Spies, rogues, patronage – a soapie unfolds
What’s going on here? There was a spy unit at the SA Revenue Service (Sars), but it was not rogue – most revenue services have intelligence-gathering capacity because of the scale, sophistication and effect of tax dodging on their fiscal positions. It was comprised in terms of law and signed off by an earlier finance minister, Trevor Manuel.
The unit largely went after huge underworld money stashes such as those found in cigarettesmuggling empires (big business because government has hiked sin taxes so ruthlessly) and it went for mega tax dodgers like Dave King. But then it touched politics and hit a political nerve – skirting too close to the empires of cronies who are in presidential circles. It’s no secret that the president is vulnerable to capture. This is why the acting commissioner, Ivan Pillay, was pushed out of Sars and replaced by Tom Moyane, say several officials.
Cronies engage in the practice now called “state capture” in South Africa. It refers to big money being used to buy political support for everything from customs duty evasion to policy capture (nuclear policy is widely regarded as being made for interests outside the state). The term is used as a synonym for the business practices of the powerful Gupta family that leverages political support into business growth with significant acumen. But it is much bigger than the Indian émigré family.
The budget’s emphasis on parastatal reform is a response to this capture because the large budgets commanded by Eskom, Transnet, SAA and Denel, among other state-owned companies, are regarded as being soft targets for capture. The Guptas, for example, operate at three of these while Dudu Myeni and Yakhe Kwinana, directors of both SAA and the Jacob Zuma Foundation, have SAA cornered. There are others. In the months ahead, the skirmishes we saw during the tabling of Budget 2016 are likely to play out around Sars and the state-owned enterprises.
I predict much soap opera and drama.
– Ferial Haffajee