Admin
08 Nov, 2025
Renewed concerns over probable governance irregularities and conflicts of interest at the Public Investment Corporation: the PIC’s confused(ing) rhetoric regarding the Lanseria and FlySafair deals
Mr MC Ramaphosa President of the Republic of South Africa Private Bag X1000 Pretoria 0001 and Mr Songezo Zibi, MP Chairperson of the Standing Committee on Public Accounts PO Box 15 Cape Town 8000 Dear Mister President and Chairperson Zibi Renewed concerns over probable governance irregularities and conflicts of interest at the Public Investment Corporation: the PIC’s confused(ing) rhetoric regarding the Lanseria and FlySafair deals 1. I refer to my correspondence dated 29 October 2025, titled “R3.5 trillion at risk: the Public Investment Corporation’s governance collapse demands action.” In that letter, I outlined the serious risks arising from several recent and questionable transactions undertaken by the Public Investment Corporation (PIC), which place over R3.5 trillion in pensioners’ funds in jeopardy, as well as broader governance and ethical failures within the institution. 2. “The PIC’s records in respect of Harith’s (or a party related to Harith) application/request for funding to acquire all or portion of the shares in FlySafair, directly or indirectly.” This is a direct quote from the letter referred to in Paragraph 4.2, wherein the PIC is asked to preserve “records, minutes, notes, guest lists, recordings and resolutions and/or other material” relating to Harith General Partners’ acquisition of shares in FlySafair. One must ask: who is fooling whom? 3. On 5 November 2025, the PIC Board Chairperson and Deputy Minister of Finance, Dr David Masondo, launched a scathing and aggressive attack on me personally and made a weak attempt to tarnish my reputation, question my credentials, and cast aspersions on the information the UDM provided in its letter of 29 October 2025. In this regard, I wish to make the following observations: 3.1. While the PIC provides impressive financial statistics, it fails to meaningfully address the core governance concerns raised by the UDM, namely valuation manipulation, political interference, and weak board oversight. 3.2. The PIC attempts to project transparency by citing asset growth and external audits yet simultaneously hides behind claims of legal confidentiality in the Lanseria Holdings matter. This contradiction severely undermines its credibility. 3.3. Although claiming to respect Parliament, the PIC’s statement labels a Member of Parliament’s formal correspondence as “nefarious i.e. language that may be interpreted as contemptuous of democratic oversight and to which I take strong personal exception. 3.4. Furthermore, while denying wrongdoing, the PIC’s statement acknowledges that a review of the arbitration proceedings is underway, implicitly conceding that there may indeed be irregularities in the transaction. This is clearly evidenced by the correspondence referred to in Paragraph 4.14.1, which confirms that the matter remains under internal scrutiny. Yet, instead of welcoming the alert and taking proactive corrective measures, the PIC chose to attack me personally, rather than expressing gratitude for having brought this concerning deal to its attention. 3.5. Why issue the statement in the first place? The PIC went to great lengths to adopt a defensive posture, using offensive language directed at me, while at the same time conceding through its own actions that there is indeed something fishy about the Lanseria transaction. 4. To provide further context to this entire matter, I have attached two pieces of critical correspondence which demonstrate that Dr Masondo, in the name of the PIC, “doth protest too much”: 4.1. A letter from Werksmans Attorneys to Mabotja Attorneys titled: “PUBLIC INVESTMENT CORPORATION SOC LIMITED // ACAPULCO TRADE AND INVEST 164(RF) (PTY) LTD” dated 6 November 2025. 4.2. Mabotja Attorneys’ response to the above entitled.: “LANSERIA AND RELATED MATTERS” of 7 November 2025. 4.3. Werksmans Attorneys, acting on behalf of the PIC, addressed a letter to Mabotja Attorneys, who represent Acapulco Trade and Invest 164 (Pty) Ltd, regarding the aftermath of an arbitration award in favour of Acapulco, dated 17 September 2025 in the amount of R411 282 264.44. The correspondence indicates that the PIC intends to review or challenge the arbitration award and seeks to freeze the funds already deposited in Mabotja Attorneys’ trust account pending the outcome of that review. 4.4. In response, Mabotja Attorneys issued a combative and defensive reply, aimed at discrediting Werksmans Attorneys’ correspondence on behalf of the PIC and portraying Acapulco as the aggrieved party. The exchange suggests escalating tension between Acapulco and the PIC, its Chief Executive Officer (CEO), Mr Patrick Dlamini, as well as Harith General Partners and its founder, Mr Mahloele, who appears to be a central figure of contention. 4.5. The revelation that Mr Mahloele hosted a “celebratory gathering” in Bryanston to mark Mr Dlamini’s appointment as PIC CEO is particularly concerning in the broader context of potential conflicts of interest and governance integrity within the PIC. 5. Clearly, the Lanseria transaction and the PIC’s dealings in the FlySafair matter, both linked to Mr Tshepo Mahloele, appear increasingly suspect in light of the aforementioned context. The Lanseria deal has been unfolding for over twelve years, and it is now imperative that SCOPA asks even more probing questions than it did before my letter of 29 October 2025. 6. The key question for the UDM therefore remains: how many other transactions of this nature the PIC has entered into, in violation of its own governance protocols, and in the process placing at risk the R3.5 trillion in pensioners’ funds managed through the Government Employees Pension Fund (GEPF), notwithstanding Dr Masondo’s protestations to the contrary. 7. Ultimately, the PIC is a state-owned enterprise, and Parliamentary oversight is a cornerstone of ensuring that such institutions are managed ethically and transparently. Yet, the PIC appears determined to avoid public scrutiny and to continue operating in secrecy, contrary to the principles of accountability and public trust. 8. The UDM reiterates that the protection of public pension funds is a matter of national importance. Urgent intervention is required to ensure that the PIC is not used as a vehicle for political patronage and that the R3.5 trillion in assets under its management are handled with the highest standards of integrity, professionalism, and accountability. 9. We are in for a jolly period, to say the least, consider this my early Christmas gift to the public. The truth is finally coming to light. Yours sincerely Deputy Minister Bantu Holomisa, MP President of the United Democratic Movement Copied to: • Mr Enoch Godongwana, MP - Minister of Finance • Dr David Masondo, MP - Deputy Minister of Finance and Chairperson of the Board of the Public Investment Corporation • Ms Thoko Didiza, MP - Speaker of the National Assembly of South Africa • Mr Patrick Dlamini - Chief Executive Officer, Public Investment Corporation • Mr Musa Mabesa - Principal Executive Officer, Government Employees Pension Fund • Ms Tsakani Maluleke - Auditor-General of South Africa • Adv Andy Mothibi - Head of the Special Investigating Unit
Admin
30 Oct, 2025
Formal clarification and representation in respect of the Lanseria Holdings (PTY) Ltd transaction
Mr KG Mabotja Mabotja Attorneys 189 Lunnon Road Hillcrest Office Park Barbet Place Hillcrest Pretoria 0083 Dear Sir Formal clarification and representation in respect of the Lanseria Holdings (PTY) Ltd transaction 1. I note your client’s position; however, the explanations provided raise several further questions that require documentary verification before any of the assertions can be accepted at face value. 2. You state that the valuation in question was performed by an independent audit firm and a professional property valuer jointly appointed by the Public Investment Corporation (PIC) and Acapulco. Please confirm whether the external audit firm and the property valuer were selected from the Public Investment Corporation’s panel of accredited external valuers, and, if so, provide documentary evidence of their accreditation and appointment process. The independence of the valuer is a material consideration, as valuations of this nature are vulnerable to manipulation if not conducted by duly accredited professionals who have undergone an approved appointment process by the PIC. Kindly also provide: 2.1. The full valuation report and supporting schedules; 2.2. The name of the audit firm and confirmation of whether it is one of the recognised Big Four or Five audit firms (Deloitte, PwC, EY, KPMG, or BDO). 2.3. As you will appreciate, financial institutions and institutional investors typically rely on the work of internationally recognised audit and valuation firms to ensure independence and credibility. The integrity of the valuation process depends on this standard. 3. It has been noted that the Government Employees Pension Fund (GEPF) continues to hold the same Lanseria asset at an impaired value, despite the revaluation you reference. 3.1. How does your client explain this discrepancy? 3.2. Are you suggesting that the GEPF valuation is incorrect? 3.3. If not, please clarify how two entities, both ultimately representing the same shareholder interest, can hold materially divergent valuations for the same asset. 4. If the valuation truly reflected a higher fair value, why did neither the PIC nor your client initiate a market sale of the asset to test and realise that value? 4.1. A sale to a bona fide third party would have provided the only objective confirmation of the claimed valuation and would have allowed the repayment of the outstanding loan from real, realised proceeds. 4.2. The decision to effect payments without such a sale raises legitimate questions about potential collusion between PIC representatives and BEE partners, to the detriment of the GEPF and the pensioners whose funds are at risk. 5. You confirm that repayment of the loan was linked to dividend flows. Once those dividends failed to materialise, the loan should have been declared in default and the PIC should have executed against the security, in this case, the shares held by Acapulco, until recovery was completed. 5.1. On what basis, therefore, were payments made to Acapulco before any such sale took place? 5.2. Please provide documentation or correspondence showing the PIC’s authorisation for these payments. 6. In light of your client’s assurance that all valuations, arbitration records, and transaction documents are available for inspection, I hereby formally request copies of these documents for review. Kindly provide the complete valuation report, arbitration award, loan and shareholder agreements, and any other records relevant to the Lanseria Holdings transaction. These documents are essential to substantiate your client’s representations and to enable informed oversight and accountability in the public interest. 7. Would you kindly direct future correspondence to my attorney, Mr Eric Mabuza, at Mabuza Attorneys at Eric@mabuzas.co.za. Yours sincerely Deputy Minister Bantu Holomisa, MP President of the United Democratic Movement Copied to: Mr Eric Mabuza, Mabuza Attorneys
Admin
29 Oct, 2025
R3.5 trillion at risk: the Public Investment Corporation’s governance collapse demands action
Mr MC Ramaphosa President of the Republic of South Africa Private Bag X1000 Pretoria 0001 and Mr Songezo Zibi, MP Chairperson of the Standing Committee on Public Accounts PO Box 15 Cape Town 8000 Dear Mister President and Chairperson Zibi R3.5 trillion at risk: the Public Investment Corporation’s governance collapse demands action 1. I had the privilege of attending the extended Cabinet Lekgotla at the end of September 2025, where you, Mr President, emphasised that the fight against corruption and the looting of state resources would be a top priority for the Government of National Unity. You further noted that the current climate of corruption and mismanagement has severely undermined investor confidence, and that this situation must be decisively addressed. 2. The Judicial Commission of Inquiry into Allegations of Impropriety at the Public Investment Corporation (PIC) (‘the Mpati Commission’) was established by you, Mr President, in October 2018 to investigate allegations of corruption, maladministration, and governance failures at the PIC, Africa’s largest asset manager, overseeing pension and social funds exceeding R2 trillion at the time (now over R3.5 trillion). 3. Amongst others, the Mpati Commission in 2020 exposed the PIC as a politically captured institution plagued by poor governance, weak accountability, and corruption, particularly within its unlisted investment portfolio (Isibaya Fund). Its recommendations aimed to restore transparency and fiduciary responsibility, but implementation has been slow and inconsistent. 4. Instead, what the United Democratic Movement (UDM) presents hereunder is a stark picture of continued looting, mismanagement, and administrative bungling from top to bottom at the PIC and its Isibaya Fund since the conclusion of the Mpati Commission, a situation of enormous proportions that rivals the State Capture scandal itself. This does not require another commission of inquiry. Rather, the UDM sets out below a series of concrete proposals for decisive action to stop the rot in its tracks through innovative solutions, strengthened parliamentary oversight, and firm law enforcement intervention. 5. The Lanseria Airport Holdings case 5.1. This presents what appears to be brazen looting of PIC funds, arguably worse than anything uncovered by the Mpati Commission. Around 2013, Harith General Partners, a group of BEE partners, and the Government Employees Pension Fund (GEPF) invested in Lanseria Airport. The BEE partner, Acapulco Trade and Invest, was fully funded by the PIC with a loan of about R350 million, to be repaid from future dividends. More than a decade later, the loan remains unpaid and has ballooned to over R600 million, leaving the investment deeply underwater. Instead of writing it off, the PIC and its BEE partner conjured a revaluation, declaring the asset suddenly worth R1 billion. 5.2. The PIC then took over the BEE partner’s shares as security and astonishingly concluded that it now owed the BEE partner R400 million. In other words, a failed investment was transformed on paper into a profit for the debtor, creating R400 million of value out of thin air. From a debt of R600 million with no repayment capacity, the BEE partner miraculously walked away with a R400 million windfall (the BEE shareholders got their share this month and they are allegedly fighting over the loot). This may be one of the most blatant acts of looting in PIC history, rivalling the excesses of the Dr Dan Matjila era. 5.3. To make matters worse, the GEPF itself already holds an impaired stake in Lanseria Holdings. This means the PIC will either have to immediately write off the shares it took over or get the GEPF to revalue the shares to avoid scrutiny. You cannot hold same shares on the same balance sheet at different valuations. 6. The “New Karan Beef” and FlySafair deals 6.1. In 2019, the PIC was forced to halt its planned investment in Karan Beef after a whistleblower exposed alleged price inflation that pushed the valuation to R5.2 billion. Despite prior approval, the deal was never implemented following the Mpati Commission’s intervention. 6.2. Now, a similar pattern appears to be emerging with FlySafair. The airline is seeking local investors after regulatory rulings on ownership, and it is alleged that a consortium is attempting to acquire it with PIC funding at an inflated valuation of about R7.9 billion; nearly double the estimated fair value. If executed, the transaction could result in massive value destruction, mirroring what would have happened with Karan Beef. 6.3. While FlySafair is a strong airline, it is certainly not worth more than R3.9 billion. The airline industry remains highly volatile, and history shows that even leading carriers can collapse within years. Yet again, just as in the Lanseria Airport and other controversial transactions, Harith General Partners (linked to Mr Tshepo Mahloele) appears to be involved. This deal is currently being hotly debated within the financial services sector. No approvals yet. Just like Karan Beef, there is a push to extract billions from the PIC, and as always write-offs will follow soon afterwards. 7. The latest scandals in the public domain 7.1. The latest developments at the PIC reveal a deepening power struggle within the institution, exposing how political factionalism continues to undermine its governance. 7.2. The suspension of Chief Investment Officer Kabelo Rikhotso in early October 2025, officially framed as part of a misconduct investigation, has reportedly triggered internal tensions between rival camps competing for control of the corporation’s investment machinery . According to insider accounts, the battle is not merely administrative but linked to political influence over access to capital and deal-flow. The episode underscores a worrying pattern: instead of operating as an independent and professionally managed custodian of more than R3.5 trillion in public servants’ pension assets, the PIC has again become a stage for self enrichment. This climate of uncertainty and factional interference threatens both investor confidence and the fiduciary security of millions of pensioners who depend on the integrity of the institution. 7.3. In July 2025, the Thabiso Moshikara scandal reignited concerns about governance at the PIC. Moshikara, acting head of the PIC’s Unlisted Investments division, was accused of demanding a R3 million bribe from businessman Ralebala Mampeule, whose company Levoca 804 had received R693 million in PIC funding to buy a stake in Metrofibre Network. Mr Mampeule claimed that after the investment soured, Mr Moshikara allegedly threatened to cut off funding unless he paid the bribe, leading to a criminal investigation for extortion and Mr Moshikara’s suspension in October 2025. The case, which erupted in the same period as other senior-level suspensions, has deepened divisions within the PIC and underscores how the Isibaya Fund, long criticised by the Mpati Commission for weak oversight and political interference, remains a focal point of instability in an institution managing over R3.5 trillion in public funds. 8. Investment losses and governance problems: the Daybreak Foods case 8.1. Daybreak Foods, once presented as a flagship black-empowerment investment, has become one of the most visible symbols of the PIC’s governance and oversight failures. Despite repeated warnings from the Mpati Commission about weaknesses in the unlisted portfolio, the PIC has continued to pour money into the struggling poultry company. In July 2025, the PIC injected a further R150 million into Daybreak, bringing its total exposure this year to about R400 million and total investment since 2015 to approximately R1.7 billion. The company entered business rescue in May 2025, following years of losses, poor governance, and operational mismanagement. The PIC’s decision to provide additional funding to a failing enterprise under these circumstances underscores the absence of effective oversight, proper risk assessment, and consequence management within its unlisted investments. 8.2. Observers note that, while the PIC claims to have implemented the Mpati Commission’s recommendations, its continued support of non-performing and poorly governed entities such as Daybreak Foods demonstrates that the underlying accountability mechanisms remain weak, opaque, and easily influenced. 9. Even after the Mpati Commission, corruption within the PIC appears deeply entrenched. The institution is increasingly viewed as ground zero for corruption in South Africa, with billions of rand lost through reckless investments and outright misconduct. The PIC manages over R3.5 trillion in pension funds on behalf of public servants, yet the scale of governance and oversight remains alarmingly weak. 10. The current PIC board appears unfit for purpose 10.1. Compared to boards of other major financial-sector entities, including even struggling state-owned enterprises like Eskom, the contrast is stark. It is deeply concerning that a fund managing R3.5 trillion in pensioners’ savings operates under such a fragile governance structure. This persistent instability raises serious questions: is it the result of oversight failures, or a deliberate design to enable political capture rather than protect public assets? 10.2. It is alleged that the board is struggling to constitute key subcommittees, such as the audit committee, due to a lack of people with the minimum required qualifications, i.e. chartered accountant expertise. 10.3. Furthermore, the board lacks sufficient investment experience to form a credible investment committee. At present, there is reportedly no one with appropriate investment credentials serving on the board. Of particular concern is the Minister of Finance’s recent appointment of the wrong individual, one Mr Maseko, to the board. This bizarre error raises further questions: was it a genuine mistake, or was the Minister misled into making the appointment? Either scenario reflects poorly on the integrity and diligence of the appointment process. 11. Involvement of the banks 11.1. Some of the top South African banks have been involved in advising the PIC to participate in many transactions that exposes the PIC to reckless investment dealing, while at the same time participating in the more secured portion of the deals. These top banks need to be held accountable for their role in value destruction. They hide behind the so-called Chinese Walls. There is one bank that has been more prominent in the deals involving the PIC/GEPF. Both as an advisor and a participant in the more secured portion. 12. Investigation into the government pensions Regarding the matter of the former SATBVC pensioners, which I raised during the State of the Nation Address debate on 14 February 2023, I wish to reiterate my concern that no progress has been made. At the time, you, Mr President, directed the Minister of Finance, Mr Enoch Godongwana, to establish a team to investigate the pension entitlements of civil servants from the former SATBVC states. You further tasked the Deputy President, as head of the task team on the benefits of military veterans, to provide you with a report on this matter. To date, however, no such report has been produced, and the affected pensioners continue to wait in uncertainty. 13. The Isibaya Fund remains the epicentre of corruption within the PIC. Despite the Mpati Commission’s warnings, little has changed. This unlisted investment portfolio continues to operate with weak oversight, opaque decision-making, and politically connected deal flows. It functions as a pot of money selectively accessed by a privileged few, often without proper risk assessment, leaving the PIC exposed to massive losses. The loss ratios are unacceptable by any commercial or development finance standard. 