Malusi Gigaba and state capture: A short history of Eskom, Transnet and Home Affairs

2018-11-05 17:03
Home Affairs Minister Malusi Gigaba. Picture: Simon Dawson/Bloomberg via Getty Images

Home Affairs Minister Malusi Gigaba. Picture: Simon Dawson/Bloomberg via Getty Images

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Home Affairs Minister Malusi Gigaba is under enormous pressure to resign after a horrid week in which his political fortunes plunged steeply. Not only was a sex tape featuring the minister widely distributed, but both the public protector and the Constitutional Court delivered stinging rebukes which quite conceivably could lead to Gigaba's demise. 

A leaked parliamentary report into state capture at Eskom and other state-owned enterprises (SOEs) recommends a criminal investigation into Gigaba.

He has been on the offensive since the weekend, alleging the existence of a plot to prevent him from one day ascending to the Presidency and attempting to torpedo his political career.

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A political survivor

Gigaba, who first rose to prominence as leader of the ANC Youth League while Thabo Mbeki was party leader and head of state, is known as a survivor and someone adept at changing his allegiance with the changing of political currents. He was one of former president Jacob Zuma's early supporters after the ouster of Mbeki and even though he wasn't considered a Zuma confidante by the end of 2017, he was quite open about the opportunities to advance his career that the appointment to the finance ministry presented.

But Gigaba, having served Zuma as minister of public enterprises, homes affairs and finance, is also closely associated with state capture and the Guptas, even though he has tried his best to portray himself as removed from the grand capture project. Gigaba was central in the reconfiguration of SOEs in order to benefit the Guptas as well as the process to naturalise them.

New minister, new boards

He was appointed Minister of Public Enterprises on November 1, 2010 after Barbara Hogan was fired. She resisted efforts for SAA to give up the lucrative Johannesburg-Mumbai route in favour of Jet Airways, a company with close ties to the Guptas.

Within the first year of Gigaba's tenure he made wholesale changes at some of the country's biggest SOEs. This not only included key strategic executive appointments, but also far-reaching changes to company boards.

In December 2010 Gigaba appointed Iqbal Sharma as chair of Transnet's acquisitions and disposals committee after he failed to get him appointed as chairperson of the board. It later turned out that Sharma was a close associate of the Guptas and had a direct link to one of their companies, VR Laser.

During the same month The New Age newspaper, the Guptas' mouthpiece, reported that Brian Molefe would become Transnet CEO. He was appointed by Cabinet on Gigaba's recommendation in February 2011.

A year later Anoj Singh was appointed as Transnet's chief financial officer. The duo were to make enormous capital commitments on behalf of Transnet and later, Eskom.

In June 2011 Gigaba effected major changes to the board of Eskom. He sanctioned the appointment of no less than seven members with demonstrable Gupta links to the Eskom board, including some with direct business links to the family.

In 2012 SAA chairperson of the board Cheryl Carolus and most of the board resigned after a "breakdown in relationship" between Gigaba and the board.

In 2013 Gigaba's special legal adviser, Siyabonga Mahlangu, sent a text message to the then-acting SAA CEO Vuyi Kona berating the latter because he exposed "the mission" to Dudu Myeni, who was appointed SAA chair shortly after the text message. This was shortly after a meeting at the Guptas' Saxonwold compound where Mahlangu, Kona and Myeni were present along with Tony Gupta, Duduzane Zuma and the son of Free State premier Ace Magashule.

Gigaba's appointments of both Sharma and Molefe proved to be key in the capture project. Both facilitated the awarding of massive tenders to companies linked to capture and led to enormous outflows from Transnet's accounts.

The Guptas and their passports

In December 2014 Gigaba was moved to the home affairs portfolio. The Guptaleaks emails revealed that although Gigaba seemingly wasn't directly involved in helping the Guptas and their associates with naturalisation and obtaining visas, senior officials in his department – including his special legal adviser – did go out of their way to fast-track the Guptas' applications.

And according to some home affairs officials Gigaba did sign an "instruction" that two senior officials be moved to India. These officials were then contacted by Gupta associates to facilitate immigration requirements.

Gigaba, appearing in front of the Portfolio Committee on Home Affairs last month, admitted that he visited the Guptas at home in Saxonwold for religious celebrations and that he attended the infamous Sun City wedding. He told MPs he went to Saxonwold more than once but less than five times. 

He has however denied that he ever did anything to advance the Guptas' cause or that he facilitated state capture. His visits to the Guptas were for "social cohesion reasons", he said.

In the academic study of state capture, Betrayal of the promise, Gigaba is identified as a member of the so-called "elite" responsible for the "establishing and maintaining of patronage networks". He is also considered to have been "sympathetic" to the project of reconfiguring state procurement in favour of certain networks and other rent-seeking practices.

Sources: Betrayal of the promise (State capacity research project), Enemy of the People (Adriaan Basson & Pieter du Toit), amaBhungane and News24.

Read more on:    anc  |  guptas  |  malusi ­gigaba  |  state capture

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