Commission of inquiry into Guptas and Eskom

2017-01-22 06:10
Lynne Brown. (File)

Lynne Brown. (File)

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Cape Town - Lynne Brown, the minister of public enterprises, hopes President Jacob Zuma will appoint a commission of inquiry into the involvement of the Guptas in Eskom, as recommended by former public protector Thuli Madonsela in her state capture report.

“I really hope the president appoints the commission at some point – it’s necessary so we can talk a few things through,” Brown said in an interview with City Press’ sister newspaper, Rapport.

That makes her the first cabinet minister to openly support the appointment of a commission of inquiry into state capture.

After 30 months in this strategic portfolio, Brown is halfway through her term as minister, but was cited in Madonsela’s report as having appointed the Eskom board that approved the deals.

But Brown said she had people look into the awarding of coal supply contracts between Eskom and Tegeta, a company which belongs to Zuma’s son Duduzane and Oakbay Investments, the Gupta’s parent company.

“When the uproar about Tegeta was in full swing, I asked Eskom to tell me how the process [the awarding of the contracts] had unfolded.

"There were seven companies, but only three qualified for contracts. I looked at the process followed for all three companies ... and [my analysts and legal team] couldn’t find fault with any of the transactions,” she said.

But in the course of these transactions, Eskom made a prepayment of R569 million to Tegeta for the supply of coal.

Sale of the mine

The payments were approved at a special meeting of Eskom’s board of directors – less than 12 hours after bankers declined an application by Tegeta to advance them the R586m required to pay for the acquisition of the Optimum coal mine.

Tegeta was able to use the money to pay the final outstanding instalment for Optimum.

The deadline for the payment was the following day.

“There was nothing wrong with the sale of the mine nor with the supply contracts to Eskom,” said Brown.

She said there were no basis for interfering with Eskom’s decision to conclude contracts with the Guptas.

“They have not been found guilty of any crime. Nobody has even laid any charges against them. So on what grounds could I prevent Eskom from doing business with them?

“The DA laid a charge against me when the public protector’s state capture report was released – and I respect them for that. I welcome it. It must be investigated,” said Brown.

She said she was shocked when her colleague, Mcebisi Jonas, deputy minister of finance, said in a statement on Treasury’s website that the Guptas allegedly offered him the job of finance minister and tried to bribe him to channel contracts to their companies.

Black shareholding

But Brown maintains she couldn’t interfere with Eskom, despite the shocking allegations made by Jonas.

She will, however, be intervening in the dispute between Eskom and Exxaro Resources because Exxaro, one of Eskom’s four biggest coal suppliers, allowed its black shareholding to drop below 50%.

Matshela Koko, acting CEO of Eskom, is now threatening to suspend Eskom’s contract with the company.

Brown said:

“I asked Koko to organise a meeting with Exxaro about it, which I will also attend. I don’t easily interfere at this level, but it’s concerning that Exxaro is decreasing its black shareholding.”

Read more on:    eskom  |  lynne brown  |  jacob zuma  |  thuli madonsela  |  guptas
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