14. The credit loss ratios of over 39% is purely criminal, no credible institution will allow such level of brazen looting in the name of empowerment. Ultimately, the State and South African public are the real losers given that PIC is guaranteed by the National Treasury. The scale of looting rivals the Gupta’s State Capture, the amount at risk is over R170 billion. The sophistication of the financial engineering and contracts are used to hide the brazen looting. Many people hardly understand deal structuring. South Africa needs to know that something worse than the State Capture continues to thrive at the PIC. 15. Given these persistent failures, it is time to ask difficult questions: Why should the Isibaya Fund remain under the PIC’s control at all? A more sensible approach would be to transfer its developmental and impact investment mandate to institutions better equipped for that purpose, such as the Development Bank of Southern Africa (DBSA) or the Industrial Development Corporation (IDC), where project evaluation, governance, and sectoral expertise are stronger. The PIC’s role could then be limited to allocating funds under DBSA or IDC supervision, or outsourcing mandates to independent professional managers with clear risk controls and accountability mechanisms. The looting will continue as long as the fund remains under the PIC. The instability will never stop; and no commission can fix that. 16. Isibaya Fund at R175 billion (at 5% of total AUM 3.5 trillion) can be transformative for South Africa if applied prudently for development purpose as defined in the mandate. Currently the fund is yielding negative returns. Based on the above number and high credit loss ratios, up to R70 billion is provided for ultimate write offs; clear wastage, with minimal development impact except narrow enrichment of a select few. 17. Working at Isibaya or the PIC has, regrettably, become increasingly viewed as career suicide. What should have been an exceptional training ground for Black investment talent, a place to hone technical, ethical, and leadership capabilities, has instead become a graveyard for many promising careers. It is virtually impossible to attract top talent with the reputation that the Fund has; the inability to attract top talent makes it difficult to do good investments. 18. The United Democratic Movement herewith recommends that: 18.1. SCOPA convenes urgent public hearings with the PIC Board, the Chief Executive Officer, and the Government Employees Pension Fund to account for ongoing governance failures, ethical breaches, and poor investment decisions. 18.2. The Auditor-General and the Special Investigating Unit to conduct a forensic audit of the Isibaya Fund and the Unlisted Investments Division, focusing on politically connected deals, loss-making projects, and compliance with the Mpati Commission’s recommendations. 18.3. National Treasury to review the composition, competence, and independence of the current PIC Board, with a view to strengthening governance and reducing political interference. 18.4. The Minister of Finance to present to Parliament a status report on the implementation of the Mpati Commission’s findings and recommendations, indicating which reforms have been completed, delayed, or abandoned. 18.5. The Minister of Finance commission a feasibility study on the transfer of the PIC’s developmental and impact investment mandate to institutions such as the DBSA or the IDC and report the findings to Parliament within a defined timeframe. 18.6. All deals under the Isibaya Fund should be reported on their website on a quarterly basis, showing the full details of the transaction, with no exception. Confidentiality cannot trump the transparency required for public funds. Current disclosure is not sufficient at all. Full amount disbursed should be shown, valuations, beneficiaries, impairments, original investment amount and all settlements. Parties not comfortable with disclosure should seek funding from commercial banks. 18.7. Dealmakers at the PIC/Isibaya Fund should be paid based on economic return performance, not disbursement of funds. Once funds are disbursed, the dealmakers do not have “skin in the game”. That should stop. With current return profile (i.e. negative returns), no bonuses should be paid irrespective of funds disbursed, just like in any commercial fund. 18.8. It is imperative that the Isibaya Fund be placed under immediate moratorium to facilitate its transition to a more credible and professionally managed platform, such as the DBSA, the IDC, or an independent third-party investment manager with robust governance frameworks and proven expertise. This decisive action will help stabilise the PIC by eliminating avenues for exploitative and politically motivated investments. 19. The United Democratic Movement believes that the protection of public pension funds is a matter of national importance. Intervention is essential to ensure that the PIC is not used as a vehicle for political patronage and that the R3 trillion in assets it holds are managed with the highest standards of integrity, professionalism, and accountability. Yours sincerely Deputy Minister Bantu Holomisa, MP President of the United Democratic Movement Copied to: • Mr Enoch Godongwana, MP - Minister of Finance • Dr David Masondo, MP - Deputy Minister of Finance and Chairperson of the Board of the Public Investment Corporation • Ms Thoko Didiza, MP - Speaker of the National Assembly of South Africa • Mr Patrick Dlamini - Chief Executive Officer, Public Investment Corporation • Mr Musa Mabesa - Principal Executive Officer, Government Employees Pension Fund • Ms Tsakani Maluleke - Auditor-General of South Africa • Adv Andy Mothibi - Head of the Special Investigating Unit
Admin
20 Oct, 2025
Exposing the water-tanker mafia: UDM urges SCOPA to act on corruption and sabotage in municipal supply
Mr Songezo Zibi, MP Chairperson of the Standing Committee on Public Accounts PO Box 15 Cape Town 8000 Dear Chairperson and Members of SCOPA Exposing the water-tanker mafia: UDM urges SCOPA to act on corruption and sabotage in municipal supply 1. The United Democratic Movement (UDM) wishes to bring to the Standing Committee on Public Accounts’ (SCOPA) urgent attention the alarming escalation of spending on water-tanker services by municipalities across South Africa, and the growing evidence of systemic abuse, corruption, and sabotage of water infrastructure associated with these contracts. 2. Recent investigative reports reveal that the City of Tshwane spent R777 million on water-tanker services in the 2024/25 financial year, an astronomical figure that far exceeds the reasonable cost of emergency water provision. This follows earlier findings that Tshwane alone paid more than R116 million in 2023/24 for tanker operations in areas repeatedly affected by burst pipes and alleged deliberate vandalism. 3. These numbers are not merely accounting anomalies; they speak to a wider pattern of dysfunction and profiteering. Treasury has already warned municipalities that water tankering must remain a temporary emergency measure, yet it has become a long-term business model feeding a network of contractors who thrive on public desperation. 4. The South African Human Rights Commission has gone so far as to suggest that deliberate interference with water infrastructure for profit could amount to terrorism against essential services. Lack of oversight, weak internal controls, or corruption in tendering and contracting tanker services, meaning funds may not be used optimally, or contracts may be awarded to unqualified providers. 5. The abuse of tanker procurement undermines every principle of clean administration and human dignity. It drains municipal budgets, discourages maintenance of pipelines, and forces poor communities to depend on unreliable and unsafe water sources. Every rand spent on this corruption-ridden system is a rand diverted from lasting solutions such as reservoirs, reticulation upgrades, and proper maintenance. 6. In view of these disturbing trends, I respectfully request that SCOPA: 6.1. Launch a national investigation into municipal expenditure on water-tanker services for the past five years, beginning with the City of Tshwane as a case study. 6.2. Summon the National Treasury, Department of Water and Sanitation, and the Auditor-General to account for the monitoring and control of tanker-related procurement. 6.3. Direct the Special Investigating Unit and Hawks to examine allegations of sabotage of water infrastructure and possible collusion between municipal officials and private contractors. 6.4. Recommend policy reform to ensure that water-tanker services are used only for emergency relief and are strictly time-bound, audited, and publicly reported. 6.5. Ensure transparency to communities by compelling municipalities to publish all tanker contracts, expenditure, and service records on accessible platforms. 7. South Africa’s water crisis is deepening, not only because of scarcity but because corruption has been allowed to pollute the very systems meant to deliver relief. The people deserve answers and decisive action. It is time for Parliament to intervene before water delivery becomes the next national scandal. Yours sincerely Ms Thandi Nontenja, MP United Democratic Movement Member of SCOPA
Admin
17 Oct, 2025
Request for intervention regarding Jozini: where a full dam meets empty taps
Mr Paul Shipokosa Mashatile, MP Deputy President of the Republic of South Africa Private Bag X1000 Cape Town 8000 and Ms Pemmy Majodina, MP Minister of Water and Sanitation Private Bag X9052 Cape Town 8000 and Mr Velenkosini Hlabisa, MP Minister of the Department of Cooperative Governance and Traditional Affairs Private Bag X802 Pretoria 0001 and Mr Leonard Jones Basson Chairperson of the Portfolio Committee on Water and Sanitation PO Box 15 Cape Town 8000 Dear Deputy President, Minister Majodina, Minister Hlabisa and Chairperson Basson Request for intervention regarding Jozini: where a full dam meets empty taps 1. Introduction In 2011, government promised that families living around the Jozini Dam (Pongolapoort Dam), in KwaZulu-Natal, would soon drink water from the dam for the first time in 40 years. Fourteen years later, thousands of those same families are still waiting. The people of Jozini and the greater uMkhanyakude District continue to fetch untreated water from the dam that towers above their homes. Children, elders, and livestock share the same water source in one of South Africa’s greatest contradictions, abundance without access. This is no longer an infrastructure problem. It is an accountability crisis. 2. The record of some of the reported broken promises In 2011, government announced the imminent launch of three water reticulation schemes expected to benefit about eight thousand families in the kwaJobe Traditional Authority area of Jozini. By 2015, elderly residents were still walking long distances to collect water directly from the dam, carrying heavy containers home each day while living in sight of the vast reservoir they could not access. In 2017, government declared that more than 10,000 residents across the wider Jozini area would henceforth have access to potable water. This promise was tied to phase launches of bulk infrastructure intended to expand coverage beyond urban nodes into rural settlements. However, despite this public commitment, countless households in these same areas remain without functional taps today; a stark reminder that grand launches have not translated into sustained service at the household level. That same year, the Jozini Bulk Water Supply Project launched a new treatment works designed for 40 million litres per day, meant to supply about 135,000 people (16,200 households). However, despite this major investment (over R1.075 billion spent) and the appointment of Mhlathuze Water as implementing agent, far too many in Jozini remain without functional taps. Infrastructure was built, yet the link from bulk works to community households has broken down. This disconnect between promise and performance demonstrates that the challenge is not just constructing infrastructure, but making it work for the people it was meant to serve. In 2022, the district finally obtained a licence to draw water from Jozini Dam, raising hopes that the long wait was ending. Yet, years later, the pipelines and treatment works remain incomplete, and most households still have no reliable supply. Between 2023 and 2024, frustration boiled over as residents in Mathayini and Mbabanana blocked roads and marched in protest after burst pipes, illegal connections and poor maintenance once again left entire wards without water. By 2024 and 2025, the much-celebrated Nondabuya Water Scheme, funded at R151 million and intended to reach 2,400 households, had collapsed, reaching only about 700 families before allegations of corruption and over-expenditure surfaced. Two senior officials were suspended, yet one has since resurfaced in another province’s department, continuing the cycle of impunity that defines this tragedy. 3. The cost in human dignity Behind every failed project is a community forced to live without the most basic necessity of life. Schools and clinics operate without reliable water supply. Women and children spend hours each day walking for water instead of attending school or work. Farmers lose livestock because pumps and canals lie idle. Families bury children who drown fetching water from unsafe sources. Water is life, but for many in Jozini it remains a privilege. 4. Findings from national oversight The Department of Water and Sanitation has acknowledged uMkhanyakude as one of the municipalities under Section 63 intervention, meaning national government itself recognises local collapse. The South African Human Rights Commission has confirmed that water supplied by nearly half of South Africa’s municipalities is unsafe to drink, with uMkhanyakude among those in critical condition. We take note of Water and Sanitation Minister Pemmy Majodina’s commitments in her 2025/26 Budget Vote, where she pledged to strengthen accountability, professionalise municipal water services, and accelerate delivery through the Water Partnerships Office and new legislative reforms. These undertakings are welcome and necessary. However, communities like Jozini must see these commitments materialise in real, functioning infrastructure and visible results on the ground, not only in plans, task teams, or budget lines. Minister Majodina’s speech identified vandalism, illegal connections, and non-payment as national challenges, but Jozini’s experience shows the deeper truth: these failures persist because accountability remains optional. We also note the establishment of the Makhathini Lower Pongola Water User Association in 2023 by Gazette Notice No. 48514, designed to manage the dam, river, and canal infrastructure across Jozini, uMhlabuyalingana, and parts of Zululand in a coordinated manner. Its governance structure is to include representation from farmers, municipalities, conservation authorities, traditional leaders, and other user groups to ensure equity in decision-making over water releases, allocation and infrastructure operations. Yet despite this statutory framework, the association remains largely aspirational: canal sections are vandalised or illegally tapped, refurbishment is unfunded, and community voices seem excluded from real oversight. If it is to be more than symbolic, the Water User Association must be empowered, resourced and held to account, and its operations must align with the accountability and transparency demands outlined above. We further note with grave concern the redeployment of Chuleza Hombisa Jama, a former KwaZulu-Natal Cooperative Governance and Traditional Affairs (CoGTA) official who was suspended in connection with the failed R151 million Jozini water project, to a senior position in the Eastern Cape’s disaster management unit. Despite her suspension and the unresolved investigations, she was transferred without clear vetting or accountability. Such actions undermine the principle that those under investigation should not be placed in positions of authority over public resources or emergency response. This practice erodes public trust and highlights the urgent need for national safeguards against the redeployment of officials implicated in misconduct. The UDM firmly holds that cadre deployment and redeployment without accountability have become a mechanism for perpetuating maladministration and corruption. Time and again, officials who fail or are implicated in wrongdoing are simply shuffled from one department to another with no consequence. They are recycled instead of being removed. This practice undermines public confidence and shows that loyalty and political patronage matter more than competence, integrity or results. According to UDM policy, the state must institute measures to vet, sanction and, when necessary, dismiss such officials permanently from public service. Appointments and redeployments must be subject to transparent scrutiny, and no individual should be protected from consequence because of political connections. 5. A Parliamentary call for action As a Member of the Standing Committee on Public Accounts (SCOPA), I therefore call for the following actions, each with clear lines of responsibility for the: 5.1. Minister of Water and Sanitation and the Auditor-General of South Africa to commission a joint forensic and performance audit, with the Special Investigating Unit, into all Jozini and uMkhanyakude water projects since 2010, including Nondabuya, Greater Ingwavuma, and the Makhathini Canal. 5.2. KwaZulu-Natal MEC for CoGTA to implement the immediate suspension of any official implicated in financial or project irregularities, pending the finalisation of investigations, and ensure that no redeployments occur until due process is completed. 5.3. Department of Water and Sanitation, working with the uMkhanyakude District Municipality to publish up-to-date progress reports on all water projects in Jozini and uMkhanyakude, detailing expenditure, appointed contractors, and realistic timelines for completion. 5.4. Department of Water and Sanitation and the National Treasury to fast-track the completion of the Greater Ingwavuma Bulk Water Supply Scheme and secure the funding necessary to ensure full functionality before the 2026 financial year. 5.5. Minister of Water and Sanitation, in collaboration with CoGTA and the Municipal Infrastructure Support Agent to establish a multi-agency task team, including the Department of Water and Sanitation, the Department of Cooperative Governance and Traditional Affairs, the National Treasury, the Municipal Infrastructure Support Agent, and local civil society, to coordinate funding, technical support, and consequence management. 5.6. Deputy President of the Republic, in his capacity as Chairperson of the Infrastructure and Investment Committee to provide executive coordination and oversight to ensure that national, provincial, and municipal interventions in the Jozini and uMkhanyakude water projects are properly aligned, funded, and implemented within measurable timelines, with quarterly progress reports submitted to Parliament. 5.7. Parliamentary Portfolio Committee on Water and Sanitation, together with SCOPA to receive and review all audit outcomes from the above processes and ensure ongoing Parliamentary oversight and follow-up to guarantee accountability and delivery. 6. Restoring trust and transparency The people of Jozini deserve honesty. They deserve updates, site visits, and written reports, not ribbon-cutting ceremonies. Transparency must replace secrecy and confusing messaging, and delivery must replace excuses. 7. Conclusion The African National Congress and Inkatha Freedom Party in KwaZulu Natal have repeatedly traded accusations over who are to blame for the ongoing water crisis in Jozini, while actual delivery to communities remained absent. The political squabbling has become a spectacle, a diversion from the core failure: that waterless residents suffered years of neglect. This unhealthy dynamic has allowed both parties to claim moral high ground without ever changing the status quo for the people. The Jozini crisis also reflects a massive failure of coordination between the three spheres of government. Over the years, every department and level of authority has made promises; yet there has been no sustained follow-through. The national department announces interventions, the province appoints task teams, and the district and local municipalities hold community meetings, but these efforts rarely converge into one accountable plan. The result is duplication, confusion, and continued hardship for ordinary residents. The lack of alignment between policy, funding, and implementation is glaring, and the people of Jozini are bearing the brunt. The Government of National Unity (GNU) has promised to turn a page on this legacy of division and failure. That promise will mean nothing if it does not reach the most neglected corners of our country. The crisis in Jozini is a test of the GNU’s sincerity: whether it can replace political blame with shared responsibility and turn promises into pipes that actually deliver water. Water is life, and accountability must now flow as freely as the water that surrounds Jozini. It is now imperative for Deputy President Paul Mashatile, as Chairperson of the Infrastructure and Investment Committee, to convene all stakeholders at national, provincial, and local levels, into one coordinated platform to resolve this crisis once and for all. Yours sincerely Ms Thandi Nontenja, MP United Democratic Movement Member of the Standing Committee on Public Accounts Copied to: ? Mr Enoch Godongwana, MP - Minister of Finance ? Mr Songezo Zibi, MP - Chairperson of the Standing Committee on Public Accounts ? Rev Thulasizwe Buthelezi, MPL – KwaZulu-Natal MEC for Cooperative Governance and Traditional Affairs ? Ms Tsakani Maluleke - Auditor-General of South Africa ? Adv Andy Mothibi - Head of the Special Investigating Unit ? Adv Chrystal Pillay – Acting Chief Executive Officer of the South African Human Rights Commission ? Cllr Remington Mazibuko - Provincial Chairperson of the UDM in KwaZulu-Natal
Admin
06 Oct, 2025
Urgent Inquiry into the expenditure and delays of the Upper and Lower uMkhomazi Water Projects
