How Eskom bankrolled Trillian without tenders or contracts

Johannesburg - Eskom paid Gupta-linked Trillian at least R266m, the explosive Trillian report released on Thursday confirmed.

The money was paid to Trillian for work done on the Duvha Power Station, despite the absence of any tenders or contracts for the work, the damning 67-page report by Advocate Geoff Budlender revealed.

Outgoing chair Tokyo Sexwale requested the inquiry after a whistleblower reported that Trillian executives had been aware of the firing of former finance minister Nhhanla Nene, months ahead of time.

Budlender said Trillian, which is majority owned by Gupta lieutenant Salim Essa, benefited from Eskom and Transnet transactions. He said to ignore the link between Trillian and the controversial Gupta family, would be naive. 

After fine combing correspondence, the advocate also found that Trillian had been in possession of information that Nene would be fired and asked for a proper inquiry, where witnesses would be compelled to give evidence.

No contract or tender

Despite the huge payments from Eskom Budlender found that Trillian never submitted a tender for its supposed work. Also no contract exists between Trillian and Eskom, and the work was likely to have been done by another firm, Regiments.

Budlender was able to find three invoices for work relating to Duvha, after Trillian refused to cooperate with the investigation.

Apart from the Duvha payments the advocate also uncovered other cash flows from Eskom to Trillian that showed at least R266m had ultimately been paid.

The three invoices include work done for Duvha power station project, whose boiler had to be replaced after it exploded in 2015.

The invoices showed that Trillian had received payment for work done on Duvha, despite Eskom, Public Enterprises Minister Lynne Brown and Trillian’s denials that money had been paid to Trillian for work on Duvha.

Parliamentary lies?

The report also calls into question whether Brown had lied in parliament. In a reply to parliamentary questions from the DA‚ Brown said no money was paid to Trillian for the Duvha power plant insurance claim.

She told parliament Trillian was not appointed to negotiate the settlement for the Duvha claim and that Eskom did not ask Trillian to find a new vendor for a new boiler. She added that there was no need to appoint any external party to assist with the sourcing.

Brown's spokesperson Colin Cruywagen said they took notice of the report, but that the minister had already provided an answer on the matter to parliament's ethics committee.

Both Trillian and Eskom had also denied last month that it had paid any money to Trillian. Eskom spokesperson Khulu Phasiwe told Fin24 in May that while Trillian was listed as a supplier of Eskom in 2016, the power utility has no record of paying any money as no services were used.

READ: Eskom claims it didn't pay Gupta-linked Trillian a cent

Three invoices

But Budlender cited three invoices submitted by Trillian in 2016, totalling R266m stamped "paid".

First on August 10 2016, Trillian sent Eskom an invoice listed as Duvha of R122.2m, for apparent advisory services. The invoice was stamped "paid" three days later.

Another earlier invoice was paid on 14 April for R30.6m, the same day it was submitted, while a third invoice of R113.2m was paid on 13 August 2016.

This invoice was for “professional fees” for “management consulting and included items such as “procurement”, “claims”, “generation” and “primary energy”.

Budlender commented on the report that these payments seem to indicate that information Brown gave to parliament was‚ “depending the view you take of it‚ false or seriously misleading.”

"It is difficult to see on what basis Eskom … could have lawfully made payment to Trillian for work for which it did not tender, for which it did not have a contract and which it did not perform,” Budlender said.

Budlender said Regiments did work for Eskom, and that Trillian seemed to have cashed in on some of that work.

Trillian CEO Eric Wood is a director of Regiments. Regiments and Trillian are also involved in legal action over which company completed which job.

Yet Budlender said: “It appears that all the work was done by Regiments and not by Trillian.”

“It is difficult to see on what basis Eskom, a third party which was not party to these negotiations could have lawfully made payment to Trillian for work for which it did not tender, for which it did not have a contract, and which it did not perform.”

He said at best Trillian may have a claim against Regiments, but that Eskom should have then paid Regiments and not Trillian.

Phasiwe told Business Day on Wednesday that an external review was conducted of all payments linked to the contract.

"The report concluded that payments due to the contractor [were] based on prudent costs incurred and value created," he said.

Trillians' response

After the release of the report Trillian said it had requested Budlender to hold back on the report, because it had not had a chance to study the content and comment.

It said allegations in the interim report "appear to be incorrect".

Budlender concluded the report by saying that Trillian had obstructed the investigation, asking for further investigations into his findings.

“There is ample evidence in the public domain that malfeasance is continuing.”

FULL DOCUMENT: Damning Trillian report on state capture

SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox.

Read Fin24's top stories trending on Twitter:

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
Rand - Pound
Rand - Euro
Rand - Aus dollar
Rand - Yen
Brent Crude
Top 40
All Share
Resource 10
Industrial 25
Financial 15
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders