Molefe shirks questions at hearing in Parliament
Brian Molefe, Eskom’s former CE, was grilled by Parliament’s public enterprises committee for four hours on Tuesday evening.
He put up a good fight: he passed the buck; he avoided direct answers; he did not know; or had not been told. On each of the big corruption issues, Molefe was somewhere else at the time, had “a long story” to tell and most often referred to now suspended chief financial officer Anoj Singh, whom he indicated repeatedly was the one responsible for implementing many of the decisions that are now under the spotlight.
But in the end, Molefe — whose wily intelligence is widely admired — may have avoided admitting any guilt on the big things, but he was tripped up by small mistakes and some wild implausibility, as he failed to keep track of what he had said and done before and what he knew or didn’t know. The thing about lying is that you have to remember the lie.
The first issue under scrutiny, which is also Molefe’s immediate concern, was the matter of his Eskom pension. As two courts must soon decide the status of his employment and what to do about his pension benefit, he was well prepared and not likely to say anything to jeopardise these proceedings.
Evidence leader Ntuthuzelo Vanara tried to force some accountability nonetheless. Insisting that all the formal public communications — Molefe’s, the Eskom’s board’s — had described his departure as voluntary resignation, Vanara argued that Molefe could not possibly have retired.
It was a dead horse though and at the end of it, without having squeezed anything out of Molefe, the best Vanara could do was to assert that in fact Molefe should have been disqualified from the Eskom Pension and Provident Fund the moment his employment was converted to a fixed term contract — a month after he signed on for the job.
Even this though, Molefe was not willing to concede. Using a rule not intended for the purpose, he said that because he had initially joined the fund, as when he first arrived at Eskom his contract did not specify a fixed term, he was allowed to remain on it.
The wrangling over the pension fund was more than anything else a display of Molefe’s tenacity.
It was also a demonstration of his disinclination to offer any accountability to Parliament at all. While Vanara, incredulously reminded him of his duty, Molefe was unmoved.
It was the same on each of the big contentious matters on which there is much evidence in the public domain to suggest that grand scale corruption has occurred. These include: the R600m pre-payment made to Tegeta for coal, before it became the owner of Optimum; the R1.6bn guarantee, secured from Absa with the purpose that it could be used by Tegeta to raise finance to buy Optimum; the R2.1bn fine imposed on Optimum mine when it was still owned by Glencore; and the dodgy payments made to McKinsey subcontractor Trillian, despite there being no contract in place.
The story of the “capture” of Optimum mine, as outlined by the public protector in her State of Capture Report and in many investigative journalism pieces, before and after, is that Eskom indirectly financed the purchase of Optimum mine on behalf of the Guptas, using a combination of the mechanisms above facilitated by Eskom executives.
On all of these Molefe had ready answers. The prepayment for instance, was necessary because Eskom needed the coal as it headed into winter. At the time of the prepayment Optimum was still in business rescue. If anyone was to be paid for coal it should have been the business rescue practitioners, said Vanara. No, said Molefe. The business rescue practitioners sold the coal to Tegeta, which then offered it to Eskom. But most importantly, said Molefe, he had not been part of the process.
“This is the understanding that I got from interrogating the officials: the chief financial officer [Singh] and the head of generation [Matshela Koko]. I hope they will come here and explain better because I wasn’t there,” he said.
The R1.6bn Absa guarantee was also not something he had direct knowledge of, he said. At the time — December 2015 — he was off work ill. He had, however, learned about it afterwards and could assure the committee that although it was obtained it was never used, and lapsed in March.
Glencore’s R2,1bn fine was unprecedentedly huge and was one of the factors that forced Optimum into business rescue.
Molefe, who had been publicly questioned many times about the fine, had steadfastly insisted that the new Gupta owners of Optimum would have to take on its full burden. After Molefe’s tearful departure from Eskom at the end of 2016, Eskom held a private arbitration with Tegeta at which it was agreed that the fine would be reduced R577m.
But again, Molefe was not there. “Mr Singh and Mr Koko can tell you exactly what led to that.” Molefe’s reply on the Trillian McKinsey matter — he denied knowing that Trillian had done any work for Eskom — was so implausible that DA MP Natasha Mazzone thanked him for his “blatantly honest” response.
In reply to Mazzone he also said he had heard that Suzanne Daniels of Eskom’s legal department had said Eskom must recover the money paid to Trillian and McKinsey, but he had not examined the matter and “was sure that the chief financial officer [Singh] will tell you the details of that contract”.
Later though he elaborated on the Trillian-McKinsey contract, saying that there was difference of opinion on whether the correct permissions had been obtained from the Treasury for the McKinsey arrangement. Singh and Koko though, would soon come and explain it all.
Molefe’s biggest misstep came right at the end of a long night when he faced former finance minister Pravin Gordhan, his respected senior both in government and in ANC policy circles. Asked by Gordhan why he had stated that prior to coming to Eskom he had never done business with the Guptas when he had signed over R4bn in IT contracts to Zestilor, a company owned by Salim Essa’s wife, while CE of Transnet, Molefe was caught flat-footed. “I admit I must have made a mistake that Zestilor was a Gupta company,” he said.
While Molefe had in his opening statements complained that former public protector Thuli Madonsela had not given him the opportunity to explain what she claimed were 57 phone calls between himself and the Guptas, many at the time of the Optimum transaction, Gordhan cut to the chase. Just tell me: were there phone calls? It doesn’t matter how many. “Yes there were.” And did they take place at the time of Optimum transaction?
“At that stage there would have been contact of some form or another.”