South Africa - Pretoria - 15 April 2019 - Director of Harith General Partners Tshepo Mahloele testifies at the Public Investment Corporation(PIC) Commission of Inquiry in Old Council Chambers, Sammy Marks Building, Pretoria. Picture: Karen Sandison/African News Agency(ANA)

PRETORIA – The decision by the Government Employees Pension Fund (GEPF) to make an investment in the Pan-African Infrastructure Development Fund (PAIDF) was entirely independent of the Public Investment Corporation (PIC).

This was according to the director of Harith and Lebashe, Tshepo Mahloele, who was testifying before the PIC Commission of Inquiry, where he dismissed claims made to the same commission by Bantu Holomisa, leader of the United Democratic Movement.

Mahloele said the GEPF was and is managed by an independent board of trustees, the head of which was then Martin Kuscus, none of whom are directors or otherwise involved in the management of the PIC. 

“About half the GEPF Board consists of representatives from labour and unions and the other half are government employees nominated by government. It was accordingly an independent decision of the GEPF to invest in the PAIDF and to permit Harith Fund Managers (HFM) to manage the funds so invested,” he said.

Mahloele said the investors were not required immediately to pay over the full amount of their commitments. “As was practice in the industry, they undertook to make the funds available as and when required by the fund manager, HFM, who drew down the funds in line with the demands of the relevant projects. Funds are not held idle in bank accounts to be drawn on, as and when the fund manager pleases.” 

He submitted to the commission that as at March 31, 2018 the GEPF’s initial investment of R2.3 billion was independently valued and audited at being about R3.3 billion. The gross internal rate of returns earned to such date was 6.2 percent in dollar terms and 11.7 percent in rand terms.