Can Gordhan work his magic?

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IOL pic may26 pravin gordhan file Independent Newspapers Co-operative Governance and Traditional Affairs Minister Pravin Gordhan. File picture: Ian Landsberg

However important his new role, Pravin Gordhan’s move cannot be seen as anything but a demotion, says Andrew Siddle.

Pretoria - A surprising change brought about by President Jacob Zuma’s cabinet reshuffle was the shifting of former minister of finance Pravin Gordhan to co-operative governance and traditional affairs. This department is responsible for oversight at national level of the local sphere of government. But CoGTA may be a poisoned chalice, and the move could just as easily be seen as a sign that Gordhan has hit the political skids and is on the way out.

Is Gordhan the right person to take on a department that, for all the wrong reasons, has been so much in the news? To answer that, we need to look first at the environment Gordhan is about to enter.

A number of municipalities acquit themselves reasonably well. But in general, local government is in a state of crisis. It is tempting to blame municipalities themselves. Venality and incompetence have certainly had disastrous consequences. But local government presents a highly complex environment; the causes for the malaise are many, and not all of them should be blamed on local actors. To do so would fail to recognise the crucial role that senior members of government should (but often do not) play.

It is a paradox of decentralisation that although its purpose is to shift powers and resources from central to lower governments, central governments retain a crucial role in supporting them. The greater and more rapid the transfer of such powers, the greater the need for a central government to ramp up its own capacity to provide support. This requires political will and capacity to drive the process and entrench it.

Section 154 of our constitution was enacted to deal with this very problem; it requires that “the national government and provincial governments… must strengthen and support the capacity of municipalities to manage their own affairs, to exercise their powers and to perform their functions”. And this is where CoGTA has fallen very short.

CoGTA has had five ministers since 2008. The negative consequences for sound administration of this are obvious. Most ministers were a disaster. During this period, the department was not able to achieve one clean audit report. It was frequently embroiled in irregular expenditure scandals. In 2009, it produced its “local government turnaround strategy”, which turned out to be a damp squib, and achieved nothing of lasting value.

It is into this environment that Gordhan has been elevated – or dumped. It will be a difficult transition for him. The cultures, roles and practices of his old and new departments are very different. The National Treasury has a reputation for being meritocratic, and a home for the best and brightest that the civil service has to offer. It is a “government within a government”, which has extraordinary powers in relation to other organs of state.

In his old job, Gordhan no doubt relished discussing the finer points of economic theory in international forums. CoGTA, on the other hand, is the epitome of a bureaucracy gone wrong, a moribund institution that has run out of ideas and has been allowed to drift aimlessly for years.

Is he equipped to deal with his new challenge? In his favour, he is highly articulate and has an obvious administrative talent that was put to good use at both Sars and the Treasury. He is also not totally unfamiliar with the local government environment, with his old department playing a critical role in municipal finances, and he knows about the fiscal and governance shenanigans of municipalities. He also understands the importance of enhancing capacity and appointing the right people to do the job.

Most importantly, he understands the interrelationship between good governance, accountability, government effectiveness and service delivery. On the other hand, Gordhan is saddled with baggage which will make his job more difficult. However important his new role, Gordhan’s move cannot be seen as anything but a demotion and his political star is on the wane. In consequence, his ability to wield influence will be limited.

Second, Gordhan has to rely on sectoral departments and provincial governments to implement whatever plans he has to revive local government. This means getting the ministers of water and sanitation, energy and human settlements, among others, on board, and having to get the co-operation of the provincial departments of local government.

Third, being a product of the National Treasury, Gordhan will likely promote technocratic solutions to political problems. When responding to problems of incapacity or non-compliance in the local government finance context, National Treasury’s instinct has usually been to throw even more complex regulations at them, thereby further burdening institutions already struggling to comply. This instinct will probably also lead Gordhan to rely on fashionable but largely ineffective management mechanisms such as performance management systems and (heaven forbid) monitoring and evaluation processes.

Fourth, one has to wonder whether Gordhan always has the courage to do the right thing. As minister of finance, he had extraordinary powers under section 216 of the constitution to impose disciplinary financial measures on errant municipalities, but he seldom used them despite there being a crying need to do so. He was also notoriously silent on the Nkandla scandal.

Finally, Gordhan faces a problem of having to meet unrealistic expectations. He is clearly under pressure from the ANC to produce results before the 2016 elections. Commentators did him no favours by suggesting that he was the answer to all local government’s problems.

Gordhan could do a lot worse than think about the following: first, he should surround himself with the best people available, regardless of political persuasion. Second, he should conduct a skills audit of all municipalities and ensure that inadequacies are addressed. Third, he should ensure there are consequences for those who persist in thumbing their noses at the dictates of good governance. Fourth, he should set about designing a less complex framework that is realistic as regards the functions of local government and its capacity to perform those functions. If these measures require legislative and even constitutional changes to implement, then so be it, and let’s hope that he has the will to do so.

Gordhan is certainly not the answer to all of local government’s problems, but he is probably the best prospect we have had in a long time.

* Dr Andrew Siddle is an independent consultant on public governance and democratic decentralisation.

** The views expressed here are not necessarily those of Independent Newspapers.

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