Nene goes nuclear at state capture inquiry. And drops a few names

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Finance Minister Nhlanhla Nene became the first sitting Cabinet minister to testify before the Zondo commission on state capture. He appeared before Judge Raymond Zondo on Tuesday (October 3 2018). Picture: Tebogo Letsie
Finance Minister Nhlanhla Nene became the first sitting Cabinet minister to testify before the Zondo commission on state capture. He appeared before Judge Raymond Zondo on Tuesday (October 3 2018). Picture: Tebogo Letsie

Finance Minister Nhlanhla Nene made an about-turn on his previous stance – that he had only bumped into members of the Gupta family in public gatherings once or twice, and that he had never been asked to do them any favours – when he gave testimony before the state capture commission of inquiry on Wednesday.

He revealed that he had repeatedly met with members of the Gupta family and had, on at least one occasion, been requested to share official information by the Guptas.

During his captivating, and at times shocking, testimony Nene also revealed that former president Jacob Zuma and other senior Cabinet ministers became hostile towards him for refusing to sign the nuclear deal.

The nuclear deal with Russia may have been able to deliver 6200MW of power by 2030, but would result in anything between R25 billion and R50 billion more being spent a year on power in South Africa by 2030.

I met members of the Gupta family during a number of government events, the first time I met them was in 2009 when I was still deputy minister of finance
Nhlanhla Nene, during his State Capture Inquiry testimony

According to Nene, these meetings were not chance encounters as he had revealed after former president Jacob Zuma fired him in 2015.

Nene testified that he was invited to Sahara Computers in Midrand twice in 2010: “Ajay Gupta said he was an economist and on the president’s advisory council. He assured me that he did not do business with government and that he was a good corporate citizen, which made me feel at ease to take him up on his invitation.”

Deputy Chief Justice Raymond Zondo then inquired if it was the norm for deputy ministers to visit private businesses, to which Nene responded that the Guptas had assured him that they “did not do business with government and were good corporate citizens”.

Nene said he only got suspicious of the brothers’ narrative that they did not do business with government when he heard about their involvement in the Vrede Dairy farm project in 2013.

The case, which was being investigated by the Hawks, involved the alleged looting of R250 million from the Free State department of agriculture through the Vrede dairy farm project;

However, even with his suspicions Nene still accepted another invitation by Ajay Gupta to his house for “tea” to discuss the economy.

“At the time, I had no reason to think there would be an adverse impact in me accepting the invitation,” said Nene.

However, in hindsight Nene said he realised that the Guptas may have been trying to unduly influence him.

Nene added that it was hard to state how many times he visited the Guptas between 2010 and 2013 as deputy minister, since the visits were unplanned, but thinks he visited the Gupta house and Sahara Computers four times.

He seemed more sure as to how many times he had visited the Guptas in 2014 – a total of two occasions. On one such occasion in 2014 Nene recalled how the Guptas requested information from him on Iqbal Survé’s deal with the Public Investment Corporation (PIC) to buy Independent Newspapers.

According to Nene, the Guptas and Survé had jointly entered into an agreement with the PIC, however, the Guptas had found themselves excluded from the deal by Survé.

“Ajay Gupta told me that a court case had been instituted against Survé over the PIC loan for the buyout of Independent Newspapers and that he needed information on Survé and the deal, I told Ajay that if he had queries on this, he should raise it with the PIC,” said Nene.

As deputy finance minister Nene also held the role of chair of the PIC hence the Guptas sought to manipulate his role to gain the upper hand in their court battle with Survé.

During his testimony, Nene also addressed allegations by the Economic Freedom Fighters that suggested that he abused his role as chair of the PIC to advance his son and wife’s business.

The EFF claim that Nene’s son and wife received funds from the PIC, whilst he was chair of the PIC. Nene denied these accusations and claimed that he sent a letter to the EFF to that effect. However, the EFF have been adamant that he hasn’t responded and that they have proof of these accusations, but none have been publicly released. 

'I was fired for insubordination' - Nene

Nene also claimed that he had been fired from his role as minister of finance because he had refused to “toe the line with regards to the nuclear deal”.

He was removed as finance minister by Zuma in December 2015 and replaced with little known ANC MP Des van Rooyen – a change that sent the rand into free fall.

Nene told the commission on Wednesday how he was accused of “insubordination” after he refused to sign a letter committing South Africa to an agreement with Russia on the nuclear build programme.

This was after Cabinet had mandated him and then energy minister Tina Joemat-Pettersson to present a memorandum on the financial implications, proposed funding model and risk mitigation strategies for the nuclear deal.

Nene said Joemat-Pettersson was ready to sign the deal, however, he had refused to sign because, at first, he was unaware of the merits of the deal. When he became aware of them he quickly realised that the deal would cost South Africans more than a trillion rand and was modelled after the failed e-tolling system.

“The e-tolls should have been a good lesson that there could be risks in terms of these user-pay principles that the nuclear deal was also set to take –especially after the public revolt against e-tolls,” said Nene.

Nene revealed that he was accused of insubordination for his refusal to sign the deal and he recalled that the attitude of his colleagues, “particularly Department of International Relations and Cooperation Minister Maite Nkoana-Mashabane and Minister of State Security David Mahlobo became hostile” after his refusal to sign the deal.

I concluded that the ministers who were aggrieved by my not signing the [nuclear] deal must have been part of it since they saw me as standing in their way
Nhlanhla Nene, during his State Capture Inquiry testimony

He added that his refusal to sign the deal “was not out of arrogance or insubordination” but that he was “bound by legislation and the desire to ensure that there was secure accountable, transparent management of the country’s finances”.

On December 9 2015, the day Cabinet approved the nuclear deal, Nene recalled been summoned into a meeting with then president Zuma. It lasted less than five minutes and he was informed that he was being removed from his role as finance minister.

Nene maintained before the commission that the reason behind his dismissal was because he failed to toe the line on, among other projects, the nuclear deal.


Juniour Khumalo
Journalist
City Press
p:+27 (0) 11 713 9001
w:www.citypress.co.za  e: juniour.khumalo@citypress.co.za
      
 
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