Gordhan tells of secret agendas

Former finance minister Pravin Gordhan was ignored when he asked for information on the new operating model at the South African Revenue Service.

Appearing before the Judge Robert Nugent commission of inquiry into the tax agency, Gordhan painted a picture of secret agendas and lack of accountability during the restructuring of SARS.

Suspended SARS commissioner Tom Moyane oversaw the restructuring process. The reasons for the restructuring are yet to be made public, but it is expected Moyane will appear before the panel to do so.

Moyane and Gordhan had a fractious relationship, with the suspended commissioner accusing the minister of shouting at him and treating him like a “nonentity”. The relationship was on the brink of collapse when Gordhan was removed from the post of finance minister by former president Jacob Zuma and replaced by home affairs

minister Malusi Gigaba. The restructuring was largely credited for the mass loss of staff from SARS, which has declined from 14,000 to 12,600.

Gordhan was the first to be grilled by the panel, made up of Judge Nugent, tax expert Michael Katz, advocate Mabongi Masilo and lawyer Vuyo Kahla. He was asked about the need for the restructuring at SARS.

Gordhan said he believed the reasons for the restructuring were linked to the state capture project unfolding in other institutions in the country. He said these reasons would be made clear as the commission continued to uncover information.

Gordhan, also a former commissioner of SARS, presented a detailed presentation of the modernisation and transformation that the tax agency underwent during his term between 1999 and 2009.

Nugent asked Gordhan why there was a need to review the operating model, if the systems in place had already worked.

Evidence leader Carol Steinberg put it to Gordhan that the commission had heard two reasons during interviews for the need for the restructuring. One was that the modernisation process under his watch had “left people behind” and had taken place “too quickly” and the second was that SARS procurement processes did not pay sufficient attention to black economic empowerment.

Gordhan told the commission that when he was reappointed as finance minister in 2015, he requested further information on the review of the operating model conducted by consultants Bain. He said he had met Moyane and written to him so he could “understand the new operating model”.

Gordhan told the commission that he was concerned as it appeared that the large business centre — a key feature of the modernisation process put in place during his tenure — was being dismantled and that a “new concentration of power was taking place” at SARS.

He said there was a “deficit of information” provided to him and that he was told the review needed to continue when he asked for it to be halted.

Gordhan said 61% to 70% of SARS business went to blackowned companies.