South Africa’s Finance Minister Pravin Gordhan acknowledged under heavy questioning by reporters that the appointment of his predecessor David “Des” van Rooyen, who had held the job for four days, had been “a miscalculation”.

Gordhan, who was reappointed to the post he held form 2009 to 2014, was confident as he took questions but worded his answers carefully when asked why someone with no national experience had been appointed. 

“I am not the president,” he said. “There have been a few statements over the weekend [from the presidency]. The last one was at 9.30 last night.
After many representations were made to him, [he] reflected on the representations.”

In a democracy one had to be “mindful … there are times you have to admit that there was a miscalculation [and review] of a decision [is required] … and move on to a new scenario.”

“Regrettably”, he said, “I represent that new scenario.”

Gordhan said in relation to the national health service and the costs of state-owned enterprises (SOEs) – including South African – decisions would have to be taken “in a fiscally responsible way”.

The aim at all times was to narrow the deficit over a period of time, manage down the debt – currently standing at R1.8-trillion . “We need to make sure that this is managed,” he told journalists in Pretoria and Cape Town.

SARB will stick to scheduled MPC
The South African Reserve Bank would also not be holding any unscheduled monetary policy committee (MPC) meetings and had not considered it in the light of the events surrounding the appointment of two finance ministers in the last week.

Lesetja Kganyago, the governor who sat with Gordhan in Pretoria today, acknowledged that there had been rumours that there would be a special MPC.

But “the MPC is scheduled for January … we will stick to the calendar of meetings. From where we are sitting there is no need for special MPCs.”

Acknowledging the recent environment of uncertainty and panic over the appointment of an unknown quantity as finance minister last week, the governor said: “Policymakers need to bring sanity to the market … historically we have not toyed around calling for special MPCs.”

The only time this had happened was during the special circumstances of the 2008 world global market crisis.

No toying with state-owned enterprises
Another talking point from Gordhan’s press conference was his insistance that there will be no toying with the finances of state-owned enterprises.

Noting that treasury had “the important responsibility of creating the conditions of confidence” by investors and South Africans at large, Gordhan said it was time for people in government and state-owned enterprises to stop treating state institutions “as if they are a personal toy from which to extract money when they feel like it.”

In an obvious reference to SAA – which needs billions of rands to pay for an expensive Airbus programme in addition to operating losses – he said: “These are public institutions which contribute to the economy, to services and provide revenue for government”.

“We are guardians of public resources, we must play our role in a responsible way.”  Gordhan said he would be talking to the SAA chairperson, Dudu Myeni, shortly.

Donwald Pressly is the editor of the Cape Messenger