Where was the ANC when the Guptas took control of Transnet, Eskom and Denel?

The Zondo Commission found that the ANC had relinquished control of Eskom to the Guptas, who were instrumental in ensuring that Brian Molefe and Anoj Singh would be appointed as CEO and CFO of Eskom.

“The ANC and the ANC government should be ashamed that this happened under their watch,” states Part IV of the Zondo Report.

South African citizens are entitled to ask ‘Where was the ANC?’ when they see how the Guptas took control of Transnet, Eskom and Denel. Did the ANC ‘lack the courage’ to stop former President Jacob Zuma and his friends, the Guptas, in what they were doing? ‘Were they looking the other way?’ 

The ANC has a say in appointments

Both President Cyril Ramaphosa and ANC National Chair Gwede Mantashe made it clear in their oral evidence that the ANC has a right to have a say in the appointment of board members to state-owned entity (SOE) boards, and as CEOs of such entities.

Hence, the commission reasoned, the ANC should have been consulted, and should have done “homework” on the appointment of Ben Ngubane as chair of Eskom, and the appointment of the Eskom board, as well as the appointments of Molefe and Singh.

On the basis that the ANC has this right, the ANC would have the “duty or responsibility … not only to ensure that people who are appointed to these positions are people of integrity and with the right qualifications [and] knowledge but that it should also monitor their performance when they are in these positions”.

The cabinet flouted the Constitution

The commission questioned whether the cabinet asked any questions relating to Eskom, and if they asked their colleague Lynne Brown “what was going on?”.

Did the cabinet ask for a full report?

Referring to Section 92(2) of the Constitution of South Africa, which provides that “Members of the Cabinet are accountable collectively and individually to Parliament for the exercise of their powers and the performance of their functions”, the commission questioned if the cabinet understood the meaning of “collective accountability”.

The commission pointed out that Molefe was appointed group CEO of Transnet (a position he held from February 2011 to April 2015) “in breach of a fair and transparent recruitment process”; and that Siyabonga Gama was appointed group CEO of Transnet (in April 2016) “without a transparent, competitive and fair appointment process”. Molefe and Singh “were appointed to important positions in [Eskom] without a transparent, competitive and fair appointment process”.

The commission observed that “in each case they caused serious damage to those institutions”, as revealed in the commission’s reports.

The commission questioned where parliament was “as all these things were happening at Eskom”. It questioned whether the Portfolio Committee on Public Enterprises had been holding the board, the minister and the cabinet accountable for what was happening at Eskom, and whether it even knew what questions should have been asked.

The commission concluded that: “It would appear that there must have been a complete dereliction of duty on the part of many government and state functionaries which or who should have prevented the capture of Eskom.”

Zwane’s appointment as minister of mineral resources

Prior to September 2015 Mosebenzi Zwane was involved in the Free State local government, eventually serving as a member of the executive council (MEC) of the Free State Provincial Government in different portfolios. These portfolios included human settlements; agriculture and rural development; economic, small business, tourism and environmental affairs; and agriculture and rural development.

In 2015 Zwane became an ANC member of parliament, and within two weeks was appointed minister of mineral resources, replacing Ngoako Ramatlhodi, who had consistently refused to have anything to do with the Guptas.

Zwane’s bad and disgraceful performance is indicated below:

• As MEC for agriculture, he oversaw the Estina/Vrede dairy project debacle; and
• “When Mr Zwane was the MEC for Human Settlements, he was responsible for the Free State R1 Billion Housing Project that was simply a disgrace”. Hundreds of millions of rands were spent on building houses for the poor, but none of these were built.

Zuma overlooked more than 200 ANC members of parliament in appointing Zwane as minister of mineral resources, and appointed someone who had been a “complete failure in two of the [ortfolios that he had been given to lead”.

The commission posed the following questions:

• Where was the ANC as premier Ace Magashule continued to keep Zwane on as an MEC after these dismal performances?
• Was the ANC not monitoring the performance of its premier and his MECs?
• Why did the ANC not intervene?
• Why was the ANC quiet?

The commission concluded that the only possible reason that Zuma chose Zwane is that he “wanted somebody that had the blessings of the Guptas and who would co-operate with the Guptas”.

The commission found, based on evidence before it, that there was a strong connection or relationship between Zwane and the Guptas:

• When Zwane was MEC for agriculture and rural development in 2011, his department concluded a contract with Nulane Investments 204, whose sole director was Iqbal Sharma, “a known associate” of Salim Essa and the Guptas.
• Zwane initiated the establishment of the Vrede Integrated Dairy Project, with Estina as the service provider, whose sole director was Kamal Vasram, “an IT salesman with no farming experience”. This cost the Free State government approximately R280 million, in which the Guptas benefitted.
• The first prepayment of R30 million to Estina paid for the Guptas’ wedding at Sun City in April/May 2013.
• The Guptas/associates paid for Zwane and his local gospel choir to travel to India in 2012, which included a lunch at the Gupta house.
• In 2013 Zwane officially invited the agricultural minister in India to visit South Africa. This invitation “was used to facilitate the landing of an aircraft [carrying guests for the Gupta wedding] at the Waterkloof Air Force Base”.
• Zwane had several meetings with Tony Gupta between 2012 and 2014, and undertook several overseas trips to India, Dubai and Switzerland with Tony Gupta and/or Salim Essa.
• Zwane had, in August 2015, sent his CV to Tony Gupta, who then forwarded it to Duduzane Zuma, Zuma’s son.
• As minister of mineral resources, Zwane appointed Gupta associates Kuben Moodley and Malcolm Mabaso as his “special advisers”.
• As minister of mineral resources, Zwane “abused his position” by intervening in negotiations to acquire Glencore’s Optimum Coal Holdings and Optimum Coal Mine by Tegeta Exploration and Resources, which was owned by the Guptas.
• Zwane’s special advisors suspended the mining licences of Glencore-owned mines, “thus hampering mining operations and putting the mines under financial strain”.
• After the banks had closed the bank accounts of the Guptas, Zwane, as chair of the inter-ministerial committee, pressurised the banks to reopen the accounts.
• Zwane introduced Salim Essa to former Glencore CEO Ivan Glasenberg in Switzerland as his special advisor.
• Tony Gupta, Nazeem Howa (former CEO of Gupta-owned Oakbay Investments), Duduzane Zuma, and the Gupta-hired PR firm Bell Pottinger assisted Zwane “in preparing his media statements and responses to questions raised by journalists”.

With Zuma as president, Zwane as minister of mineral resources, Lynne Brown as minister of public enterprises, Molefe as CEO of Eskom and Anoj Singh as CFO of Eskom, all dancing to the Guptas’ villainous tune, Eskom and the coal suppliers were ripe for the picking.

Based on Volume III of Part IV of the Zondo Report.

Read:
State Capture Commission Report Part IV Vol I
State Capture Commission Report Part IV Vol II
State Capture Commission Report Part IV Vol III
State Capture Commission Report Part IV Vol IV