Mr Songezo Zibi, MP Chairperson of the Standing Committee on Public Accounts PO Box 15 Cape Town 8000 Dear Chairperson and Members of SCOPA Urgent Inquiry into the expenditure and delays of the Upper and Lower uMkhomazi Water Projects 1. Introduction 1.1. The United Democratic Movement (UDM) writes to formally request that the Standing Committee on Public Accounts (SCOPA) institute a full inquiry into the expenditure, procurement processes and governance failures associated with the Upper and Lower uMkhomazi Water Projects. 1.2. In my understanding, the uMkhomazi development has always been envisaged as two complementary projects with distinct roles. The Upper uMkhomazi Water Project centres on the construction of the Smithfield Dam and a transfer tunnel into the uMngeni system, designed to secure bulk raw water for Durban, Pietermaritzburg and inland communities. The total costing reportedly R28 billion. By contrast, the Lower uMkhomazi Water Project is focused on potable water delivery, with a balancing dam, treatment works, and bulk pipelines intended to serve an estimated 50,000 households in southern eThekwini and the Ugu District, including Amanzimtoti, Umkomaas, Scottburgh and Hibberdene. 1.3. The Upper project is therefore about storage and transfer to the metropolitan supply, while the Lower project is about immediate, treated water supply to households along the coast. The latter project is valued at over R20 billion. The UDM did note the recent statement by Water and Sanitation Minister Pemmy Majodina that the Lower uMkhomazi scheme has reached over 60% completion, with key components such as the Ngwadini Dam, bulk pipelines and treatment works underway. 1.4. These projects, with a combined estimated value of R48 billion, are meant to secure water supply for both inland and coastal communities in KwaZulu-Natal . Instead, they have become emblematic of delays, disputes and dysfunction, leaving thousands of households without access to their constitutional right to water. 2. Problems and delays 2.1. The Upper uMkhomazi scheme, was originally projected to be completed by 2018. It has now been pushed back to 2032, a 14-year delay . Communities such as Tafelkop , west of Durban, have already lived with dry taps for more than 15 years and now face the prospect of another generation without water. 2.2. In 2022, the then Minister of Water and Sanitation noted that the Department is making efforts to deal with abandoned projects by resuscitating them and accelerating those that have been slow to implement. He admitted that in the past the Department struggled with weak project management, premature announcements of projects without proper planning or budgets, and failures to complete essential processes such as procurement. He added that steps are currently being taken to resolve these shortcomings. 2.3. The Lower uMkhomazi scheme, has a R7 billion tender was interdicted in court due to disputes about the adjudication process . This is not a minor administrative hiccup but a sign of systemic weaknesses in procurement governance. 3. Governance and procurement failures 3.1. The UDM is gravely concerned that: 3.1.1. Funding shortfalls have been allowed to derail timelines repeatedly, even though public money continues to flow into the projects. 3.1.2. Procurement disputes have resulted in costly litigation, effectively freezing delivery while contractors and departments fight in court. 3.1.3. Former Minister Senzo Mchunu made explicit commitments to resuscitate and fast-track these projects, commitments that have not been honoured. 3.1.4. Current leadership — Minister Pemmy Majodina and Deputy President Paul Mashatile — have yet to provide the public with clear milestones or an accountability framework for delivery on both projects. 3.2. Recent media reports highlight troubling governance lapses at uMngeni-uThukela Water (UUW), the implementing institution for the uMkhomazi schemes. A forensic probe by Strauss Daly found that Mr Khanyisani Stanley Shandu, Chairperson of UUW’s subsidiary, uMngeni Water Services (UWS), failed to fully declare his and his spouse’s interests in several companies, including one doing business with UUW. Following these findings, the UUW board removed Shandu from his roles as chairperson of UWS and member of its Capital Projects and Fixed Assets Committee. However, he remains a member of the main UUW board. Reports also note that Minister of Water and Sanitation Pemmy Majodina considered his removal in July 2024 but did not proceed. These red flags go beyond individual failings. They highlight systemic weaknesses in conflict-of-interest controls, related-party disclosures, procurement integrity, and executive oversight in the water sector. The fact that a senior figure implicated in such governance failures remains on the board of a critical water utility undermines public confidence in the stewardship of multi-billion-rand projects such as the Upper and Lower uMkhomazi schemes. For this reason, SCOPA’s potential inquiry cannot be limited to tracing financial flows alone. It must also scrutinise the fitness of governance structures and leadership at implementing institutions and assess whether ministerial oversight has been exercised effectively to protect the public interest. 4. Financial oversight concerns 4.1. The scale of investment is staggering: R48 billion committed, yet the tangible benefit for communities remains minimal. Parliament has no transparent breakdown of: 4.1.1. How much of this money has already been spent. 4.1.2. Which contracts have been signed and honoured. 4.1.3. The cost implications of court interdicts and legal wrangles. 4.1.4. The extent of waste, irregular expenditure, or overpayments over the years. 4.2. Without this clarity, the risk is that billions will continue to be consumed without producing a single drop of water for households. 5. Variations in project costs 5.1. Over the past decade, the projected cost of the Upper uMkhomazi project has escalated dramatically. As far back as 2015 and 2016, government admitted “affordability concerns”, with early estimates for project climbing into the range of R19 billion . In 2023 it was estimated to cost R23 billion by 2028 . In the most recent reporting from 2024 and 2025, figures as high as R26 billion have been cited. In her 100-days performance report, Minister Pemmy Majodina confirmed that the Department is pursuing the R28 billion Upper uMkhomazi project, including a new dam and transfer tunnel intended to supply eThekwini and surrounding municipalities. 6. Human impact 6.1. At the heart of this crisis are people. Communities west of Durban such as Tafelkop, and along the coast from Amanzimtoti to Hibberdene, remain without safe, reliable water despite living next to multi-billion-rand projects. 6.2. Families are forced to fetch water from rivers and streams. Children go to school without the guarantee of clean water at home. Clinics and local businesses operate under extreme constraints. The constitutional promise of access to sufficient water is being violated. 6.3. This is not simply a technical or financial issue. It is a matter of human dignity and social justice. 7. Request to SCOPA 7.1. The UDM therefore requests that SCOPA: 7.1.1. Launch a full inquiry into the expenditure on the Upper and Lower uMkhomazi Water Projects, with disclosure of every contract, payment, and variation order to date. 7.1.2. Summon former and current Ministers of Water and Sanitation, including Mr Senzo Mchunu, as well as the incumbent Minister Pemmy Majodina, to account for promises made, delays, and failures of oversight. 7.1.3. Call Deputy President Paul Mashatile to outline the role of the Infrastructure Fund and coordination mechanisms in preventing further waste. 7.1.4. Require National Treasury to provide a detailed account of funding allocations, affordability assessments and interventions since the start of the projects. 7.1.5. Examine the impact of court interdicts on the Lower scheme and recommend measures for expediting the resolution of procurement disputes, including interim service delivery arrangements so that communities are not left hostage to litigation. 7.1.6. Assess the human cost of these delays by inviting submissions from affected communities, civil society, and municipalities in eThekwini and Ugu. 7.1.7. Report quarterly to Parliament and the public on the progress of the inquiry and recommendations for corrective action. 7.1.8. Assess the fitness of leadership at uMngeni-uThukela Water and its subsidiaries, including the conduct of board members and the adequacy of ministerial oversight, to ensure that governance failures do not derail multi-billion-rand water projects 8. Conclusion 8.1. The Upper and Lower uMkhomazi schemes were meant to represent hope for communities long denied water. Instead, they have become symbols of how governance failures, procurement disputes and weak financial oversight can hollow out even the most important infrastructure projects. 8.2. SCOPA has a constitutional duty to ensure that every rand spent produces results. Water is life, and public money is sacred. The UDM urges SCOPA to take up this inquiry without delay, as a test of Parliament’s commitment to accountability and the protection of the rights of ordinary South Africans. Yours sincerely Ms Thandi Nontenja, MP United Democratic Movement Member of SCOPA
Admin
03 Oct, 2025
Open letter to the Financial Sector Conduct Authority, National Treasury and the government of South Africa on pension arrears
Mr Enoch Godongwana, MP Minister of Finance Private Bag X115 Pretoria 0001 and Mr Velenkosini Hlabisa, MP Minister of the Department of Cooperative Governance and Traditional Affairs Private Bag X802 Pretoria 0001 and Commissioner Unathi Kamlana Financial Sector Conduct Authority PO Box 35655 Menlo Park 0102 Dear Minister Godongwana, Minister Hlabisa and Commissioner Kamlana An open letter to the Financial Sector Conduct Authority, National Treasury and the government of South Africa on pension arrears 1. The United Democratic Movement (UDM) writes with grave concern about the worsening crisis of unpaid pension contributions, recently highlighted by the Financial Sector Conduct Authority (FSCA). According to the FSCA, employers across South Africa owe more than R7.29 billion in pension arrears, affecting nearly 600,000 workers. 2. This is not only a financial scandal; it is a betrayal of trust. Pensions are not perks; they are deferred wages. For thousands of workers, the discovery that contributions deducted from their salaries were never paid over to pension funds has caused shock and despair. Many only became aware of this painful truth when attempting to access their savings under the two-pot retirement system in September 2024. 3. The introduction of the two-pot retirement system was meant to improve financial security by splitting new contributions into a savings pot, from which one withdrawal can be made each year, and a retirement pot, which remains locked until retirement. Instead of providing relief, the system has exposed the depth of the arrears crisis. When workers tried to make their first withdrawals, many discovered that their contributions had never been transferred to their funds. What should have been a safety net has become proof of betrayal, leaving workers with empty accounts where their savings should have been. 4. Families who are already struggling with rising costs of living now face the indignity of poverty in their old age because of the failures of their employers and the weakness of the regulatory framework. 5. As a party within the Government of National Unity (GNU), the UDM sees it as our duty to exercise firm oversight from within, ensuring that government does not turn a blind eye to failures that harm workers and their families 6. The scale of the crisis 6.1. The arrears problem is no longer marginal; it is systemic. Arrears surged by 40% in one year to reach over R7 billion. Nearly 600,000 workers are affected, with many still in employment and others already retired. Over 1,000 cases have been referred to the South African Police Service, and more than 8,000 instances of legal action have been initiated by retirement funds. Yet, prosecutions remain limited and recoveries slow. 6.2. This problem is not confined to small businesses. Large provident funds such as the Auto Workers Provident Fund and the Motor Industry Provident Fund account for the bulk of legal actions, and government itself has emerged as one of the biggest culprits. 7. Accuracy and transparency of data 7.1. While the scale of the arrears is shocking, there are also concerns about the accuracy of FSCA data. Reports have shown that some employers named in arrears lists insist they had made payments, but that the arrears were still reflected because of delays in updating data, incomplete reporting by funds, or administrative errors. 7.2. Such inaccuracies undermine trust in the regulatory system, cause reputational harm to compliant employers, and create confusion for workers. Transparency only has value if the information is accurate and up to date. Workers and Parliament need figures they can rely on. 8. The systemic weaknesses 8.1. The UDM acknowledges steps the FSCA has taken, including publishing arrears lists, collaborating with Treasury and the Hawks, recovering R39 million and R50 million from municipalities through withheld transfers, and securing court orders against delinquent municipalities and company directors. These are important interventions. 8.2. However, they remain insufficient. The FSCA itself admits that it lacks full powers over employers until the Conduct of Financial Institutions (COFI) Bill is passed into law. Enforcement is slow, arrears continue to grow, and some retirement fund trustees are failing to act decisively against non-compliant employers. In the meantime, workers continue to suffer while billions in deferred wages are withheld. 9. Accountability and governance 9.1. It is especially alarming that government itself (through national and provincial departments and municipalities) is among the biggest culprits, owing an estimated R1.5 billion despite Treasury interventions. Municipalities in particular are repeat offenders, often defaulting again even after arrears are recovered through withheld equitable share transfers. National and provincial departments are not immune either. 9.2. This is unacceptable. When the state itself is in breach, it weakens public confidence in the entire system and sets a terrible example for private employers. The UDM cannot remain silent while the state itself is one of the worst offenders. We will use every platform in Parliament, including SCOPA, to hold both our partners and ourselves to account. Leadership cannot demand compliance from others while defaulting on its own workers’ pensions. 10. In light of the above, the United Democratic Movement calls for urgent action on the following: 10.1. The Minister of Finance to prioritise the Conduct of Financial Institutions Bill and for the Portfolio Committee on Finance to fast-track its passage through Parliament, so that the FSCA is fully empowered to act against defaulting employers. 10.2. The FSCA, working with National Treasury, the Hawks and the National Prosecuting Authority, to enforce the law through criminal charges, asset seizures and by holding directors, officers and municipal managers personally liable. 10.3. The FSCA to continue publishing arrears lists, but to strengthen them by ensuring accuracy, providing sectoral breakdowns, and reporting not only on arrears but also on recoveries and enforcement actions, so that workers, Parliament and the public can track real progress transparently 10.4. National Treasury and Minister Velenkosini Hlabisa, in his role as Minister of Cooperative Governance and Traditional Affairs, to intervene firmly in delinquent municipalities and government departments, with SCOPA exercising oversight to ensure that such failures do not repeat. 10.5. The FSCA to act against trustees who neglect their duty to recover contributions from defaulting employers. 10.6. National Treasury to put in place interim protection measures so that workers making use of the two-pot system are not left destitute because of employer failures. 11. Conclusion 11.1. South Africa cannot tolerate a situation where nearly R7.3 billion in pensions is left unpaid while workers go hungry and pensioners live in indignity. Pensions are deferred wages earned through years of labour and withholding them is nothing short of theft from the future. 11.2. Being part of the GNU does not mean turning a blind eye. It means doubling our vigilance. The UDM will continue to play its role by exercising firm oversight inside government to safeguard the rights of workers and ensure public money is used with integrity. Yours sincerely Mr NLS Kwankwa, MP Deputy President of the United Democratic Movement Party Leader in Parliament Copied to: Ms Nomakhosazana Meth, MP - Minister of Employment and Labour Mr Songezo Zibi, MP - Chairperson of the Standing Committee on Public Accounts Dr Mkhacani Maswanganyi – Chairperson of the Standing Committee on Finance Mr Makhosonke Maneli – Chairperson of the Portfolio Committee on Employment and Labour Dr Zwelini Mkhize – Chairperson of the Portfolio Committee on Cooperative Governance and Traditional Affairs Ms Thandi Nontenja, MP - UDM Member on the Standing Committee on Public Accounts
Admin
24 Jun, 2025
Year-in-review report on my role as Deputy Minister of Defence and Military Veterans within the Government of National Unity
Honourable Nqabayomzi Kwankwa, MP Parliament Leader of the United Democratic Movement (UDM) Parliament of the Republic of South Africa Cape Town Dear Honourable Kwankwa, Year-in-review report on my role as Deputy Minister of Defence and Military Veterans within the Government of National Unity I trust this letter finds you in good health and high resolve. BACKGROUND AND PURPOSE Since my appointment as Deputy Minister of Defence and Military Veterans in July 2024, I have had the privilege of engaging meaningfully with various parliamentary structures, state institutions, and formations within the South African National Defence Force (SANDF), as well as in certain instances, alongside the Minister - as evidently drawn in a summative table below, there was no space to breathe. These engagements have highlighted both the strengths and the structural weaknesses within our broader governance ecosystem. Most of the issues identified are of a legacy nature. The Auditor-General’s report has been instrumental in guiding the new Ministry, the Joint Standing Committee on Defence, and the Portfolio Committee on Defence, providing critical insight into the terrain we are expected to navigate. It is clear that the Department of Defence did not escape the effects of state capture. The ongoing SIU investigations initiated through proclamations signed by the President and the fact that the former Minister is still before the courts highlight the depth of the challenges we face. These realities point to a protracted process of restoring the integrity and capacity of the SANDF, a task further complicated by years of chronic underfunding. Another matter that garnered considerable public and institutional attention was the Democratic Republic of Congo (DRC) debacle, which placed the Department of Defence under intense scrutiny. This incident raised serious concerns about the overall capacity, preparedness, and logistical readiness of the SANDF to effectively carry out its continental peacekeeping and combat obligations. It further brought into question the adequacy of our planning processes, resource allocation, and strategic command structures in high-risk deployments. The DRC episode served as a stark reminder of the urgent need to review and strengthen our defence capabilities, particularly in the context of multinational operations under the auspices of SADC or the African Union. Adding to the ongoing concerns is the increasing impact of climate change, which continues to present new and evolving threats to our country’s security and humanitarian stability. This changing climate landscape is testing the capacity of the SANDF to respond swiftly and effectively, particularly in the deployment of rescue equipment and disaster relief operations. A case in point is the devastating floods in the Eastern Cape, which tragically claimed the lives of at least 92 people, though the final death toll is yet to be confirmed. Despite the scale of the disaster, only one Oryx helicopter was deployed for rescue and relief efforts days after the disaster had occurred, highlighting the severe limitations in our aerial response capabilities during emergencies. This highlights the urgent need to improve SANDF’s disaster response readiness in alignment with the growing frequency and intensity of climate-related events. The purpose of this letter is twofold: To provide you, as Parliamentary Leader of the United Democratic Movement (UDM), with a concise reflection on the nature of oversight and executive engagement I have undertaken since assuming office; and To urge, in the strongest terms, the reactivation and intensification of Parliament’s role in holding the Executive accountable on several unresolved matters of national importance, especially those the UDM has historically championed. It is my belief that the UDM’s principled, consistent, and people-centred voice must now take a more assertive role in ensuring that findings, commissions, and legislative frameworks lead to real consequences and reform. SUMMARY OF ALL ENGAGEMENTS This Meetings Summary Table outlines the scope of my official engagements over the reporting period. It serves as a record of the work I have undertaken in the execution of my duties as Deputy Minister of Defence and Military Veterans. The engagements span parliamentary responsibilities, oversight of the Department and the SANDF, Cabinet cluster coordination, and international cooperation. I have always believed that public office must be anchored in accountability and purpose-driven action. Each meeting reflected in this table represents a deliberate effort to advance the priorities of our defence mandate, strengthen operational efficiency, and respond to the needs of our servicemen and women, veterans, and broader society. Whether meeting with international partners, military leadership, parliamentary committees, or community stakeholders, my focus has remained on upholding the integrity of the portfolio and ensuring that decisions are informed, inclusive, and responsive to our evolving national and global context. This table is therefore more than a schedule - it is a transparent demonstration of the work done, the responsibilities carried, and the trust placed in my office to serve with diligence, consistency, and impact. Meeting Type / Category Total Meeting Count Summary Description Department of Defence (DoD) related meetings 63 Strategic meetings with Armscor, Denel, Defence Secretariat, AG compliance briefings, logistics planning, HR and CMIS oversight, force design sessions, budget alignment talks, and NCACC duties. SANDF Service Formations 42 Operational visits and reviews at SA Army HQ, Navy HQ, AFB Waterkloof, Military Police, Defence Intelligence, SAMHS, Logistics HQ, CMIS, and SF Brigade; command parades and capability briefings. Joint Standing Committee on Defence (JSCD) 12 Defence oversight briefings, acquisition performance reviews, and coordination with Treasury and Armscor. Portfolio Committee on Defence & MV 58 Parliamentary meetings focused on oversight of military veterans, departmental annual reports, and policy matters. Cabinet & Cluster Meetings 33 Engagements in JCPS and ICTS Cabinet Clusters, Deputy Ministers forums, Cabinet Lekgotla, executive caucuses, and inter-cluster alignments. International & Diplomatic Engagements 51 Bilateral engagements with Turkey, Italy, Pakistan, Spain, China, Cuba, India, the US, Japan, France, Russia, and multilateral meetings including BRICS, Ethiopia, AU Peace & Security Council sessions, arms control dialogues, the Thabo Mbeki Foundation dialogue on peace and security, various conferences on peace and security, and embassy briefings. Countries Visited on Bilateral Missions 6 Ethiopia, India, Pakistan, Cuba, Japan, and France. Community / Civic Engagements 19 Veteran forums, traditional leadership sessions, Youth Day, Women’s events, rural civic visits, and local councillor engagements. MILITARY DIPLOMACY AND STRATEGIC BILATERAL ENGAGEMENTS Over the course of this reporting period, I have placed a strong emphasis on advancing South Africa’s military diplomacy through a series of targeted bilateral