Board was ‘unaware’ of Tegeta guarantee
• Tegeta deal revealed only later, Naidoo tells inquiry
Former Eskom board member Viroshini Naidoo said on Tuesday she was “horrified” that the board was led into approving a R1.6bn guarantee to Gupta-owned Tegeta Exploration and Resources on the understanding it was a prepayment for coal.
Former Eskom board member Viroshini Naidoo said on Tuesday she was “horrified” that the board was led into approving a R1.6bn guarantee to Guptaowned Tegeta Exploration and Resources on the understanding it was a prepayment for coal.
The guarantee facilitated the purchase of Optimum Coal by Tegeta from Glencore.
Naidoo, a board member from December 2014 to July 2016, said at the inquiry of Parliament’s public enterprises committee into state capture that she had only heard about the guarantee in media reports in 2017.
Many disclosures about events at Eskom only came to light in the State of Capture report by former public protector Thuli Madonsela, she said.
Although Naidoo said her husband knew the Guptas and their associate Salim Essa, she did not, and insisted that she had never been influenced by them in her decision making as an Eskom board member.
Earlier, former board member Venete Klein said the Eskom board appointed suspended acting CEO Matshela Koko to the position despite knowing the “defects” in his character regarding the manner in which he treated people. After his appointment, Klein warned Koko that he was “on watch” and that if he defaulted on the human relations front, he would be removed.
While Klein would not go so far as to describe Koko as being “close to a Hitler” — as evidence leader Ntuthuzelo Vanara suggested — she did concede that Koko had a reputation of mishandling people and for his erratic behaviour.
Klein said that Public Enterprises Minister Lynne Brown had not been told about his character flaws when the board recommended the appointment of Koko as acting Eskom CEO.
She denied that the minister had been misled and explained the failure to inform her by saying that the board did not have many experienced candidates to choose from.
Vanara also questioned Klein extensively about a board meeting held in March to discuss Koko’s suspension after allegations emerged he had entered into procurement contracts with Impulse International in which his step-daughter was involved.
Vanara’s questioning related to the change in attitude between a midday board meeting, at which it was agreed that Koko should be suspended, and a later meeting, at which he was given the opportunity to present his case in writing to then Eskom chairman Ben Ngubane.
Klein said she could not explain what had happened between the two meetings and could not confirm the testimony given last week by Eskom reputation manager Khulani Qoma, who claimed that he had been told by acting Eskom chairman Zethembe Khoza that a phone call to a Gupta brother after the first meeting and to Brown led to the suspension of Koko being put on hold.
Klein told the committee that the Eskom board had supported the move to make former Eskom CEO Brian Molefe’s interim contract a long-term one as they were “in awe” of his achievements in stabilising the state-owned utility.
Molefe had been seconded in 2015 for a three-month term from Transnet, where he had been CEO. He was then given a five-year contract, though the nature of this contract became the subject of dispute.
It was alleged in the State of Capture report that Molefe played a key role in the conclusion of coal contracts with the Gupta-owned Tegeta Exploration and Resources.
Klein said Molefe’s appointment had been based on information available at the time, not what was available now, after the allegations of state capture.
“The entire board, including me, was in awe of what Mr Molefe had been able to deliver especially as he had done so with substantially the same executive team who had previously not known how to turn the load-shedding situation around,” Klein said in her statement submitted to the committee.
KLEIN WOULD NOT GO SO FAR AS TO DESCRIBE KOKO AS BEING ‘CLOSE TO A HITLER’