Gigaba team puts a leash on Treasury

Senior Treasury officials have accused Finance Minister Malusi Gigaba of ‘capturing’ the Treasury, usurping the power of his DG and establishing a parallel administration run by close aides in his office. A City Press report says the claims were made by several senior Treasury executives and two other top government bureaucrats who work closely with the Finance Ministry. They all raised red flags that appear to show how Gigaba, who was once a regular visitor to the Gupta family’s Saxonwold compound, has pointed Treasury in a radically different direction from his predecessors. These include allegations that:

* He is sitting on a decision by DG Dondo Mogajane to appoint a company to conduct a forensic audit into Eskom’s coal contracts with Tegeta Exploration and Resources, which was until August owned by the Gupta family and President Jacob Zuma’s son, Duduzane.

* Gigaba brought in nearly 20 staff who have set up a parallel administration in his office.

* He does not consult deputy DGs and other technocrats when making important decisions.

* Key documents and memorandums which should be seen by Mogajane before they go to Gigaba, are first sent to Gigaba’s chief of staff Saki Mofokeng, legal adviser Kholeka Gcaleka and political adviser Thamsanqa Msomi for their perusal and input. Msomi, a member of the Denel board, is reportedly close to the Gupta family. His board took Treasury to court in March over its refusal to allow Gupta-linked company VR Laser’s joint venture with Denel to go ahead.

* The budgeting process, Treasury’s core function, is being moved to the Presidency for the 2018/19 financial year’s budget.

* There have been inexplicable delays in informing Water and Sanitation Minister Nomvula Mokonyane that her request to deviate from tender processes for the R16bn Mzimvubu water project has been declined.

Gigaba is running 'an administration that is parallel to the DG’s office', according to one of several senior Treasury officials to whom City Press spoke. All have accused Gigaba of bypassing experienced bureaucrats. ‘They are running an administration that is parallel to the DG’s office. Matters which should be handled by the DG go to them,’ said one. One of the two government officials who work closely with Treasury reportedly said: ‘It is true that there are parallel structures. Things are up to a point where nothing goes to the Minister if it is not first seen by one or two of the nearly 20 people Malusi brought with him. The other senior official said: ‘The intention is to have a Treasury that is pliable; that in many cases merely implements any decision – good or bad, affordable or unaffordable.' Last month, Cabinet announced that the budget allocation process would be shifted from Treasury to the Presidency for the 2018/19 financial year, to ensure that the allocations were in line with the National Development Plan. The sources said while Gigaba did not initiate this, it was one example of how Treasury was being captured. The shift was ‘meant to put a leash on Treasury and make sure that all the projects that President Jacob Zuma wants are funded’, one Treasury official said. However, spokesperson Mayihlome Tshwete told City Press that Gigaba had brought 17 people to Treasury and appointments had been made in accordance with the Ministerial handbook.

The shifting of the budget allocation process to the Presidency confirms fears that there are agendas to disable National Treasury, political analyst Ralph Mathekga claims in a Fin24 report. He explained that the capturing of Treasury has been in development for a long time. A two-pronged approach of capture is being followed, explained Mathekga. The first is to disable Treasury to prevent it from doing a critical evaluation of government expenditure as it has done in the past, through the creation of parallel institutions. Secondly, ‘something more sinister’, is to have the functions of Treasury as laid out in section 200 of the Constitution conferred to the Presidency. This amounts to a ‘constitutional crisis’, Mathekga is quoted as saying. When asked about Gigaba’s leadership since taking over Treasury six months ago, Mathekga said that it brings into question whether Gigaba is his ‘own man’. ‘Gigaba is torn between two worlds that cannot co-exist,’ said Mathekga. One world is run by the Guptas, who have deployed him to the top position to push a particular agenda. While, at the same time Gigaba is trying to push against attempts to control his actions by doing good. On Gigaba’s leadership Professor Jannie Rossouw, head of the School of Economics and Business Science at Wits University, referred specifically to slip ups in meeting goals of the 14-point plan Treasury announced in June. One of the goals was to appoint a new chairperson of SAA, but it appears Dudu Myeni will remain until 2018, he said. Rossouw said it was disconcerting to find that the Presidency has more control over the budget, especially given the fact that the country is running a fiscal deficit and slowly approaching a fiscal cliff. ‘We are really seeing the capture of National Treasury at different levels,’ he said.