A-team puts Gigaba on notice

Side-eye: Director general Lungisa Fuzile (right) resigned after Malusi Gigaba (left) was appointed finance minister. Photo: Gianluigi Guercia/AFP

Side-eye: Director general Lungisa Fuzile (right) resigned after Malusi Gigaba (left) was appointed finance minister. Photo: Gianluigi Guercia/AFP

NEWS ANALYSIS
Newly appointed Finance Minister Malusi Gigaba has hit the treasury like a whirlwind, causing its conservative senior employees to reconsider their positions.

Gigaba fuelled feelings of insecurity by bringing an entourage of 18 people with him from the department of home affairs, including two questionable advisers, actions exacerbated by the resignation of the treasury’s “furniture”, director general Lungisa Fuzile.

Gigaba has also moved swiftly to replace his predecessor’s personal assistant with his own and is appointing his own chief of staff.

Gigaba spokesperson Mayihlome Tshwete, also from home affairs, said this is standard practice when a new minister takes over a department.

Three sources have seen home affairs official Samuel Mandiwana at the treasury and believe he will be Gigaba’s chief of staff. But Tshwete dismissed this, saying there are “two names the minister is considering for the position. A chief of staff has not yet been appointed.”

It is Gigaba’s removal of officials working in the treasury registries, who are tasked to store records and file minutes, that raised eyebrows and created concerns about “resistance towards Gigaba on a level where people service the ministry”.

Tshwete has defended this move, saying the minister must “know, trust and be comfortable with the persons he works with; there is nothing strange about Minister Gigaba bringing over his own administrative team”. He added that Gigaba has not yet “signed off anything to human resources”.

Another “serious red flag” raised by a source in the treasury is that at least one of Gigaba’s advisers, Thamsanqa Msomi, has been linked to the Guptas. Msomi is a board member of the state arms manufacturer, Denel, which is embroiled in litigation with the treasury over a contentious joint venture with the Guptas.

The Mail & Guardian reported last year that Msomi is seen to be close to the Gupta family, whom he has met.

When asked about his advisers at a press conference, Gigaba refused to reveal their names, though Tshwete tweeted them later.

It doesn’t necessarily indicate “malintent” by Gigaba, several treasury officials said. “But one rather hoped that Gigaba would first get used to the furniture before initiating significant changes. It is crucial to have a finance minister who does not rush into things and recognises the importance of a stable environment,” one of them said.

Officials at the helm of the treasury are divided over whether to stay or go. Some who have decided to “sit out the storm” have revealed a list of “lines for Gigaba to cross” that would influence their decision.

Gigaba’s new colleagues in treasury describe him as smart, savvy, stubborn, a “person who absorbs [information] quickly” and a “true politician” who “loves the camera”.

Senior treasury staff have often been described as “nerdy”, “smart”, people who are “sticklers for protocol and the law” and “strict”. Whether they will get along with their new political head is a matter of national importance. Few are entirely sure they will.

One source with a harsher stance said: “Every mid-level to senior employee in treasury is highly regarded and can immediately walk right into a job in the private sector where they’ll earn a lot more than they do now. If Gigaba thinks he can threaten treasury employees on the effect of losing their jobs to do something they don’t agree with, he is in for a surprise.”


Red-flag issues filling the new finance minister’s inbox

Financial Intelligence Centre Amendment Bill

The treasury tabled the Bill in Parliament in April 2015. It’s aim is to stop money laundering, illegal cross-border financial transactions and the financing of terror. It was severly criticised by the security cluster and the Black Business Council. It is awaiting the president’s signature. “There has been much talk of taking it back to the justice cluster because they wanted to get it away from [Pravin] Gordhan,” a source said.

His relationship to the taxman

The relationship between Gordhan and South African Revenue Service (Sars) commissioner Tom Moyane has been tenuous at best, mainly because Gordhan thought the current Sars leadership unfit for the job. There are concerns that Malusi Gigaba, with little knowledge of Sars, will be “led by the nose” by Moyane. Gigaba’s reaction to the Davis tax committee will be telling, as well as his response to the outcome of the tax ombud’s investigation into systemic problems at Sars regarding the late payment of tax refunds.

Denel’s legal battle

Denel has asked the courts to legitimise Denel Asia, its contentious joint venture with the Guptas in Hong Kong. Gordhan previously refused to rubber-stamp the deal and described its board as “belligerent”. In turn, Denel’s case is very critical of Gordhan. Gigaba’s tactics and take on the matter, especially given the fact that his adviser serves on Denel’s board, might prove decisive, sources said.

Nuclear programme

Gigaba has held three press conferences since his surprise appointment last week. In each he said, using Gordhan’s words,  the treasury would implement the nuclear programme at an affordable “pace and scale”. But Gigaba seems to favour building a second nuclear plant, citing clean energy and outdated coal power stations as reasons for “alternative” plans.

Chief procurement officer

This office was set up in the treasury to tighten controls over the state’s acquisitions and services in an effort to fight rampant corruption in state departments. Its first incumbent, Kenneth Brown, resigned last year and a permanent head must be appointed. “We want to know who will fill that post and how independent it will be,” a source said.

Radical economic transformation

“It is not reconcilable with our current fiscal framework,” said one source. When asked to define his understanding of the phrase “radical economic transformation”, Gigaba said at his most recent press conference that it is a “fluid” matter to be discussed with stakeholders.

“Gigaba doesn’t seem to realise that by just saying something like that he creates uncertainty,” the source said. 

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