Chancellor House — in the news for all the wrong reasons since 2006

2014-04-26 00:00

CHANCELLOR House was first exposed as an ANC funding front in 2006 by the Mail & Guardian newspaper and it has attracted controversy ever since.

Its name comes from the building in central Johannesburg that once housed ANC leaders Nelson Mandela and Oliver Tambo’s legal practice.

The driving force behind its formation in 2003 was then ANC treasurer-general Mendi Msimang and from the start it targeted investments in areas in which government would be influential in policy-making.

At the time its existence was revealed, Chancellor House had been formed as a charitable trust with its trustees including Popo Molefe, the former North West premier, and other ANC heavyweights.

The ANC initially denied its link to Chancellor House, which now operates openly as a broad-based empowerment entity after the ANC’s then secretary-general Kgalema Motlanthe finally admitted to it in 2007.

Chancellor House’s current managing director is Mamatho Netsianda, a founding member of the entity from 2003, and who has also been a former acting defence secretary in the Department of Defence as well as administrator in the ANC office in London up until 1992.

The relationship between the ANC and Chancellor House has ignited fierce debate about the ANC being “player and referee” in the economy.

Chancellor House’s 25% stake in Hitachi Power Africa, which won a R38,5 billion boiler deal with Eskom, has been among the most controversial.

It sparked an investigation in 2009 by the public protector, whose report concluded that the Hitachi deal exposed the need for legislation to regu­late business between state entities and those connected to political parties.

The ongoing debate finally saw then ANC treasurer-general Mathews Phosa tell party heavyweights at a briefing in 2012 that the ANC needed “to factor in modern day conflict- of-interest principles as this can cause public embarrassment, especially during election periods”.

New ANC treasurer-general Zweli Mkhize said late last year that the role of Chancellor House as a fundraising vehicle should be reviewed if there were conflicts of interest in its transactions.

He told City Press that if any company owned by Chancellor House was awarded a government contract, “it must be a minor party [in that business] and not have a controlling stake”. “You should deal with it like that and I think you will probably get a safe situation where you don’t feel like you’re throwing with the one hand and catching with the other.”

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