Finance Minister Malusi Gigaba knows that his only chance of building confidence with the markets is if he is able to persuade people that there is continuity in the Treasury.
On his roadshows, he has tried to reassure fund managers that it is business as usual, and to prove it, he has appointed an insider – Dondo Mogajane – as director-general after the departure of Lungisa Fuzile.
But that is where “continuity” ended. The relationship between the Treasury and the ministry is in tatters.
The trust previous ministers had with senior officials, who they relied on for technical work and advice, has evaporated. Gigaba spends little of his time with or in the department, preferring instead to consult the staff he has brought into the ministry – about 22 people, double the number specified in the ministerial handbook.
Not even the prospect of a R50-billion revenue shortfall, which has raised the chances of an immediate credit ratings downgrade when the medium-term budget policy statement is tabled in October, has been enough to galvanise Gigaba into urgent consultations with Treasury officials.
While the relationship between the ministry and department falls apart, a strange series of articles has begun to appear in the media.
First came a barrage of “reporting” on ANN7, alternating flashing images of former finance minister Pravin Gordhan and Fuzile with shock headlines about corruption at the Treasury.
The report was about the government’s botched and decade-long attempt to modernise key information technology systems in public finances.
If there is one word to describe the Integrated Financial Management System (IFMS) it is: mess. Managed jointly by the Treasury, the State Information Technology Agency and the Department of Public Service and Administration, it has been a complex process, but there is no getting away from the fact that it has been botched.
Up to 2013, the idea was to design original software. Later, after delays and failures, it was decided to buy an off-the-shelf system from one of the big vendors. Oracle was chosen and a project management office managed by consulting firm Abacus was established in the Treasury. Around about last year, the Treasury’s internal audit picked up problems with the IFMS and compiled a report for the department.
The report recommended a forensic audit. Fuzile agreed, Deloitte was appointed and the audit was done. However, the internal audit committee was not happy with the result and the forensic report is still in progress.
It was the 2016 internal audit report that was leaked to ANN7 in June. This was followed by another article in the Sunday Times two weeks ago, again on the IFMS, this time referring to correspondence between the department and the auditor-general, between whom there is a disagreement that has delayed the finalisation of annual financial statements.
Could it be, officials in the department must be asking, that “sources” in the ministry are purposefully undermining the department?
Following these was an article by probably the oddest of business journalists, Business Report editor Adri Senekal de Wet, who in her column made the claim that the Treasury was “dodging” questions on the IFMS. It had also, she said, refused to provide her with a full list of beneficiaries of the Presidential Jobs Fund. She warned that Business Report was out to bust corruption and that “the team would investigate”.
The appearance of reports intended to damage the image of the Treasury has sharpened the divide between the ministry and the department. Could it be, officials in the department must be asking, that “sources” in the ministry are purposefully undermining the department?
There have been other leaks too. An anonymous “Treasury source” has recently made it known that Gordhan’s pick for South African Airways (SAA) deputy chairwoman, Tryphosa Ramano, will need to be removed in the interests of stability. Then there is the “secret cabinet memo” on SAA that found its way into the hands of the DA within 24 hours of being signed by Gigaba.
Calculated leaks into the public domain always have a purpose. Leaks about SAA, its board and finances could have been made to lay the ground for unpopular decisions that will follow. But when it comes to leaks that are angled to damage the image of a department that has until now enjoyed a sparkling reputation, the purpose is much darker.
Carol Paton is Business Day deputy editor
Leaks seem to play ‘sordid’ game
On his roadshows, he has tried to reassure fund managers that it is business as usual, and to prove it, he has appointed an insider – Dondo Mogajane – as director-general after the departure of Lungisa Fuzile.
But that is where “continuity” ended. The relationship between the Treasury and the ministry is in tatters.
The trust previous ministers had with senior officials, who they relied on for technical work and advice, has evaporated. Gigaba spends little of his time with or in the department, preferring instead to consult the staff he has brought into the ministry – about 22 people, double the number specified in the ministerial handbook.
Not even the prospect of a R50-billion revenue shortfall, which has raised the chances of an immediate credit ratings downgrade when the medium-term budget policy statement is tabled in October, has been enough to galvanise Gigaba into urgent consultations with Treasury officials.
While the relationship between the ministry and department falls apart, a strange series of articles has begun to appear in the media.
First came a barrage of “reporting” on ANN7, alternating flashing images of former finance minister Pravin Gordhan and Fuzile with shock headlines about corruption at the Treasury.
The report was about the government’s botched and decade-long attempt to modernise key information technology systems in public finances.
If there is one word to describe the Integrated Financial Management System (IFMS) it is: mess. Managed jointly by the Treasury, the State Information Technology Agency and the Department of Public Service and Administration, it has been a complex process, but there is no getting away from the fact that it has been botched.
Up to 2013, the idea was to design original software. Later, after delays and failures, it was decided to buy an off-the-shelf system from one of the big vendors. Oracle was chosen and a project management office managed by consulting firm Abacus was established in the Treasury. Around about last year, the Treasury’s internal audit picked up problems with the IFMS and compiled a report for the department.
The report recommended a forensic audit. Fuzile agreed, Deloitte was appointed and the audit was done. However, the internal audit committee was not happy with the result and the forensic report is still in progress.
It was the 2016 internal audit report that was leaked to ANN7 in June. This was followed by another article in the Sunday Times two weeks ago, again on the IFMS, this time referring to correspondence between the department and the auditor-general, between whom there is a disagreement that has delayed the finalisation of annual financial statements.
Could it be, officials in the department must be asking, that “sources” in the ministry are purposefully undermining the department?
Following these was an article by probably the oddest of business journalists, Business Report editor Adri Senekal de Wet, who in her column made the claim that the Treasury was “dodging” questions on the IFMS. It had also, she said, refused to provide her with a full list of beneficiaries of the Presidential Jobs Fund. She warned that Business Report was out to bust corruption and that “the team would investigate”.
The appearance of reports intended to damage the image of the Treasury has sharpened the divide between the ministry and the department. Could it be, officials in the department must be asking, that “sources” in the ministry are purposefully undermining the department?
There have been other leaks too. An anonymous “Treasury source” has recently made it known that Gordhan’s pick for South African Airways (SAA) deputy chairwoman, Tryphosa Ramano, will need to be removed in the interests of stability. Then there is the “secret cabinet memo” on SAA that found its way into the hands of the DA within 24 hours of being signed by Gigaba.
Calculated leaks into the public domain always have a purpose. Leaks about SAA, its board and finances could have been made to lay the ground for unpopular decisions that will follow. But when it comes to leaks that are angled to damage the image of a department that has until now enjoyed a sparkling reputation, the purpose is much darker.
Carol Paton is Business Day deputy editor
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