The new head of South Africa\u2019s tax agency says rebuilding the organisation will be a long haul after management was \u201cdismantled\u201d and it lost public trust.<\/p>\n
\u201cIn the five months I\u2019ve been there we\u2019ve done a significant amount of work, but it\u2019s not a one-trick pony – it\u2019s a multi-dimensional, multifaceted piece of work,\u201d South African Revenue Service commissioner Edward Kieswetter said in an interview at Bloomberg\u2019s Johannesburg office Thursday.<\/p>\n
Kieswetter, who took over as head on May 1, inherited an institution that suffered \u201cmassive failure of governance and integrity\u201d after the appointment of former head Tom Moyane in 2014, a commission that probed problems at the body found.<\/p>\n
SARS had a climate \u201ccharacterized by fear and intimidation, with compliant managers that felt they were under a command-and-control structure,\u201d and unwittingly or unconsciously carried out work that didn\u2019t serve the organisation, the new head said.<\/p>\n
Turning around the tax agency is crucial to lift South Africa out of an economic slump.<\/p>\n
The state institution was one of the more effective during the 2000s, when efficient collection and strong growth led to revenue surpluses and space for the government to offer tax cuts.<\/p>\n
Rebuilding Trust<\/strong><\/p>\n The National Treasury started reversing those concessions in 2015 as the economic expansion waned and skilled professionals left the organisation, hindering its ability to improve collections.<\/p>\n Revenue fell R57.4 billion ($3.9 billion) short of the budget estimate in the year that ended March 31, the agency said in April.<\/p>\n \u201cHow do I rebuild the trust and improve the morale? My answer is one person at a time – you have to connect with each of the 12,500 people and demonstrate to that individual that you truly care,\u201d Kieswetter said.<\/p>\n \u201cTrust isn\u2019t built by making big promises, it\u2019s by doing many small things.\u201d<\/p>\n Kieswetter said he\u2019s met with labor unions and about 90% of the institution\u2019s staff to share his plans for the future.<\/p>\n \u2018Deep Hole\u2019<\/strong><\/p>\n He also started a revenue-recovery project and is implementing the recommendations of the inquiry into SARS\u2019s management.<\/p>\n It has recovered money paid to Bain & Co, the Boston-based consultancy company that was hired to assist in restructuring SARS in 2015, and is in discussions with Gartner Inc after the US technology-research firm secured a contract without proper procurement processes being followed, Kieswetter said.<\/p>\n The institution has also referred some matters to the Directorate for Priority Crime Investigation for further inquiries.<\/p>\n \u201cWe have reached a point of inflection – we are in a deep hole, but we are not digging ourselves into the hole, we are climbing,\u201d he said. \u201cThere can be no once-off wonders.\u201d<\/p>\n
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