Chief Executive Officer of Business Leadership South Africa (BLSA), Bonang Mohale, said the organisation was deeply disturbed by the sudden resignation of Michael Sachs from Treasury.
Sachs is the Head of Budget in Treasury and various reports have cited interference from President Jacob Zuma as being the reason for his departure. Those reports might eventually turn out to be false but that does detract from the fact that stability in the Treasury will once again be called into question.
Central to the storm is the development of a funding model for fee-free tertiary education – a ‘legacy’ project of President Zuma.
“Michael Sachs is another in a line of admirable and competent professionals leaving what is arguably our most important ministry tasked with the economic wellbeing of the country,” said Mohale this week.
The credibility of South African institutions has been the subject of considerable debate throughout the administration of President Zuma. However, confidence in Treasury was never really an issue, until now.
It is something that credit agencies will observe, when they complete their reviews later this month.
“In his medium-term budget policy statement, Minister Gigaba told us about a new structure in the Presidency to oversee expenditure in the Treasury. We at BLSA are of the view that this could well violate the constitution,” said Mohale, placing the blame squarely at the feet of the Finance Minister.
“Sections 215 and 216 of the constitution ensure transparency and expenditure control, including the right of the Treasury to stop the transfer of funds to organs of state in the face of any serious or material breach of proper financial management.
“Parliament carries the ultimate responsibility for approving the budget, not the Presidency. This latest development raises further concerns over the politicisation of the Treasury and budget process and sends the wrong signal to the people of South Africa.”