LIVE FEED: State Capture Inquiry, February 5, 2020
Johannesburg - The Zondo commission will on Wednesday morning continue hearing evidence related to state-owned airline South African Airways (SAA).
A director of SRS Aviation, Sibongile Rejoyce Sambo, will continue her testimony.
On Tuesday the commission heard from former SAA board chairperson and acting CEO Vuyisile Kona.
Kona told the inquiry how he had been pressured to attend a meeting at the Gupta household in Saxonwold by an advisor to the minister of Public Enterprises Malusi Gigaba.
The former executive took the stand at the inquiry on Tuesday. He had served as acting CEO at SAA for a few months from September 2012 until October 2012. He was replaced as board chairperson by controversial former board chairperson Dudu Myeni.
Kona detailed how at the time of his appointment as acting CEO, the airline had been facing financial constraints and had to ask for a bailout from National Treasury. Treasury needed a business plan from the company and Kona had directed his supply chain division to go on tender and find a consultancy firm that would assist SAA in drawing up a business plan.
Kona said two companies had offered a business case. Lufthansa Consultancy had offered a deal of R6 million while McKinsey and Company was offered the deal for R40 million. Kona said it was clear that Lufthansa was the cheapest and most affordable option for the struggling airline.
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He said while this deal was underway, he had been approached by Gigaba's advisor Siyabonga Mahlangu who insisted that he meet with business partners. The meeting was actually with the Guptas at their household in Saxonwold. Kona said he was unaware that he would be meeting with the Guptas.
In October 2012, the meeting took place and present at this meeting were Duduzane Zuma, Tshepiso Magashule, the son of former Free State premier Ace Magashule, and Mahlangu and Tony Gupta.
Kona said he was offered R100 000 in cash by Gupta on the spot. He said he was taken aback by the offer and refused the money.
"Then the conversation comes to the issue of the business plan. Tony first said he is welcoming me into the family. He said 'We know you have not been paid' and he offered me R100 000. Indeed, I had not been paid my September salary. He then said he could offer me R500 000. I told him I do not need the money. His expression changed and he was like 'What is the story with the consulting contract'? Their money was there in cash. I was just not going to take money from a stranger. I started feeling uncomfortable with the whole thing. Nobody is going to give you that much money for nothing," he said.
Kona said when he refused the money, Gupta's attitude changed and he immediately started asking questions about the consultancy contract.
"He asked about the contract and I said 'Yes, the people have been informed (appointed)' and he was livid. He asked who is going to be doing the consultancy, and I said it would be Lufthansa. Then immediately after that, the meeting ended. They (Gupta) called the director general of public enterprises who was Tsediso Mathona and asked him to come and explain what was going on. I walked out," Kona detailed.
Matona then called Kona and demanded to know why he had decided to award the consultancy contract with McKinsey. He said he never heard from Matona until the department of public enterprises demanded to review the process that determined Lufthansa as the winning bidder.
"The next week I get a letter from public enterprises and they say they want to investigate the awarding the contract to Lufthansa. So we prepared and the team (from the department) came and they found nothing. The department of public enterprises still would not let me appoint Lufthansa," he said.
Kona said he believes he was treated very differently and harshly by fellow board members and the department because of his decision to award the contract to Lufthansa.IOL