Gordhan, committee chair in war of words over failed deal
As parliament heads towards closure ahead of the general election, the relationship between outgoing public enterprises minister Pravin Gordhan and the chair of parliament’s public enterprise committee, Khaya Magaxa, has deteriorated.
This comes after the committee decided on Wednesday to request the speaker of the National Assembly Nosiviwe Mapisa-Nqakula to refer the now cancelled Takatso consortium’s purchase of a 51% stake in SAA to the special investigating unit (SIU) for further investigation “to ensure accountability and transparency”.
The proposed sale came to the attention of the committee as a result of a petition by dismissed director-general Kgathatso Tlhakudi who alleged that SAA was grossly undervalued and that the sale was irregular and manipulated by Gordhan.
“It is essential to address the sequence of events that led to the undervaluation and to investigate any potential corruption or misconduct in the process,” Magaxa said in a statement after the meeting.
During the committee’s months-long attempts to probe the allegations it came into conflict with Gordhan over the submission of the sale and purchase agreement which the committee said it needed to see to test the allegations. Gordhan insisted the agreement was confidential and commercially sensitive.
In his opening remarks at the committee meeting, Magaxa gave some legitimacy to Tlhakudi’s allegations, which he said justified an SIU investigation without which there would remain a cloud over the cancelled deal. Committee members unanimously endorsed his view saying that many questions about the deal remained unanswered.
“The committee is concerned about the undervaluation of SAA and the need for a comprehensive evaluation of the business. It is essential to address the sequence of events that led to the undervaluation and to investigate any potential corruption or misconduct in the process,” Magaxa said in his statement.
Controversially, members of the committee said at Wednesday’s meeting that in future parliament “needs to play an integral and meaningful role in government transactions of this magnitude. The committee was also of the view that parliament should be part of overseeing deals in which state assets are to be sold to the private sector.”
In the statement, Magaxa stressed the importance of transparency and accountability when it comes to financial matters, particularly when there is a need for funding. “It is crucial for the relevant parties to appear before the committee and provide necessary details to ensure proper oversight,” he said.
The public enterprises department hit back with a scathing attack on Magaxa, saying it was “appalled” by his misleading attempt to insinuate impropriety in the deal with Takatso.
“Magaxa appears instead to have gone on what increasingly looks to be a rogue campaign to accuse and convict the department and by extension minister Pravin Gordhan of impropriety without a shred of verifiable evidence, and by going beyond his mandate and by sidestepping the legal opinion of parliament’s own legal adviser.
“In essence, Mr Magaxa has turned a legitimate oversight exercise into a kangaroo court at which the department and its staff have been slandered, denigrated, and pilloried for the sake of politicking. Throughout the department’s engagement with Mr Magaxa it has become clear that his pronouncements and actions hark to a sinister agenda, which begs the question of Mr Magaxa’s true intent.”
The department’s statement said parliament’s legal adviser Andile Tetyana told the committee he found no sign of corruption in the proposed transaction.
“Mr Magaxa sees it fit to conflate issues by entertaining new lies by the former directorgeneral wherein he denies that he had signed off on correspondence addressed to prospective partners during the evaluation of the expressions of interests,” the department said.
On Tuesday, minister Gordhan wrote to Mr Magaxa to reiterate that the Takatso consortium was not “hand-picked” by him, and that Takatso was appointed through a process that was led by Mr Kgathatso Tlhakudi, the former directorgeneral of the department.