Few people doubt Pravin Gordhan’s ability to run South Africa’s finance ministry. As tax commissioner, Gordhan turned the ailing South African Revenue Service into a lean money-collecting machine. The receiver that collected R179 billion in 1998–99, grew under his tenure into an efficient tax collector with a revenue target for 2009–10 of R659 billion.
Gordhan, appointed in May as Trevor Manuel’s replacement, has already shown that his parsimonious eye for detail is as sharp as ever. Reviewing spending by South Africa’s nine provinces last month, Gordhan told provincial administrations to cut back on wasteful spending as part of a push to save R100 billion in procurement spending that would also introduce new mechanisms to cut down on fraud and corruption.
“Hopefully, in three to six months, life ain’t going to be that easy for those who want to extract free rands from the state. We owe that to the South African public and the South African taxpayer,” he says.
Whether the 60-year-old former pharmacist has the political muscle to stare down cabinet colleagues and frustrate their spending plans is another matter. In an ANC government walking a tightrope between liberal economic policies and satisfying the spending demands of its allies in labour federation Cosatu and the South African Communist Party, the lobbying is fast and ferocious. Gordhan is also feeling his way along in a new arrangement where president Jacob Zuma’s newly created Ministry for Economic Development, headed by Ebrahim Patel, a former textile union head, will also share some responsibility for economic policy.
Economist and CEO of Pan African Capital Holdings Iraj Abedian says Gordhan is playing a conservative game by making statements such as “Inflation targeting is part of our policy; it stays in place” or, ‘We are not going to interfere in the foreign exchange market to waken the currency.”
“At the same time for example, he says,‘But discussions are healthy about everything.’ It means very little. It essentially means: ‘When in doubt, chicken out, don’t say anything,’” Abedian says. —M.B.