Pravin Gordhan: Does the private sector give a damn?

It is now 3 weeks since the National Budget Speech and I have travelled around South Africa quite a few times.

I could say that I am exhausted and need the Easter break to recuperate. But my travels and workload are totally insignificant in relation to Finance Minister, Pravin Gordhan. Try this schedule:

  • Recalled as Minister of Finance on 13 December 2015.  December break cancelled.
  • Take stock of the situation and establish the key proposals contained on the National Budget Speech.
  • Delivering the national budget speech is just one afternoon in the schedule. Then comes the dash around SA in the media frenzy that follows.
  • Then sell SA on an international road show to the UK and the US in a desperate attempt to save us from junk status
  • Prepare for the imminent visit from Moodys

Minister Gordhan is probably getting by on a few hours sleep at night, but the weight of responsibility on his shoulders drives him to do what is best for South Africa. In between, he has been flying economy class, setting an example to us all.

On 19 February, the Hawks national head Lieutenant-General Mthandazo Ntlemeza sent a letter to Gordhan. The letter contained questions which the Minister had to answer on or before 16:00 on 1 March‚ so they could continue with their investigations into the alleged rogue unit at SARS.

Now surely the very timing of the 19 February Hawks letter is in suspicious enough to question the very integrity of the Hawks?

There can be little doubt that the Hawks will make as much as possible from Gordhan’s response. So it would seem reasonable for PG to tread carefully and turn for help to a legal team.

But do we as South Africans honestly expect PG to defend SA in the aftermath of Nenegate and deal with the Hawks at the same time? That’s just preposterous. Most of us would have to take extended sick leave.

Gordhan did not make the second deadline of 14 March. Everyone knows that Gordhan has been batting, bowling and keeping wicket for SA in the UK and US for most of that time.

But Hawks spokesman Brigadier Hangwani Mulaudzi said “The minister‚ for whatever reasons‚ has failed to meet the ‘second’ deadline for answering questions and our legal team are forging a way forward, which will see the Hawks exercising our constitutional powers. The investigations will not be stalled by an individual who refuses to comply with the authorities and demand a preferential treatment.”

Now hang on. Let’s look at this another way.

Some in the private sector say that the effect of Junk status rating for SA is already priced into the markets and that our banks are well capitalised and could handle the storm. Then they add that a junk status rating will only effect our offshore funding and SA is mainly funded by domestic debt.

Are they saying ‘bring it on!’ What if they are wrong? What if a junk status rating actually causes SA to collapse into economic and social chaos? We just don’t know the answer.

But there are few who would doubt that were it not for Gordhan’s efforts we would be at junk status already. So playing on Churchill’s words ‘ Never in the SA’s economic history has so much been owed by so many, to ONE MAN!’

In my wanderings there seems to be total apathy in the SA business community. Just rumour mongering and waiting for the next tweet.

And questions about how we are going to sanitise the billions illegally held by taxpayers in offshore accounts using the new amnesty or Special Voluntary Disclosure Program. Or how the forthcoming tax amendments are going to stuff up our family trusts. Or how are we going to protect our bottom line from whatever goes down.

Of course Gordhan will answer the Hawks questions. But surely at the very least the business community of SA needs to somehow get behind Gordhan.

SA’s economic woes are not over. The world is watching this debacle. And on 1 April comes the next round, the announcement of the tax collection numbers for the 2015/16 year.

I am sticking my neck out here. What I hear is that many major corporates will be paying reduced second provisional payments by 31 March. Many sustained huge forex losses over Nenegate and tax collections could well suffer as a result.

So, if SARS does not come within the R11bn shortfall predicted in the national budget review we are going to be up proverbial creek without a paddle again. And guess who is going to have to dig us out of the hole on that one?

If there is a hope for SA it rests on the shoulders of Gordhan.

The private sector is going to have to back him up. And perhaps that starts with a simple message that the Hawks will be doing no harm of they cut PG a little slack and grant an extension until at least 18 April. The same day as Oscar.

Watching George Osborne. Britain’s Chancellor of the Exchequer, present his budget speech, I could only think “George, you don’t know how lucky you are”.

 


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