and multilateral engagements. These efforts are aimed at deepening defence cooperation, strengthening strategic partnerships, and safeguarding our national interests in a dynamic and often volatile global environment. In meetings with representatives of foreign governments, military attachés, and international defence institutions, I have consistently advocated for the expansion of opportunities for our officers to attend foreign staff courses and specialised military training programmes. Building the intellectual and leadership capacity of the SANDF remains a top priority, and external training partnerships are central to that goal. Furthermore, I have worked to promote the interests of South Africa’s defence industry, calling for increased collaboration in manufacturing, technology transfer, and procurement opportunities. By encouraging reciprocal engagement between our state-owned and private defence entities and their international counterparts, we have opened new avenues for innovation and market access. These engagements have not been ceremonial. In some instances, we have used quiet diplomacy to de-escalate tensions, clarify miscommunications, and avert diplomatic fallout that could have had far-reaching implications for our defence posture and foreign relations. I remain committed to ensuring that every interaction, whether at a reception, conference, or strategic roundtable, serves the broader purpose of peace, preparedness, and prosperity for our nation and the region. IMPLEMENTATION OF THE 2015 DEFENCE REVIEW In terms of the FY2023/24 Ministerial Priorities as agreed to with the President on 18 July 2023, the Minister of Defence and Military Veterans was set the target of “Conducting an Evaluation of the Defence Review 2015 and Action Plan” for completion by 31 October 2024. The Department completed the draft documents in fulfilment of both the FY2023/24 Ministerial Priorities, as well as the subsequent direction as was given by the President during a bilateral engagement on 24 January 2024. The above- mentioned work-in-progress was formally submitted to the Presidency before the said 31 October 2024 deadline. PROCESS UNDERTAKEN The work-in-progress includes (inter alia): A concise PESTEL(M) Analysis of the Strategic Environment at the Global, Continental, Regional and National (GCRN) Dimensions. A Draft Defence Capstone Policy Concept for the Republic of South Africa. A Draft Military Capstone Strategizing Concept for the Defence and Protection of the Republic of South Africa. A Draft South African Military Strategy, Force Design and Force Structure for the period 2025 – 2055. The Journey to Greatness (Long Term Planning Intent). It was envisaged that a planned series of engagements and consultations would be pursued with the President and other critical stakeholders under the direction of the Minister before such work is formally tabled in Cabinet and in Parliament. Consequently, the South African National Security Council (SANSC) has directed the South African National Security Secretariat (SANSS) to develop a Report on the Reviewing of the Defence Review 2015 and the considerations for “investing in a sustainable modern Defence Force”. An initial engagement took place with the SANSS on 17 March 2025, where it was decided that a one-day workshop between the Department and the SANSS would be planned for the near future. This second engagement took place on Friday 13 June 2025. The work was well received and positive support was expressed in terms of the 1.5% of GDP Defence Funding Target as set by the President. The SANSS subsequently resolved to establish a small team of DGs (including the DG of the National Treasury) to engage on the fiscal strategy for attaining the goal as set by the President. Once endorsed by the National Treasury and the Ministry of Finance, this matter will proceed to the National Security Council and possibly Cabinet for further endorsement. Furthermore, the Minister will also be engaging with the Speaker and the Chairs of Parliamentary Committees on modalities for engagement with the relevant oversight bodies, so as to add value to this important work. The Department of Defence met the deadline as it was set by the Presidency. However, the Department cannot issue copies of the documents in question to the Portfolio Committee, or any structure beyond those explicitly identified for initial consultation, until a formal directive or clearance is received from the President. The decision on whether these documents may be distributed to oversight bodies rests with the Presidency, and the Department remains bound by that process. OVERSIGHT ROLE IN THE NATIONAL CONVENTIONAL ARMS CONTROL COMMITTEE (NCACC) As part of our collective responsibilities in the National Conventional Arms Control Committee (NCACC), we have actively contributed to the clearing of a significant backlog of arms control applications and export permits. Regular sittings of the Committee have ensured that due process is followed while maintaining the momentum necessary to support South Africa’s defence trade and associated industries. The backlog, which had affected operational timelines and contract fulfilment, has been systematically addressed except in instances where further verification or end-user clarity is still required. Our approach has balanced national security interests with economic imperatives, ensuring that compliant transactions are processed without unnecessary delay. Importantly, this work has direct fiscal implications. Every approved permit contributes to sustaining the country’s defence manufacturing base, securing jobs, and increasing state revenue. The NCACC therefore functions not only as a regulatory mechanism but also as a strategic enabler of industrial and economic resilience. We remain convinced that if the recovery and growth plans presented by Denel and Armscor are implemented with urgency and alignment, these state-owned entities can be repositioned toward institutional ascendancy. Through coordinated support and policy certainty, we can restore their role as vital components of South Africa’s defence capability and global competitiveness. ENGAGEMENTS WITH DEFENCE INDUSTRY STAKEHOLDERS Recent engagements with stakeholders across the defence industry were held as part of ongoing efforts to advance the implementation of public-private partnership (PPP) resolutions adopted during previous national platforms. These interactions served both as progress reviews and as strategic exchanges aimed at deepening cooperation in critical capability areas, including artillery systems, weapons testing, and industrial modernisation. The engagements also reaffirmed a shared commitment to leveraging the local defence industry as a cornerstone of national security and economic growth. A central focus of these engagements was the increasing interest, both domestically and internationally, in concluding memoranda of understanding (MoUs) with South African partners. These MoUs are expected to strengthen collaboration in advanced defence manufacturing and testing, helping position South Africa as a serious global player in next-generation defence systems. Discussions also centred on developing a coherent industry roll-out strategy that aligns local capabilities with global demand, enables technology transfer, and revitalises underutilised infrastructure for defence innovation. Stakeholders noted some progress since the last formal conference, but also expressed concern over regulatory delays, particularly those related to the issuing of permits by oversight bodies. These delays have disrupted momentum on several priority projects, thereby limiting the speed and scale of PPP execution. On a positive note, regulatory engagements with National Treasury have yielded revised guidelines, effective June 2025, that provide broader space for PPPs in areas such as prime mission equipment maintenance and upgrades. Concurrent consultations with the SANDF are also underway to ensure that industry proposals respond directly to operational requirements. One of the most significant recommendations arising from these discussions is the proposal to establish a dedicated PPP Directorate within the Department of Defence. This unit would serve as the central coordinating body for all PPP-related initiatives, reporting directly to senior leadership and working closely with oversight structures such as the Council on Defence and SANDF command. Stakeholders further recommended that the scope of PPPs be expanded beyond weapons systems to include strategic infrastructure development such as military hospitals, new bases, and the rehabilitation of command and logistics centres, thereby enabling comprehensive capability renewal. These engagements concluded with a unified commitment to intensify coordination between government, the defence force, state-owned entities, and industry partners. The focus going forward is to finalise a practical implementation roadmap for PPPs, remove regulatory bottlenecks, and institutionalise a mechanism to drive delivery on key resolutions. Stakeholders reiterated their readiness to support the Department’s efforts in positioning the local defence industry as a strategic, responsive, and globally competitive contributor to national development and security imperatives. ISSUES FACED BY MILITARY VETERANS One of the critical departments currently facing significant challenges is the Department of Military Veterans (DMV), particularly with regard to the prolonged delays in filling vacant posts. In response, we have convened a series of strategic sessions aimed at resolving these longstanding issues. These efforts have included the development of structured data management procedures, the compilation of a comprehensive implementation plan, and the establishment of a reliable and up-to-date veterans database. Through these targeted interventions, we are confident that tangible progress will be achieved, ensuring improved service delivery and greater satisfaction for military veterans across the country. Furthermore, we are working in close collaboration with the Presidential Task Team (PTT) to accelerate the resolution of the pressing issues identified above. This partnership is anchored in a shared commitment to restoring dignity and improving the quality of life for military veterans. The PTT serves as a vital coordinating mechanism, bringing together various stakeholders across government to ensure alignment, expedite decision-making, and remove bureaucratic obstacles. PARLIAMENTARY ENGAGEMENTS TO DATE In adherence to the principles of transparency and executive accountability, I have participated in a wide range of key engagements since assuming office, as reflected in the Meetings Summary Table above. These include: Portfolio Committee on Defence and Military Veterans – Regular attendance and formal submissions on matters affecting strategic capability, force readiness, and the well-being of military veterans, including oversight on departmental performance and policy execution. Joint Standing Committee on Defence – Active participation in joint oversight sessions, with specific focus on defence budget alignment, acquisition oversight, interdepartmental coordination, and strengthening the operational posture of the South African National Defence Force. Parliamentary Budget Votes and Debates – Participation in defence-related budget vote debates, including presenting key departmental priorities, defending expenditure patterns, and outlining performance targets in support of the Vote 23 allocation. Questions and Answers in Parliament – Engagements in plenary sessions involving questions to the President and Deputy President, as well as oral and written responses to parliamentary queries related to peace and security, military procurement, international cooperation, and veterans’ affairs. The nature of these engagements has not only reinforced the importance of parliamentary oversight but has also highlighted the urgent need for meaningful and enforceable accountability across all arms of the state. These engagements reveal systemic weaknesses, recurring audit disclaimers, and a dangerous normalisation of underperformance in service delivery and defence operations. In this context, the United Democratic Movement must position itself at the forefront of revitalising Parliament’s role. We must not only build on previous oversight work, but also be uncompromising in demanding implementation, consequence management, and institutional reform. Whether dealing with state-owned entities, public funds, or post-commission reform, the UDM must lead efforts to restore ethical and effective governance. ENGAGEMENTS WITH SANDF SERVICE FORMATIONS AND DEFENCE INDUSTRY ENTITIES In line with my executive responsibilities and the constitutional duty to ensure responsive governance, we have conducted a series of structured engagements with the South African National Defence Force (SANDF) and its associated defence industry institutions. These engagements have been instrumental in mapping the operational posture, resource gaps, institutional dysfunctions, and potential areas of reform within the defence ecosystem. Within the SANDF, we have exercised oversight on the following service formations and divisions: South African Army South African Air Force South African Navy South African Military Health Service (SAMHS) Military Police Division Logistics Division Human Resources Division Military Intelligence Division, among others. Each of these components performs a critical function in safeguarding the territorial integrity, sovereignty, and national interests of the Republic. However, these briefings have revealed a pattern of declining capacity, exacerbated by chronic underfunding, outdated equipment, infrastructure backlogs, and skills attrition. ENGAGEMENTS WITH THE DEFENCE INDUSTRY: DENEL AND ARMSCOR In addition to these military briefings, we have participated in oversight and strategic discussions with the two most significant players in our domestic defence industrial base - Denel and Armscor. These engagements have been instrumental in reaffirming the defence function not as an expense, but as a constitutional guarantee of sovereignty, stability, and peacekeeping in the region. However, without strategic intervention by Parliament, the SANDF risks organisational stagnation. The effectiveness of Parliament has been ambiguous for some time, with many struggling to comprehend that portfolio committees, particularly those overseeing Defence, have been raising alarms over a continued decline, yet the resolutions have largely amounted to little more than talk shops over the years. Every week, we report to the portfolio committees on these issues, but when it comes to Parliament’s role in capacitating these committees and ensuring the protection of our country, tangible support has been lacking. Even when in 2023 the President issued a directive to increase defence funding from 0.57% to 1.5% of the Gross Domestic Product (GDP), subsequent Cabinet meetings reduced these urgent calls to mere rhetoric, and the National Treasury failed to allocate the necessary funds. Parliament and the Government of National Unity must establish a structured, accountable process to implement resolutions, especially those related to Defence and oversight bodies such as SCOPA. PARLIAMENT’S OVERSIGHT MANDATE: LEGISLATIVE AND CONSTITUTIONAL FRAMEWORK Parliament’s oversight function is grounded in our democratic Constitution and further supported by key legislation that empowers Members of Parliament to act decisively: Section 55(2) of the Constitution mandates the National Assembly to “provide for mechanisms to ensure that all executive organs of state in the national sphere of government are accountable to it”; Section 92(2) and (3) of the Constitution holds Cabinet members individually and collectively accountable to Parliament; Rules of the National Assembly empower committees to summon any person to provide evidence, produce documents, or account for their actions; The Financial Management of Parliament and Provincial Legislatures Act (Act 10 of 2009) and the Money Bills Amendment Procedure and Related Matters Act (Act 9 of 2009) outline Parliament’s role in fiscal scrutiny and resource allocation oversight. This framework makes it clear: Parliament is not a passive observer. It is a constitutional watchdog with the authority and duty to demand accountability, transparency, and implementation. URGENT NATIONAL PRIORITIES DEMANDING PARLIAMENTARY ACTION Considering the background outlined above, I respectfully urge you to deploy the full weight of your office and the UDM’s parliamentary caucus to intensify oversight and push for finality on the following critical matters: Implementation of the Zondo Commission Findings The State Capture Commission unveiled an architecture of corruption that compromised state institutions and undermined public trust. Yet, implementation of its findings remains inconsistent and slow. The UDM, through Parliamentary procedures must: Demand detailed progress reports from the Presidency and the NPA; Ensure asset recovery is expedited and transparent; Create a dedicated oversight structure within Parliament to track implementation and prevent institutional regression; Introduce reforms to seal procurement loopholes and reinforce the independence of law enforcement bodies. Champion and expedite the enactment of legislation that enshrines the Commission’s rulings into law, effectively safeguarding the state from future attempts of corruption in any form. Public Investment Corporation (PIC) Accountability The Mpati Commission laid bare the mismanagement and undue influence within the PIC, risking public servants’ pensions. The UDM, through Parliamentary procedures must: Demand a detailed and public implementation report from Treasury and the PIC; Reinforce transparency in investment decisions; Re-evaluate laws governing the PIC to insulate it from political and commercial abuse. State Response to Ex-Mineworkers The UDM has long championed justice for ex-mineworkers, many of whom continue to suffer from occupational illnesses without compensation. Despite acknowledgment from former President Mbeki, implementation remains weak. The UDM, through Parliamentary procedures must: Pursue diligent follow-up on all correspondence directed to the Presidency and the Department of Labour during the tenure of former Minister Thulas Nxesi, wherein the UDM formally submitted numerous letters concerning this matter. Demand a policy framework with timelines and budget allocations for redress; Establish an interdepartmental task team to coordinate response efforts; Oversee enforcement of legal rulings and settlement payouts to affected mineworkers and their families. Land Reform and Restitution Delays The backlog in land claims, particularly post-1998 claims, continues to disenfranchise communities. The UDM, through Parliamentary procedures must: Demand a revised, time-bound implementation plan from the Commission on Restitution of Land Rights; Introduce clearer legislative frameworks for expediting land restitution and tenure security. Collapse of Provincial Health Systems and NHI Readiness While the National Health Insurance (NHI) Bill signals intent for universal healthcare, existing infrastructure and corruption in the provincial health systems raise serious concerns where many are destitute. The UDM, through Parliamentary procedures must: Demand provincial audits on hospital infrastructure and medical staffing; Scrutinise funding flows in aim to prevent tender manipulation; Insist on a phased, measurable NHI roll-out plan with clear reporting mechanisms to Parliament. The other issue is the pension of the South Africa Transkei Bophuthatswana Venda Ciskei (SATBVC) states , President Ramaphosa during the State of the Nation Address (SoNA) instructed the minister of Finance to address the matter, but Treasury once more ignored this call, however, we managed to bring it back to Parliament and are simply asking him to monitor the progress of the finalisation of this enquiry and address the concerns of these pensioners. The other pressing matter is that which relates to the remuneration of the herdsman (iiBhodi). Numerous engagements with the Presidency, National Treasury, and COGTA had been initiated by the UDM in the 6th administration, and it my plea that your office further escalates the matter to ensure that there is action in as far as this issue concerned. Youth Unemployment and Skills Mismatch The UDM, through Parliamentary procedures must also confront the unacceptably high rate of youth unemployment, now surpassing 60% in some areas. Despite billions spent on education and skills development, graduates remain locked out of the economy. The UDM should demand: Full audits of SETAs and the National Skills Fund; Reforms linking training programmes directly to identified economic sectors; State procurement policies that prioritise youth-owned enterprises and cooperatives. CONCLUSION This report serves as a summative reflection on the engagements, responsibilities, and strategic interventions undertaken over the reporting period. It captures not only the scope of work executed in alignment with my portfolio duties, but also reflects the broader institutional and policy challenges we continue to confront as public representatives. The insights and data provided herein are intended to inform, support, and empower the critical oversight role played by your office and by Parliament more broadly. Honourable Kwankwa, we are at a historical juncture. Public confidence in democratic institutions is eroding. The gap between policy and implementation continues to widen. It is in this context that the UDM’s voice and leadership in Parliament must grow louder and more decisive. I remain committed to providing assistance wherever possible, fully appreciating the established reporting protocols given my deployment within the Executive. Nonetheless, I wish to emphasise with conviction that when these critical matters are brought forth by your esteemed office, they are far more likely to gain the necessary traction, visibility, and momentum. This will significantly amplify the many voices we represent in Parliament and ensure that our concerns receive the urgent attention they deserve. We must insist on accountability, demand justice for the forgotten, and champion ethical governance as a pillar of transformation. Through your leadership, Parliament must become a place where reports are not only tabled, but implemented; where corruption is not only debated, but punished; and where vulnerable communities are not only heard, but served. With a thorough understanding of the dynamics within the Government of National Unity (GNU), I intend to formally raise these concerns at the forthcoming Bosberaad of GNU leaders, convened as per the President’s suggestion in response to the recent budgetary challenges and the discontent expressed by other political parties regarding aspects of the decision-making process. It is particularly notable that the African National Congress (ANC) and the Democratic Alliance (DA) are, in posture, seen to be undermining other parties and excluding them in all decision-making processes. The aim of this Bosberaad is to view the priority areas that need alignment and rethinking. Please be assured of my continued cooperation and support in pursuit of this collective national duty. Yours sincerely, Maj. Gen. (Ret.) BH Holomisa President of the United Democratic Movement Deputy Minister of Defence & Military Veterans
