South Africa

South Africa

Parliament & State Capture: Inquiry into Eskom’s role passes first hurdle, but is it just a show of form?

Parliament & State Capture: Inquiry into Eskom’s role passes first hurdle, but is it just a show of form?

Parliament’s public enterprises committee is inching towards its inquiry into Eskom’s dodgy procurement dealings, state capture and governance troubles including Brian Molefe’s controversial return as chief executive. At its preparatory meeting on Tuesday, MPs heard from the South African Council of Churches (SACC) about its Unburdening Report, the academic research collective on state capacity and Outa (Organisation Undoing Tax Abuse). What emerged wasn’t necessarily new, but clearly sketched a scenario of the systematic weakening of the state and its entities to facilitate the enrichment of a few. Parliament can no longer say it didn’t know. By MARIANNE MERTEN.

For weeks now #GuptaLeaks reports have outlined webs of connections between the Gupta family, its companies and business associates, senior officials, particularly in state-owned entities (SOEs), and politicians.

The leak of hundreds of thousands of emails came shortly after the turmoil sparked by President Jacob Zuma’s midnight Cabinet reshuffle at the end of March. The reshuffle saw not only the removal of finance minister, Pravin Gordhan and his deputy, Mcebisi Jonas after almost a year of what has been described as a campaign against them, including last year’s aborted attempt to charge Gordhan criminally by the Hawks, but also other key ministries like energy and transport.

That presidential action came six months after former public protector Thuli Madonsela released the “State of Capture” report in October 2016, recommending a judicial commission of inquiry into the extent and detail of how the state is being undermined.

Regardless of the political noise from some even in the top echelons of the governing ANC that such a commission should be launched post-haste, there can not be any action until the completion of the court review brought by Zuma largely over Madonsela’s finding that the Chief Justice, not the president, must appoint a retired judge to head this state capture commission of inquiry. The hearing is set down for October 24 to 26, but the legal process may run for a while particularly if there are appeals.

Meanwhile, earlier this year the SACC released the findings of its Unburdening Panel, and a collective of academics launched the Sate Capacity Research Project which published its report, “Betrayal of the promise: How South Africa is being stolen”.

The official message from government has been that those with knowledge of wrong-doing should lay criminal charges. This was re-iterated as recently as Monday in one of Zuma’s parliamentary replies. “I would like to reiterate that the government’s position that any person… who have [sic] information about any wrongdoing by any individual to inform the law enforcement agencies so that investigations can be undertaking. It is my considered view that this is the proper and lawful way to deal with all the allegations of unlawful conduct,” Zuma answered to Cope’s question on the reports by the public protector, SACC and the academic collective.

While it’s understood the Hawks indicated a probe into the veracity of #GuptaLeaks – at least three of those mentioned have already publicly acknowledged their truthfulness – little has emerged on other investigations despite several criminal cases opened by the EFF and DA.

The National Prosecuting Authority (NPA) absence over state capture arose on Tuesday during Parliament’s public enterprise committee meeting. EFF Chief Whip Floyd Shivambu asked where the NPA was, and called for the prosecuting authority to appear before the committee’s inquiry to brief on the status of action on these cases.

Several MPs also asked Outa to elaborate on its statement that the latest Eskom financials showed R3-billion had gone missing, as auditors could not find supporting documents for payments. “Somewhere in Eskom there is someone with a golden key, who can override the SAP system or there’s a cheque book through which payments could be made outside the system,” said Ted Blom, director for energy at Outa.

Having worked stints for Eskom until 2008, Blom also pointed out the inconsistency of approving some R90-billion for Medupi power station, when initial costings and a similar project in India cost between R32-billion to R35-billion. Since then costs have ballooned.

Professor Ivor Chipkin, Director of the Public Affairs Research Institute, representing the Sate Capacity Research Project academic collaboration, told MPs Eskom was part of “a larger story of illegality and criminality” which systematically had weakened the state and that this included the “repurposing of (state) institutions”.

“Never mind the looting … One of the great tragedies is the profound, profound weakening of state institutions,” he replied to MPs questions. “We can see a general decline of the ability by state institutions to perform their duties. (There’s a) deliberate attempt to politicise state administration.”

And this affected others in the private sector and professional associations. “We see the complicity of all sorts of business and professional associations (lawyers, accountants) that, for example, are putting in place systems for money to get out of the country.”

The scale and breadth of the impact of state capture was supported by SACC General Secretary Malusi Mpumlwana. In response to questions from now ANC MP Pravin Gordhan – “Have we reached the point of impunity?” and “Once an institution is messed up, how long will it take to recover?” – the bishop said he had sleepless nights.

“When things happen at the leadership level, they have a way of setting the culture at lower levels… People don’t even see the need for education because they can always make money,” said Mpumlwana, adding later: “The government environment has really developed the kind of rot that will be very difficult to be reversed. We were discouraged by parliamentary complicity (covering up instead of oversight)”.

While the email leaks focused at national level, the bishop told MPs, much of the same was happening at municipal and provincial levels where money is being diverted to other purposes than set out in budgets and plans. “The individuals that have spoken to us are so afraid for their lives (especially in small towns) and people say don’t even use this detail because they will know it is me. We have people talking to us that are not living at home…”

Talking of a national conversation on social and public values and South Africanness, Mpumlwana concluded: “We need to have our mind in the right place for the future. For us that is public ethics”.

The public enterprises committee decided on its state capture inquiry in the wake of last month’s directive from House Chairman for Committees Cedric Frolick to “urgently probe the allegations (of state capture) and report back to the National Assembly” and to “ensure immediate engagement with the concerned ministers to ensure that Parliament gets to the bottom of the allegations”. According to Parliament’s statement, four committees were to do so: public enterprises, home affairs, transport and mineral resources.

It’s not clear what steps the transport and mineral resources committees are taking at this stage. Last month the home affairs committee heard from Home Affairs Director-General Mkuseli Apleni that all was above board when his former minister Malusi Gigaba, now Finance Minister, granted citizenship naturalisation to several members of the Gupta family before the residency requirements were fully met. The briefing followed Gigaba’s office publicly explaining that the decision was taken in terms of legislation allowing ministerial discretion.

But what also emerged on Tuesday was that resources for an inquiry even just into Eskom were in short supply. There is as yet no evidence leader, even if two parliamentary legal advisors have been seconded, and it is unclear whether further support like additional researchers would be available.

Questions may be raised whether the official directive to deal with state capture was just to show that something was being done on a matter that is dominating public discourse. Parliament’s actions in the Nkandla saga, when it effectively absolved Zuma from any of the repayments ordered by the Public Protector for the security upgrades at the president’s private rural homestead, have not only been sharply criticised in public, but were also found inconsistent with the Constitution by the Constitutional Court in March 2016.

The public enterprise committee’s inquiry was meant to get underway on August 1. But it will not kick off then. According to a statement following the committee’s Tuesday meeting, a starting date is pencilled in for the third week of August. DM

Photo: President Jacob Zuma addresses Eskom staff at Eskom Headquarters in Megawatts during his monitoring visit to the state owned power utility, 6 May 2016. (Photo: GCIS)


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