Nhlanhla Nene removed as finance minister
President Jacob Zuma took an unprecedented step on Wednesday night by dismissing Finance Minister Nhlanhla Nene – barely two years after he took office.
In a shocking move that saw the rand plummeting to below R15 to the US dollar, Zuma appointed a relatively unknown backbencher David ‘Des’ van Rooyen – who served as a member of the finance committee in Parliament – to replace Nene. Nene has been at loggerheads with SAA chair Dudu Myeni – who serves as thechairperson of the president Jacob Zuma’s education trust.
Tensions between Nene and Myeni worsened last week after Nene turned down a proposal from the SAA board to restructure a re-fleeting transaction with Airbus. Nene reportedly gave a stern warning that should the board proceed without his permission, it would constitute financial misconduct with consequences for the directors. The treasury said in a statement last week that the board’s proposal to restructure the deal would leave the SAA in a materially “worse off financial position where it is unable to meet commitments as they become due”.
Nene is not the first minister to bite the dust after clashing with Myeni. Malusi Gigaba was moved from the public enterprises portfolio to home affairs after he fought with Myeni, and SAA was taken away from the current minister Lynne Brown to the treasury after Brown clashed with Nyeni.
DA leader Mmusi Maimane said Zuma’s decision would have a negative impact on the economy.
“Nene fought for the fiscal discipline. The implication of this on the economy is that South Africa is now seen [by investors] as unstable. Former minister Trevor Manuel served for two terms. For Zuma to fire Nene after a just over a year is a clear indication of instability within his administration. This will have huge implications for job creation. It is very irresponsible,” said Maimane.
Maimane said Nene’s sin was to refuse to toe Zuma’s line by providing funds to the nuclear deal and the president’s private jet – a price tag estimated to be R4-billion.
“He [Zuma] needs someone who can toe the line at the expense of South Africans. He believes he comes first, before the people of South Africa. Even the ANC, in this case, is becoming second,” said Maimane.
The Economic Freedom Fighters (EFF) said Nene was fired because he refused to take “illegal instructions” made by Zuma and his friends in both business and state-owned enterprises.
EFF spokesperson Mbuyiseni Ndlozi said: “Nene refused to give SAA guarantees and bailout when Zuma’s girlfriend and chairperson of the board requested it. Nene also refused to buy Zuma a new luxurious private jet and declined to grant Zuma’s staff exemptions from using expensive hotels and flying first class. Above all, Nhlanhla Nene was reluctant to approve the country’s new nuclear deal which Zuma wanted expedited so he can benefit before his term as president ends. There can be no more shocking news coming out of South Africa to signify that we are a country in crisis, with no knowledge of what tomorrow holds.
“We have always warned that with Zuma you must either be corrupt or you fall out of favour with him. No one in the world will trust a political leadership that changes Cabinet and finance ministers like underwear. A decision to change a person that presides over the treasury of the country must come with substance, be predictable and not come as a shock. If so, we all doubt what is being intended with the taxes of the people,” Ndlozi said.
Cope spokesperson Dennis Bloem described the decision to fire Nene as the “worst card” ever played by the president.
“Ideally, it is President Zuma who should have been axed by the ruling party. His exit would end the national drift and the policy paralysis that is crippling the economy. He stands between South Africa and economic growth. He has certainly overstayed his welcome and it is he who should go,” said Bloem. He said the axing of Nene would make the jittery market even more dubious about South Africa’s prospects of shifting economic gears and holding spending.
“Whatever the reason, Zuma has played his worst card ever. If South Africans were blasé up to now, they should wake up to the fact that our government and our economy are in the very worst of hands. Nene must have been under immense pressure not to apply the fiscal brakes,” said Bloem.
The ANC said in a statement on Wednesday night that it noted and respected Zuma’s decision to appoint a new finance minister – Van Rooyen – to replace Nene.
“The president has exercised his constitutional prerogative to appoint a new minister who we believe has what it takes to lead the ministry,” said ANC spokesperson Zizi Kodwa.
“We believe his experience and tenure as the ANC National Assembly whip for both the finance portfolio committee and theANC Caucus’ Economic Transformation Cluster will enable him to provide the necessary leadership in the department. We wish the new minister well in his responsibilities. The former minister remains a valuable resource in the organisation and we accordingly commend him for the excellent service he rendered to the department and the people of South Africa.”
ANC head of economic transformation Enoch Godongwana said the decision to remove ministers were the prerogative of the president. He said he knew Van Rooyen when he served as a mayor of the Merafong Municipality. “He [Van Rooyen] left for Parliament where he served as a whip of in the economic transformation cluster and the standing committee on finance. Because of that, he attended ETC [economic transformation committee] meetings of the ANC,” said Godongwana.
The South African Transport and Allied Workers Union [Satawu], which has defended Myeni throughout, last week called on Zuma to take action against those who were against her.
“SAA has moved from one crisis to another under Public Enterprises Minister Lynne Brown and Finance Minister Nhlanhla Nene. It’s time President Jacob Zuma brought this state-owned entity under his fold.”
Last week, SAA chair Dudu Myeni confirmed that the Hawks were investigating the airline’s financial affairs. It now appears the investigation will go beyond SAA’s finances and probe a plot to sabotage the national carrier.
News of the plot came to light on Friday, when SAA Pilots Association head Captain John Harty was summoned to Douglasdale police station for questioning by several members of the Hawks.
Harty was questioned about his alleged involvement in recruiting technicians to interfere with the functioning of an aircraft rudder of a craft flown by a black pilot. Harty was quizzed about his understanding of treason, because if successfully carried out, such a plot would result in the loss of hundreds of passenger lives. “In light of this, Satawu calls for the immediate suspension of Captain Harty as the allegations put to him are serious and tantamount to treason,” the union said in a statement.