THE rot in South African politics, which has eaten away at state companies, is spreading. This week McKinsey, a consultancy, apologised for the “distress” it had caused the South African people. Political mud had already drowned Bell Pottinger, a British public-relations firm, and forced resignations at KPMG, an auditor. So the shenanigans at the government-owned Public Investment Corporation (PIC), have set off alarm bells. One concern is an apparent attempt to oust Dan Matjila, its boss. A linked worry is whether PIC funds will be used to prop up state businesses.

The PIC is a lucrative prize: it is Africa’s largest money manager, controlling 1.9trn rand ($140bn) of assets, mostly the pensions of state employees, and holding 11% of shares in South Africa’s biggest 25 companies. So anonymous allegations against Mr Matjila, including the claim that he had misdirected funds to his girlfriend’s business, naturally provoked a furore. On September 29th, after an internal audit, the PIC’s board cleared him of wrongdoing. But many detected a plot to remove Mr Matjila and install a more pliable replacement. Mr Matjila himself told a South African newspaper that well-connected people wanted to force him out and get “the keys to the big safe”, though he now says that his remarks were misconstrued.

Meanwhile, the government has been scratching around for funds to rescue South African Airways (SAA), the national carrier, which has not turned a profit in six years. The airline’s corporate plan listed the PIC as a possible source of finance. But Mr Matjila has been reluctant to throw money at SAA, which he says has “governance issues”. Nor did he agree to an alternative idea, in which the government would raise funds by selling its entire stake in Telkom, a phone and internet firm, to the PIC. Instead, the Treasury used 3bn rand of taxpayers’ money to help SAA meet a repayment deadline on 30th September.

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