Eskom CEO Brian Molefe‚ who was implicated in the state capture report‚ has cried foul‚ saying that the Public Protector did not give him an opportunity to reply.
Speaking to reporters in Sunninghill‚ Johannesburg‚ on Thursday‚ Molefe went to town explaining how Eskom ended up having contracts with the Gupta-owned Tegeta company.
“The Public Protector never called me or Mr [Anoj] Singh our CFO. We gave her 120 files. She subpoenaed us but cancelled the meeting. That is my gripe‚ we never got a chance to answer‚” Molefe said.
“The Public Protector has painted me with a corrupt brush…During this period my children will be told your father is corrupt‚” an unhappy Molefe said.
“I do not agree that the board should resign over this matter. I take the responsibility. I don’t think the minister [of public enterprise] should resign. I also don’t think that the president should resign over this matter. I will resign‚” said Molefe.
An angry chair of Eskom‚ Baldwin Ngubane‚ said: “If we lose Brian‚ she [Thuli Madonsela] should take the responsibility.”
They were speaking at the presentation of Eskom’s financial results for the six months ended September 30 2016.
Eskom features prominently in the former Public Protector’s state capture report‚ released on Wednesday.
The word “Eskom” appears 829 times.
Cell phone records obtained by the Public Protector show that Molefe and Ajay Gupta exchanged 58 calls in eight months between 2015 and 2016.
Ajay is one of three brothers‚ the other two being Atul and Rajesh Gupta‚ whose business empire and alleged political influence have stirred up a hornet’s nest of controversy in South Africa.
The parastatal was a source of lucrative contracts for the Gupta family and Duduzane Zuma‚ the son of President Jacob Zuma‚ through a company called Tegeta.
Tegeta secured a 10-year supply agreement with Eskom to supply coal to the Majuba power station. Tegeta also secured contracts to supply coal to the Hendrina and Arnot power stations.
Madonsela said in her report that a member of the Gupta family admitted to her during an interview on October 4‚ 2016‚ that Molefe was his “very good friend” and often visited his home in the upmarket suburb of Saxonwold‚ Johannesburg.
“Eskom’s awarding of the initial contracts to Tegeta to supply coal to the Majuba Power Station will form part of the next phase of the investigation‚” noted the report by Madonsela.
Having considered the evidence uncovered during the investigation‚ Madonsela said that it appeared that the board of Eskom was “improperly appointed”‚ not in line with the spirit of the King III report on good corporate governance.
A board appointed to a state-owned-enterprise was expected to act in the best interests of the country at all times but‚ “it appears that the board may have failed to do so”.
Molefe was seconded to Eskom from Transnet on April 20‚ 2015 as an Acting Group Chief Executive. He was appointed as the Group Chief Executive on September 25‚ 2015.
Cell phone records show that he called Ajay Gupta 44 times between August 2‚ 2015 and March 22‚ 2016. Gupta called Molefe 14 times during the same period.
Molefe was also in telephonic contact with Nazeem Howa — a director at Tegeta and until recently the CEO of Gupta-owned company Oakbay Investments — four times in a single day‚ August 24‚ 2015.
The timing of the phone calls is significant as it dovetails with a controversial purchase by the Gupta family of Optimum coal mine. The Guptas’ reportedly financed this deal with about R600 million that was a pre-payment by Eskom to Tegeta for coal.
The report published a diagram showing a “distinct line of communication between Mr Molefe of Eskom‚ the Gupta family and directors of their companies in the form of Ms (Ronica) Ragavan and Mr Howa. These links cannot be ignored as Mr Molefe did not declare his relationship with the Gupta family‚” the report states.