Minister of Employment and Labour Thulas Nxesi has denied as “completely unsupported by facts or any piece of evidence” the allegations that he tried to solicit a R500 million bribe from one of his department’s contractors.
This comes after Thuja Capital Fund CEO Mthunzi Mdwaba, over the weekend, made damning allegations against Nxesi, saying that officials acting on behalf of three Cabinet ministers attempted to solicit a 10% kickback from the irregular R5 billion deal.
Mdwaba mentioned Minister of Finance Encoh Godongwana, and Minister of Higher Education, Science and Technology, Dr Blade Nzimande, as the other implicated Executives.
Nxesi on Wednesday said he intended to firmly address Mdwaba’s “false and defamatory statements”, adding that the R5bn of public funds in question will not be released to Mdwaba’s company.
“This is false and without foundation; not one iota of evidence is provided, in what is clearly a self-seeking attempt to divert attention from the issues around the R5bn Thuja scheme,” Nxesi said.
“The attacks on myself by Mdwaba began two years ago when we were obliged to withdraw our support for his candidacy for a position in the International Labour Organisation (ILO),” he said.
“Mdwaba blamed me for this, even though it was a government decision, emanating from the emergence of information on his dubious past: he was previously declared a delinquent director and unfit to hold certain positions by the courts.”
Nxesi said a forensic investigation into Mdwaba had found irregularities and a conflict of interest as he was both the chair of Productivity SA - an entity within Nxesi’s department - and also the CEO of Thuja, which intended doing business with the department.
Mdwaba has since been removed as chair of Productivity SA and the department has instructed lawyers to prepare an application to set aside the Thuja agreement.
The Department of Employment and Labour, and the Unemployment Insurance Fund (UIF), had planned to invest R5bn in Mdwaba’s Thuja, and the company would in return invest the funds in various companies to create at least 750,000 jobs.
This was in spite of Thuja having been registered just 10 days before the deal was signed in December last year and against the advice of the department’s own adjudication structures.
Last month, the director-general of Labour and Employment Thobile Lamati resigned after his position in the department became untenable over the deal with Thuja.
Political parties have said that Lamati’s resignation underscored the shadow cast by this scandal, and have called for President Cyril Ramaphosa to task the Special Investigative Unit (SIU) to probe the allegations.
ActionSA spokesperson Lerato Ngobeni said Ramaphosa must do the right thing and fire Nxesi at once and suspend the other two alleged conspirators pending the outcome of a further probe into their involvement.
“This latest allegation serves yet another glaring example of the deep-seated corruption that has permeated throughout the State with senior ministers and officials entangled in this corruption,” Ngobeni said.
“Given the gravity of the allegations, ActionSA demands that President Cyril Ramaphosa, as the Head of the Executive, leave no stone unturned in investigating the allegations made against members of his Cabinet.”
Ministers Godongwana and Nzimande had not responded to media enquiries by late afternoon yesterday.
DA MP Michael Cardo said it may well be the case that Mdwaba was clutching at straws and making wild accusations in anger after his lucrative deal was blocked, but these allegations warranted serious concern and further investigation.
“For that reason, it is incumbent upon both Mr Mdwaba to lay charges and Minister Nxesi to dispel the allegations decisively. If Mr Mdwaba is tilting at windmills and making up stories to deflect blame, then Minister Nxesi should sue him for defamation,” Cardo said.
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