Deputy Minister of Public Enterprises Phumulo Masualle’s department is to sue a Gupta-linked company for R2.7 billion. Picture: African News Agency (ANA)
Deputy Minister of Public Enterprises Phumulo Masualle’s department is to sue a Gupta-linked company for R2.7 billion. Picture: African News Agency (ANA)

Deputy minister warns Gupta-linked Tegeta: We want our R2.7bn back

By SIYABONGA MKHWANAZI Time of article published Nov 13, 2019

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Johannesburg - The Deputy Minister of Public Enterprises Phumulo Masualle has confirmed that they are suing a Gupta-linked company for R2.7billion and want to get that money back.

Masualle said in Parliament on Tuesday this was part of a number of measures by the Special Investigating Unit (SIU) to recoup billions of rand looted from state-owned entities.

He said they want to recover R2.7bn from Tegeta, a mining company that was owned by the Gupta family.

Masualle, who was answering questions in the National Council of Provinces, said the controversial management consultancy firm McKinsey, whose managing director was Rajat Gupta, has already paid back R902million to Eskom, that it had overcharged.

The firm, which worked alongside Trillian Capital Partners, apologised in July last year and admitted to the wrongdoing. It also conceded that its business relations with its clients locally and the trust of South Africans in the firm had been impacted.

Eskom, which had threatened to take McKinsey to court, welcomed the apology, and as well as the millions that were returned.

Masualle said the High Court in Gauteng a few weeks ago ordered Trillian, another Gupta-linked company, to pay back R600m. Both McKinsey and Trillian were said to have received payments from Eskom illegally.

Masualle said the SIU was now in court to recover R2.7bn from the Guptas, through Tegeta.

“There are more funds that have been identified for recovery,” said Masualle, adding that they had gone to the SOEs to identify funds that were irregularly paid, and the SIU is on those cases.

He said plenty of work has so far gone into supporting the SIU and the Zondo Commission of Inquiry.

He also highlighted that state capture had undermined government institutions and structures. “For these kinds of acts to find expression it took undermining government structures,” said Masualle.

He pointed out that the department has not yet quantified losses suffered by SAA after it was grounded by the South African Civil Aviation Authority last month for non-compliance with maintenance standards.

SAA has been making losses of R28bn in the past 13 years.

It has relied on government bailouts for the past few years. It is also one of the entities that has not made a profit for a number of years, and this week unions expressed concern over its bid to shed jobs.

The aviation entity had said previously it would break even in 2021, but its chief executive Vuyani Jarana resigned in June.

The SOEs have remained a burden to the fiscus and the government warned that if one SOE defaulted on its loans it would cause a cross-default in all SOEs.

Political Bureau

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