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Mkhwebane initiated an investigation that was carried out through correspondence, interviews and documentation analysis.
“The allegation that Minister Gordhan irregularly approved the early retirement of Mr. Ivan Pillay with full retirement benefits and his subsequent retention in Sars is corroborated,” concluded Mkhwebane.
“Since neither Mr. Pillay’s request for early retirement nor Mr. Magashula’s recommendation to Minister Gordhan contemplated retirement, there was no retirement in law and in fact. If there was no de facto and de jure retirement, it can be concluded that Mr. Pillay was not entitled to early retirement with full pension benefits under any statutory provision … “
Mkhwebane also found that even if the contentious recall was “in fact a recall,” Gordhan had no authority to approve it. He recommended that disciplinary action be taken against Gordhan. He also urged the Sars commissioner to recover the tax that Sars paid on Pillay’s behalf from both Pillay and Magashula. He recommended that the Sars commissioner “ensure that Sars introduce, as part of its hiring process, regulations, policies and practices that are clear and unambiguous regarding early retirement and retention of staff.”
Gordhan, Pillay, and Magashula stepped aside. Mkhwebane was sued both in her capacity as a public protector and personally and a punitive cost order was sought against her.
Gordhan told the court that he approved the proposal because he believed it was “totally legitimate.” He said he also thought it appropriate to acknowledge the “invaluable work that Mr. Pillay has done in transforming Sars since 1999.”
“Mr. Gordhan understood that Mr. Magashula had established from consultations with the public service and administration department that the terms of Mr. Pillay’s early retirement and redeployment were legal and not unusual,” the ruling reads.
“Before approving the request, Mr. Gordhan himself also consulted several other people about the request set out in Mr. Magashula’s memorandum. These consultations are said to have taken place over a period of three months from receipt of the application to its approval. “
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