Newsflash

Ramaphosa signs off on SIU probe into Ace-linked asbestos deal

By Pieter-Louis Myburgh 12 July 2019
Caption
Illustrative image. Photos: ANC secretary general Ace Magashule speaks to journalists outside the ANC’s national executive committee meeting in Cape Town, 23 March 2018. Photo by Leila Dougan / Background: Adobestock / Cyril Ramaphosa, President of the Republic of South Africa, Co-Chair of the G20-Africa Advisory Group, attends the G20 Investment Summit in Berlin, Germany, 30 October 2018. EPA-EFE/CHRISTIAN MARQUARDT / POOL

A R255m Free State government deal that dates back to 2014 bears the fingerprints of then Free State Premier and current ANC Secretary-General Ace Magashule. Thanks to a new proclamation signed by President Cyril Ramaphosa, the Special Investigating Unit will finally start to follow the cash flows of this contentious contract. This may turn out to be a significant development in the ongoing tussle for control between the governing party’s two foremost power blocs.

Proclamation R 39 of 2019, published in Friday’s edition of the Government Gazette, could have far-reaching consequences for the ANC’s secretary-general.

The order, approved by President Cyril Ramaphosa, allows the Special Investigating Unit (SIU) to probe allegations of “unlawful or improper conduct” in relation to the R255-million contract the Free State department of human settlements (FSHS) dished out in 2014 for the audit and assessment of asbestos roofs in the province.

A joint venture (JV) between the companies Blackhead Consulting and Diamond Hill Trading 71 clinched the deal without a tender process and without having been registered as a JV.

According to the proclamation, the SIU needs to determine if “employees or officials of the Department, the applicable service providers, or any other person or entity” were guilty of procurement irregularities or financial misconduct in relation to the large contract.

Igo Mpambani, Diamond Hill’s late director, was gunned down in Sandton in 2017. Leaked emails and documents from his businesses implicate Magashule in some of his dealings, including the asbestos audit.

In January 2015, Mpambani accompanied Magashule and other government officials on a trip to Cuba, from where the businessman sent the JV’s first invoices to FSHS officials.

He also created a “cost of business” spreadsheet, according to which a certain “AM” was due to receive a R10-million cut from the contract.

Later, throughout 2015 and 2016, Magashule’s PA and other staffers requested money from Mpambani, who complied with their requests. Some of the emails make it clear that they were acting on behalf of Magashule.

The R255-million contract and Mpambani’s dealings in the Free State are explored in detail in the book Gangster State.

According to a press release from the Presidency in late 2018 regarding other SIU matters, the unit is “mandated in terms of the Special Investigating Units and Special Tribunal Act . . . to investigate serious malpractices or maladministration in connection with the administration of state institutions, state assets and public money as well as any conduct which may seriously harm the interests of the public.”

If any senior political figures or officials do get implicated in any misconduct related to the asbestos deal, Ramaphosa will be the first to know about it.

The SIU submits a final report to the President upon the conclusion of each investigation conducted. SIU reports include recommendations on interventions such as disciplinary action, criminal prosecution or civil litigation in instances where wrongdoing is identified,” reads the 2018 press release.

Should the SIU implicate the ANC SG in any such wrongdoing, Ramaphosa would have no choice but to enforce the unit’s recommended interventions, even if said recommendations include something as drastic as criminal prosecution.

The investigation into the Free State’s asbestos saga may, therefore, turn out to be a significant development. It has the potential of toppling the foremost figure in an ANC grouping that clearly doesn’t really want Ramaphosa to lead either the country or the party. DM

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