Business Day

Zuma’s pro­tected dis­ci­ples shake Gord­han’s ground


PRAVIN Gord­han re­mains fi­nance min­is­ter, but events this week have shown he has al­ready been con­sid­er­ably weak­ened. South African Rev­enue Ser­vice (SARS) com­mis­sioner Tom Moy­ane sit­ting on a re­port from a re­spected bank­ing reg­u­la­tor ques­tion­ing whether his right-hand man, Jonas Mak­wakwa, was in­volved in crim­i­nal or cor­rupt ac­tiv­i­ties is out­ra­geous.

By its own ad­mis­sion, SARS is meant to fol­low prin­ci­ples of “ac­count­abil­ity, fair­ness, hon­esty, in­tegrity, re­spect, trans­parency and trust” in con­duct­ing its work. The stink around its han­dling of “sus­pi­cious and un­usual” trans­ac­tions to­talling R1.2m in­volv­ing the ac­counts of Mak­wakwa and his girl­friend in­spires lit­tle con­fi­dence that it is liv­ing up to these prin­ci­ples.

Its han­dling of the mat­ter is in stark con­trast to the way Moy­ane tack­led in­ter­nal mat­ters in the past. He en­tered SARS in Septem­ber 2014 and by De­cem­ber, had be­gun “clean­ing house”, sus­pend­ing of­fi­cials now im­pli­cated in the al­leged rogue unit un­der in­ves­ti­ga­tion by the Hawks. This was done days af­ter re­ceiv­ing an in­ter­nal re­port on the unit. In com­par­i­son, the re­port on Mak­wakwa came from a cred­i­ble in­sti­tu­tion with a le­gal man­date to in­ves­ti­gate and re­port sus­pi­cious ac­tiv­i­ties in the fi­nan­cial sec­tor.

It is also wor­ry­ing that Gord­han was not in­formed of the re­port, although he and Moy­ane are not ex­actly golf­ing bud­dies. The re­la­tion­ship was fraught from the start, with ten­sion height­en­ing to such an ex­tent ear­lier this year that Gord­han threat­ened to re­sign if Moy­ane was kept in the post. Pres­i­dent Ja­cob Zuma was meant to have man­aged the ten­sion, but this ev­i­dently did not hap­pen.

Moy­ane and Zuma have a long­stand­ing re­la­tion­ship, and the fact that the re­struc­tur­ing at SARS went ahead de­spite Gord­han’s in­struc­tion to halt it shows the com­mis­sioner en­joys po­lit­i­cal cover from the pres­i­dent.

In an in­ter­view with eNCA this week, the ANC’s head of its eco­nomic trans­for­ma­tion sub­com­mit­tee, Enoch Godong­wana, pro­vided fur­ther ev­i­dence that Moy­ane en­joys po­lit­i­cal pro­tec­tion way above that of his own boss (Gord­han).

“You have got a sit­u­a­tion which is un­prece­dented, a min­is­ter of fi­nance who has no con­trol over his rev­enue ser­vice, SARS. It is un­prece­dented be­cause your fi­nance min­is­ter must have con­trol of both the rev­enue and ex­pen­di­ture sides,” he said.

“That in it­self has been a prob­lem, and the fact of the mat­ter is that the ini­ti­a­tion of this crim­i­nal com­plaint [against Gord­han] is by that same rev­enue ser­vice.”

Godong­wana is re­fer­ring to the fact that Moy­ane had laid the crim­i­nal com­plaint with the Hawks that led to its in­ves­ti­ga­tion of Gord­han, and the unit’s bad­ger­ing of him since he re­turned to the helm of the Trea­sury in De­cem­ber. Its ini­tial ques­tions to Gord­han were de­liv­ered in Fe­bru­ary, and the Na­tional Prose­cut­ing Au­thor­ity con­firmed it had re­ceived the docket, yet there is still no move­ment.

In the mean­time, South African Air­ways chair­woman Dudu Myeni was re­tained at the helm of the board and the em­bat­tled air­line has been granted an ex­ten­sion of its loan guar­an­tee. Fur­ther, top brass at other state-owned en­ter­prises were con­fi­dent and em­bold­ened enough to pub­licly take on Gord­han and the Trea­sury through me­dia state­ments.

All this points to a wor­ry­ing trend: those who en­joy po­lit­i­cal cover from the pres­i­dent are able to by­pass the fi­nance min­is­ter as he at­tempts to per­form his role. This is a grave con­cern as he has to nav­i­gate a tough eco­nomic cli­mate and re­store the con­fi­dence of South Africans, in­vestors and ratings agen­cies in the com­ing months.

Godong­wana is the first se­nior ANC leader openly to ad­mit that the pur­suit of Gord­han by the Hawks is po­lit­i­cally mo­ti­vated, and he has been can­did about the way the Zuma ad­min­is­tra­tion is erod­ing the au­thor­ity vested in the fi­nance min­is­ter.

That said, Deputy Pres­i­dent Cyril Ramaphosa re­cently awoke from his slum­ber and ad­mit­ted the govern­ment was at war with it­self.

For his part, Zuma com­plains of be­ing abused in Par­lia­ment as the in­sti­tu­tions he is obliged to pro­tect crum­ble around him. While recog­ni­tion of a prob­lem is the first step to­wards fix­ing it, by the time the rest of the govern­ment twigs, it will have de­stroyed the very in­sti­tu­tions it is meant to com­mand and steer.

Mar­rian is po­lit­i­cal ed­i­tor.

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