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Eskom report on R1bn nepotism scandal ready

Energy
Johannesburg - Eskom has finalised the report on its investigation into allegations that a stepdaughter of acting chief executive Matshela Koko benefited from contracts worth at least R1 billion, Public Enterprises Minister Lynne Brown said on Wednesdays.

Brown, who is part of the South African government delegation to the World Economic Forum (WEF) on Africa taking place in Durban, said she also expected the board to give her a report on the controversial payout to former chief executive Brian Molefe.

Following reports that Koketso Choma, Koko’s stepdaughter, had scored the contracts, there were also allegations that the board had proposed to pay Molefe R30 million after he was at the helm of the power utility for about 18 months.

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Photo: Reuters

Brown gave the power utility 30 days to finalise its investigation into Koko’s conduct after shortening the probe from 90 days, citing public interest in the matter.

Speaking during a tour of Transnet’s facilities in Durban yesterday, Brown said the report was due on Tuesday.

“The Eskom chairperson (Ben Ngubane) has spoken to me to say the report is done. I am now at the World Economic Forum, so I have not seen the report yet,” she added.

She expected to get the report “at some point” this week. “I am comfortable with that. I have given them enough time to be able to deal with it,” she said.

Read also: Eskom board probes allegations of impropriety

Brown also commented on the proposed payout to Molefe. She blocked the R30 million payout last month.

“The issue is that they must look at the legality remember it is a contract that they signed. They must look at the legality and bring me a proposal. I have to allow the board to actually take responsibility. They must handle it in some way. That is also supposed to come to me in the next couple of days,” she said.

Lacking rationale

In rejecting the board’s proposal, Brown said the pension arrangement with Molefe lacked legal rationale, saying it was not justifiable “in light of the current financial challenges faced, not only by state-owned companies, but by the country as a whole".

Meanwhile, Brown said radical economic transformation and inclusive growth required state-owned companies to ensure that their strategies impacted on the people. This included taking decision on how they outsourced their services.

“ That they outsource to small and medium enterprises and create joint ventures with small and medium enterprises. So that you do not have a just few beneficiaries."

Brown said radical economic transformation should be skills-based and Transnet’s maritime school will create that skills base. “It must be able to create young entrepreneurs and jobs, and deal with poverty. We must ensure the empowerment of black people, especially black women.

"It has always been the policy of the country, but it has not always been implemented.If you look at the big companies that contract to Transnet, they are largely white and they are largely big."

Brown lauded Transnet’s move into the rest of Africa. “This road into the continent started in May 2015 when Transnet adopted its Africa Strategy, based on their mandate to develop and pursue commercial opportunities on the rest of the continent more actively.

"This must be done with other state-owned companies and the private sector. It is also based on Transnet’s need to diversify revenue sources in response to the economic slowdown in the country and the world,” said Brown.

She said addressing Africa’s logistics infrastructure deficit could improve trade relations among African countries. “In 2015, intra- African trade accounted for less than 18 percent of total continental exports.

"Underpinning these numbers is Africa’s logistics infrastructure deficit,” she said.

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