Business

Tom Moyane axed. Now what?

2018-11-04 06:03

With President Cyril Ramaphosa having dismissed suspended SA Revenue Service (Sars) commissioner Tom Moyane this week, the question now is: Who will the president appoint to fill this key post?

Kyle Mandy, partner and head of national tax technical at PwC SA, said the most important question when it came to appointing a permanent Sars commissioner would be whether Ramaphosa would opt for a political deployee or a technocrat.

Acting Sars commissioner Mark Kingon, who has been at the helm since March 19 – after Moyane was suspended as Sars commissioner – is the lead contender from within the tax collection agency.

Kingon has expressed interest in taking on the commissioner role.

Ettiene Retief, chairperson of the national tax and Sars committee at the SA Institute of Professional Accountants, said Kingon was the man for the job because he had “integrity” and was very knowledgeable about the institution, which was important for the rebuilding of Sars.

Looking outside the institution, there was speculation – as early as March this year – that former deputy finance minister Mcebisi Jonas could be in line to be the next Sars commissioner.

There were also rumours that former deputy Sars commissioner Ivan Pillay could make a return to the tax collection agency.

However, Pillay faces charges and needs to clear his name before he can be considered for any job at Sars.

Pillay – together with two ex-Sars executives, Johann van Loggerenberg and Andries Janse van Rensburg – have been charged with corruption and contravention of the Rica Act by the National Prosecuting Authority with regard to their allegedly roles in the so-called Sars rogue intelligence unit.

All three deny the allegations.

At the Nugent commission of inquiry into Sars, witnesses have testified about the need for a more robust process to be implemented in selecting the next Sars commissioner and for governance to be improved urgently.

Another call at the inquiry has been for the Sars boss to be apolitical.

However, any changes to the way the Sars commissioner is hired will likely only be made by next year at the earliest, as Parliament will soon be in recess, PwC’s Mandy said.

It will be interesting to see what process, if any, Ramaphosa will announce he will follow in selecting a new Sars commissioner.

Another option, suggested Mandy, would be to appoint a Sars commissioner on a short-term contract while changes are made to the hiring process – but this would not be conducive to the stability of the agency.

Whoever takes up the job will have his or her work cut out to turn around the institution, which was wrecked by Moyane during his tenure.

This is reflected in Kingon’s testimony.

Kingon told the Sars inquiry last month that: “Rarely, if ever, has Sars had to contend with weak leadership, blemished integrity, total public distrust of our organisation, serious operational lapses and breaches of the higher purpose.

“I don’t think we have ever experienced, in my history of being in this organisation [for more than 34 years], a moment like we are in today. I hope in my tenure here we never have to face this again. It is a first for us.

“Our executive leadership is broken, unstable, wrecked by division and distrust.”

Ramaphosa terminated Moyane’s appointment on Thursday, following the recommendation made by retired judge Robert Nugent, head of the Sars inquiry, that Moyane be removed to “forestall any further deterioration of our tax administration system”.

In his interim report, Nugent said Moyane’s tenure was characterised by “reckless” mismanagement, and that this “ought not to be permitted to continue”.

“We consider it imperative that a new commissioner be appointed without delay to remove the uncertainty at Sars and enable it to be set on a firm course of recovery, so as to arrest ongoing loss of revenue,” Nugent noted.

“We stress that the replacement of Mr Moyane is not a panacea, but only the first necessary measure, without which there is no possibility of rectifying the damage that has been done to Sars.”

In a letter to Moyane, Ramaphosa said the interim report “paints a deeply concerning picture of the current state of Sars and the reckless mismanagement which characterised your tenure as commissioner of Sars”.

“Of further, and in many ways, greater concern is your refusal to meaningfully participate in the Sars commission in order to assist with identifying the root causes of the systemic failures at Sars and ways in which to arrest these,” Ramaphosa added.

Presidential spokesperson Khusela Diko said that Kingon would remain in his post until the president had exercised his constitutional duties and had acted in accordance with the Sars Act.

Meanwhile, Moyane continues the fight to keep his job and has filed legal papers with the Constitutional Court seeking to halt lawfulness of the Nugent commission of inquiry and the disciplinary against him.

Ramaphosa replied to Moyane via an affidavit on Thursday his relief, following his firing, had been ‘rendered moot’.

The prospects of Moyane’s application to the court being successful were ‘poor’, he added.

Kevin Allardyce, a labour lawyer, said Ramaphosa had the power, in terms of section 6 of the Sars Act, to appoint the national commissioner.

“While the Sars Act does not stipulate that the president has the power to remove the national commissioner, the power to dismiss is a corollary of the power to appoint – and, therefore, the power to dismiss has to be read into section 6 of the SARS Act.

“The exercise of this power is subject to the constitutional principles of legality and rationality.

“Therefore, Moyane could apply to the High Court to set aside the decision by Ramaphosa to dismiss him on the basis of it being ‘an irrational decision’,” he added.

“In terms of section 9(1)(d), the commissioner is the CEO and also the accounting authority for Sars, and therefore, he is an employee who is entitled to protection in terms of the Labour Relations Act.

“Therefore, Moyane can theoretically refer an unfair dismissal claim and seek compensation.

“However, given what has emerged at the Sars inquiry and the recommendations made by Nugent, Moyane has little or no prospects of getting any favourable ruling by any court,” Allardyce said.

Next on City Press

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
1 comment
Add your comment
Comment 0 characters remaining

June 16 2019