[The wastage and inefficiency in South Africa is something that never ceases to amaze me. Jan]
South African Revenue Service (SARS) commissioner Edward Kieswetter says that, before his appointment, the tax collector was spending millions of rands on employees to sit at their desks and do nothing.
Speaking to the City Press, Kieswetter said that when he first joined SARS, there were about 60 senior executives who had been referred to as ‘supernumeraries’.
“There were literally people who earned more than R1 million a year who were not doing any work. When I came there, I interviewed every one of them personally. And I would say: ‘So tell me, what are you doing?’ And they would say to me: ‘I do nothing’.
He added that these employees would come in, sit at their desks, and were not even part of any internal email groups. This would lead them to read the odd notice sent by SARS, catch up on the news and go to the mall.
“That is so undignified. And these were senior people. They were also people with institutional knowledge, you know, the kind of people you want on your side,” Kieswetter said
“But, for the previous leadership, they were people who weren’t doing the budget, they were people who weren’t big, who didn’t become compliant, and so they were just marginalised. There were 60 individuals who were in that category.”
Kieswetter noted that SARS is currently in the middle of a mass hiring drive to replace skills lost under the previous administration.
While 500 staff have now been replaced, he noted that the revenue service is still woefully understaffed and was still desperately lacking specific skills such as specialised auditors.
SARS’ 2020/2021 annual report shows that it has a total headcount of 12,479 staff, with attrition of 444 employees in the last year. Notably, the total headcount has dropped steadily over the last five years, from 13,583 in 2016/2017.
In January, acting chief justice Raymond Zondo handed over the first part of his report on state capture to president Cyril Ramaphosa, which included findings on the capture within the revenue service.
Zondo said in the initial 874-page document that the state procurement processes were abused, pliable officials were appointed to oversee the improper allocation of government contracts and the ruling African National Congress benefited from the proceeds of corruption. The commission concluded that the state had been “captured” during former president Jacob Zuma’s tenure.
The probe also determined that governance collapsed at state entities, including the revenue service.
Evidence related to the tax agency demonstrated how the private sector colluded with the executive, including Zuma, to capture what was a highly regarded institution and render it ineffective, Zondo said.
He found that SARS was systemically and deliberately weakened through restructuring, strategic appointments, dismissals of key staff and a pervasive culture of fear and bullying.
Kieswetter was brought in as commissioner of SARS in May 2019, restoring credibility within the organisation, and improving tax collection rates.
During a discussion about the national budget in March of this year, Kieswetter was critical of the direction in which the country is headed under the current government. He told Bloomberg that South Africa is fast moving toward an environment, where things work in spite of the government, and not because of the government.
“We have too many leaders with a sense of self-importance, as opposed to knowing that they are here to serve,” Kieswetter said. “Until and unless we have those honest conversations, we will more and more lose the promise of our democracy.”
The graph below shows the average cost to company per employee to the end of the 2021 financial year. The average annual salary per employee amounted to R570,341, with as many as 451 senior managers earning over R1.6 million a year.