Admin
23 Sep, 2020
Holomisa submission to the state capture commission: the real mastermind behind state capture
Deputy Chief Justice RMM Zondo Chairperson of the Judicial Commission of Inquiry into State Capture PO Box 31322 Braamfontein 2017 Per the acting Secretary of the Judicial Commission of Inquiry into State Capture Dear Sir SUBMISSION TO THE COMMISSION: THE REAL MASTERMIND BEHIND STATE CAPTURE 1. Corruption: a cancerous tumour 1.1. One of government’s major mistakes is delaying the implementation process to deal with corruption and addressing maladministration. It is evident that incompetence and corruption has collapsed and downgraded this country, thereby costing our economy billions of Rands. As a result of this undesirable culture, many municipalities have crumbled, because there are no effective structures to stop corruption, and to prevent maladministration and mismanagement of funds. 1.2. We acknowledge that measures have been taken, such as the formation of the Judicial Commission of Inquiry into State Capture (‘the Commission’) so that it may establish who has captured the state, but the process has been laborious and, in our view, not nearly far-reaching enough. 1.3. The former Public Protector, Professor Thuli Madonsela, had revealed that the Gupta family had effectively captured the state, however, as it turns out, the real architect of corruption is the ruling party itself, the African National Congress (ANC). 1.4. Accordingly, the Commission has been making the ruling party’s head honchos account for their alleged acts of corruption, but there is much more to this iceberg than what is presented to the public. Although the media and opposition parties, like the United Democratic Movement, have exposed some of the ANC and their leaders’ misdeeds, I believe most of it is kept diligently under wraps, because it might be the lurking iceberg that finally sinks the ANC Titanic. 1.5. The ANC and its leaders have misused state funds through companies like Bosasa, Chancellor House, Mohlaleng Media and Maverick State, to mention but a few. Looting from public resources has become a habitual act to fund the ANC by whatever means necessary, whether it be by paying its cadres’ exorbitant salaries or financing their election campaigns by any means necessary. 1.6. It is repulsive that this brazen looting takes place right under the noses of the authorities, whilst parliament’s oversight has not been effective either. The powers of the accounting officers have been usurped by the executive, consequently it has also affected the performance of state-owned enterprises. 1.7. The Commission’s terms of reference states that your work shall be guided by the Public Protector’s state capture report and we have noticed from the testimony that other accounts of corruption have been creeping out of the woodwork. It is therefore evident that there is a ‘big picture’ corruption that must be looked at. 1.8. Whilst much is made of Guptagate implicating former President Zuma and some other insatiable cadres, the fact that the corruption and looting at all spheres of government is to the benefit of the ANC itself, is negated. The Commission should therefore investigate the involvement of the ANC in acts of corruption, in totality. 1.9. This institutionalised corruption is not new, and it can be traced back through the previous decades. Even the Commission of inquiry into allegations of impropriety regarding Public Investment Corporation (‘PIC Commission’) quoted my testimony where I said that: “One of the most difficult tasks regarding dealing with the type of corruption that is alleged to have happened at the PIC is the sophisticated nature of the transactions. Corruption can come in two forms, legal and illegal corruption. Legal corruption occurs when the elite build a legal framework that protects corruption or manipulate existing legal framework without necessarily breaking the law.” 1.10. The PIC Commission concurred with my statement when they said in their report to the President that: “When going through the story of Harith, these words resonate. The layering of legal entities (state owned corporations, pension funds, banks, companies and trusts and partnerships etc.), when applied by financiers and corporate structure experts, can make finding the substance, and not form, of a transaction or series of transactions complex and quite perplexing. These layers also give the players in such a formation use ‘plausible deniability’ most effectively, as looking through all the conducts is challenging and time consuming.” 1.11. This designed incompetence permeates our law enforcement agencies, such as the police, the Directorate for Priority Crime Investigation (Hawks), the Special Investigating Unit (SIU) and the National Prosecuting Authority (NPA), which all have dismally failed to investigate and prosecute the reported culprits. One must be honest in one’s assessment of the competence of the state’s investigative and judicial resources. It is a given that the state lacks such competence in all respects, whilst the same is further exacerbated by means of prevalent corruption within the ranks of these institutions themselves. 1.12. The gate keepers of maladministration are the incompetent key administrative personnel who have been deliberately appointed (deployed) to accomplish the agenda of looting state resources on behalf of the ANC and, of course, to feed their own personal greed. It must be borne in mind that the ANC’s cadre deployment policy is just another form of corruption. It is called nepotism for a reason, because making appointments based on party affiliation, friendship and familial connections violate the statute books and is patently wrong. Cadre deployment deprives our civil service of talented individuals and we have thousands of young South Africans with degrees who cannot find jobs. 1.13. Epidemic levels of corruption handicaps service delivery which results in many violent protests. Not only that, prospective international investors shun South Africa because of the high levels of corruption and sadly our people are paying the price. Ultimately, corruption is destroying the gains of our freedom and patriotic South Africans have lost all hope and endlessly question the so-called measures put in place to address this untenable situation, whilst the ruling party itself perpetuates corruption in order to sustain itself. 1.14. Let us remind ourselves of what the late, former President Nelson Mandela admitted, already in 1998, about corruption in South Africa: “Unfortunately there are officials who betray their calling… this is part of the wider cancer of corruption that is undermining our efforts in all areas of society. We have learnt now that even those people with whom we fought the struggle against apartheid’s corruption can themselves become corrupted.” 1.15. The sad state of affairs is that the liberators of yesteryear have become the perpetuators of this immoral pillaging of state resources, whilst we are misdirected in our focus on the Gupta’s involvement in state capture. 1.16. The true architects of state capture are those who run government and its institutions in collusion with certain elements within the private sector. The private sector, which particularly benefits from government tenders, is represented by individuals who are shareholders in large corporations. These individuals appear to represent the private sector, but instead they use corporate fronts that merely return the loot to the ANC. These individuals also represent the corrupt interests of the ruling party in that they are either ANC stalwarts or that they are connected in one or other compromising manner to that party, politically or otherwise. 2. A Nelson Mandela Bay example: Mohlaleng Media, the ANC’s access to public funds 2.1. The purpose of this letter is to request the Commission to investigate the mechanisms used in government institutions to misuse state funds, especially at local government level. 2.2. I was recently briefed, on the matters which I raise below, by Mr Werner Wiehart, a persecuted forensic investigator formerly employed by the Nelson Mandela Bay (NMB) Metropolitan Municipality. He indicated to me that he had forwarded the information to numerous political parties and as well as the Commission (See Annexure A), but I took the liberty to meet with him last week and wish to report the matter to you formally. 2.3. The matter centres on how municipal funds have been looted by the ANC over, at least, the past fifteen years in NMB. Some information is already in the public domain including those that have been reported to the police, Hawks, NPA and the Public Protector. 2.4. The documentary evidence, which I have in my possession, convinced me that there is prima facie evidence that NMB municipal funds were looted for the ANC’s benefit, to fund its operations and to sustain itself. Questionable entities or companies (which are non-compliant with tax obligations and also lack related tax and billing clearances) and the registration of multiple enterprises simultaneously, are used as tools to achieve their dastardly goals. 2.5. Furthermore, I noted that law enforcement agencies remain actionless where corruption in the NMB municipality, more often than not, remains uninvestigated – in some cases, for more than three years. I cannot over-emphasise my concern if this is the alacrity with which this government is driving the fight against corruption, whilst little or nothing is achieved to start off with. 2.6. The widely publicised NMB Integrated Public Transport System (IPTS) scandal, in which National Treasury is implicated, is simply not being addressed, except for a single case in court. National Treasury, with particular reference the Chief Director, Mr Jan Hatting, had apparently been informed in writing during October 2012 of the large-scale looting, yet with such knowledge National Treasury continued to make payments thus feeding the large-scale looting scheme over a period of a further three years. So, nothing is happening, whilst the thieves are still trawling through personal protective equipment (PPE) tenders to rake in money to fund the ANC’s campaign for the 2021 municipal elections. 2.7. The evidence in my possession shows that, according to Mr Wiehart, there were three key players from Luthuli House involved, namely, Mr Pravin Gordhan (then Minister of Cooperative Governance and Traditional Affairs), Dr Crispian Olver (famous author of “How to Steal a City: The Battle for Nelson Mandela Bay: An Inside Account) and Mr Cheslyn Mostert (a well-known ANC operator), who presented themselves as those mandated to address the NMB municipality’s issues; a process which led to the appointment of Mr Danny Jordaan as executive mayor and Mr Johann Mettler as acting city manager. 2.8. The same process led to the suspension (with full pay) of some municipal officials and their subsequent resignations, as well as some limited dismissals. Amongst others, these suspensions and resignations were caused by the allegations that some of the employees benefited from the IPTS deal. 2.9. Prior to the aforementioned ‘Luthuli House intervention”, the opposition, the media and the people were voicing out their anger about the IPTS corruption and as a result our Mr Mongameli Bobani, an ordinary councillor at that point in time, asked the Public Protector in October 2014 to investigate the matter. The Public Protector’s Advocate Tom had apparently investigated, but the final report was never made public. The municipality had appointed legal firms which have cost the rate payer more than R100 million over three years. 2.10. The evidence shows that the hand of Dr Olver extends beyond ‘helping the municipality’, but that he also played a role in the mismanagement of funds which were channelled to the ANC through a company called Mohlaleng Media, which served exclusively as the propaganda machinery of the ruling party in NMB. In this email Dr Olver informs the acting city manager that: “Here are the two CVs from Cheslyn, together with the draft letter to be signed and sent back to him, and the rates for the resources has set out in the SLA. The start date in the letter needs to be changed to Monday Next Week.” 2.12. A “tender” for R7,5 million was awarded to Mohlaleng Media, however the municipality failed to comply with its obligations in terms of the Municipal Finance Management Act to conclude the prescribed SLA which had to be signed between the municipality and Mohlaleng Media prior to commencement of any services. In fact, on assessment of the information, it is evident that Mohlaleng Media’s bid is riddled with fraudulent information, whilst even the entire procurement process was rigged from inception in favour of Mohlaleng Media. 2.13. Mohlaleng Media operated from December 2014 to February 2016 before any so-called SLA was signed on a fraudulent basis and of course the ratepayer footed the bill. This so-called SLA is referred to as an addendum to a former SLA, which never existed, hence, fraud. The tender/contract period entailed three years, however the bid value of R7,5 million had already been exhausted within the first ten months of the contract period. 2.14. Documentary evidence reveals that Mohlaleng Media invoices merely claimed monthly “resource cost” which eventually reached the amount of more than R21 million versus the actual approved bid value of R7,5 million over three years. These invoices were specifically created in such a manner to conceal the true nature of the work/service performed by this ANC aligned communications machine. 3. Mohlaleng Media forensic investigations, the cover-up and harassment of an investigator 3.1. One of the things I noticed as I went through these files is the harassment of Mr Wiehart by the office of the then Democratic Alliance executive mayor, Mr Athol Trollip, and his chief of staff together with the then acting city manager, Mr Johann Mettler. The harassment resulted in the malicious suspension of one of the municipal auditors based on fabricated and trumped-up charges and who was eventually expelled in a collusive manner. 3.2. The quarrel stemmed from Mohlaleng Media, which was used to generate ANC campaign material for the 2016 local government elections. (see pictures on the right) 3.3. An internal investigation had been done regarding Mohlaleng Media during which the Chief Audit Executive and forensic investigator, Mr Wiehart, questioned Mr Mettler’s involvement, which clearly caused discomfort in some quarters given the backlash that followed. 3.4. After Mr Trollip became aware that Mr Mettler and Dr Olver were implicated in the internal investigation on Mohlaleng Media, he had the terms of reference that was prepared by the internal audit team changed and, in essence, had it watered down in order to intentionally and actively conceal ANC corruption using an external forensic inquiry. In fact, Mr Mettler drafted the terms of reference for the external audit, which was a clear conflict of interest. The new terms of reference did not require the investigation of Mr Mettler and Dr Olver’s involvement, which was obviously intentional and self-serving. 3.5. A certain Morrison and Vermeulen were appointed on 31 May 2017, with the new terms of reference, whilst Mr Wiehart was placed on compulsory special leave, during which he was persecuted on the basis of fabricated charges of misconduct. Morrison and Vermeulen apparently performed very poorly, and in fact showed little progress. Mr Morrison furnished a preliminary report on 6 November 2017. 3.6. Mr Morrison’s final report does not contain the factual findings that were communicated to him since May 2017, nor did he make any reference to evidence furnished to him by a whistle-blower whose disclosures are included in the documents that I have now studied. 3.7. Same resulted in the comprehensive Chief Audit Executive review queries in that Mr Morrison had simply not performed, but more concerning is the fact that he collusively acted with Mr Mettler in concealment of impropriety by Mr Mettler, Dr Olver and others. 3.8. From the evidence before me, Mr Morrison is in all probability a compromised individual who did not render the service that he was appointed and paid for. This is how entrenched corruption is in our society, that even external forensic consultants are prepared to engage in the very same cancerous agenda that society is attempting to eradicate. 3.9. According to Mr Wiehart, Mr Trollip had even gone so far as to hide documents at his residence for a period of twenty-six months after a forensic report was furnished to a Hawks investigator in March 2018. Mr Trollip may say that he was the one who mandated the investigation, yet he must be made to account for his collusive actions in protection of corrupt officials and politicians. 3.10. This entire narrative raises a concern, which is that “the system” used in NMB to loot funds through companies like Mohlaleng Media could be, and probably is, “the system” that is replicated in other municipalities (and even other spheres of government) in favour of the corrupt and looting ruling party. 4. The leaked CR17 campaign bank statements: the same names crop up 4.1. Mr Wiehart further took me into confidence and shared information with me that relates to Linkd Environmental Services of which Dr Olver is, at the moment, the sole director. This three-man operation in 2017 entered into an SLA with Ria Tenda Trust (which belongs to President Ramaphosa) to provide accounting and financial services (https://www.thepresidency.gov.za/download/file/fid/1649) This is rather odd, because Linkd Environmental Services is not a financial services or accounting firm at all. What had apparently piqued Mr Wiehart interest had been that, given what had transpired in NMB, that this might be a case of history repeating itself. 4.2. I was shown some of the various leaked bank statements, that are quite easily accessible on social media platforms and, even though they have been sealed by the court , they therefore can never enjoy protection from public scrutiny. 4.3. What can be seen from these bank statements is that a bank account was utilised to channel alleged CR17 campaign funding. I find it questionable that the principals segregated so-called day to day business operations, with alleged campaign donations, as one would expect that separate trust accounts be opened and be managed in a transparent manner. 4.4. What was however of much interest to me, given the context of this submission, was that these statements showed the involvement of the very same individuals involved in the NMB/Mohlaleng Media corruption. They are Maverick State (formerly known as Mohlaleng Media), Crispian Olver, Cheslyn Mostert, Grant Pascoe, Vukile Pokwana and some others. 4.5. I was also shocked by some of the names of the listed beneficiaries, where I saw that many members of the ANC received money, totalling millions of Rands, in their personal bank accounts. Although, I hold no brief for the ANC as an organisation, I am concerned about Crispian Olver and Cheslyn Mostert’s seeming endgame. Whilst on the one hand, their hands may loom large in the corruption that has been taking place in NMB and on the other hand, Dr Olver’s company is alleged to have distributed millions of Rands to ANC members. There seems to be a strange disconnect between those actions. 4.6. That said, my concern is that, from where exactly did the funding in Dr Olver’s company bank account originate. On review of the deposits, it is evident that these origins are not vested in well-known and/or credible corporate resources from the private sector. Considering how Mohlaleng Media was used to fund and sustain the ruling party’s ever-hungry hyenas in NMB, one cannot believe that there is any legitimacy behind the so-called donor funding from private individuals or corporations. 4.7. Who are the real ‘donors’ and from where does such funding truly originate? Looking closely at the methodology used by Bosasa, and what could possibly be used by Linkd Environmental Services, one is left with unanswered questions as to who the real architects of state capture are. This is the actual question that must be considered, and investigated, by the Commission. 4.8. The innocuous words ‘donor funds’ are constantly used, whilst the biggest and most important ‘donor’ is the state through the looting of public funds. These so-called donor funds emanate directly from state contracts and government tenders and not from happy and morally complacent ANC supporters. 5. Conclusion 5.1. To verify the authenticity of the information contained in this submission, the Commission should consider conducting a preliminary investigation by engaging Mr Werner Wiehart. All the documentation I have scrutinised is available on request. 5.2. Furthermore, to aid its work, the Commission would be well advised to request the Public Protector’s report on its 2014/15 investigation of the NMB municipality’s IPTS system, as well as all the NMB corruption cases that have been reported to the police, Hawks, SIU and the NPA. 6. Parting shot: the money must be recovered from the ANC 6.1. We, at the moment, spend a lot of time talking about corruption and plumbing its depths, which is of course right. But we must also emphasise the imperative that all the moneys that have been pilfered through tender rigging, as was done with the eye-opening Bosasa shenanigans, in favour of ANC linked companies, or ANC leaders and linked individuals or the party itself, must be recuperated. 6.2. Tracing exactly into whose pocket the money went might look like an insurmountable task, and it probably will be a massive operation. But not tackling this task, would be short-changing South Africans from the moneys that should have been spent to make manifest their constitutional rights. Simple as that. 8. I remain at your disposal. Yours sincerely Mr Bantu Holomisa, MP President of the United Democratic Movement Copied to: • President of the Republic, Mr Cyril Ramaphosa • Minister of Finance, Mr Tito Mboweni • Speaker of the National Assembly, Ms Thandi Modise, for the relevant portfolio committees’ attention • NMB acting Executive Mayor, Cllr Thsonono Buyeye • NMB acting City Manager, Mr Mandla George
Admin
10 Sep, 2020
DHET: further allegations of Minister Nzimande’s political interference: appointment of SACP cronies
