Deputy Finance Minister Mondli Gungubele says his primary objective is being a deputy minister. Photo: Timothy Bernard/African News Agency (ANA)

CAPE TOWN – Calls are growing for the deputy minister of finance, Mondli Gungubele to resign from his portfolio at the National Treasury after being implicated in a series of emails linking him to corrupt activities with a number of individuals serving as executives at the Public Investment Corporation (PIC). 

Some economic, academic and political commentators raised the question after Gungubele decided to collectively resign with a number of board members implicated in corruption allegations contained in an email penned by whistleblower “James Noko” to Tito Mboweni, the minister of finance.

On Friday evening, Mondli Gungubele, Xolani Mkhwanazi, Pitsi Moloto, Sibusisiwe Zulu, Mathukana Mokoka, Sandra Beswick, Lindiwe Toyi and Dudu Hlatshwayo offered their resignations after corruption allegations were levelled against some of the board members by a whistleblower who is understood to be an insider at the PIC. Gungubele and Zulu have since refuted the allegations and have opened themselves up to an investigation. 

In the letter, they said:

“There have also been various allegations against at least four directors for now. Our assessment is that this may not be the end. There is clearly a concerted effort to discredit the board of directors to an extent that there cannot be any credibility to the work that is executed in fulfilling its fiduciary responsibilities. We, therefore, cannot help but view this as an attempt to bring the institution into a state of paralysis. These events have been unbearable to us as individuals and have undoubtedly had a negative impact on pouring professional integrity. It is for this reason that we now write to humbly request the honourable minister to release us as directors of the PIC.”

READ: PIC board's demise clears way for proper probe

Chris Harmse, the chief economist at Rebalance Fund Managers said under normal circumstances, Gungubele should have been placed on suspension or dismissed as the deputy due to the break in trust and confidence in his portfolio as the Chairperson of the Board at the PIC.

“If it’s true that the deputy minister and the president were aware of the allegations of corruption against Gungubele then they should be held responsible and he should be dismissed for breach of confidence. It is also important to ascertain if the financial services board was aware of or informed of investment decisions that were irregular and if they queried those investment decisions,” he said.

He was of the view that in light of the widespread resignations, the Public Protector may have to be roped in to institute an investigation, or the president would have to relook at the terms of reference of the PIC Commission of Inquiry looking or perhaps establish another commission that aims to deal with corrupt activities that took place when the Government Employees Pension Fund was consolidated back in 1996.

Shingai Mutizwa-Mangiza, an academic and political commentator from the University of the Western Cape was also of the view that Gungubele needed to step aside until his name had been cleared and an investigation had been concluded because the deputy minister of finance served as an important duty to chair the PIC. He argued that the current government was running on a banner of anti-corruption which meant that an officer serving in government, implicated in should resign and be dismissed if found guilty.

He further explained that there is a current drive to try and restore confidence in the National Treasury and if the board is stepping down, there needs to be a proper vetting process for new members of the board.

“The presidency may be waiting for an opportune time as they need to ensure that there is a smooth handing over process and transition. The series of events that have transpired are very unfortunate and the issue of corruption needs to be dealt with accordingly by fixing the systems that are in place instead of just replacing individuals. The resignation of a deputy minister from an institution like the PIC is a major issue and once the president has accepted the resignation, there will be a serious probe into the allegations of corruption along with the establishment of another inquiry which is open to the public,” explained Mutizwa-Mangiza.

Ralph Mathekga, a political analyst and managing director of Clear Content Research and Consulting said Treasury needed to reaffirm its integrity and if someone finds it untenable to remain as chair of the board of the PIC then it made no sense as to why they would remain in the employ of the National Treasury as a deputy finance minister. 

“For the mere fact that he recognises that he needs to resign pending an investigation means that he needs to step aside. There will be more pressure on him to do the right thing but there will be denials and one will continue holding on. This should not be about waiting for people to be found guilty. Already, the deputy minister has a cloud hanging above his head. It’s unacceptable because these people control pension funds and the PIC is not a bottomless pit of money. There should be no room for them to benefit themselves. The PIC Commission of Inquiry, like most inquiries, has backfired with these revelations of rampant corruption, just like with the State Capture Commission of Inquiry,” said Mathekga.  

Professor Sipho Seepe, a political commentator said upon analysing the letter of resignation by the members of the PIC, he had reached a conclusion that it was "nothing but grandstanding" and "political posturing" as no one accepts full responsibility of the rot that is plaguing the institution.

Seepe’s argument is that when they were appointed, they were appointed as individuals, yet when they resign, they do it as a collective which "ostensibly means that they a protecting one another".

“Usually when people do this sort of thing in the corporate space, it means that there is something seriously wrong and it is irresponsible of them to engage in such grandstanding. At the end of the letter, they are saying they will remain as members of the board until such a time as a new board is appointed and don’t see the letter as a genuine attempt to resign. It is an intention to protect. If they were serious about resigning they should have done so with immediate effect."

Seepe further explained that the collective resignation could also be an attempt to hide each individual’s transgressions.

“I don’t see intention for them to resign. They are asking to be protected against the allegations that have been made and Gungubele needs to answer as to what has he done to join the bandwagon of resignations, was he not the initiator of collective resignation,” asked Seepe.

In an interview with 702 on Friday evening, Gungubele responded: “These allegations against me are a figment of a whistleblower… I am a chair of a board by virtue of being a deputy minister. I am not a minister by virtue of being chair of the board. My primary objective is being a deputy minister. What happens thereafter is left in hands of the president…I dare say, my conscience is clear.”