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Uproar over Molefe’s R30m Eskom payout

Publish date: 20 April 2017
Issue Number: 112
Diary: Legalbrief Forensic
Category: General

National Union of Metalworkers of SA (Numsa) leader Irvin Jim has berated Eskom for its parting payment of R30.1m to former chief executive Brian Molefe‚ saying the parastatal must account for it, according to a TimesLIVE report. It notes Molefe spent only 18 months at the power utility and resigned in November 2016 after former Public Protector Thuli Madonsela’s State of Capture report revealed his curious relationship with the Gupta family. At the weekend‚ he told the Sunday Times that he had been paid ‘what was due’ to him‚ but refused to give a figure. ‘The board of Eskom and government must account for on what basis would this (amount) be justified. It is shocking because there has been a deepening crisis on all the SOEs (state owned enterprises). We have a weakness in the serious growth of cronyism and corruption ... be it tenders or a particular trend of handshakes that this government has allowed itself to continue with‚’ Jim is quoted as saying yesterday (Wednesday). The report notes Jim added that parastatals had become ‘milking cows for particular individuals who are powerful in the state’. That‚ he said‚ must stop. He said that Numsa wanted all parastatal boards to be reconstituted and said that civil society must be part of them.

First TimesLIVE report

The Public Protector is mulling over complaints from the DA and the SA National Civic Organisation over the huge payout. ‘The decision to investigate has not been taken yet. The complaints are being assessed for jurisdiction and merit. Only after this process can the Public Protector be in a position to say if she will be investigate or not‚’ Oupa Segwale‚ Public Protector Busisiwe Mkhwebane’s spokesperson is quoted in another TimesLIVE report as saying. The report notes a tearful Molefe, now an MP, said at a press conference last year that Madonsela was mistaken in saying he had made frequent visits to the Gupta compound in Saxonwold‚ the home of President Jacob Zuma’s friends.

Second TimesLIVE report

Whatever Molefe received was due to him, Eskom board spokesperson Khulani Qoma reportedly told Fin24. Qoma emphasised that whatever was due to Molefe, was paid at the end of last year. He has not received anything this year. ‘In terms of governance we have to follow a stipulated protocol. That is why we cannot make any information known ahead of the release of the annual reports,’ Qoma is quoted as saying. ‘We maintain that there is nothing untoward in what Molefe has received. Whatever he has received was due to him and appropriate in terms of the Labour Relations Act.’ Qoma said whatever any of the Eskom directors received, including Molefe, will be available in the audited results due out in June.

Full Fin24 report

However, the Sunday Times reports that the R30m payment was made last month and has been described as ‘very irregular’, but Public Enterprises Minister Lynne Brown reportedly said she knew nothing about it because this was an ‘operational issue’. Documents from Eskom the Sunday Times says it has seen show that Molefe was paid R30.1m on 23 March. One document lists the payment under ‘separation/severance cost’; another lists it as an ‘Eskom pension fund’ payment. The report quotes a source familiar with the payment as saying Molefe would have had to earn R243m a year to warrant that sort of pension payout. LabourNet industrial relations expert Juanne van Vuuren said the payment looked very irregular. ‘I have to question where taxpayers’ money is going and what the justifications are for such a payment. This looks like some mutual settlement agreement that they (Eskom and Molefe) reached before he resigned,’ she said. Molefe said he had been paid ‘what was due’ to him but refused to give a figure. ‘All I can say is that I didn’t receive any severance package, but I was paid pension benefits that I was entitled to,’ he said.

Full Sunday Times report