Dear President Ramaphosa DEPARTMENT OF HIGHER EDUCATION AND TRAINING: FURTHER ALLEGATIONS OF MINISTER NZIMANDE’S POLITICAL INTERFERENCE: APPOINTMENT OF PARTY CRONIES 1. I refer to my letters of 24 and 31 August 2020 regarding allegations of interference of the political head of the Department of Higher Education and Training (DHET), the Minister of Higher Education, Science and Technology, Dr Blade Nzimande, in departmental processes and administration, as well as the undermining of the senior departmental accounting officers. 2. Minister Nzimande’s alleged direct interference in procurement processes, such as what apparently happened with the National Student Financial Aid Scheme (NSFAS) laptop tender, clearly has disastrous consequences. This much vaunted project has flopped; everyone sits with egg on their faces and our students are left right where they started, without learning devices. NSFAS’s feeble attempt to mitigate the damage, effectively blaming a total of 150 bidders for “getting it wrong”, is almost laughable. 3. It has now come to my attention that Minister Nzimande was allegedly directly involved in twelve DHET appointments in the 2019/20 financial year that were not made in line with Public Service Regulations (PSR) and/or the Public Finance Management Act (PFMA) 1 of 1999. 4. The salaries of these twelve allegedly irregularly appointed individuals cost the taxpayer around R9,7 million a year, but once you consider the allegation that the majority of them are South African Communist Party comrades of the Minister, their appointments take another flavour and one can see why the regulations were seemingly so grossly flouted. 5. It is alleged that, in March 2020, five employees additional to the DHET establishment were appointed, but that there were no logic or justification for the creation of these posts in terms of Section 57(2) of the PSR. Apparently, the posts were not even advertised. I also understand that there was no appointment committee and no competency assessments were conducted as required by Section 67(1). Lastly, there were allegedly no vetting or checking of qualifications in terms of Section 57(3). These appointments are: 6. Another alleged appointment where the Minister had a hand in, is that of a 12-month contract of a Deputy Director-General Planning, Policy and Training, whilst this post already existed in the department establishment and it was vacant. The story with this appointment is the same as with the previous five; none of the PSR prescriptions were adhered to. 7. Two staff members were allegedly headhunted, whilst this is only allowed in terms of the DHET Recruitment and Selection Policy under certain circumstances as described in Section 2.1.6. For some reasons, apparently known only to the Minister, they were both headhunted after only one failed advertisement and the process was not conducted by a recruitment agency. Also, apparently, no verification of their qualifications has been done; they are: 8. The last four instances where the Minister apparently had a hand in are listed below, and as I understand it, there is no evidence on file, that indicates that their qualifications/studies and employment verifications were performed prior to their appointment as is required by Section 67(9a) of the PSR. 9. Much as the blustering rationalisations and irritable explanations come from the Minister, no amount of spin-doctoring can camouflage the dysfunction within the DHET, the Sector Education and Training Authorities (SETAs) and NSFAS. 10. Given the information that you have, I am interested to know what actions you have taken, or plan to take, to address these serious allegations against Minister Nzimande? Have you, at all, considered the United Democratic Movement’s call to suspend him? If not, why not? 11. Lastly, in the interest of setting the record straight, I also refer you to Minister Nzimande’s use of a ministerial briefing to strike at me and his use of a manipulative lie when he said I have an interest in doing business with his department. I wonder how he justifies conscientiously executing his oath of office if a lie is so easily told using a government platform. I wish to place on record that I am not the businessman he disparaged me to be, and that I have no interests, nor have I ever had, in any companies that do business with government and/or any of its entities. I have, in an effort to clear this up with the Honourable Minister, gone to the extent of offering to engage him on this topic on any live radio or television platform of his choice, but the response from his corner has, thus far, been mute. Yours sincerely Mr Bantu Holomisa, MP President of the United Democratic Movement
Admin
31 Aug, 2020
PSETA: Minister Nzimande’s alleged manipulation and political interference in the appointments of the board, chairperson and CEO
Dear Mr President PSETA: MINISTER NZIMANDE’S ALLEGED MANIPULATION AND POLITICAL INTERFERENCE IN THE APPOINTMENTS OF THE BOARD, CHAIRPERSON AND CEO 1. I refer to my letter to you, dated 24 August 2020, regarding the alleged direct interference of the political head of the Department of Higher Education and Training (DHET), the Minister of Higher Education, Science and Technology, Dr Blade Nzimande, in that department’s administration. Although I have not received a formal acknowledgement of receipt, the Presidency’s automated stock-email response, indicates that you are in receipt thereof. 2. I would like to bring to your attention further information I received pertaining to the Minister’s conduct, in what appears to be interference and manipulation of the administrative process leading to the appointment of the board and chairperson of the Public Service Sector Education and Training Authority (PSETA) as well as the chief executive officer (CEO). 3. Appointment of PSETA board 3.1. The fact that Minister Nzimande twice advertised, at the end of 2019 and the beginning of 2020, the call for appointments to the Sector Education and Training Authority (SETA) boards is a fact. His unexplained reasoning for doing so is, however, open to criticism for several reasons. 3.2. Regarding the 2019-round, I am told that the PSETA employed a selection process that considered merit, continuity, and the requirements of stakeholder representation. Its recommendations were forwarded to the DHET for approval. Yet, it is alleged that the Minister did not make appointments for reasons known only to him, but rather directed for the process to be re-opened. This came as a surprise to PSETA, as I suspect other SETAs, since they had already gone through their long-used process with which they are familiar. 3.3. It must be noted that PSETA apparently did not receive any new nominations during the second round of a request for nominations. This meant that recommendations made to the Minister in 2019 were relevant for appointment. It must be noted that a nomination of a certain Mr Thulani Tshefuta was apparently received during the initial nominations for board appointment but was rejected as he did not meet the requirements. The relevance of this specific allegation will become apparent later in this letter and the Minister must explain this phenomenon. 3.4. PSETA recommended a full roster of six names allocated to organised labour representatives, yet the Minister for some odd reason, appointed five, one of whom did not receive an appointment letter, thus leaving the two existing vacancies. The Minister, again without explaining himself, only made two of PSETA’s recommended reappointments. 3.5. There are two persons, namely Mr Lewis Nzimande (community organisations’ representative) and Ms Linda Dube (organised employers’ representative), who the Minister has seemingly unilaterally appointed. PSETA apparently has no records, such as curriculum vitae and the background check, ordinarily undertaken by Managed Integrity Evaluation (MIE), on file. These documents are crucial for audit purposes. 3.6. The directive by the Minister for re-advertisement without providing reasons and the subsequent appointment of board members who were not recommended nor nominated through PSETA processes is indicative of an abuse of power and manipulation of a regulated process by Minister Nzimande. 3.7. The critical question here is, was this entire exercise merely an attempt to satisfy compliance, whilst the Minister had his own agenda? 3.8. Furthermore, the Minister’s “double advertising” imposed time pressures, which resulted in the newly appointed board being unprepared and they allegedly fell prey to the CEO, Ms Bontle Lerumo, causing them to make decisions before they received a hand-over report and induction, and before they could familiarise themselves with the organisation and previous board resolutions. This is a dangerous set of circumstances, but when one considers the allegation that Ms Lerumo is a confederate of the Minister and Mr Mabuza Ngubane (the Director SETA Performance Management whom I referred to in my previous letter), matters take a shadier turn. 4. Appointment of PSETA chairperson 4.1. Regulation 14(2) of the “Standard Constitution of SETA regulations associated with the Skills Development Act 26 of 2011” was amended in 2017, ironically by Minister Nzimande himself, to allow for SETA board chairpersons to serve two terms of office. 4.2. The motivation had been to ensure continuity and organisational stability. I therefore suspect that all the SETAs were stunned when the Minister directed the advertising of the chairpersonships in late 2019. For reasons known only to the Minister this call was reopened in early 2020. 4.3. The Minister, in essence, unilaterally limited the former PSETA chairperson’s service to one term, this despite the spirit of the aforementioned amendment. I however found it extremely disturbing that the Minister, also for reasons known only to him, decided to appoint Mr Thulani Tshefuta (to whom I referred in Paragraph 3.3) as PSETA board chairperson. It is surprising that he emerged as the chairperson of the board when he did not meet the requirements for the board. 5. Appointment of PSETA CEO 5.1. As I understand it, the appointment of CEOs is in line with the SETAs’ five-year licencing period and that the SETAs’ executive committees and boards (assisted by corporate services) take responsibility for this process. Ms Lerumo’s contract ended on 31 March 2020 but, to ensure smooth transition, she must serve until 30 September. 5.2. This NQF Level 9 post was advertised in two Sunday newspapers and on PSETA’s website, but shortly thereafter the advert was recalled and re-placed (this time only on the website) with an erratum specifically lowering the level of academic qualifications. Why on earth was this done, if not to accommodate a certain applicant? 5.3. Shortlisting evidently took place and, Ms Lerumo, whom I hear does not possess an NQF Level 9 qualification, was amongst the top three performers recommended to the Minister possibly due to the new board’s inexperience and some irregular influence. 5.4. There is already an indication that the Minister refused the top candidate, because he did not know him/her. The initial list of recommended candidates is available, and should the appointment not be done according to this recommended list and Ms Lerumo is appointed, the Minister must be held accountable for flaunting the process in favour of his alleged collaborator. 5.5. It would also mean that the top candidate was discriminated against, because of the Minister’s personal preferences, and that the entire process is legally contestable in terms of our labour legislation. As a matter of fact, given the Minister’s reputation, there could be a wholesale legal action where these SETA CEO appointments are concerned. If the new PSETA board is confident that the process was fair and transparent, they should confidently supply you with all the relevant documentation. 6. Mr President, Minister Nzimande seems to be running DHET and the SETAs from his briefcase and in light of all the nauseating allegations against him that have risen of late, it is incumbent upon you and cabinet to intervene in the appointments of the SETA boards, chairpersons and CEO until the veracity of these allegations are established by your office. 7. This entire set of circumstances demonstrates Minister Nzimande’s seeming lack of duty of care as an executive authority in managing public resources and ensuring efficient public service. He appears to have demonstrated a high level of disregard for public service regulations, not acting in the interest of the public good and is not fit to be a minister and it is your responsibility to sort this out. Yours sincerely Mr Bantu Holomisa, MP President of the United Democratic Movement
Admin
21 Aug, 2020
UDM helps 72 tenants threatened with legal action by Eastern Cape Public Works
Honourable Premier Mabuyane IMMORAL EVICTIONS: MISTREATMENT OF ORDINARY SOUTH AFRICANS BY THE EASTERN CAPE DEPARTMENT OF PUBLIC WORKS WHICH ADMINISTERS PROPERTIES IN WHICH THEY RESIDE (MTHATHA) 1. I was recently approached by a anxious group of persons who have organised themselves under the banner of the Democratic Housing Tenants Association (DHTA) which consists of 72 tenants, all of whom reside in properties, in Mthatha, administered by the Eastern Cape Department of Public Works and Infrastructure (DPWI) and the Eastern Cape Development Corporation (ECDC). 2. I understand that many of the aforementioned tenants have occupied these properties for a minimum of ten years, and up to 35 years in some cases. It is alleged that, since 1994, these buildings have not been maintained by the DPWI/ECDC, aside from the repairs the tenants had done at their own expense. By all accounts this seems to be true. 3. Numerous meetings with the DPWI, as far back as 2001, have apparently taken place where discussions were held regarding the opportunity for the tenants to purchase the houses they have been occupying (and paying rent for) for so many years. Seemingly, despite various DPWI commitments, none of the problems were addressed. 4. I have been informed that discussions around the purchasing of these properties with your special advisor, Mr Zandisile Qupe, on 30 June 2019, who undertook to find speedy resolution to the matter, was for naught as these tenants out of the blue received notices of motion of eviction proceedings in early July 2020. Worse still is that this unnecessary and unconscionable legal action is happening at a time of so much insecurity and fear due to the Coronavirus pandemic. 5. DHTA requested a meeting with your Public Works MEC, Mr Babalo Madikizela, which took place on 25 June 2020. Apparently, although departmental officials had rightfully been present, for some inexplicable reason, the African National Congress (ANC) OR Tambo Regional Secretary and members of the ANC Youth League, were also in attendance and the objections to their presence were ignored. Apparently, no resolution had been found at the end of that meeting and Public Works MEC Madikizela had also instructed the departmental officials to engage with DHTA within two weeks of that meeting, which has to date not occurred. 6. This story is rife with allegations of years’ long mistreatment of South Africans at the hand of the Eastern Cape government, whilst this community did their utmost to find a mutually beneficial recourse in the matter. The fact that it now also seems to be laced with politics is totally unacceptable and should be investigated. 7. I therefore now propose that you immediately involve the national Department of Public Works in the matter to assure some degree of impartiality and lack of prejudice towards ordinary South Africans in a time where their lives are already adversely impacted by the Covid-19 pandemic. 8. I attach the letter I received from the complainants for your assistance and I look forward to your speedy response, as this is an urgent matter due to the threat of legal action. Yours sincerely Mr Bantu Holomisa, MP President of the United Democratic Movement Copied to: Minister of Public Works and Infrastructure, Ms P De Lille The Democratic Housing Tenants Association
Admin
20 Jul, 2020
Alleged looting of state resources, through the DBSA, by some of the same people who have been fingered in the Public Investment Corporation investigation
Mr CM Ramaphosa President of the Republic of South Africa Private Bag X1000 Pretoria 0001 Dear Mr President RE: Alleged looting of state resources, through the DBSA, by some of the same people who have been fingered in the Public Investment Corporation investigation 1. I wrote to you a little more than a month ago, on 17 June 2020, regarding my grave concerns over the apparent looting of state resources by some of the very same individuals who were found to have had an enhanced ability to secure easy access to Public Investment Corporation (PIC) funds, as well as some new characters, who have now seemingly set their sights on looting from the Development Bank of Southern Africa (DBSA). 2. In the 17 June-letter I also suggested that Treasury intervene and cause the DBSA to urgently stop the Crede Power and Infrastructure funding, via a vehicle called Poseidon, and that investigation be made into the allegations of impropriety. 3. Much water has flown under this bridge and, since then, the individuals who I had named in my letter, first tried to bully me via a lawyers’ letter and had ultimately run to the courts in an attempt to, what appears to me, intimidate and of course gag me. Their first volley failed as the court removed their application from the urgent court roll and they were ordered to pay the wasted costs occasioned by the set-down on the urgent court roll. 4. I had also made a Promotion of Access to Information Act (PAIA) application to the DBSA to obtain all the information pertaining to the Crede Power and Infrastructure/Poseidon water project but was unsuccessful because the DBSA relied on frivolous technicalities to refuse my request. I am of the view that this was a gambit to play for time. Speculating about the real reason why they acted in this manner, leads me to think someone was up to no good. 5. The DBSA’s chief executive officer and managing director, Mr Patrick Dlamini, had also decided to engage with me in letter-warfare, which I believed to be yet another effort to intimidate me. But, knowing what I know now, I suspect it might also have been a play for time to cook the books. 6. I was quite disturbed, last week, to learn that there had been alleged interference with the DBSA’s computer systems, where electronic documentation and records on the Crede Power and Infrastructure/Poseidon water project had been made to vanish at the time of my PAIA application, thus frustrating a good cause, whilst aiding and abetting those suspected of ill deeds. 7. Up to now, there have been far too many coincidences, that point to a massive cover-up. For instance, Crede Power and Infrastructure’s website being unavailable, just after my complaint to you and a threat from some lawyers, when I wanted to double-check my researched information. Then the DBSA spitefully refused my PAIA application and Mr Dlamini inadvertently confirmed, in writing, that the information at my disposal was accurate. Now we have an alleged sudden clean-up and wipe-out of critical information on the DBSA’s funding of the Crede Power and Infrastructure/Poseidon water project. 8. This brings another serious matter into focus and that is whether there are any other current funding deals at the DBSA, involving the same parties, of which we are unaware and whilst the grass is growing underneath your feet, evidence of such are also disappearing. 9. Given the information I have imparted to you in this writ, I wonder whether you and/or Minister of Finance Tito Mboweni can rely on any information provided to you by, who in my view are, potentially discredited DBSA executives. 10. I submit to you that there is a clear need for an independent forensic investigation to review the entire matter and in particular the alleged tampering with the DBSA’s computer records. Forensic investigators will be able to validate which files and what information have been tampered with and/or have been deleted. Computer experts will also be able to ensure that any restored information is legitimate. 11. The other matter that I had raised in my 17-June letter had been that PIC board member, Ms Irene Charnley, had allegedly received a USD 20 million loan from the DBSA and that she has yet to pay that back. It might behove you to also have investigation made of the DBSA’s loan practices and whether those loans are serviced, and who the culprits are that do not pay their instalments as per the agreement with the bank and why. 12. I remain at your disposal to discuss these matters and I reiterate my request that a forensic audit is urgently needed to get to the bottom of what seems to be the machinations of the greedy and the looting of state resources. Yours sincerely Mr Bantu Holomisa, MP President of the United Democratic Movement Copied to: Minister of Finance, Mr Tito Mboweni DBSA Chairperson, Mr Enoch Godongwana DBSA Chief Executive Officer and Managing Director, Mr Patrick K Dlamini
Admin
17 Jul, 2020
Complaints of alleged racism, nepotism and corruption at the NPA, Bantu Holomisa writes to Shamila Batohi
Advocate Shamila Batohi National Director of Public Prosecutions Private Bag X752 Pretoria 0001 Dear Advocate Batohi Being sent from pillar to post: serious staff frustrations within the National Prosecuting Authority of South Africa in the Eastern Cape, Kwazulu-Natal, and Western Cape offices in particular 1. I was recently approached by a group of concerned prosecutors who work mainly in the Eastern Cape, KwaZulu-Natal and Western Cape offices of the National Prosecuting Authority of South Africa (NPA), though I understand the frustrations they brought to my attention prevail in other provinces. They have petitioned my assistance in their plight to be heard as their frustrations are festering into resentment and anger. 2. I read with interest your comments during your “listening tour/staff engagement” at the start of this year and in particular the results of a staff survey where you listed, lack of promotion, no career growth, high staff vacancies, low staff morale, and budgetary constraints as some of the complaints that staff had registered. The complaints now on my desk echo this list to a great extent. 3. From my reading of the group of concerned prosecutors’ complaints, the aforementioned matters are particularly true for prosecutors who work in rural South Africa and who depend on greater resources to get about and do their jobs. 4. However, the group of concerned prosecutors have additional complaints to those already mentioned and have made allegations of nepotism and racism. The persistence of claims of racism in the NPA over the years is worrying and clearly the solution has not yet been found. 5. I have been made to understand that the NPA has appointed a person to investigate the allegations of racism and nepotism within the organisation, but that this investigator is either too busy to attend to new complaints and/or refuses to accept such. I am interested to know what this investigator’s scope of operation is and whether it is true that some complaints are not being accepted and/or attended to and if so, why. 6. Amongst the worst of the claims made by the group of concerned prosecutors are that there are several people in senior positions within the NPA’s provincial structures who have been tainted by allegations of corruption and, whilst complaints have been lodged against them, nothing has seemingly been done to address those complaints. 7. I also refer you to your memo dated 13 December 2019, but signed on 6 January 2020, wherein the group of concerned prosecutors’ appeals for intervention was shot down, as their union had not yet been recognised by the Public Sector Coordinating Bargaining Council to represent employees in the public service. Even though this might be technically and legally correct, I find it disconcerting that you would rely on a pure technicality to, for all intents and purposes, seemingly ignore what might be serious problems within your organisation. 8. I believe what frustrates this group of concerned prosecutors the most is their feeling that their emails and letters to you, as well as meetings with you, have been for naught. They feel that they have not been properly heard nor have any of their complaints been addressed, for whatever reason, and that they are now being victimised by NPA middle management for speaking out. 9. I have also noted that your office had, in the media in late January 2020, indicated that you would be looking into the concerned prosecutors’ complaints, but judging from their contact with me, you have not yet done so. 10. I would be grateful if you would take me into your confidence regarding your views on the matters I have raised above, the plans you have made and actions you have taken to address the complaints on your desk and the progress, if any, that you have made thus far. 11. I hope to hear from you soon. Yours sincerely Mr Bantu Holomisa, MP UDM President
