Business Leadership SA cuts ties with Bain & Company

Business Leadership South Africa announced on Monday it has parted ways with global management consultancy Bain & Company over its involvement in changing the operating model at SARS. 

The new operating model which Bain helped formulate was implemented in 2015 under now suspended commissioner Tom Moyane. It has been described by several SARS executives at the ongoing Nugent Commission of Inquiry as hampering revenue collection.

BLSA said the decision to stop working with Bain was in line with its anti-corruption oath, and followed revelations at the Inquiry.

Bain has pledged to set aside the R164m it earned from SARS, including VAT and interest, to be used as the Nugent Commission prescribes or for the benefit of South Africans.

BLSA said it still wants Bain to provide a full disclosure of its involvement in SARS to authorities in order to help South Africa “cleanse itself of state capture”.

In its statement it also slammed the restructuring that took place at the tax agency, saying it aided in the collapse of a “well-oiled, perfectly functioning state-owned company”.

“BLSA believes that Bain’s involvement in the so-called ‘restructuring’ contributed to questionable, unnecessary changes at SARS,” its statement read.

The business group said the changes introduced impacted revenue collection negatively and resulted in the talent leaving the tax agency.

“This created space for illegal activities and thus directly contributed to a rapidly declining tax morality,” the organisation stated.

BLSA CEO Bonang Mohale has called for Bain to continue cooperating with the authorities on the matter. “While we accept that wrongdoing can be caused by ‘a few rotten apples,’ this assertion cannot be accepted at face value and must be rigorously tested. If remedial action is found to be necessary, we require that it be fully proportional to the wrongdoing,” he said. 

A spokesperson from Bain said the firm would not be commenting on the BLSA’s decision at this time.

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