Labour Minister Thulas Nxesi has rejected allegations that he and two other Cabinet ministers demanded bribes for a R5 billion Unemployment Insurance Fund (UIF) contract, saying the accusation was meant to divert attention from the irregularities surrounding attempts to access public funds.
Nxesi was responding to claims by Thuja Capital CEO Mthunzi Mdwaba, in a Sunday newspaper, who alleged that three ANC ministers, through government officials acting as intermediaries, demanded 10% of the R5bn to help him seal the deal.
Higher Education, Science and Technology Minister Blade Nzimande and Finance Minister Enoch Godongwana are the other ministers implicated.
The UIF last year awarded a R5bn job creation deal to Thuja Capital, made up of part loan and part grant funding. The deal was allegedly decided on without due diligence and earlier this year Nxesi ordered a judicial review of the award.
Nxesi told Parliament last month that the project, meant to create 750000 jobs through investment from the UIF as seed capital, was suspended towards the end of last year, pending a probe.
The project involved the department, the UIF, Thuja and state-owned Productivity SA which had been chaired by Mdwaba at the time.
In the wake of the investigation, Department of Labour and Employment director-general Thobile Lamati resigned following reports that he backed the controversial project to channel billions of rand from the UIF into the private investment company.
Nxesi on Wednesday said Mdwaba’s latest allegation that he attempted to take a bribe “from the very transaction that I stopped is false and without foundation”.
He said “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”.
“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 ILO (International Labour Organisation).
“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.
“Our paths crossed again late last year, when the media exposed a plan to pay over R5 billion of UIF funds to Mdwaba’s private company, Thuja.”
Nxesi said he acted immediately to stop any payment, despite Mdwaba’s threats of legal action, “thus safeguarding public funds”.
“I then called for a forensic investigation, which pointed to irregularities, including a conflict of interest: Mdwaba was both chair of Productivity SA (an entity of the Department of Employment and Labour) and CEO of Thuja.
“We therefore instructed lawyers to prepare an application to set aside the Thuja agreement, and Mdwaba was removed as chairperson of Productivity SA.”
Nzimande’s spokesperson, Ishmael Mnisi, said the minister did not know anything about the allegations and had never participated in such a matter.
“This involves another department and matters in which he has no dealings.”
Godongwana’s spokesperson, Mfuneko Toyana, said the accusations were unclear.
“These are pretty big allegations, but they are hard to follow and the minister will not be commenting at this moment.”
ANC national spokesperson Mahlengi Bhengu-Motsiri said the party’s secretary-general, Fikile Mbalula, believed to have also been named by Mdwaba, will open a crimen injuria case against Mdwaba on Thursday.
She said Mbalula would issue a statement on the matter after opening the case.
ActionSA said they would write to President Cyril Ramaphosa requesting that he task the Special Investigating Unit (SIU) with probing the allegations.
ActionSA spokesperson Lerato Ngobeni said Ramaphosa must leave no stone unturned in investigating the allegations made against members of his Cabinet.
The DA’s Michael Cardo said Mdwaba could be making wild accusations in anger after his lucrative deal was blocked but the matter warranted further investigation.
“For that reason, it is incumbent upon both Mr Mdwaba to lay charges and Minister Nxesi to dispel the allegations decisively,” Cardo said.