Admin
13 Jul, 2020
DBSA’s strange treatment of the allegations of corruption regarding the Poseidon water project and its funding
Mr Patrick K Dlamini Chief Executive Officer and Managing Director Development Bank of Southern Africa PO Box 1234 Halfway House 1685 Dear Mr Dlamini Development Bank of Southern Africa’s strange treatment of the allegations of corruption regarding the Poseidon water project and its funding 1. I respond to your letter of 10 July 2020, which the Development Bank of Southern Africa (DBSA) Company Secretary, Ms Bathobile Sowazi, sent at 22:57 on a Friday. Looking back at other emails, after hours correspondence seems to be the norm at the DBSA and one can but speculate as to the reasons why. 2. In all your letters to me regarding the Poseidon water project you sound defensive and blustering regarding the DBSA’s handling of this funding deal. Why would you cover your wickets with such excessive vigour and choose to cast aspersions on my bona fides? 3. You stated that I have “…publicly disclosed confidential information and documents belonging to the DBSA’s clients…”, what I interpret this to mean is that the information at my disposal is true and accurate. You are, in fact, right to be worried that the DBSA’s credibility might be undermined, as it, and/or some of its leadership, are seemingly engaged in activities they do not want exposed. 4. It is interesting that you decided to pre-empt President Ramaphosa’s response to my request for an investigation of the Poseidon deal. Now that you have positioned yourself as the president of this country, will you please tell the nation how the following people, as per your below document, are involved in the Poseidon transaction and how they directly and/or indirectly benefit from this deal. 5. This list of politically exposed persons (PEPs) in Poseidon’s group structure is a veritable Who’s Who of directors of public owned entities. It raises questions about the comprehensiveness and effectiveness of the DBSA’s due diligence processes in terms of corporate governance as defined in the Companies Act, No. 71 of 2008 and its 2011 amendment, the Public Finance Management Act, No. 1 of 1999 and the fourth revision of the King Report on Corporate Governance. 6. Item number 4 of the above document (in the picture), refers to the Public Investment Corporation (PIC) directors who were identified as PEPs in this deal by virtue of being board members of a state-owned entity. Who exactly are these PIC board members your document refers to i.e. the board members at the time of the submission of the application or those at the time of its approval? Either way it would be helpful if you could explain their involvement in this private, for-profit matter and whether the DBSA condones this kind of association. 7. It is confounding that your very own document states that Dr Renosi Mokate is a PEP by virtue of her being a trustee of the Harith Holdings Employee Trust and the board chairperson of the Government Employees Pension Fund (GEPF), yet she made a bare denial of any connection to Poseidon in her submission to the court in her defamation case against me and the United Democratic Movement. So, the questions the public and/or a judge might ask you are: Who added her name to this document, and why? Also, from where did you obtain this information? 8. Ultimately you are to be thanked for confirming the veracity of the above information. We will however ask those individuals (including the GEPF chairperson) who ran to court, to explain why their names appear on a DBSA document pertaining to the Crede Power and Infrastructure Investments/Poseidon funding application. 9. Our letter to the President is clear in terms of what we want to be investigated. Part of that would be that you seemingly misled the DBSA’s board by allegedly recommending that this project be funded despite the above information being at your disposal. Worse still is that some of these PEPs have been fingered in the Commission of inquiry into allegations of impropriety regarding the Public Investment Corporation. Why are you promoting and protecting these people? 10. You have placed on record that “On or about June 2019 the DBSA received an application from Crede Power and Infrastructure Investments…”. Mr Jabu Moleketi left as DBSA Chairperson in December 2018. What these two facts mean is that the Crede Power and Infrastructure Investments/Poseidon funding application was submitted to the DBSA within six months of his having left the DBSA, which I understand is in contravention of the DBSA’s twelve month “cooling off” period for directors who have left the Bank. The public might ask you whether these facts were disclosed to the Board when it considered and approved the funding application? 11. Your artless attempt to threaten me with “the law” where it pertains to whistleblowing, begs the question: “Is it not nice and convenient that the DBSA decision-makers, in the Poseidon water project deal, can hide behind this country’s laws?” This might exactly be the reason why there was no other way of exposing the alleged corruption in the way that we have. 12. The DBSA’s refusal of my Promotion of Access to Information Act 2 of 2000 request, because of technicalities, is utter drivel. You and Ms Kim Sanderson (DBSA Deputy Information Officer) who wrote to me, know exactly to which deal I was referring and what information I had asked for. Such seemingly spiteful delaying tactics could be interpreted as the DBSA playing for time to “cook the books”. If I were in your boots, I would be preparing to explain this mess in court. 13. Your 10 July 2020 letter smacks of a panicked response to being confronted by facts that are not to your and your colleagues’ liking, least of all to the liking of the PEPs involved in Poseidon. 14. I walk away from all your correspondence, thus far, with a very repulsive taste in my mouth and the perturbing feeling that you are not acting in the best interest of the people of this country. Yours sincerely Mr Bantu Holomisa, MP UDM President Copied to: Minister of Finance, Mr Tito Mboweni DBSA Chairperson, Mr Enoch Godongwana DBSA Company Secretary, Ms Bathobile Sowazi DBSA Deputy Information Officer, Ms Kim Sanderson Mabuza Attorneys, Attorney Eric Mabuza
Admin
09 Jul, 2020
Call on the IEC to host a meeting for political parties to debate South Africa’s democratic ideals, electoral reform and the impact of Covid-19 on elections
Mr Glen Mashinini Chair of the Electoral Commission Private Bag X112 Centurion 0046 Dear Mr Mashinini Call on the IEC to host a meeting for political parties to debate South Africa’s democratic ideals, electoral reform and the impact of Covid-19 on elections 1. The United Democratic Movement (UDM) has had in-depth internal discussions around two critical matters that have already impacted on, and will still impact, the way that South Africa practices democracy and runs elections. One is of course the Constitutional Court’s judgment that the Electoral Act 73 of 1998 (‘the Electoral Act’) is unconstitutional in so far as it requires candidates to contest national and provincial elections only as members of political parties and, the other, the impact that Covid-19 is having, and will have, on future elections. 2. We have also noted the opinions of some political parties on electoral reform, as well as that of the Independent Electoral Commission (IEC), expressed in the media. 3. One such item is the notion of combining national, provincial and local government elections, especially given the impact of the Covid-19 pandemic on the IEC’s preparations for the 2021 Local Government Elections and what an election would look like – in a little more than a year from now – with the uncertainty around our continued journey with the Coronavirus. Combining our elections will require constitutional changes and the practicality of somehow altering the five-year election cycles to achieve synchronicity, and the impact it will have on democracy, must be carefully considered. 4. The UDM has long been of the view that changes to our electoral system is indeed needed and the opportunity has presented itself, no matter how it was precipitated, to have earnest debate around public representatives’ accountability to the electorate and whether South Africa’s purely proportional system is the right tool to ensure that. 5. But to our minds, the most important change necessary is the need to have voters directly elect their president of the country, as is the case in many established democracies across the globe. The UDM believes that South Africa’s president should be directly elected by her people, and be held accountable to them, instead of the around 3,000 delegates at a party congress choosing a party president to be foisted onto an entire nation. 6. It is necessary to have a structured debate around these issues and it is imperative that we, as political parties, must formally engage as primary stakeholders of the IEC and South Africa’s democratic processes. 7. Given the complexities of the matters on the table, we must start the debate now in order to (if there is consensus that changes to our electoral systems are necessary and will achieve greater democracy) amend the Constitution, the Electoral Act and the Municipal Electoral Act 27 of 2000 and the attending regulations. 8. The UDM therefore calls on the Electoral Commission to urgently host a formal debate, maybe in a virtual hybrid format, where political parties can officially table their policies on the matter of electoral reform so that we can chart the way forward. Time is of the essence. Yours sincerely Mr Bantu Holomisa, MP UDM President Copied to the leaders of all political parties and the people of South Africa
Admin
01 Jul, 2020
Capturing of the administration of NSFAS
Advocate Busisiwe Mkhwebane The Public Protector South Africa Private Bag X677 Pretoria 0001 Dear Advocate Mkhwebane COMPLAINT: CAPTURING OF THE ADMINISTRATION OF THE NATIONAL STUDENT FINANCIAL AID SCHEME – ALLEGED NEPOTISM AT THE HIGHEST LEVELS, STAFF VICTIMISATION AND PURGE, CORRUPTION AND MALADMINISTRATION As you might be aware, the National Student Financial Aid Scheme (NSFAS) was placed under administration by former Minister of Higher Education and Training Naledi Pandor after its failure to pay out bursaries had led to student protests. I have been approached by concerned NSFAS employees for assistance, and the seriousness of the allegations that are being made lead me to think that this process has been “captured”. There are allegations of nepotism, victimisation and purging of staff, racism, corruption, general maladministration, mismanagement by Dr Randall Carolissen (NSFAS Administrator) in particular, as well as a general collapse of corporate governance at NSFAS. Worst of all is the allegation that the Minister of Higher Education, Science and Technology, Dr Blade Nzimande (who is supposed to oversee this process and is the custodian of good governance) is aware of some of these issues and are seemingly ignoring them and worse still, is involved in nepotism with the appointment of those loyal to him to key NSFAS (and other) positions. I hereby lodge a complaint in terms of Section 6(1) (A) of the Public Protector Act, 1994 and request you to investigate these allegations. To assist you at this point in time, please find attached to this email: 1. Annexure A (98KB) – a document that details various allegations of poor performance, unscrupulous procurement, compromised internal auditing, failures of NSFAS’s IT system, maladministration, racism and compromised oversight. 2. Annexure B (85KB) – a list of key questions regarding allegations against Dr Carolissen in terms of his role in various matters, such as nepotism and maladministration (amongst others, how much of the cumulative irregular expenditure of R7.5 billion NSFAS declared in the 2018/19 financial year was spent under his watch?). 3. Annexure C – a list of staffers and former staffers who have allegedly been victimised, targeted and or purged by Dr Carolissen (not posted due to sensitivity of the information). 4. Annexure D1 and D2 – list of persons allegedly appointed by virtue of their links to Dr Carolissen and other key players. (not posted due to sensitivity of the information) 5. Annexures E and F – allegations around a list of key persons appointed at NSFAS, and other bodies, by virtue of their personal links to Minister Nzimande. (not posted due to sensitivity of the information) I have further and more detailed information in my possession, which I am more than willing to share should you decide to investigate, as it is of paramount importance (at this stage) to protect the identities of the whistle-blowers to avoid further victimisation. I am at your disposal and look forward to engaging with you. Yours faithfully Mr Bantu Holomisa, MP President of the United Democratic Movement
Admin
23 Jun, 2020
DBSA approval of Poseidon water project grant/loan: CEO Sandile Sokhela seems to be economical with the truth
Mr Enoch Godongwana Chairman of the Board of Directors Development Bank of Southern Africa PO Box 1234 Halfway House 1685 Dear Mr Godongwana DBSA APPROVAL OF POSEIDON WATER PROJECT GRANT/LOAN: CEO SANDILE SOKHELA SEEMS TO BE ECONOMICAL WITH THE TRUTH 1. I write to your good office regarding a grant/loan application submitted to the Development Bank of Southern Africa (DBSA) by Poseidon Pty Ltd (‘Poseidon’). 2. According to the information at my disposal, the DBSA had on 26 March 2020 approved funding for Poseidon to the tune of R50 million to conduct feasibility studies, for some kind of water project/s, in South Africa and other Southern African countries. Another R300 million is apparently still to be disbursed for the implementation of Poseidon’s project. 3. In terms of the DBSA’s March approval, Poseidon’s shareholding is as follows: 4. As I understand it, Harith General Partners invested in Crede Power and Infrastructure Investments (‘Crede’) via a capitalisation of R25 million over a four-year period to fund continued operational and other costs. Harith invested in Crede with an objective to capacitate an emerging fund manager that would complement the activities of Harith as a fund manager to the Pan African Infrastructure Development Funds (PAIDF I and II). To date Crede has drawn down R12 million of these funds. 5. My information shows that the DBSA Compliance Unit undertook Politically Exposed Persons (PEPs) checks on Poseidon’s shareholder and group companies and various directors were identified as PEPs by virtue of them being board members of various state-owned entities. Amongst others, the following is identified as a PEP: • Mr Tshepo Mahloele who is a non-executive director in the Crede was identified as a PEP by virtue of him being a former board member of Telkom SA in 2008; his PEP status is inactive as of 2008. Mr Mahloele is the CEO of HGP and sits on Crede’s board. 6. As you are aware, I recently wrote to the President of the Republic (letter attached for your ease of reference) to register my concern over what seems to be another attempt to loot state resources, as had occurred at the Public Investment Corporation, but this time at your organisation, using Poseidon as a vehicle. I had sourced some of my information from their websites, but I have since discovered that both Crede Capital Partners and Crede Power and Infrastructure Investments’ websites (https://credecapital.co.za/ and http://credepower.co.za/ respectively) have been discontinued/are no longer visible. Would one be wrong in surmising that someone is trying to cover their tracks? 7. In particular, during my initial search, Crede Power and Infrastructure Investments’ website proudly shared that Mr Tshepo Mahloele was its director, but I was recently confronted with a letter from Crede/Poseidon’s lawyers (also attached) categorically stating that Mr Mahloele has never been its director. What is however extremely odd is that, Mr Mahloele himself, in his written submission on 15 April 2019, to the Judicial Commission of Inquiry into allegations of impropriety at the Public Investment Corporation (‘Mpati Commission’) declared in Paragraph 3.3 that: “In addition to the positions already referred to, I also serve on the boards of NOVO Energy, Anergi, Lanseria International Airport, Rainfin, 4 Africa Exchange, Crede Power & Infrastructure Investments and Dark Fibre Africa, amongst others.” One is forced to ask whether Mr Mahloele had then lied to the Mpati Commission, or whether Mr Sandile Sokhela, Crede’s Chief Executive Officer, is lying now (or has lied in his grant/loan application to the DBSA). Someone is definitely lying, and one is worried that public entities, such as the DBSA, are doing business with people of this ilk. 8. I have instructed my attorney, Mr Eric T Mabuza, of Mabuza Attorneys, to submit a Promotion of Access to Information Act (PAIA) application to the DBSA to obtain the attending documentation of Poseidon’s DBSA loan/funding application e.g. the application itself, information on the DBSA’s due diligence, relevant minutes of DBSA meetings, contracts, and any other pertinent information. I implore you to cooperate with our PAIA application, not only because it is to the DBSA’s advantage, but also because it is in the public’s interest that the truth comes to light. 9. Given that the DBSA board has already approved Poseidon’s grant/loan it might be advisable that you immediately suspend any disbursement/s to that company until the matter is satisfactorily addressed by the President and/or the courts. I am at your disposal and look forward to engaging with you. Yours sincerely Mr Bantu Holomisa, MP UDM President Copied to: President of the Republic of South Africa, Mr Cyril Ramaphosa Minister of Finance, Mr Tito Mboweni PIC Chairperson, Dr Reuel Khoza DBSA Company Secretary, Ms Bathobile Sowazi Mabuza Attorneys, Attorney ET Mabuza
Admin
17 Jun, 2020
DBSA: looting of state resources by some of the same people involved in the Public Investment Corporation saga
Dear Mr President DBSA: looting of state resources by some of the same people involved in the Public Investment Corporation saga 1. I write to you with grave concern over the apparent looting of state resources by some of the very same individuals that were found to have had enhanced ability to secure easy access to Public Investment Corporation (PIC) funds. We seem to have the same style of legal corruption, but this time it is at the Development Bank of Southern Africa (DBSA). A curious feature, however, is the emergence of the involvement of the Chairperson of the Government Employees Pension Fund (GEPF). Elitist people seem to behave like locusts that hop from one source of easy funding to the next; voraciously consuming every opportunity they can generate through whatever means. Once they have depleted one source, they effortlessly jump to the next one with the same agenda – enriching themselves at any cost and patting themselves on the back for being such clever operators. 2. I believe your appointment of the Judicial Commission of Inquiry into allegations of impropriety at the PIC, under the leadership of the Honourable Justice Lex Mpati, (‘the Mpati Commission’), was, amongst other concerns, exactly to look into this kind of behaviour that now seems to rear its ugly head at the DBSA. 3. I wish to refer you to an observation made by, and a salient finding of, the Mpati Commission regarding a company called Harith. The Mpati Commission, on page 419, of its report to President Ramaphosa, directly quotes part of my submission, i.e.: “One of the most difficult tasks regarding dealing with the type of corruption that is alleged to have happened at the PIC is the sophisticated nature of the transactions. Corruption can come in two forms, legal and illegal corruption. Legal corruption occurs when the elite build a legal framework that protects corruption or manipulate existing legal framework without necessarily breaking the law.’ The Mpati Commission continued saying that: “When going through the story of Harith, these words resonate.” In paragraph 62 on page 434 the Mpati Commission also stated that: “Harith’s conduct was driven by financial reward to its employees and management, and not by returns to the GEPF. In essence, the PIC initiative, created in keeping with government vision and PIC funding was ‘privatised’ such that those PIC employees and office bearers originally appointed to establish the various Funds and companies reaped rich rewards.” Clearly there is enough motivation to have, at the very least, immediately suspended Harith’s management of any and all of PIC/GEPF funds and launched further investigation. Has government taken any action to protect the PIC/GEPF from these self-enriching individuals? If not, why not? 4. To make matters worse, this recipe for plundering state resources is seemingly being replicated at the DBSA with the very same people involved. This time, at the face of it, with a new vehicle called Poseidon Pty Ltd, of which the shareholding is as follows: On a side note, according to Crede Capital Partners’ website, their team has managed two PIC projects i.e. “Univen” (R920 million) and the “Oceans Hotel Property Development” (R600 million). The Mpati Commission’s view that where Harith was concerned, “…the approach taken provided easy access to PIC funds, influence and including an enhanced ability to secure additional investment…”, it is therefore of interest to know that another company with close ties to Harith Group Chief Executive Officer, Tshepo Mahloele, had access to PIC contracts. 5. The DBSA has recently funded Poseidon to the tune of R50 million to conduct feasibility studies, for some kind of water project/s, in South Africa and other Southern African countries. Another R300 million is apparently still to be disbursed for the implementation of Poseidon’s project. 