19 Cabinet members still have private business interests

2014-07-27 15:00

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Nineteen members of President Jacob Zuma’s new Cabinet – including the president himself – have private business interests.

According to the Companies and Intellectual Property Commission (CIPC), just more than a quarter of Zuma’s 72-member Cabinet are directors of active companies.

CIPC records show President Zuma owns one active company called Michigan Investments, registered in 1992.

But according to presidency spokesperson Mac Maharaj, the company is dormant and has not been trading. “We are looking at having it removed from the CIPC register,” he said.

It has been reported Zuma intended to resign his directorship but the company remains listed as active. It is unclear what sort of work the company does.

Fewer Cabinet members of Zuma’s second presidential term have business interests when compared with his first Cabinet of 2009, in which 27 ministers and deputy ministers were listed as company directors.

Ministers and MPs have until August 15 to make full declarations of their business interests to Parliament. But union federation Cosatu has insisted that simply declaring one’s interests is not good enough.

Two years ago, Cosatu called for a ban on public office bearers owning businesses. An internal discussion document noted Cosatu should insist those who want to be public representatives must choose between serving the country and being businesspeople.

Last month, Cosatu general secretary Zwelinzima Vavi criticised National Council of Provinces chairperson Thandi Modise for trying to be both a politician and farmer, saying she should choose between the two.

Hennie van Vuuren, a research associate with the Institute of Justice and Reconciliation, said the ministers may have exposed themselves to an offence in breaching the Executive Members’ Ethics Act by undertaking paid work.

“It is inexplicable why ministers to whom we have entrusted enormous responsibility have failed to resign their directorships the moment the president tipped them for a Cabinet post,” he said.

“Do our leaders believe we are naive enough not to see the conflict of interest? We are left asking: if a salary of between R1.7?million and R2.4?million a year is insufficient, then what is enough?”

Commenting on whether Cabinet ministers are allowed to have business interests, ANC spokesperson Zizi Kodwa said: “They must declare their business interests first in Parliament. Nothing stops them from participating in business, as long as there is no conflict of interest.”

Cyril Ramaphosa

Cabinet’s biggest businessman by far is Cyril Ramaphosa, who is an active member of two companies and holds at least 40 directorships. His spokesperson Ronnie Mamoepa told City Press on

Friday that Ramaphosa’s interests were still in the process of being placed into a “blind trust”, and when this happens he will no longer be involved in their day-to-day operations. But he will still benefit financially from his business interests in companies including

Lonmin, Bidvest, Mondi, MTN Group, Standard Bank, Coca-Cola and McDonald’s.

“The profit goes to the beneficiaries of the trust. It only means he will not be involved in day-to-day operations,” Mamoepa said.

Forbes magazine’s list of Africa’s richest people placed Ramaphosa in 29th place and calculated his net wealth at $700?million (R7.4?billion).

While Ramaphosa places his assets in a blind trust, other ministers and deputy ministers say they are in the process of resigning their directorships. Others who have business interests include:

Bheki Cele

The deputy minister of agriculture, forestry and fisheries owns two companies – Ithembelihle Logistics, and Tiray Holdings, which were both established in the past 18 months. Cele’s spokesperson, Vuyo Mkhize, who is also listed as a director of Tiray Holdings, said Cele was unemployed at the time the companies were registered.

Cele’s business partner in Ithembelihle is Lawrence Mazibuko, his longtime friend and the former bodyguard of President Zuma.

Mazibuko is a director of a security company called KZN Security Services, registered in 2005, which manages security for a number of government clients including the provincial legislature and eThekwini municipality, where it has a contract that paid it R4.4?million last month alone. The company also had a contract with the SA Revenue Service in KZN which ended in 2011.

Mazibuko said that Ithembelihle Logistics had not yet done any business. “We had big plans when we started the company, but things have changed now that he [Cele] has been appointed as minister,” he said.

Mzwandile Masina

The deputy minister of trade and industry holds interests in three active private companies.

Masina, the former CEO of the Gauteng Film Commission, shares his business interests with TS Records’ owners Lionel “TK” Nciza and Sbusiso “DJ Sbu” Leope, as well as Gauteng education MEC Panyaza Lesufi.

CIPC records show the four of them own Brown Way Trading and Projects, and Zithobe Investments. Masina and Nciza share ownership of another company, TK Mzwa Tyres Services, which has an address in Boksburg.

Masina also owns a firm called Masina Civil and Construction.

Masina said on Friday: “Only two of my companies are active and none have conducted any business with the state at any time. And I will only answer to the executive before the due date for declarations.”

He added that he was not aware whether his business associates had conducted business with the state.

Nciza, who has known Masina since they were young, said he has never benefited from their relationship: “Mzwandile is still very new in government; he has no influence.”

Lesufi said the companies have never traded but he will be resigning from them.

Enver Surty

The deputy minister of basic education confirmed that he has four active property-owning companies that were established and acquired before 1994. These include Safari Centre, Casbah Cinema, Zinrus

Developers, and Hectaris and Hectaris Investments.

“They have always formed part of my disclosure to Parliament’s ethics committee and the secretary of Cabinet,” said Surty.

Casbah Cinema is the only company Surty says conducts business with the state. The building has been leasing a portion of its premises to the SA Post Office since the mid-1980s when the property was developed.

Pamela  Tshwete 

The deputy minister of water and sanitation is a director of a fishing company called Flashing Star, as well as of Life Healthcare Group. She is also a director of Brimstone, an investment company with shares in Nedbank, Aon Re Africa, Old Mutual and Tiger Brands.

Her spokesperson, Phakamisa Hobongwana, said the other eight companies Tshwete is registered as a director of are inactive and have never traded.

“Brimstone and Life Healthcare are companies inherited from her late husband [Steve Tshwete] and the deputy minister is not active in their operation,” he said.

“Both these companies are open to all South Africans and because of the number of people participating, very little dividends are realised and cannot in any way be considered as entities for individual wealth creation.”

Ayanda Dlodlo 

The deputy minister of public service and administration is still an active director of Rosschef Africa, a company that manufactures coke, refined petroleum products, nuclear fuel, chemicals, rubber and plastic products. She is also a director of another company called The Wired Cloud.

This company is codirected by Lerema Kekana, who also works for the BCS Group, an IT and communications company that counts the ANC among its clients. Kekana asked for questions to be emailed to him but did not respond to them.

Dlodlo is also a director of Women in Energy, an entity registered as a private company which she co-directs with former beauty queen and businesswoman Basetsana Kumalo.

But Dlodlo disputed the accuracy of CIPC records, saying she has resigned from many of her companies. She has directed or had shares in at least 36 companies in her business career.

“As part of my commitment to serve in office and the public in a fair and transparent manner, I am in the process of deregistering interests in companies that would present a conflict of interest,” she said.

Michael Masutha

CIPC records show that the justice and correctional services minister is a director of a company called CIE Investments. But his spokesperson Mthunzi Mhaga denied this, saying Masutha was instead an independent nonexecutive director.

“He was appointed because of his relationship with Catholic schools as a past pupil of Siloe School for the Visually Impaired in Limpopo,” Mhaga said.

  • This report has been updated since the last publication.

Cabinet Inc

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