Deputy Minister of Finance Mondli Gungubele testifying at PIC Commission of Enquiry. Photo: Oupa Mokoena/African News Agency (ANA)

PRETORIA – The PIC Commission of Inquiry continued yesterday, with Deputy Finance Minister Mondli Gungubele’s turn to be quizzed. 

The Board of the Public Investment Corporation (PIC), of which Gungubele is also the chairperson, is currently in limbo.  

If any decisions are made, the current members who have all asked to be relieved of their duties will not be held accountable in the near future for any decisions made at an institution that is responsible for close to R2 trillion worth of government pension funds.

The lack of accountability and the negative effects that this may have on the national fiscus formed part of Deputy Finance Minister Mondli Gungubele’s testimony during the PIC Commission of Inquiry, which is chaired by former Supreme Court Justice Lex Mpati.

Gill Marcus, the former Reserve Bank Governor, who is also assisting the commission, grilled Gungubele on the status of the board, after the mass resignation which followed damning allegations by whistle-blower James Noko (not his/her real name), and which implicated the deputy finance minister, board member Sibusisiwe Zulu, her live-in lover Lawrence Mulaudzi, current acting chief executive Matshepo More and board member Dudu Hlatshwayo.

Gungubele gave his testimony under oath at the Mpati Commission in Pretoria yesterday. The PIC Commission is investigating issues of impropriety and corruption that occurred over the last few years. Some directors have been accused of unduly benefiting in a series of dodgy deals involving Ascendis, technology group EOH, the infamous Steinhoff, as well as Karan Beef.

A deal involving Ayo Technology Solutions is also under scrutiny. When asked for comment, Gungubele said the PIC Commission would also look at other deals that occurred during the period in question.

The evidence leader of the PIC Commission, advocate Jannie Lubbe, said deals that were highlighted in UDM leader Bantu Holomisa’s letter to President Cyril Ramaphosa, which led to the establishment of the commission, would also be heard and interrogated in the commission.

Others who testified include the PIC’s head of internal audit, Lufuno Nemagovhani, head of corporate affairs, Deon Botha and acting company secretary Wilhelmina Louw.

Botha gave evidence stating that most media reports involving Ayo were based on factual inaccuracies. 

“In retrospect, following the testimony at this commission by head of internal audit Mr Lufuno Nemagovhani, as well as assistant portfolio manager in listed equities Mr Victor Seanie, it seems as if media statements attributed to me might have contained incorrect information.” He referred to articles in City Press, AmaBhungane, Bloomberg and Business Day

Marcus instructed Gungubele to give an update on the status of the board, asking if the board was still in quorum.

Gungubele responded, claiming that the board was not in quorum; however, Minister of Finance Tito Mboweni had not yet responded to the letter of resignation. 

Marcus questioned the legality of decisions taken between now and when Mboweni eventually responds to the resignation letter.

On cross-examination, Gungubele revealed that there was a high possibility of the board being in limbo after Gungubele openly admitted that it was facing some serious challenges at the PIC. This seemed to contradict his earlier statement in his affidavit, which stated that the board had “fulfilled its fiduciary duties” and there was “no professional crisis”.

Marcus continued, asking Gungubele if the board was “dysfunctional”, following the resignations of nine board members.

The PIC, in a recent statement, said the emails from Noko implicating the board members and Gungubele would be the subject of an investigation at the Mpati Commission. Marcus said it was important to determine if the board was not dysfunctional.

“The status of any decisions made by the board or any of sub-committees must also be looked at. I would like to urge you to get a legal opinion. It looks as though the board has not got any clarity on its status from the time of its resignation… Given that the board resigned by staying in its current position, should the board be able to take any decisions which they won’t be held accountable for in the future because they are in limbo.”

Gungubele said Mboweni had not responded to the resignation letter as he was preoccupied with the Budget. When Mpati pressed Gungubele if he was forced to resign, Gungubele said the members sat as a group and had a discussion.

“We looked at the emails from the whistle-blower and we resolved that we are in a situation where the decisions that we take, the quality of them, will be questioned. It was not an admission of guilt, but due to the public perception and size of the asset we thought it would be prudent to step aside. We had to deal with (the) situation and we thought maybe it’s better to walk away instead of being told to walk away,” he explained. 

Gungubele also gave evidence on how Dan Matjila, the former chief executive of the PIC, presided over a deeply divided board at the embattled institution, where close to R100 billion of government employee pension funds have been wiped out as a result of bad investments in companies such as Steinhoff, where R24bn was written down.

“There appears to be this view that the board is divided. Perhaps one must clarify that the board found itself divided on issues relating to former chief executive Dr Matjila. Divisions also play themselves out when reviewing some of the decisions he took. This even created an impression that there are pro- and anti-Dr Dan camps on the board."

So far, the identity of the whistle-blower remains elusive and steps are being taken to find his/her true identity. According to Gungubele, Noko could be someone who is part of the board or a senior current, or former, employee at the PIC, as he/she seems to have an understanding of the institution.

“I believe he (she) is in the institution. It is someone who understands the institution. In instances about the PIC, whoever Noko is, he (she) understands closely what is happening. I doubt that it could be someone who is confidently speculating from the outside,” said Gungubele.