6. The Mpati Commission also said in its report on page 436, paragraph 67, that: “The Board of the PIC should examine whether the role played by either Mr [Jabu] Moleketi and Mr Mahloele breached their fiduciary duties or the fit and proper test required of a director in terms of the Companies Act.” With this knowledge in mind, please take note that Mr Moleketi (a former DBSA board chairperson) and Mr Mahloele (former head of the DBSA’s Private Sector Investment Arm) are both directors of Poseidon. Mr President, history is repeating; Mr Moleketi had fulfilled the highest leadership roles at both the PIC and Harith. Mr Mahloele, in turn, had been internally transferred (as the Mpati Commission described it) as head of the Pan African Infrastructure Development Fund (PAIDF) to Chief Executive Officer of Harith. The following persons are also Poseidon directors: 6.1. Dr Renosi Mokate (GEPF Board Chairperson), 6.2. Ms Lungile “Zee” Cele (independent non-executive director of Harith General Partners and a former board member of Eskom Holdings SOC Ltd), 6.3. Mr Roshan Morar (former PIC Deputy Chairperson, former Chairman of the South African National Roads Agency SOC Ltd, chairman of Ithala Development Finance Corporation (Ltd) and non-executive director of Harith General Partners) and 6.4. Ms Motseoa Alix-Mary Lugemwa (former Chairperson of the Gautrain Management Agency Board and non-executive director of PAIDF). This list reads like a dream-team of politically exposed persons (PEPs) who seemingly have access to public funds. It is especially worrying to find the name of Dr Renosi Mokate on this list; a scenario where a GEPF Chairperson has access to public funding using a private conduit, after having seen what happened at the PIC, is indefensible. She must be removed as GEPF Chairperson with immediate effect. It is also worth noting that Mr Roshan Morar is named and shamed in the Mpati Commission’s report regarding the Lancaster Steinhoff, Project Sierra case study. The Commission on page 41, paragraph 98, said that: “The chair of the IC [Investment Committee] was Mr Roshan Morar, a PIC non-executive director, who signed off on the IC resolution for this investment. At the same meeting, he was also appointed as a board member to L101 representing PIC’s interests which clearly indicates a conflict of interest.” 7. It would be advisable that Treasury quickly intervenes in the DBSA’s funding of Poseidon’s water project and that it immediately freezes the payment of the first tranche of R50 million, as well as the second tranche of R300 million implementation funding, until the Mpati Commission’s findings and recommendations are addressed. If the R50 million has already been disbursed, it must also be recouped in the meantime and it might be advisable to follow the paper trail to see if the money was spent for its intended purposes. 8. Another matter that I wish to address with you is that of Ms Irene Charnley and her inclusion on the PIC’s interim board. She allegedly received R1,7 billion (in today’s terms) from the PIC for her company, Smile Telecoms Limited. I wrote to Finance Minister Tito Mboweni about this matter on 3 June 2020 and have attached the letter for your ease of reference. Since writing that letter, I have heard that the PIC has written the R1,7 billion off as a bad investment. Moreover, it has come to my attention that Ms Charnley has also knocked on the DBSA’s door for funding. She received a USD 20 million loan, which she has failed to pay back. The Al Nahla Group, with whom she is partnered, is a Saudi Arabia-based company. The situation might mean the PIC and DBSA’s monies were channelled out of South Africa on purpose and someone else is smiling to the bank, because it definitely is not South African investors. We now know of two instances where Ms Charnley dipped into public funds, where the money seems to have evaporated into thin air. On what basis would a government serious about fighting corruption dispatch a person of this quality and competence to resuscitate a key public entity such as the PIC? The consequences for her actions should not have been to be rewarded, at the very least, she should be immediately removed as a member of the PIC’s interim board. Yours sincerely Mr Bantu Holomisa, MP President of the United Democratic Movement Copied to: Minister of Finance, Mr Tito Mboweni DBSA Chairperson, Mr Enoch Godongwana PIC Chairperson, Dr Reuel Khoza
Admin
04 Jun, 2020
Bantu Holomisa writes to Wesbank CEO Chris De Kock re Mr Mzukisi Ndara’s case
Dear Mr De Kock MZUKISI NDARA: NATIONAL DIRECTOR OF PUBLIC PROSECUTIONS CONFIRMS “MISREPRESENTATIONS AND CONTRAVENTION OF STATUTES” BY WESBANK The above subject matter bears reference. The first time I wrote to you was on 2 May 2018, just over two years ago, seeking justice in the form of restoration for Mr Mzukisi Ndara, and his family. Mr Ndara firmly believed that FirstRand bank was complicit in a fraudulent vehicle sale transaction in 2004 that caused him to suffer irreparable harm. Frankly, I also believed, hence I wrote to you in the manner that I did. The last of the four letters I have written to you hitherto, was written on 30 October 2019. I concluded the letter thus “I would simply urge you to take this matter seriously by engaging meaningfully and honestly to find solutions. It will not just go away instead it’s going to grow until it is entrenched in the psyche of South African society”. This will now sound prophetic given the latest developments. The National Director of Public Prosecutions (NDPP) Advocate Shamila Batohi, in a letter addressed to Mr Ndara dated 24 September 2019 (Annexure 1), places Wesbank squarely at the centre of the fifteen-year saga that has severely prejudiced an ordinary family. Mr Ndara unfortunately only received this correspondence on Friday 29 May as it was sent to his old email address. The NDPP in this letter writes: “3. Based on my analysis of the matter the fraudulent activities that are the subject of your representations, emanated out of an instalment sale agreement entered into between yourself and Wesbank. 4. Based on your statement filed with the police documentary evidential material as well as the circumstances of this matter, Wesbank and/or its employees committed a breach of contract in the form of misrepresentations and also acted in contravention of various statutes as alluded to in your reports. On the basis thereof, you are, as an aggrieved party entitled to approach courts for an appropriate relief.” These assertions by the top prosecutor in the country implicating the entity that you lead are now available for public consumption. I have been at pains over the last two years urging you to occupy moral high ground by resolving Mr Ndara’s matter. Time and time again I have been met with denials and apathy. Fundamentally in our first meeting with you in May 2018, you were adamant that the bank has done nothing wrong and in fact placed the blame squarely on Datnis Nissan dealership. The National Prosecuting Authority (NPA) correspondence points to Wesbank and its officials as the people responsible. The correspondence distils that the two contracting parties are Wesbank and Mr Ndara. No one else. In the same meeting, after Mr Ndara had taken us through the details of how the deal was concluded and what he had since discovered in hindsight, you were the voice of reason as you said to him “If it’s true what you are saying and it is accurate then I must sympathise with you because you will have been done a grave injustice”. Those words remained with me and I asked myself what you will do when Mr Ndara’s utterances prove to be true. That moment is now upon us. The NDPP, who has been exposed to the case docket, with police evidential material, various internal reports and Mr Ndara’s presentations, has now confirmed that there is documentary evidence that points to misrepresentations by Wesbank. It is now time to replace your intransigence with relevance, you need to be abreast of the mood and to confront the reality that your conduct as a corporate citizen has fallen short of what is expected. It is time to accord this ordinary citizen respect, by engaging him to find a solution by sitting around the table. I am aware that you contemplated settlement on this matter in a letter to the former Chairperson of the Standing Committee on Finance, Mr Yunus Carrim dated 17 April 2019. Paragraphs 3 and 4 of this letter (Annexure 2) read as follows: “However, your suggestion for me to meet personally with Mr Ndara in an attempt to reach some kind of confidential settlement is noted. The question of who is right or wrong in this matter is not the only issue at stake here. The other issue regards the actions that Mr Ndara, backed by the media could take to further express the anger and resentment directed at Banks based on alleged discrimination over the past number of years. On the advice of our legal team we have decided it would not be the prudent approach to personally meet with Mr Ndara in an attempt to reach a confidential settlement. As discussed, we have limited appetite to enrich the individual which does not take into account the time and effort that will be required to defend this matter in the courts and the in the private domain” Gleaning from these two paragraphs these are not the contentions of an innocent party. Gone are the vehement denials of big corporates that dismiss complains with contempt. For that matter whilst I write to you open letters that are transparent, also for public consumption, not once on the four occasions I have done so have you responded in kind. There is not a single letter where you have taken the public into your confidence regarding this matter and that of the Crusaders for Justice. There are over thirty people who have suffered similar fates to Mr Ndara whose lives are ruined because of the immorality of this bank. In all their cases, their tormentor is Wesbank. Surely we should now call time on this; it is time to do the right thing. I note, in fact, that you are amenable to a settle with Mr Ndara were it not for your legal team who needed more time to explore if there were any other seemingly unethical avenues to cause him greater harm. Notably there is again no outright denial. Paramount in your narrative in this letter is the point that “As discussed, we have limited appetite to enrich the individual”. This pregnant statement takes the cake. It says so many things all at once. In fact, I hear you loud and clear, Wesbank has turned Mr Ndara’s life upside down for over fifteen years, he has lost properties and lost all cars he had, owing to this transaction based on misrepresentations. As such, whilst you “have limited appetite to enrich the individual”, Wesbank has all the appetite to rid people of their hard-earned money and property. Wesbank has had the appetite to impoverish people as has been aptly demonstrated in this case. Will the real leaders of the First Rand Group please stand up. Your silence is deafening. Judge Buyiswa Majiki in an August 2018 judgement (Ndara and Another v Weir Investments (Pty) Ltd and Others (3180/2013) (2018) at the Grahamstown High Court set aside a 2015 judgement that was in favour of Wesbank on the basis that it was erroneously sought and granted. This has been Webank’s modus operandi, hence Mr Carrim exhorts you to settle this matter. Judge Elna Revelas presided over a hearing on 18 August 2015 with only the bank’s legal team present. There were no papers served on Mr Ndara and his attorneys. Significantly there was not even a Notice of Set-down. Strangely, Judge Revelas proceeded to dismiss Mr Ndara’s leave to appeal with costs. When the bank’s representatives appeared before Judge Majiki in 2018; they conceded that they did not follow any of the applicable High Court Rules. The bank appealed Judge Majiki’s judgement and it was dismissed with costs around March 2019. A month or so later you wrote this letter to Mr Carrim. Quo Vadis? Whilst I applaud the NDPP, unlike Advocates Naicker, Goosen, Mrwebi and Govender she was much more forthcoming on what has really transpired in this David and Goliath battle. Advocate Batohi was prepared to call out the culprits – Wesbank. However whilst she identified the unethical and immoral conduct on your part, she did not have the courage to act (as the law allows her) in the interests of good governance, for justice to be served. That is really disappointing. 2) Whenever any manager, agent or employee of any credit grantor does or omits to do any act which it would be an offence under this Act for the credit grantor to do or omit to do, such manager, agent or employee shall be liable to be convicted and sentenced in respect thereof as if he were the credit grantor. The above extract is taken directly from the Credit Agreements Act 1980, that was in place when Mr Ndara’s credit agreement was concluded. In my book, “shall be liable to be convicted and sentenced”, refers to a criminal prosecution if one were to have been found to have contravened this statute. Furthermore, Advocate Tenjwa Sellem, who oversaw a seven-month investigation at the NPA on this matter, took a decision to prosecute and took warning statements. On receiving a copy of NDPP’s letter his response was “If Mr Ndara on purchasing a vehicle through Wesbank, had provided a false representations concerning his salary advice and place of domicile, was he not going to face criminal charges of FRAUD, the answer is in the affirmative”. He went on to say, in the investigation, evidence points to the following issues that anchor this matter • Wesbank delivered to Mr Ndara a USED Nissan X-Trail 2.2 Diesel, Manual with 6700 kilometres travelled valued at R270000-00 Then they processed and invoiced him for a BRAND NEW Nissan X-Trail 2.5 Automatic valued at R298000-00. • Wesbank processed and approved the sale agreement, relying on a fraudulent Offer to Purchase (OTP) that Mr Ndara had never had sight of nor signed. The OTP provided for him to sign firstly to tender his Nissan Almera as a trade in, and secondly to sign making the Offer to Purchase the Nissan X-Trail described therein. Instead Mr Jaen Van Aardt – the Dealer Principal signed on the document accepting an offer that had not been made. Despite the invalidity of the document Wesbank processed and concluded the deal as if it was above board. • Furthermore Wesbank approved fictitious extras to the value of R33000-00 that do not exist. These were insurance products as opposed to physical material enhancement in the vehicle that would have been requested by Mr Ndara. So in all the vehicle that he would have paid R270000-00 for, he was invoiced for R333000-00. • The Dealer Principal induced Mr Ndara into this deal under the pretext that he was redressing a wrong committed by a salesperson at the dealership, hence Mr Ndara believed him. He offered to do a special deal that will see Mr Ndara benefit from the Wesbank Senior Manager Scheme that he already qualified for. Noting that Mr Ndara is ignorant of the Scheme’s formula, he loaded 15,25% interest rate instead of 9% that he qualified for. Mr Ndara as a result had R8857 monthly instalment for a USED Nissan X-Trail in 2004, sixteen years ago. Advocate Sellem ended by saying he stands by his decision to prosecute this matter. To conclude my letter, Sir, I shall quote from the Regional Director of Public Prosecutions, Advocate Goosen, who was the only prosecutor to write to Mr Ndara giving reasons why they decline to prosecute. Advocate TC Goosen on 11 December 2015 writes as follows: “ “It is a fact that the vehicle was described on the transaction details document as a new one. I am of the opinion that this aspect does not assist in making a decision in your favour. Everyone including yourself knew at all times relevant that the vehicle was a demo model and therefore not brand new. Consequently the action to tick the ‘new box’ surely could not have been made with an intention to defraud you. I also consider a possible argument that being a demo model, the vehicle was definitely a used vehicle, but also new in the sense that ti has never been sold before. Another possible argument can also be that the ticking of the ‘new box’ was a mistake and that the person who made the tick is as much to blame as those who had signed the document.” The car was indeed sold to you at a price consistent with that of a new car. Essentially because of all that he advances above, Advocate Goosen then concludes that whilst there are all these permutations above, Mr Ndara’s case would not stand scrutiny in a court of law as he will be a single witness. I shall leave these two contrasting versions for your benefit and the public at large. Once more with all the respect I invite you to meet with Mr Ndara and resolve what is patently a grave injustice. Not only to Mr Ndara, but to all South Africans who believe in natural justice and the rule of law. Sir, I believe you owe this to yourself, FirstRand Bank and to all those who inflicted pain on Mr Ndara and his family throughout these years. It is never too late to mend. Yours sincerely Mr Bantu Holomisa, MP UDM President
Admin
03 Jun, 2020
Composition of PIC interim board: beneficiaries should not be members
Honourable Minister Mboweni QUESTIONS AROUND THE COMPOSITION OF PUBLIC INVESTMENT CORPORATION’S BOARD: BENEFICIARIES SHOULD NOT BE ALLOWED TO SERVE 1. Some time has lapsed since the 995-page report of the Judicial Commission of Inquiry into allegations of impropriety at the Public Investment Corporation, as lead by the Honourable Justice Lex Mpati (‘the Mpati Commission’), was handed over to President Ramaphosa and was released to the public on 12 March 2020. 2. One of the consequences of the Coronavirus lockdown is that I had the opportunity and time to read the voluminous Mpati Commission’s report and apply my mind to the size of the task of implementing its recommendations, over and above the management of the Public Investment Corporation’s (PIC) day-to-day business. 3. From my personal experience of the way the Mpati Commission functioned and reading its report, I believe that the commission did a sterling job. We will hopefully see sweeping changes that will lead to the PIC being a responsible organisation, as well as rooting out corruption and poor administration. South Africans will hopefully see the police, the Directorate for Priority Crime Investigation (Hawks) and the National Prosecuting Authority continue investigating and bring culprits to book. 4. Regarding the implementation of the Mpati Commission’s recommendations at the PIC, the complexity of the job ahead and the fortitude required to complete it requires the most competent, qualified, and trustworthy individuals. The PIC’s board and administrators must have the best interests of the PIC, and by extension the South African Government Employees Pension Fund (GEPF), at heart. 5. This knowledge and given the poor track-record of past PIC boards brought me to my next exercise, which was to look at the composition of the PIC’s incumbent interim board which you appointed in consultation with cabinet almost a year ago. 6. To my surprise, in doing my quick study, I came across an individual who now sits on the PIC’s interim board, who is a past PIC beneficiary. 7. That person is Ms Irene Charnley; the company is her Smile Telecoms Limited, to which the PIC committed an investment of USD 100,000,000 in 2015. This is a little more than R1,7 billion when calculated at today’s Rand/Dollar exchange rate. The PIC Investment Details sheet where I obtained this information, is available at https://www.pic.gov.za/DocPresentations/95.-Smile-Telecoms-Holdings.pdf). 8. It is an interesting side-note that, at the time, the now disgraced former PIC CEO, Dr Daniel Matjila, said: “We are excited about our investment in Smile Telecoms as it provides us with an opportunity to accelerate and realise our mandate to invest in the rest of the African continent.” 9. Given this information I have provided thus far, I could not help but ask whether history was repeating; and it left me feeling quite uneasy. 10. This discovery piqued my interest and I also did a cursory internet search on Smile Telecoms Limited (‘Smile’) and found the following information, the context of which will become clear in my later questions to you: 10.1. “Capitalworks” is listed as Smile’s “partner” on its website but is named “CapitalWorks SSA” on the Investment Details sheet. Presumably, this name difference is due to there being different divisions of the same company. I then found an announcement that an entity called “Capitalworks Group”, in 2017, had launched “Africa Capitalworks”, an investment company, which aimed to raise USD 300 million to “…deploy permanent equity capital in mid-market companies in strategically selected sectors across Sub Sahara Africa (“SSA”) (excluding South Africa)”. This discovery in itself is not interesting, what however is, is that they had “… already secured early support and substantial investment, including from CDC, the UK’s development finance institution, and the Public Investment Corporation SOC Limited (PIC) on behalf of its client the South African Government Employees Pension Fund (GEPF).” 10.2. I also found a PIC document called “ISIBAYA DETAILED INVESTMENT SCHEDULE AS AT 31 MARCH 2017” which is available on, investigative journalism organisation, Amabhungane’s website at https://amabhungane.org/wp-content/uploads/2018/08/170331_PIC-Unlisted-assets.pdf. Under the column called “FRESG Performance” the following is written about Smile: • “Financially Underperforming – economic headwinds, devaluation of local currencies mainly Nigeria and stiff competition led to underperformance”, • “Owner Managed Companies – Corporate governance principles are compromised- Governance policy, Delegation of Authority, succession planning and risk management framework need to be in place” • “Establishment of Social and Ethics Committee to manage the Representatives of local people on the boards be increased to ensure legislation in countries that advocate local representation on the board.” 11. Given the above information the following questions arose in my mind: 11.1. Were you aware that Ms Charnley had been a PIC beneficiary when you appointed her as an interim board member? If so, do you consider this to be a healthy situation and what were your reasons for continuing with her appointment despite the knowledge? 11.2. What was the agreement in terms of the USD 100,000,000 investment the PIC made in Smile and has investment paid dividends, especially given the PIC’s 2017 conclusion that Smile was “financially underperforming”? What were the implications of this lack of performance? Did the PIC write off this investment and if so, would this not constitute mere looting? 11.3. The PIC concluded that Smile’s “Corporate governance principles are compromised” whilst the company was squarely under Ms Charnley’s management. Would you agree that this casts doubt on Ms Charnley’s suitability to function at board level? 11.4. Did CapitalWorks SSA/Capitalworks Group/Africa Capitalworks receive PIC/GEPF funding? If so, what are the details, and would you consider it compromising that a board member has yet another link to a PIC beneficiary? The United Democratic Movement would argue that there is enough evidence that warrants that Ms Charnley must vacate her seat on the PIC board immediately. One other matter I would like to raise with you is the appointment of Mr Abel Sithole as the new PIC CEO. It would serve us well to remember that the GEPF wrote off billions of rands in investment losses, as was reported in 2018, whilst he was that entity’s Principal Executive Officer. Some of those so-called investments were quite dodgy and this scenario means that Mr Sithole is a man who failed at his job. Surely there were other competent individuals available for your consideration. We do not want to conclude that his appointment is to merely clean-up the mess he was part of and covering tracks in the process. We look forward to your response. Yours sincerely Mr Bantu Holomisa, MP President of the United Democratic Movement
