Brown lines up Gupta file

SA Public Enterprises Minister Lynne Brown. File picture: Tracey Adams

SA Public Enterprises Minister Lynne Brown. File picture: Tracey Adams

Published Aug 31, 2016

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Cape Town - Eskom bosses have been placed in Parliament’s firing line by Minister of Public Enterprises Lynne Brown, who has instructed them to hand over to the Treasury the report into tenders with Gupta-linked companies.

Read also: Eskom and Treasury clash over coal probe

The Treasury on Monday said it had tried for months to obtain the 172-page report on coal contracts with Tegeta Exploration, owned by the Gupta’s Oakbay Investments.

Eskom has now agreed to work with the Treasury after Brown instructed they do so.

Eskom bosses are expected to appear before the portfolio committee on public enterprises to face a grilling from MPs on their conduct in the investigation by the Treasury.

Brown told Talk Radio 702 Eskom bosses have to urgently respond to the Treasury’s request for information on the tenders.

The Guptas had threatened to take the Treasury to court to block it from making its report into the coal contracts public.

The coal contracts into the Guptas are reportedly worth R400 million over a period of 10 years.

The Treasury has become the subject of intense public scrutiny following the investigation by the Hawks into Finance Minister Pravin Gordhan.

Gordhan has been receiving backing from across society.

The business sector and civil society have called on President Jacob Zuma to intervene, but so far he has failed to act.

The remarks by Brown that Eskom must co-operate with Treasury comes as a stern warning to the power utility bosses to get their act together.

Meanwhile, the probe into Eskom’s dealings with Tegeta is an assertion of Gordhan’s authority, but could have dire consequences for the economy and the consumer, according to political analyst Keith Gottschalk.

wIn addition to this, the Cape Chamber of Commerce and Industry has warned the public the enormous cost overruns on the two new power stations, Medupi and Kusile, meant huge and unaffordable increases in future electricity tariffs - beside the annual 8 percent increase each year for the next five years.

Cost estimates have grown in a short period of time with the Ingula pump storage scheme, which was estimated to cost R8.9 billion, increasing to R36bn.

The cost of the Medupi power station was estimated at R69.1bn in April 2007, but in July this year costs were R135bn, according to Eskom.

The cost of the Kusile power station has experienced a similar increase from R80.6bn to R135bn.

“Their incompetence has resulted in power stations costing double of what was originally promised. If Eskom was given the go-ahead it would be a R1 trillion load on consumers. It would mean huge electricity increases. If electricity costs keep jumping up, businesses will experience a drop in profits,” Gottschalk said.

It was clear, however, that Gordhan was even more committed to rooting out corruption in state-owned enterprises, even if it meant the government waged war on itself, he said.

“This means that National Treasury is more than ever before investigating irregularities in government tenders. This has, without a doubt, inflamed the relationship between Eskom and Gordhan and escalated the conflict between the minister and President Jacob Zuma’s donors - the Guptas,” he said.

He said the Hawks’ investigation of Gordhan was added stress on his watchful eye of the tender processes within government structures. He said the Hawks investigation of Gordhan was added pressure in his honing in on tender processes within government structures.

Earlier yesterday, Brown spoke to political analyst, Eusebius McKaiser on Talk Radio 702 where she said she could not provide any real comment on the controversial coal contract speculated about in the media until the probe was concluded.

The Sunday Times reported the Treasury investigation showed Eskom paid more than R130m to a mining company owned by the Gupta family for coal the power utility could not use.

Brown refuted these claims, saying no real evidence was presented to her board of directors that proved such a contract existed.

However, Brown admitted she would not be aware if coal was bought that was unusable to the parastatal as the board made such decisions.

“I would not be able to check,” she said.

The Gupta family on Sunday announced plans to sell their shares in their South African interests before the end of the year, but denied leaving the country.

The family has been accused of trying to influence political appointments and using its relationship with Zuma to advance its business interests. The family has denied using such influence.

CAPE ARGUS

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