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Public Protector finds Gordhan guilty over SARS retirement payout

Public Protector Busisiwe Mkhwebane urged Cyril Ramaphosa to take appropriate disciplinary action against Minister Pravin Gordhan's approval of Ivan Pillay’s payout and early retirement.

FILE: Public Enterprises Minister Pravin Gordhan at a press briefing at the Lethabo power station on 3 April 2019. Picture: Abigail Javier/EWN

JOHANNESBURG - Public Protector Busisiwe Mkhwebane has found Minister Pravin Gordhan guilty of improper conduct regarding a payout for former South African Revenue Service (Sars) deputy commissioner Ivan Pillay’s early retirement.

Mkhwebane was addressing the media on the findings of six concluded investigations into various matters on Friday afternoon in Pretoria.

“One (of the findings) relates to an investigation into allegations of maladministration and impropriety in the approval of Mr Ivan Pillay's early retirement with full benefits and subsequent retention by Sars,” she said.

At the time, Gordhan was serving as the minister of finance and made the decision based on the recommendation of then Sars commissioner Oupa Magashula.

The Public Protector said: “We investigated the application of early retirement and payment of over R1 million which was levied on Mr Pillay’s benefits by the government pension fund that would allow him to enjoy full pension benefits as though he would have retired at a statutory age.”

She said the complaint about Pillay’s payout and early retirement was made anonymously in November 2016.

She said analysis of 11 documents, interviews and considerations of key case law formed part of her investigation.

“Having considered the evidence uncovered during the investigation, regarding whether Gordhan irregularly approved an early retirement of Pillay with full pension benefits and his subsequent retention at Sars, that allegation is substantiated.”

Mkhwebane found that by law, Gordhan was not authorised to sign off on Pillay’s request for early retirement and full payout.

“Pillay was not entitled to early retirement with full benefits under section 16.2A of the PSA Act.”

In her recommendations, she urged President Cyril Ramaphosa to take appropriate disciplinary action against Gordhan for violating the Constitution in approving Pillay’s payout and early retirement.

She also urged “the commissioner of Sars to set in motion steps to recover the money paid… and to ensure that Sars introduces part of their recruitment processes, regulations, practices and which are clear and unambiguous relating to early retirement and staff retention”.

Pillay and Gordhan were charged with fraud and corruption in 2016 related to this pension payout, but the charges were later withdrawn when evidence revealed there was no wrongdoing.

Last year, Mkhwebane said the National Prosecuting Authority's decision to withdraw the criminal case against Gordhan and Pillay was irrelevant.

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