Maverick’s refreshing streak needs limits
When news broke about a month ago that Tito Mboweni was returning to the cabinet and the rand surged, I remembered how different things had been back one weekend in 1998 when it was announced that he would be deployed to the Reserve Bank, with the view that he would take over when then governor Chris Stals retired the next year.
You wouldn’t know it from the vitriol he gets from trade unions whenever he opens his mouth, but in those days, being the labour minister who ushered in worker-friendly legislation which elements in business had passionately opposed, he was seen as somewhat of a radical. This was before the term “populist” got the currency it has now.
As predicted, the rand tanked that Monday and it took him some time to establish his credentials. He turned out to be more hawkish than most would have expected and was a fierce defender of the Bank’s independence. How much of the latter was due to principle or a personal antipathy to being told what to do, I’m not sure.
So as President Cyril Ramaphosa announced his appointment to replace Nhlanhla Nene as finance minister and the rand reversed earlier losses, I wondered what the former governor made of it all. Was this the final confirmation that he is now truly a member of the establishment?
So it was amusing to see his tweet encouraging members of the public to annoy “the establishment” by sending him ideas on what to put in his maiden medium-term budget policy statement.
Nobody was feeling more sentimental than me when Mboweni’s appointment was confirmed. Early in my career I had a run-in with the then relatively new governor that made me famous for a couple of days. When I think back on it, I’m grateful that it was before the days of Twitter.
I had written what I thought was a rather harmless piece of commentary about how unwise it was for him to make potentially market-moving comments at an event open to an exclusive audience. It was a more innocent age, when hardly anyone had a smartphone. So having written the offending column and left town, I didn’t know I had displeased the governor until late in the day when Peter Bruce, my editor at the time, finally got hold of me. Things did get better from there.
Since his return to government, Mboweni has been as outspoken as one could have expected and has broken a few policy taboos already. In his policy statement and subsequent press conference, Mboweni suggested that there should be no “holy cows” when it comes to the future of SAA, which has been guzzling billions of taxpayer cash for years, with no sign that any of its turnaround strategies will work. The loss-making airline, which has asked for almost R22bn in state bailouts over the next three years, needs to refinance or repay R14.2bn of debt before March, with R5bn due this month.
Mboweni then suggested that public enterprises minister Pravin Gordhan, under whose brief the national airline falls, would present the government with what he hoped would be a credible plan by the end of the year.
It’s still just under two months before the end of 2018, so it was a bit of a surprise to see Mboweni being quoted last week as categorically saying that SAA should be closed down. The airline “is lossmaking, it’s unlikely to sort out the situation, in my view we should close it down”, he said.
Not many will challenge his contention that no selfrespecting investor would want to buy a minority stake in SAA.
Surely if one thought the business could be made viable, they would want to take it over properly so they can make the necessary changes themselves. And nobody has ever explained how running an airline can be a core function of the government, any more than, say, running a car maker can.
Having said that, it’s understandable that the unions, and to some extent Gordhan, should be a little annoyed with Mboweni’s latest utterances.
While his straight-talking self is refreshing and some may regard off-the-cuff commentary as possibly part of a strategy by Ramaphosa to send a message to populists inside and outside the ANC without getting his own hands dirty, there should be limits to how maverick a finance minister is.
When he says something, the audience needs to know that he is articulating government policy.
And as far as we know Ramaphosa and the government are still committed to keeping the airline, rightly or wrongly.
The maverick at some point has to embrace the fact that he is part of the establishment, and a degree of collective responsibility and discipline may be needed from time to time. But then, that could make for boring headlines.
SINCE HIS RETURN TO GOVERNMENT, MBOWENI HAS BEEN AS OUTSPOKEN AS ONE COULD HAVE EXPECTED AND HAS BROKEN A FEW POLICY TABOOS ALREADY