Former Eskom chief executive Brian Molefe has defended his relationship with the Guptas at the state capture commission of inquiry on Friday, saying they were the only ones who were willing to invest in a state bank that he was trying to establish.
Molefe said that Ajay Gupta, with whom he had become close friends with over the years, introduced him to a wealthy businessman from India who was willing to finance the operation, but it was later turned down by former Reserve Bank Governor Tito Mboweni who refused to grant them a banking license.
Molefe said he had no regrets about being friends with the Guptas because he saw them as normal South African citizens who enjoyed the fruits of our Constitution like everybody else.
“I saw nothing wrong in going to their house. I had no reason to treat them like lepers as people pretend that they did when they met them for the first time,” said Molefe.
“It was a normal relationship with people that I had approached and who had received me warmly and said let us talk about establishing this institution [state bank].”
Before his testimony was cut short – due to the news that one of Deputy Chief Justice Raymond Zondo’s colleagues had tested positive for Covid-19 – Molefe said that during his tenure at Eskom they had put an end to loadshedding but it had resumed after President Cyril Ramaphosa was elected to office.
Molefe said Ramaphosa was a key figure behind one of Eskom’s main coal suppliers, Glencore, which demanded that Eskom increase the price of coal from R150 to R530 per ton which would mean a transfer of R6 billion from Eskom to the company over three years.
He added that if Eskom had paid that amount – including the writing off of R2 billion in penalties that Glencore wanted – Eskom would have been financially ruined.
“I told Glencore at a meeting that if they want to put a gun to my head then they might as well pull the trigger,” said Molefe.
“What was happening was wrong on all fronts. It was going to financially ruin Eskom. There was no way that I could with a clean conscience attend public gatherings and meetings and shout from the rooftops that Soweto residents needed to pay their debt to Eskom when I was allowing international corporates to disadvantage Eskom on many fronts.”
He said this would have led to the poor and most vulnerable subsidising the dealings of the rich.
“I found the behaviour of Glencore and Ramaphosa to be revolting,” he said.
Molefe also testified that Eskom had a de facto board established outside the company in the form of a war room in the Presidency and that its management had to report to this structure.
He said that after attending a few of these meetings he realised that Eskom management was spending more time preparing for these meetings than actually doing the work that was required to stop loadshedding, so he stopped attending them.
Ramaphosa, who was deputy president at the time, headed the war room and was the de facto chairperson of the Eskom board as well, Molefe said.
He said members of the legitimate board of Eskom were not seeing those reports.
“The war room demanded meetings with management and department of public enterprises officials every Friday. They had to submit reports for the war room. I was uncomfortable with the war room, and stopped attending its meetings,” he said.