Gordhan threatened to quit Cabinet: report

Pravin Gordhan threatened to quit Cabinet on the eve of the budget speech – a move that would have certainly sent South Africa into an economic spin.

According to a report in Business Day, citing several sources. Gordhan sent an ultimatum to President Jacob Zuma last week calling for the resignation of South African Revenue Service (SARS) commissioner Tom Moyane.

“Moyane must go or I must go,” Gordhan allegedly told the president.

Moyane led an investigation into an alleged ‘rogue unit’ at SARS, which reportedly used illegal methods to gather information.

In a report, commissioned by Moyane and conducted by KPMG, Gordhan is fingered as the person responsible.

President Zuma recently defended his decision to appoint back-bencher, David (Des) van Rooyen as finance minister, following the sacking of Nhlanhla Nene, which sent the markets into chaos and caused the rand to plummet to its worst ever levels against the dollar.

Zuma was forced to re-appoint Gordhan to replace van Rooyen four days later, but not before markets lost an estimated R500 billion in value.

In an interview following the budget speech, Zuma said that van Rooyen was the most qualified person to be appointed to the position of finance minister.

According to Business Day, Zuma told Gordhan that Moyane should stay in his post.

The markets’ opinion of Finance Minister Pravin Gordhan’s budget may worsen if any disconnect between the political system and the Treasury emerges, according to NKC Research.

“If there is the slightest indication that Mr Gordhan does not have the full support and backing of his government colleagues and key elements of the party and the alliance, then all bets are off,” said Van Staden and Stemmet.

They said Gordhan did what he could within the limits of his ability to manoeuvre between economic demands and political constraints, and “the deep fundamental economic reforms needed to lift growth levels well above a miserable projection of 0.9% are seemingly out of his hands”.

However, NKC said he couldn’t address the “disjointed and ideologically hobbled economic policy that is the root of the problem” and fell short in staving off a ratings downgrade.

“The fact that President Jacob Zuma felt moved to announce his support for the budget implies all is not well on the political front, and so does the public tiff between Mr Gordhan and Tom Moyane, the South African Revenue Service (SARS) commissioner,” teh research company said.

News24 reported that when asked why Moyane was absent from the news briefing on Wednesday, Gordhan said: “It’s no secret that there are issues to resolve at SARS. We will resolve them in a couple of weeks and then we will communicate to the public.”

Van Staden and Stemmet said that the “way these issues are resolved – and it is widely understood that the main issue is that Moyane, who is close to Zuma, is resisting taking orders from Treasury – will make a difference to investors’ opinion of the budget’s credibility”.

Reporting with News24

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Gordhan threatened to quit Cabinet: report