Probe told of Zuma’s ‘hidden hand’ at Eskom
Publish date: 23 November 2017
Issue Number: 589
Diary: Legalbrief Forensic
Category: State capture
For the first time, President Jacob Zuma has been placed at the scene that opened the door to the wholesale looting of Eskom, writes Legalbrief. And, in a day of high drama at Parliament’s state capture inquiry, Public Enterprises Minister Lynne Brown was yesterday exposed as being associated with the Guptas and being at the centre of machinations at Eskom that led to the suspension and ultimate departure of three key executives (see report below).
Zuma was directly linked to Eskom’s capture by former Eskom chair Zola Tsotsi yesterday (Wednesday). Zuma, Brown and their Gupta associates were the ‘hidden hand’ that Tsotsi said was orchestrating affairs at the utility, according to a BusinessLIVE report. This is the first direct link of Zuma to allegations of state capture, according to the report which says the closest he has come to being linked with such allegations was through his son Duduzane and the Guptas. But yesterday, Tsotsi told MPs in the state-capture hearings that Zuma, in cahoots with then SAA chair Dudu Myeni, had played a direct role in dislodging senior executives from Eskom, opening the way for the appointment of Brian Molefe as CEO and Anoj Singh as chief financial officer. Both have been implicated in concluding deals with Gupta-owned companies. The report says Tsotsi, who was chair of Eskom between June 2011 and March 2015, also told the inquiry of approaches made to him by Tony Gupta regarding the affairs of Eskom and the association between Brown and the Guptas.
Never has the case for a judicial inquiry into state capture by a judge who is not appointed by Zuma been so compelling as it is after yesterday’s explosive parliamentary hearings into events at Eskom, Business Day notes in an editorial. It says Tsotsi, who at one stage was happy to do Zuma’s bidding – he suspended four Eskom executives in 2015 at his behest – has spilled the beans on his former political bosses. Not only did Tsotsi say it was Zuma who urged him to make the suspensions but that the meeting at which this occurred was convened by Zuma’s close friend, Myeni, at the President’s Durban residence. Tsotsi also said Brown was directly involved in the collusion. Business Day notes that while the parliamentary inquiry is doing an excellent job of exposing, once again, the extent of the penetration of private and corrupt interests into the heart of the state and its key commercial institutions, it will be difficult for it to move much beyond the various versions of events that are put to it.
Tsotsi revealed an alleged plot to remove Eskom executives and replace them with those amenable to the President and his clique, suggesting that Zuma was behind the suspension of four senior Eskom executives in March 2015 – which ended in his (Tsotsi’s) own resignation about 10 days later, according to a City Press report. It says the former Eskom director painted a picture of a coordinated attempt to control Eskom. This attempt involved Zuma, Brown, Myeni and the Gupta brothers and started shortly after Brown took office in 2014. Tsotsi told the inquiry that he had sought to cultivate a working relationship with Brown following her appointment in May 2014, but did not succeed. Brown had called him to a meeting a day or two before the February 2015 State of the Nation address. Tsotsi claimed that after a brief exchange about their working relationship, Brown warned him to ‘go and do what you have to do, I will go and do what I have to. There is no reason for you and me to talk about anything’. Tsotsi told spellbound MPs that the very same afternoon he was approached by Tony Gupta, who requested to meet with him. At the meeting, Gupta told him: ‘Chairman, you are not helping us with anything. We are the ones who put you in the position you are in. We are the ones who can take you out.’ The report says Tsotsi notes: ‘It was at this time that I felt that some sinister clouds were gathering because the coincidence of the two events was not lost on me.’
Tsotsi has levelled damning accusations against Brown, Tony Gupta and their close associate Salim Essa. ‘There is a clear association between Minister Brown and the Gupta family,’ Tsotsi is quoted in a Fin24 report as saying. He told the inquiry that Brown invited him to her house after a new Eskom board had been appointed in December 2014. ‘Tony Gupta and Salim Essa were present,’ he said. The matter was about the allocation of board members to different subcommittees. ‘Salim Essa would draw up his idea of board allocations up and send it to the minister,’ he said. Asked by DA MP Natasha Mazzone if Brown was taking instruction from Essa, he said: ‘I would not say she took instructions from them, but it seemed to me that I was not able to complete this exercise without the involvement of Mr Essa. I got a list and I changed the list on the basis of what I thought it should be. I sent it to the minister to get her concurrence. She changed it back to what it was when she originally sent it. My hands were tied.’
Brown denied the claims, saying: ‘I have never consulted with anyone on my executive functions. Not Tony Gupta or Salim Essa or anyone else. Why would I hand over my functions to anyone else?’ A TimesLIVE report notes Brown however admitted that Eskom officials had on more than one occasion misled her‚ and manipulated her into lying to Parliament for which she faces sanctions by the Public Protector and Parliament's ethics committee. The report says Brown has painted state-owned companies as a ‘battleground’ for ANC factional battles‚ opposition parties and the media. Brown‚ who has raised concerns about Parliament’s inquiry into state capture‚ said she had appeared before the committee despite legal advice not to do so. A BusinessLIVE report says she effectively accused Tsotsi of lying in claiming that she had told then Eskom director Ben Ngubane that the financial director Tsholofelo Molefe should also be suspended along with the three already agreed upon by the board. This suspension took place. Dealing with board appointments Brown said she had never changed the shortlist of candidates proposed by her department and that the Cabinet appointed board members.
Brown denied that she received a phone call from Zuma in 2015, instructing her to suspend three Eskom executives, contradicting the explosive evidence of the former board chair. ‘I said no, Advocate (Ntuthuzelo) Vanara,’ Brown replied wearily when the evidence leader in the parliamentary inquiry into Eskom questioned her about the alleged instruction, said to have emanated from a meeting including Zuma and Myeni. ‘In fact, I don’t know the conversation. Why don’t you ask the president?’ According to a report on The Citizen site, Brown said Essa and Tony Gupta had never been to her home, adding: ‘At this point it is my word against theirs.’
Parliament's inquiry into state capture will invite the Gupta brothers‚ Salim Essa‚ Eric Wood‚ Duduzane Zuma and Dudu Myeni to appear before it. A TimesLIVE report notes that following weeks of evidence in which the Gupta brothers‚ Essa‚ Duduzane Zuma and Wood have regularly been named‚ ACDP MP Steve Swart proposed that they be subpoenaed to attend. EFF MP Floyd Shivambu said given testimony by the former Eskom board chair in which Myeni is cited as having set up a meeting with the President and Tsotsi to discuss board suspensions‚ she should be called too.
After five hours of testimony to Parliament, former Eskom CEO Brian Molefe on Tuesday admitted having phone contact with the Gupta family and knowing of the power utility's deal with Trillian, but maintained that he had no direct knowledge of corruption. A report on the IoL site says Molefe claimed that he had been removed from the business side of operations in order to focus on ending load-shedding during his 15 months at the helm of Eskom, and flippantly told MPs to raise questions about specific contracts and payments with suspended chief financial officer Anoj Singh. Molefe initially denied knowledge of Eskom’s agreement with Trillian Capital Holdings, which lacked National Treasury approval but nonetheless saw the company earn some R600m as a subsidiary of global consultancy firm McKinsey. He accused DA MP Natasha Mazzone of ambushing him by asking about Trillian, which had been the subject of extensive testimony before the inquiry.
