Bain & Company’s decision to set aside the R164m it earned from the SA Revenue Service shows the global consultancy is being held accountable, according to Judge Dennis Davis.
Davis spoke to Fin24 by phone on Monday morning, following Bain’s announcement on Sunday that it would use the R164m it earned from SARS to better serve South Africa.
“We do not want to benefit from work that was used to further a different agenda than was intended. Bain & Company’s global board today approved to set aside all of the R164m of fees plus VAT and interest, from our work with SARS,” the consultancy said in a statement on Sunday.
“This money will be used either as prescribed by the Nugent Commission of Inquiry or – in the absence of such prescription - for the benefit of South Africa.”
Davis said Bain setting the money aside “shows the power of accountability".
Bain was appointed to develop a restructuring plan for the tax agency in 2015 under now suspended commissioner Tom Moyane. Davis told the Nugent Commission of Inquiry that the restructuring was unnecessary.
Davis said that the restructuring project was “hugely counterproductive” and gave rise to “bad consequences” for SARS. “Whether [Bain was] deliberate, or negligent or just plain stupid – I don’t know.”
It is not just government who should be held accountable. “People who sought to make extraordinary sums of money off the taxpayer in projects that were clearly designed to undermine the very idea of an accountable State - they too should be held accountable,” he said.
“This is a triumph for the press and those who exposed Bain.”
Davis believes that SARS could be restored to its former glory, provided that the “proper people” are at the tax agency. “Some are there already. The acting commissioner [Mark Kingon] is an excellent person… I have little doubt that SARS can be restored to its former glory, it will take time.”
Apart from setting aside the R164m, Bain has said that Vittorio Massone - who presented evidence at the Nugent inquiry last week - will step down as managing partner and will focus on cooperating with the commission.
SARS in turn has said that it is sourcing additional facts above what has emerged in the commission’s hearings. The tax agency will ensure “sound public finance management prescripts” are followed.
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