Samwu president clarifies issues around VBS bank loan, slams Media24

2018-05-17 20:51


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The president of the South African Municipal Workers' Union (Samwu) has denied that the union was in a "state of paralysis" and has described the claim as a myth.

"The telephone lines are working, we do not know where News24 got that we are in a state of paralysis and that the union is about to fall. We can do a media tour now and you will see that everything is operational and members are being serviced," Pule Molalenyane said.

Molalenyane was responding to a report News24 published on Tuesday in which Samwu's former Gauteng chairperson claimed that the union's rent had not been paid, that telephone lines at the union's offices were not working and that it had failed to keep its website running because it had not paid Rhesus Media Group, which managed the site.

The former Gauteng chairperson Nkhetheni Muthavhi also told News24 on Tuesday that there were two factions within the organisation that had taken each other to court and that each claimed to be the legitimate structure.

READ: Samwu in a state of paralysis - former Gauteng chair

"The organisation is in a state of paralysis," he claimed.

Molalenyane also addressed reports in City Press that VBS Mutual Bank lent large sums of money to its own directors, municipal officials and Samwu to finance a building that the union already owned. At least five VBS senior executives received mortgage loans running into millions of rands between 2015 and last year.

The paper reported that in October 2017, a mortgage deal worth R11.8m, which VBS signed for the Samwu headquarters in Johannesburg, was shrouded in mystery.

Subsequently, Samwu denied that it had ever mortgaged Samwu House in Marshalltown, Johannesburg with VBS. Instead, it claimed that it owned the building outright since 2007.

Molalenyane said: "We wanted to clarify that Samwu does not have a mortgage bond with VBS. What we have is a contract that provides us with printing machines and we have used our building as security for that particular loan agreement."

He said the organisation was servicing that loan agreement without fail.

READ: We are not broke – Samwu leadership

"The second issue that we have negotiated with VBS, that other commercial banks might not actually give, was housing and vehicle loans for our members. If you are a member of Samwu, you [are] going to get a 20% housing discount and then you [will] get that house.

"So we had approached several banking institutions to see whether we could get a vehicle in which we can provide decent housing for our members and it was VBS that actually agreed to give us the discount."

He added that the union was currently paying back the loan.

"There is a R1m savings account which we cannot even access because the bank is under curatorship.

"It is unfortunate that some of the staff there decided to do what they did which is reflected in the media, we condemn what they did. We will be able to access the R1mn once the bank is no longer under curatorship."

The total amount of the loan taken is R11.8m and a monthly repayment of more than R500 000 was being paid through a debit order monthly.

"We are indeed paying all staff who are working in various provinces, and when they are due for bonuses, we do pay them on time."

He said what was negotiated was to benefit the workers and not the union's leadership.

"We also want to dispel the lies expressed in the social space as well as the purported leadership battles."

Molalenyane said the union had one leadership structure that was elected by a national conference in 2015.

READ:  VBS Bank 'related-party' loans bonanza

"That leadership was elected by a national conference and I was elected as president at that national conference. We have never had any other conference that actually elected the leadership.

He said at the time, there had been serious allegations made by the previous leadership, that there [was] millions missing from the union's coffers.

"The previous leadership, instead of appointing reputable institutions and companies, they appointed an internal team that comprised provincial secretaries to investigate allegations that were made by those former members."

The outcome of that investigation cleared the previous national office bearers.

"Samwu always had that cloud that there were those missing millions. When I was elected in Durban in 2015, I then said that we will ensure that we appoint a reputable institution that would conduct a forensic investigation.

"The general secretary was then mandated by us. The national office bearers and central committee agreed that Ernst and Young would be appointed to conduct forensic investigations."

He said this did not happen and now people were saying that they were expelled from the union because they requested a forensic investigation to be conducted, and this was not true.

Molalenyane said, after appointing a reputable company, people then started to try and hijack the union.

"They failed. They called a bogus central executive committee and they elected themselves. We went to court and they lost that case.

"So, as we stand, we don't have a provincial chairperson called Nkhetheni Muthavhi. He tried to challenge his expulsion in a Durban court and he lost and the court confirmed his expulsion because of the anarchy that he tried to create in the union."

In a shot aimed at City Press and News24 journalists, Molalenyane said: "Journalists should keep their reputations intact and not be allowed to be used by dark forces to try to tarnish the union."

The union has intentions of taking City Press to the Press Ombudsman over the VBS loan story.

Read more on:    vbs bank  |  samwu  |  media

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