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Johannesburg - Tokyo Sexwale, the new Minister of Human Settlements, will in future have an annual salary that is R3.8m less than before.
It represents a 70% cut after his resignation on Tuesday as chairperson of the Mvelaphanda Group.
Sexwale's total remuneration as chair of this listed company was more than R5.4m in 2008. In 2007 he pocketed R5.3m.
The total remuneration package of a minister in the National Cabinet is some R1.6m/year.
Sexwale is not the first minister to have to take a reduction in salary with the new post.
Pravin Gordhan, the new Minister of Finance, will in future earn 51% less than he earned as Commissioner of the South African Revenue Service (Sars). As head of Sars, Gordhan's 2008 package totalled R3.251m, compared with R2.767m in 2007.
But analysts say Sexwale will not be too unhappy.
"While he will apparently have to give up his stake in the Mvelaphanda Group because of a possible conflict of interest, this does not apply to Mvelaphanda Holdings. There his interests include energy and oil.
"These interests will create no conflict of interest and Sexwale should be able to retain them."
According to his spokesperson Chris Vick, Sexwale owns around 17% of the shares in the Mvelaphanda Group.
At Tuesday's closing price of R4.77/share on the JSE, Sexwale's stake in the company was worth about R358m.
"An announcement about what Sexwale intends doing with regard to this equity will be made by the end of the week," Vick told Sake24 on Tuesday.
The expanding of the Cabinet with six new ministers and eight new deputy ministers will cost taxpayers a additional R20m/year in salaries.
A deputy minister's package is R1.327m.
On Tuesday Gordhan stated that the additional expenditure for the new portfolios in the National Cabinet would be resolved in the medium-term budget in September.
"A re-allocation of funds will take place if necessary."
Gordhan does not consider the new Cabinet too large.
"People should remember that if you want the state to be more effective you need to invest more in it," he commented.
- Sake24.com
For more business news in Afrikaans, go to Sake24.com.