead the court can only review and set aside the report (or parts of it) if it is irrational.

If the report is based on a complete misrepresentation of the law or if it contains factual findings that no rational decision maker could have made, the court would have to set aside the report. If the report contains factual findings that are wrong but not irrational, or if it embraces a plausible interpretation of the relevant law with which the court may differ, the court will not be able to set aside the report.

The part of the report that will almost certainly be reviewed and set aside, is the part that finds that the establishment of the SARS investigative unit was unlawful.

The argument in the Public Protector’s report on this aspect is not easy to follow, but as I understand it the Public Protector found that section 3 read with section 1 of the National Strategic Intelligence Act does not establish SARS as one of the National Intelligence Structures authorised covertly to gather departmental intelligence either inside or outside the republic.

SARS can therefore only work with other law enforcement agencies within the principles of co-operative government to achieve its objectives. The report does not say whether this relates to everything SARS does, to investigations of tax matters, or only to covert investigation of tax matters, but to give the Public Protector the benefit of the doubt, I am going to assume the report argues that if SARS covertly wanted to gather information on taxpayers and tax compliance it could only do so by co-operating with the recognised intelligence structures.

Furthermore, the report points out that section 209 of the Constitution states that:

Any intelligence service, other than any intelligence division of the defence force or police service, may be established only by the President, as head of the national executive, and only in terms of national legislation.

According to the report, the establishment of the SARS unit “with the approval of Mr Gordhan” was therefore in breach of section 209 of the Constitution “in terms of which only the President may establish such a covert information gathering unit”.

The first problem here is that section 209 does not prohibit the establishment of a “covert information gathering unit” as claimed by the Public Protector. Section 209 prohibits, as noted, the establishment of an “intelligence service”. Unless the SARS unit constituted an intelligence service, section 209 is wholly irrelevant. Unfortunately, the report contains no analysis of why the unit is to be considered an intelligence service.

There is a good reason for this lack of analysis. First, it was always going to be difficult to argue that any unit of a State Department that covertly gathers any kind of information would always constitute an intelligence service.

For example, I am not sure many people will argue that social workers who gather information about abuse of children in order to decide whether to remove a child from his or her home for their own protection are actually running an intelligence service. Similarly, Department of Home Affairs officials investigating sham marriages could not be said to have formed an intelligence service.

Second, the National Strategic Intelligence Act actually provides ample guidance on what would be considered an intelligence service. Section 3 of the Act specifically deals with situations where state departments (other than one of the National Intelligence Structures recognised by the Act) deals with “national security intelligence”. It prohibits such state departments (or units such as the SARS unit) from covertly gathering “departmental intelligence”. Section 1 defines such intelligence as relating to:

any threat or potential threat to the national securityand stability of the Republic which falls within the functions of a department of State, and includes intelligence needed by such department in order to neutralise such a threat.

As both judge Nugent in his SARS report and advocate Wim Trengove in a legal opinion pointed out, the SARS unit did not  investigate matters dealing with national security and the National Strategic Intelligence Act therefore did not prohibit SARS from establishing a unit that covertly investigated tax matters. Unfortunately the report failed to refute (or at least to attempt to refute) this analysis and does not even bother to quote or reference the definition quoted above.

The unit was set up to gather information with respect to compliance with tax and custom laws. The Public Protector seems to argue (again, the argument is not clearly made) that because the unit allegedly made use of intrusive and unauthorised methods and because this was used for political purposes “as per documentary evidence in my possession” the unit was an unlawfully established intelligence service.

Apart from the fact that the Public Protector does not state what the documentary evidence is that she is relying on (suggesting that information is being used that is not being shared with the public and whose veracity cannot be evaluated), it is obvious that the intrusive and allegedly unlawful methods used by the unit does not turn investigations into tax affairs (even if used for political purposes) into investigations regarding a threat to national security. It would be like arguing that SAFA unlawfully established an intelligence service because it bugged the phones of the Egyptian soccer team management before the recent Afcon match between the two sides.

The finding that the SARS unit carried out unlawful and irregular operations may be more plausible because it is illegal to intercept communications between two parties (if the interceptor is not one of the parties in the conversation) and there is some circumstantial evidence that this might have occurred.

This aspect of the report is however not without its problems. Much of the information relied on came from testimony or submissions made by individuals to third parties. For reasons not explained in the report, the Public Protector did not interview any of these individuals on whose evidence – given to others – she heavily relies. (Or, to be more circumspect, the report contains no indication that any of the individuals were interviewed by her office.) Some of the evidence mentioned is also of such an opaque nature that it is not impossible that a court will find that it was irrational for the Public Protector to have relied on this “evidence” at all.

Two examples will suffice. First, under the heading “[i]ndependent evidence obtained” the report notes:

Other operations conducted by the [Unit] included surveillance operations (of premises), following of vehicles, obtaining information from independent sources.

The reader of the report is not told what exactly this evidence is, who provided it, and how credible it is. The reader has no way of making any assessment of the claims made here. Was the evidence obtained from a secret source? From a politician with an axe to grind? From state security sources? We are not told. Of course, it is also to be noted that obtaining information from independent sources is something that investigators – including those ensuring tax compliance at SARS – do every day and there is nothing unlawful or irregular about it.

Second, the report notes that: “An undated submission further stated that the unit was, at times, utilised for political meddling.” We are not told who this undated submission is from, what specific allegations of political meddling were made, how credible the allegations are. Does this mean if I make an undated and perhaps anonymous submission to the National Assembly (NA) that the Public Protector has utilised her office for political meddling, that the NA would be allowed to rely on this completely unsubstantiated and unverifiable allegations? Obviously not.

Nevertheless, the allegations that the unit might have unlawfully intercepted communications is a serious one and it is important that a credible body properly investigates this to establish whether a crime was committed. As some unit members are currently being prosecuted for this, only time will tell whether the evidence exist to substantiate the conclusions reached by the Public Protector.

The report contains several other findings – including a finding the Minister Gordhan deliberately lied to Parliament. I suspect this finding is wrong, but I am uncertain whether the court would find it to be irrational. I will have to think about this a bit more but it may be that there is at least some room for reasonable disagreement on the matter. But as I have run out of space, this is something that could be explored in a future column if there is any interest in the matter.

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