The National Treasury in Pretoria. (Photo: Matthew le Cordeur)
If the finance minister were to be replaced, it would not compromise the medium-term budget policy statement (mini budget) set to be delivered on October 24, economists have said.
Reports have emerged that Finance Minister Nhlanhla Nene offered his resignation to President Cyril Ramaphosa, little more than two weeks before the announcement of the mini budget.
This followed Nene’s testimony before the Zondo Commission of Inquiry into State Capture last week, where he revealed that he had met with members of the Gupta family several times between 2009 and 2014. The finance minister issued a public apology to South Africans on Friday.
"I was wrong in meeting the Guptas at their residence and not in my office or at least a public place," Nene said.
The presidency has not yet confirmed to Fin24 that an offer of resignation was received from Nene.
Continuity is key
Economists believe that if Nene were to be replaced, it would likely have to be by someone who would ensure policy continuity - in line with the National Budget announced in February – and who has a proven track record.
When asked if the mini budget would be affected, RMB Head of Research Nema Ramkhelawan-Bhana said it would not.
"National Treasury is not just one individual," she explained. "There is an entire team of competent individuals who have worked on the budget."
Ramkhelawan-Bhana said the mini budget was not meant to change policy dramatically, but rather communicate whether Treasury had met the prescribed targets set in the February Budget. "If there are any amendments to be made, it will be in line with the targets," she said.
If the resignation is accepted, then Nene’s successor will simply enact policy, which is already close to being finalised, she explained.
Dr Azar Jammine, chief economist of Econometrix, also believes Nene’s resignation would have no impact on the mini budget. "There’s a whole team at Treasury working on the mini budget. It won’t affect it one iota."
Professor Matthew Ocran, head of the economics department at the University of the Western Cape, echoed this belief, saying the mini budget was not the work of an individual. "Treasury has technocrats and political heads.
"The political heads give direction, at the end of the day the work is done by the technocrats," he said.
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