Finance minister Pravin Gordhan held his ground in a feud with President Jacob Zuma over control of the nation’s finances as he stuck to deficit targets and warned his detractors not to “mess” with the national treasury.

In the budget presented Wednesday, Gordhan allocated no new money for nuclear power plants favoured by Zuma, and stressed the need for the state to focus on fiscal prudence, reducing waste and reviving an economy that’s set to expand 1,3% this year.

The national treasury trimmed its expenditure ceiling by R26bn over the next two fiscal years and pledged to narrow the budget deficit to 2,6% in the year to March 2020, from 3,4 percent this year.

Speculation that Gordhan is on the verge of being fired has swirled for months, as he clashed with Zuma over the management of state companies and the national tax agency.

While Gordhan has led efforts to keep spending in check and fend off a junk credit rating, Zuma wants to embark on “radical economic transformation” to tackle racial inequality and widespread poverty.

“It is in the interests of all South Africans that there are a couple of institutions that you don’t mess with,” Gordhan told reporters before delivering his budget address.

“Treasury is one, revenue collection is another. It can take many years to build a solid institution, but a very short time to mess it up. Overnight someone could come in and say: ‘I don’t like it,’ and that’s the end of the story.”

Gordhan told parliament that economic transformation and growth were inextricably linked.

“Without transformation, growth will reinforce inequality,” he said. “Without growth, transformation will be distorted by patronage.”

Opposition parties have accused Zuma, 74, of being at the forefront of looting state funds and speculated that he wants to appoint a more compliant head of national treasury with a view to furthering his financial interests and those of his allies.

While Zuma denies the allegations, the constitutional court last year ruled that he broke his oath of office by refusing to repay taxpayer money spent on his private home.

The nation’s graft ombudsman also implied that he allowed members of the Gupta family, who are in business with his son, to influence cabinet appointments and the issuing of state contracts.

Zuma and the Guptas deny having ever intentionally broken the law.

Gordhan downplayed his rift with Zuma and described the budget as a collaborative effort by the whole cabinet.

The rand pared gains, trading 0,2% stronger at R13,12/US$ by 2.45pm in Johannesburg after strengthening as much as 0,7% earlier. Benchmark 10-year bond yields were two basis points lower at 8,78% after falling as low as 8,71%.

“The budget on the surface is all fine but beneath the surface is propped up by a worrying lack of shift lower in the growth numbers and no real new shifts on expenditure,” said Peter Attard Montalto, senior emerging-market strategist at Nomura International in London.

The country’s wealth should be shared through fair, transparent and predictable means, the treasury said.

“Transformation is not a zero sum game,” it said. “The benefits of empowerment should be accessible to all citizens, not limited to connected insiders.”

Cabinet change

Zuma named Gordhan, 67, finance minister in December 2015 after his decision to install a then little-known lawmaker to replace the respected Nhlanhla Nene hammered the nation’s bonds and currency and spurred ANC and business leaders to plead with him to reconsider. Local newspapers have reported that another cabinet reshuffle may be imminent, with Zuma tapping Brian Molefe, the former head of the state power company, to replace either Gordhan or his deputy Mcebisi Jonas.

Gordhan fuelled the speculation on Monday when he told broadcaster eNCA that “we are just humble civil servants” and that he’s “not indispensable”. Parliament said last week the ANC intends appointing Molefe as a lawmaker, a move that would ease the way for Zuma to name him as a minister.

While Zuma denies he’s at war with his finance chief or that he intends dismissing him, he’s said a police investigation into allegations that Gordhan oversaw the establishment of an illicit investigative unit when he headed the tax agency must run its course. The president has also rebuffed his request to fire tax chief Tom Moyane for insubordination.

And while Gordhan has asked the high court to order that he can’t intervene in a decision by the nation’s four biggest banks to shut the accounts operated by the Gupta-controlled companies after an anti-money laundering unit implicated them in irregular transactions, Zuma suggested the lenders may have been guilty of collusion.

“Both the deputy minister and I serve at the pleasure of the president,” Gordhan told reporters. “We have done the job as best we can, and our record is clear in what we have achieved in the past 14 months. But if the president chooses to redeploy us in any way, that’s his prerogative. I don’t have any appeal process.” — (c) 2017 Bloomberg LP