AS IT HAPPENED: Changes in ministers were meant to weaken National Treasury - Fuzile concludes testimony at #Statecaptureinquiry

2019-02-18 10:15

Former director-general of National Treasury Lungisa Fuzile has concluded his testimony before the judicial commission of inquiry into allegations of state capture.

state capture

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Last Updated at 17:08
18 Feb 16:14

Eskom witnesses will only commence on Wednesday.

Commission to resume tomorrow, 10:00.

18 Feb 16:12
Further discussing logistics of Eskom witnesses.

18 Feb 16:12

18 Feb 16:11

Zondo thanks Fuzile.

Now discussing next witness, who will be called up tomorrow. 

18 Feb 16:08
Fuzile says some of the dates should be discussed in advanced. He says the commission is important for the country but that there are also other important things.

18 Feb 16:08

18 Feb 16:06
Fuzile says he sought approval to travel abroad and the idea was to go overseas to meet investors. He says upon landing in London they were told the approval to be on the roadshow had been rescinded. 

18 Feb 16:06

18 Feb 16:05
Fuzile: They were meant to weaken Treasury instead of building it. I'd rather watch it from outside even with a sore heart.

18 Feb 16:03

Luthuli House gathering: Was clear that he (Gordhan) and Jonas were going to be removed from Finance and deputy finance positions, respetfully.

Fuzile ended resignation on 29th. I reached the end of the runway.

Maleka: What made you resign?

There was no chance of making a positive difference.

18 Feb 15:53

Fuzile: Our financial system is an intergral part of the international financial system. The system is as strong as the weakest part of it. There can't be a part of the world that says 'we won't do it, but we want to be a part of it'. 

The laws were being crafted, not with Guptas in mind, but the interest of SA.

18 Feb 15:50
Fuzile: I was amazed at how people in government made the very same arguments I saw on ANN7. I found it very, very disturbing. 

18 Feb 15:48
Spiderweb operation: We were captured in the spiderweb, serving other interests. I'm sure time will tell, but they had a lot to explain.

18 Feb 15:48
Fuzile: Presentation doing rounds, he didn't deny making presentation to HQ at the ANC. Reports of connections to White Monopoly Capital.

18 Feb 15:44

18 Feb 15:39
Now dealing with closing of Gupta bank accounts.

18 Feb 15:37

18 Feb 15:36
Fuzile received a letter requesting we (Treasury) should allow Sassa to deviate and continue with the Cash Paymaster Services contract.

18 Feb 15:32

18 Feb 15:31

18 Feb 15:31

Oct 2014, only 4 non-executives, this status continued until 2 September. Almost a year.

Difficulty: people lending money to SAA, and working with board ... it was not ideal. 

18 Feb 15:29

Three/Four board members at one stage, which raised concerns.

Fuzile: "One makes a point on this, it was so difficult. There was an insistance, so many attempts, to appoint the board."

Ultimately, after a few meetings, a board was appointed, chaired by Mr Nene. (2 September)

18 Feb 15:16
 Now dealing with matters relating to SAA.

18 Feb 15:12
Fuzile: The timing, around elections was awkward for the ministers.

18 Feb 15:11

18 Feb 15:04
There was a hurry to conclude the deal, says Fuzile 

18 Feb 15:01
Fuzile: Many people who are ministers are not experts in their portfolios.

18 Feb 14:59

18 Feb 14:54

Fuzile says if nuclear had proceeded the country would have been in trouble.

"I say that with humility and I believe it is suincere," he says.

Fuzile: The process that was followed was seriously flawed.

18 Feb 14:52
Fuzile: "This was the biggest procurement ever in the history of the country, yet the processes were rushed. This country would have been in trouble if the nuclear [deal] had proceeded."

18 Feb 14:51

How Eskom became involved:

Around November, Eskom was approved as owner of nuclear. 

Fuzile explains 2-stage approach contemplated. 

18 Feb 14:46

18 Feb 14:45
Relevance of chief procurement officer was to test along the way, the alignment between the approach contemplated to the rules, laws and all such things that are relevant.

18 Feb 14:42

18 Feb 14:42

Next day, Cabinet meeting:

I was there for the part that related to Treasury.

We never knew when we would be called. When they were eventually called, he hardly sat and the matter had been decided.

Fuzile: I walked in and then out.

18 Feb 14:39

Option of phasing nuclear was agreed upon (with energy colleagues not enthusiastically accepting).

Zuma then turned to Fuzile and said "you and your former minister had stopped the PetroSA project."

Zuma continued saying: "In other countries, finance ministers do not tell presidents that there is no money, they find the money. But this was not the approah of ministers in SA."

Fuzile: I do not want to put an interpreataion to it, but it did shock me.

18 Feb 14:34

Fuzile: We found it objectionable. What was being presented was not what we agreed to. We even watered it down by saying "more work needed to be done."

Needless to say, the rand never got closer to that over the year.

18 Feb 14:32

18 Feb 14:32
Fuzile: Part of what troubled us was that we have discussed these things with the colleagues of energy. You can use the historical patterns of our own currency, how it weakened by 4% to the dollar every year.

18 Feb 14:24
Fuzile: Having worked with budget for many years, I do know that people know that when you want approval for something you dont say 'it's very expensive'.  

18 Feb 14:22

18 Feb 14:21
The presentation was 40% understated, in accordance to the exchange rate of that time. 

18 Feb 14:20

18 Feb 14:19

Fuzile details a Parliamentary meeting with Zuma on 8 December. The task team was to deliver a presentation at the meeting. Meeting was chaired by Zuma.

Meeting proceedings outlined:

- Presentation was done. The president then turns to former Minister of Finance Nhlanhla Nene, asking him if he had anything to say. Nene said a few things, including: he thinks the estimates presented by colleagues of energy were too optimistic. These included the most expensive nuclear could be was at an exchange rate (from the dollar) to R10.

18 Feb 14:10
We are back from the lunch adjournement. Fuzile continues with his testimony.

18 Feb 13:08
We adjourn for lunch.

18 Feb 13:08

18 Feb 13:08
Fuzile: I made the observation towards the end that Minister Gordhan made two comments that if SA were to continue with the idea of procuring nuclear it would have to follow every rule. 

18 Feb 13:07

18 Feb 13:07

Zondo: Purpose of meeting?

Fuzile: Never stated purpose, before or after meeting.

Zondo: It appears theat the president may have wanted a discussion in his presence between all parties?

That's quite a generous interpretation, Chair.

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